Document:

Filed by Bowne Pure Compliance

EXHIBIT
10.3

SUBURBAN PROPANE, L.P.

2003 LONG TERM INCENTIVE PLAN

(EFFECTIVE OCTOBER 1, 2002)

AS AMENDED ON OCTOBER 17, 2006, JULY 31, 2007, October 31, 2007, January 24, 2008 and

January 20, 2009

ARTICLE I

PURPOSE AND APPROVAL

The purpose of this Plan is to strengthen Suburban Propane Partners, L.P., Suburban Propane,
L.P., and their affiliates (collectively, the “Partnership”), by providing an incentive to
certain Participants (as hereinafter defined), and thereby encouraging them to devote their
abilities and experience to the success of the Partnership’s business enterprise in such a manner
as to maximize the total return to the Partnership’s Unitholders. It is intended that this purpose
be achieved by extending to certain Participants added long-term incentive compensation for
continued service to the Partnership and achieving certain Performance Measures (as hereinafter
defined) which enhance the total return to the Partnership’s Unitholders. This Plan was adopted
effective October 1, 2002.

ARTICLE II

DEFINITIONS

For purposes of this Plan, capitalized terms shall have the following meanings:

2.1 “Beneficial Ownership” shall have the same meaning as that term is used within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended.

2.2 “Beneficiary” means a Participant’s Beneficiary pursuant to Article VIII.

2.3 “Board” means the Board of Supervisors of Suburban Propane Partners, L.P.

2.4 “Cause” means (a) a Participant’s gross negligence or willful misconduct in the
performance of his duties, (b) a Participant’s willful or grossly negligent failure to perform his
duties, (c) the breach by a Participant of any written covenants to the Partnership, (d) dishonest,
fraudulent or unlawful behavior by a Participant (whether or not in conjunction with employment) or
a Participant being subject to a judgment, order or decree (by consent or otherwise) by any
governmental or regulatory authority which restricts his ability to engage in the business
conducted by the Partnership, or any of their affiliates, or (e) willful or reckless breach by a
Participant of any policy adopted by the Partnership concerning conflicts of interest, standards of
business conduct or fair employment practices or procedures with respect to compliance with
applicable laws.

2.5 “Change in Capitalization” means any increase or reduction in the number of Common
Units, or any change in the Common Units, change in the percentage ownership interest of the
Partnership attributable to the Common Units or exchange of Common Units for a different number or
kind of units or other securities of the Partnership by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, spin-off, split-up, issuance of warrants
or rights or other convertible securities, unit distribution, unit split or reverse unit split,
cash dividends, property dividend, combination or exchange of units, repurchase of units, change in
corporate structure or otherwise.

 

 

 

2.6 “Change of Control” shall mean:

(a) the date (which must be a date subsequent to the Effective Date) on which any Person
(including the Partnership’s general partner) or More than One Person Acting as a Group
(other than the Partnership and/or its Subsidiaries) acquires, during the 12 month period
ending on the date of the most recent acquisition, Common Units or other voting equity
interests eligible to vote for the election of Supervisors (or of any entity, including the
Partnership’s general partner,
that has the same authority as the Board to manage the affairs of the Partnership)
(“Voting Securities”) representing thirty percent 30% or more of the combined voting power of
the Partnership’s then outstanding Voting Securities; provided, however, that in determining
whether a Change of Control has occurred, Voting Securities which have been acquired in a
“Non-Control Acquisition” shall be excluded from the numerator. A “Non-Control Acquisition”
shall mean an acquisition of Voting Securities (x) by the Partnership, any of its
Subsidiaries and/or an employee benefit plan (or a trust forming a part thereof) maintained
by any one or more of them, or (y) in connection with a “Non-Control Transaction”; or

(b) the date of approval by the limited partners of the Partnership, of (w) a merger,
consolidation or reorganization involving the Partnership, unless (A) the holders of the
Voting Securities of the Partnership immediately before such merger, consolidation or
reorganization own, directly or indirectly, immediately following such merger, consolidation
or reorganization, at least fifty percent (50%) of the combined voting power of the
outstanding Voting Securities of the entity resulting from such merger, consolidation or
reorganization (the “Surviving Entity”) in substantially the same proportion as their
ownership of the Voting Securities of the Partnership immediately before such merger,
consolidation or reorganization, and (B) no person or entity (other than the Partnership, any
Subsidiary, any employee benefit plan (or any trust forming a part thereof) maintained by the
Partnership, any Subsidiary, the Surviving Entity, or any Person who, immediately prior to
such merger, consolidation or reorganization, had Beneficial Ownership of more than twenty
five percent (25%) of then outstanding Voting Securities of the Partnership), has Beneficial
Ownership of more than twenty five percent (25%) of the combined voting power of the
Surviving Entity’s then outstanding Voting Securities; (x) a complete liquidation or
dissolution of the Partnership; or (y) the sale or other disposition of forty percent (40%)
of the total gross fair market value of all the assets of the Partnership to any Person or
More than One Person Acting as a Group (other than a transfer to a Subsidiary). For this
purpose, gross fair market value means the value of the assets of the Partnership, or the
value of the assets being disposed of, determined without regard to any liability associated
with such assets. A transaction described in clause (A) or (B) of subsection (w) hereof shall
be referred to as a “Non-Control Transaction;” or

(c) the date a majority of the members of the Board is replaced during any
twelve-month period by the action of the Board taken when a majority of the Supervisors who
are then members of the Board are not Continuing Supervisors (for purposes of this section,
the term “Continuing Supervisor” means a Supervisor who was either (A) first elected or
appointed as a Supervisor prior to the Effective Date; or (B) subsequently elected or
appointed as a Supervisor if such Supervisor was nominated or appointed by at least a
majority of the then Continuing Supervisors);

Notwithstanding the foregoing, a Change of Control shall not be deemed to occur solely because any
Person (the “Subject Person”) acquired Beneficial Ownership of more than the permitted amount of
the outstanding Voting Securities as a result of the acquisition of Voting Securities by the
Partnership which, by reducing the number of Voting Securities outstanding, increases the
proportional number of Voting Securities Beneficially Owned by the Subject Person, provided that if
a Change of Control would occur (but for the operation of this sentence) as a result of the
acquisition of Voting Securities by the Partnership, and after such acquisition of Voting
Securities by the Partnership, the Subject Person becomes the Beneficial Owner of any additional
Voting Securities which increases the percentage of the then outstanding Voting Securities
Beneficially Owned by the Subject Person, then a Change of Control shall occur.

2.7 “Committee” means the Compensation Committee of the Board.

2.8 “Common Unit” means the Common Units representing publicly traded limited partnership
interests of the Partnership.

 

 

 

2.9 “Disability” shall have the same meaning that such term (or similar term) has under
the long-term disability plan in which the Participant is eligible to be covered.

2.10 “Effective Date” shall mean October 1, 2002.

2.11 “Fair Market Value of Partnership’s Common Units” The twenty-day average of the
closing prices preceding a specific date.

2.12 “Fiscal Year” means the fiscal year adopted by the Partnership.

2.13 “General Partner” has the meaning set forth in the Partnership Agreement.

2.14 “Good Reason” means (a) any failure by the Partnership to comply in any material
respect with the compensation provisions of a written employment agreement between a Participant
and the Partnership, (b) a material adverse change in a Participant’s title without his or her
consent, or (c) the assignment to a Participant, without his or her consent, of duties and
responsibilities materially inconsistent with his or her level of responsibility as an executive
officer.

2.15 “Measurement Period” has the same meaning as set forth in Article 5.2.

2.16 “More than one Person Acting as a Group” has the same meaning as set forth in
Treasury Regulation 1.409A-3(i)(5)(v)(B).

2.17 “Participant” means an employee of Suburban Propane, L.P. designated by the
Committee to participate in the Plan.

2.18 “Partnership” means Suburban Propane, L.P. and Suburban Propane Partners, L.P.,
Delaware limited partnerships, and their successors.

2.19 “Partnership Agreement” means the Second Amended and Restated Agreement of Limited
Partnership of Suburban Propane Partners, L.P.

2.20 “Percentage of Three-Year Annualized Total Return to Unitholders” means a percentage
representing the three-year annualized total return to Unitholders from the commencement of the
Measurement Period to the culmination of the Measurement Period. This percentage shall be
calculated by an independent, third-party provider as designated by the Committee.

2.21 “Performance Measures” has the same meaning as set forth in Article 5.3.

2.22 “Person” shall have the same meaning as that term is used for purposes of Section
13(d) or 14(d) of the Securities Exchange Act of 1934, as amended.

2.23 “Phantom Unit Distributions” shall have the same meaning as set forth in Article
5.4.

2.24 “Plan” means this Suburban Propane, L.P. 2003 Long Term Incentive Plan.

2.25 “Retirement” shall mean voluntary termination of employment by a Participant who has
attained age 55 and who has completed 10 years of “eligible service” to the Partnership or its
predecessors, in connection with a bona fide intent by the Participant to no longer seek full time
employment in the industries in which the Partnership then participates. Retirement shall not
include voluntary termination of employment by a Participant in response to, or anticipation of, a
termination of employment for Cause by the Partnership or one of its affiliates. The term
“eligible service” shall have the
same meaning as the term is used in the Pension Plan for eligible Employees of Suburban
Propane L.P. and Subsidiaries.

 

 

 

2.26 “Retirement Date” means the first day on which a retiring Participant is considered
inactive. For purposes of determining the abbreviated Measurement Period described in Article 20,
if this date occurs on a day on which the stock market is closed, for purposes of this Plan, the
Participant’s Retirement Date shall be the next business day on which the stock market is open.

2.27 “Subsidiary” shall mean any corporation, partnership, or other Person of which a
majority of its voting power or its voting equity securities or equity interest is owned, directly
or indirectly, by the Partnership.

2.28 “Target Grant” shall have the same meaning as set forth in Article 5.1.

2.29 “Unitholders” means the persons holding Common Units.

2.30 “Unvested Phantom Units” means a hypothetical number of units arrived at by dividing
the Target Grant established upon commencement of the Measurement Period by the Fair Market Value
of Partnership Common Units on the first day of the Measurement Period. If the market is closed on
the first day of the Measurement Period then the Fair Market Value on the next business day shall
be used.

2.31 “Vested Phantom Units” means the quantity of a Participant’s Unvested Phantom Units
which are earned upon culmination of the Measurement Period.

ARTICLE III

PARTICIPATION

Only those Participants designated from time to time by the Committee shall participate in the
Plan and receive Target Grants hereunder.

ARTICLE IV

ADMINISTRATION

4.1 Administration by the Committee. The Plan shall be administered by the Committee, which
shall hold meetings at such times as may be necessary for the proper administration of the Plan.
The Committee shall keep minutes of its meetings. A quorum shall consist of not less than two
members of the Committee and a majority of a quorum may authorize any action. Any decision or
determination reduced to writing and signed by a majority of all of the members of the Committee
shall be as fully effective as if made by a majority vote at a meeting duly called and held. No
member of the Committee shall be liable for any action, failure to act, determination or
interpretation made in good faith with respect to this Plan or any transaction hereunder, except
for liability arising from his or her own willful misfeasance, gross negligence or reckless
disregard of his or her duties. The Partnership hereby agrees to indemnify each member of the
Committee for all costs and expenses and, to the extent permitted by applicable law, any liability
incurred in connection with defending against, responding to, negotiating for the settlement of or
otherwise dealing with any claim, cause of action or dispute of any kind arising in connection with
any actions in administering this Plan or in authorizing or denying authorization for any
transaction hereunder.

4.2 Powers of the Committee. Subject to the express terms and conditions set forth herein,
the Committee shall have the power, from time to time to:

(a) select those Participants for whom Target Grants shall be established;

(b) construe and interpret the Plan, the Target Grants, the Unvested and Vested Phantom
Units and corresponding Phantom Unit Distributions, and establish, amend and revoke rules and
regulations for the administration of the Plan, including, but not limited to, correcting any
defect or supplying any omission, or reconciling any inconsistency in the Plan, in the manner and
to the extent it shall deem necessary or advisable so that the Plan complies with applicable law
and otherwise to make the Plan fully effective.

 

 

 

(c) exercise its discretion with respect to the powers and rights granted to it as set
forth in the Plan; and

(d) generally, exercise such powers and perform such acts as it deems necessary or
advisable to promote the best interests of the Partnership with respect to the Plan.

4.3 Decisions of the Committee are Final and Binding. The Committee’s decisions, actions,
determinations and interpretations shall be final and binding upon the Partnership, all
Participants, Beneficiaries, equity holders of the Partnership and any other person.

4.4 Change in Capitalization. In the event of any Change in Capitalization or in the event
of any special distribution to the Common Unitholders, the Committee may, but shall not be
obligated to, make such equitable adjustments in the Performance Measures, the Phantom Unit
Distributions or other aspects of the Plan, as the Committee determines are necessary and
appropriate.

ARTICLE V

GRANTS

5.1 Target Grant. The Committee shall establish a Target Grant for each Participant at the
beginning of each Fiscal Year equal to a designated percentage of such Participant’s base salary at
the start of the Fiscal Year. Each participant’s designated percentage shall be recorded in the
minutes of the Committee. In the event a Participant’s base salary for the respective Fiscal Year
was adjusted within 120 days after the start of the Fiscal Year, the Target Grant will be computed
using such adjusted base salary.

5.2 Measurement Period. This is a three-year period commencing on the first day of the
fiscal year during which the Target Grant was established and ending on the last day of the second
fiscal year following the fiscal year during which the Target Grant was established.

5.3 Performance Measures. The percentage of the Unvested Phantom Units that shall be earned
and immediately converted to Vested Phantom Units at the end of the Measurement Period shall be
determined based upon the ranking of the Partnership’s Percentage of Three-Year Annualized Total
Return to Unitholders in a peer group of eleven other publicly traded partnerships selected by the
Committee. If, at the end of the Measurement Period, it is determined that less than 100% of the
Unvested Phantom Units have been earned, the unearned portion of said Unvested Phantom Units shall
be forfeited.

The following chart illustrates the percentage of the Unvested Phantom Units that shall be
converted to Vested Phantom Units based upon the Partnership’s ranking, at the end of the
Measurement Period, of Percentage of Three-Year Annualized Total Return to Unitholders among the
peer group established pursuant to Article 5.3.

	 	 	 	 	 
	THREE-YEAR ANNUALIZED TOTAL	 	 	 
	RETURN TO UNITHOLDERS PERCENTAGE	 	PERCENT OF TARGET	 
	PERFORMANCE	 	GRANT EARNED	 
	Ranked in top 3 (top quartile)
	 	 	125      	%
	Ranked between 4 – 6 (50th/75th quartile)
	 	 	100      	%
	Ranked between 7 – 9 (25th quartile)
	 	 	50      	%
	Ranked 10 – 12 (bottom quartile)
	 	 	0      	%

5.4 Phantom Unit Distributions. These are cumulative phantom partnership cash distributions
equal to each Participant’s Vested Phantom Units multiplied by the per-Common Unit distribution
declared and paid by the Partnership for each quarter over the course of the Measurement Period.

 

 

 

5.5 Plan Distributions. Upon vesting, each Participant will receive a cash payment equal
to the quantity of his Vested Phantom Units multiplied by the Fair Market Value of the
Partnership’s Common Units on the last date of the Measurement Period plus the
Participant’s Phantom Unit Distributions.

ARTICLE VI

VESTING

6.1 Vesting Schedule. Subject to Articles 6.2 and 6.3, vesting is in accordance with
Article 5.3. Notwithstanding anything in this Article VI to the contrary, the Committee may
accelerate the vesting of Unvested Phantom Units and all accrued Phantom Unit Distributions at any
time for any reason with the consent of the General Partner.

6.2 Change of Control. Notwithstanding anything in this Plan to the contrary, upon a Change
of Control, the cash value of 125% of all Unvested Phantom Units and a sum equal to 125% of the
Unvested Phantom Units multiplied by an amount equal to the cumulative, per-Common Unit
distribution from the beginning of the Measurement Period through the date on which the Change of
Control occurred shall be fully vested and nonforfeitable and shall be paid to a Participant within
thirty (30) days after the Change in Control.

6.3 Forfeiture. Subject to Articles 6.2, 6.4 and 6.5, Unvested Phantom Units shall lapse
and be forfeited upon the occurrence of either of the following events: (a) termination of the
Participant’s employment or participation in the Plan for any reason, except under the
circumstances provided in Articles 6.4 and 6.5; (b) any attempted or completed transfer, sale,
pledge, hypothecation, or assignment by the Participant of the Unvested Phantom Units.

6.4 Disability or Death. Notwithstanding the provisions of Article 6.3, if a Participant’s
employment terminates as a result of Disability or death, all Unvested Phantom Units and the
Phantom Unit Distributions associated with said Unvested Phantom Units for such Participant shall
vest in accordance with Articles 6.1 and 6.2, as applicable, and shall be paid in accordance with
Article VII and VIII.

6.5 Termination without Cause or for Good Reason. In the event a Participant’s employment
by the Partnership is terminated by the Partnership without Cause or by the Participant for Good
Reason, all Unvested Phantom Units and all Phantom Unit Distributions associated with said Unvested
Phantom Units shall vest upon the next succeeding scheduled vesting date pursuant to Articles 6.1
or 6.2, as applicable.

6.6 Notwithstanding anything in this Plan to the contrary, effective for Target Grants
established for the Partnership’s 2008 and later fiscal years, said Target Grants shall be deemed
''Incentive Compensation’’ covered by the terms of the Partnership’s Incentive Compensation
Recoupment Policy (the ''Policy’’) adopted by the Board on April 25, 2007, which is incorporated
herein by reference. In accordance with the Policy, in the event of a significant restatement of
the Partnership’s published financial results, where the percentage of the Unvested Phantom Units
derived from Target Grants subject to this Section 6.6 that are converted to Vested Phantom Units
pursuant to Section 5.3 herein would have been lower had the vesting percentage been calculated
based on the restated financial results, the Committee may review the circumstances surrounding the
restatement and shall have the sole and absolute discretion and authority to determine whether to
seek reimbursement of the amount, or some lesser portion thereof (without interest), by which
certain Participants’ distributions under Section 5.5 of the Plan exceeded the lower payment that
would have been made based on the restated financial results, regardless of the fault, misconduct
or responsibility of any such Participants in the restatement. If the Committee determines that any
fraud or intentional misconduct by a Participant was a contributing factor to the Partnership
having to make a significant restatement, then, in addition to other disciplinary action, the
Committee may require reimbursement of all, or any part, of the compensation paid to that executive
in excess of that executive’s base salary, plus interest, including distributions made under the
Plan, for the period of such restatement.
This Section 6.6 shall be interpreted and administered in accordance with the Policy as in
effect from time to time. In the case of any inconsistency between the Policy and this Section 6.6,
the Policy shall control.

 

 

 

ARTICLE VII

PAYMENTS

The Plan Distributions associated with Vested Phantom Units earned by a Participant under the
Plan shall be paid to the Participant within thirty days following the culmination of the
Measurement Period.

ARTICLE VIII

BENEFICIARIES

A Participant may at any time and from time to time prior to death designate one or more
Beneficiaries to receive any payments to be made following the Participant’s death. If no such
designation is on file with the Partnership at the time of a Participant’s death, the Participant’s
Beneficiary shall be the beneficiary or beneficiaries named in the Beneficiary designation most
recently filed by the Participant with the Partnership. If the Participant has not effectively
designated a Beneficiary, or if no Beneficiary so designated has survived the Participant, the
Participant’s Beneficiary shall be the Participant’s surviving spouse, or, if no spouse has
survived the Participant, the estate of the deceased Participant. If an individual Beneficiary
cannot be located for a period of one year following the Participant’s death, despite mail
notification to the Beneficiary’s last known address, and if the Beneficiary has not made a written
claim for benefits within such period to the Committee, the Beneficiary shall be deemed to have
predeceased the Participant. The Committee may require such proof of death and such evidence of the
right of any person to receive all or part of the benefit of a deceased Participant as the
Committee may consider to be appropriate. The Committee may rely upon any direction by the legal
representatives of the estate of a deceased Participant, without liability to any other person. If
a Participant has designated his or her spouse as Beneficiary, upon entry of a judgment of divorce
(or other evidence of formal dissolution of the marriage), the designation of the spouse as
Beneficiary will be deemed to have been revoked unless the Participant reaffirms such designation
thereafter.

ARTICLE IX

TERMINATION AND AMENDMENT OF THE PLAN

The Plan shall terminate by its terms on the day preceding the tenth anniversary of the
Effective Date of this Plan as originally adopted and no Target Grant may be established
thereafter. The previous sentence notwithstanding, the Board may, at any time and from time to
time, amend, terminate, modify or suspend the Plan; provided, however, that no such amendment,
modification, suspension or termination shall impair or adversely affect any Target Grants
established for a Participant under the Plan, except with the consent of the Participant.

ARTICLE X

NON-EXCLUSIVITY OF THE PLAN

The adoption of the Plan by the Board shall not be construed as amending, modifying or
rescinding any previously approved incentive arrangement or as creating any limitations on the
power of the Board to adopt such other incentive arrangements as it may deem desirable, including,
without limitation, the granting of options to acquire Common Units, and such arrangements may be
either applicable generally or only in specific cases.

ARTICLE XI

LIMITATION OF LIABILITY

As illustrative of the limitation of liability of the Partnership, but not intended to be
exhaustive thereof, nothing in the Plan shall be construed to:

(a) give any person any right to the establishment of a Target Grant other than at the sole
discretion of the Committee;

(b) give any person any rights whatsoever with respect to a Target Grant or Unvested
Phantom Units except as specifically provided in the Plan.

 

 

 

(c) limit in any way the right of the Partnership to terminate the employment of any person
at any time; or

(d) be evidence of any agreement or understanding, express or implied, that the Partnership
will employ any person at any particular rate of compensation or for any particular period of time.

ARTICLE XII

REGULATIONS AND OTHER APPROVALS; GOVERNING LAW

12.1 Except as to matters of federal law, this Plan and the rights of all persons claiming
hereunder shall be construed and determined in accordance with laws of the State of New Jersey
without giving effect to conflicts of law principles.

12.2 Except as provided in Article IX hereof the Board may make such changes to the Plan or
an Agreement as may be necessary or appropriate to comply with the rules and regulations of any
government authority.

ARTICLE XIII

WITHHOLDING OF TAXES

At such time(s) as a Participant recognizes income for purposes of income, employment, or
other tax liability, the Partnership shall withhold an amount equal to the federal, state and local
taxes and other amounts as may be required by law to be withheld by the Partnership.

ARTICLE XIV

NO REQUIRED SEGREGATION OF ASSETS

Neither the Partnership nor any subsidiary shall be required to segregate any assets that may
at any time be represented by Phantom Units or Phantom Unit Distributions made pursuant to the
Plan.

ARTICLE XV

RIGHT OF DISCHARGE RESERVE

Neither the Plan nor the establishment of any Target Grant shall guarantee any Participant
continued employment with the Partnership, or a subsidiary, or guarantee the establishment of
future Target Grants.

ARTICLE XVI

NATURE OF PAYMENTS

All Phantom Units awarded and Phantom Unit Distributions made pursuant to the Plan are in
consideration of services for the Partnership or its subsidiaries. The Phantom Units and Phantom
Unit Distributions constitute a special incentive payment to the Participant and shall not be taken
into account as compensation for purposes of any of the employee benefit plans of the Partnership
or any subsidiary except as may be determined by the Committee.

ARTICLE XVII

CONSTRUCTION OF PLAN

The captions used in this Plan are for convenience only and shall not be construed in
interpreting the Plan. Whenever the context so requires, the masculine shall include the feminine
and neuter, and the singular shall also include the plural, and vice versa.

ARTICLE XVIII

SEVERABILITY

If any provision of the Plan shall be held unlawful or otherwise invalid or unenforceable in
whole or in part, the unlawfulness, invalidity or unenforceability of said provision shall not
affect any other provision of the Plan or part thereof, each of which shall remain in full force
and effect.

 

 

 

ARTICLE XIX

DEFERRAL

Payments under the Plan may not be deferred by the Participants.

ARTICLE XX

RETIREMENT OF PARTICIPANT

Upon Retirement, a Participant shall not be eligible for any additional grants under the Plan;
however, all Unvested Phantom Units and all Phantom Unit Distributions associated with said
Unvested Phantom Units shall vest upon their normal scheduled vesting dates pursuant to Articles
6.1 or 6.2, as applicable.Filed by Bowne Pure Compliance

Exhibit 10.6

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) by and between AmerisourceBergen
Corporation, a Delaware corporation (hereinafter the “Company”), and R. David Yost (the
“Executive”), dated and effective as of November 24, 2008.

WHEREAS, the Company and the Executive entered into an employment agreement (the “Original
Agreement”) effective October 1, 2003, reflecting the determination of the Board of Directors of
the Company (the “Board”), upon the recommendation of the Compensation and Succession Planning
Committee of the Board (the “Committee”), that it would be in the best interests of the Company and
its shareholders to employ the Executive as the Chief Executive Officer of the Company, and the
Executive’s desire to serve in that capacity; and

WHEREAS, the parties wish to amend the Original Agreement to comport with Section 409A of the
Internal Revenue Code, as amended, and the regulations promulgated thereunder and to make certain
other changes intended to clarify certain provisions of the Original Agreement;

NOW, THEREFORE, intending to be legally bound, the parties hereto agree to amend and restate
the Original Agreement in its entirety as follows:

1. Employment Period. The Company shall continue to employ the Executive, either
directly or through a Subsidiary (as defined below), and the Executive shall continue to serve the
Company or any such Subsidiary, on the terms and conditions set forth in this Agreement, beginning
November 24, 2008 (the “Employment Date”) and until that employment ceases as provided below in
Section 4 (the “Employment Period”). “Subsidiary” means any entity that is controlled, directly or
indirectly, by the Company.

2. Position and Duties.

(a) During the Employment Period, the Executive shall be employed as the Chief Executive
Officer of the Company, subject to such changes in title as may be proposed by the Board and
consented to by the Executive. The Executive shall report to the Board and shall perform such
duties for the Company as are related typically to the office of Chief Executive Officer, in the
manner reasonably directed by the Board, in its sole discretion. For so long as and during the
period in which the Executive is serving as the Chief Executive Officer, the Board shall use its
best efforts to cause the Executive to be nominated and elected as a director of the Company and,
if elected by the Company’s stockholders, the Executive shall serve as a director of the Company.

(b) During the Employment Period, but excluding any periods of vacation and absence due to
intermittent illness to which the Executive is entitled, and any services on corporate, civic or
charitable boards or committees, lectures, speaking engagements or teaching engagements that are
approved by the Board and that do not significantly interfere with the performance of his
responsibilities to the Company or violating the provisions of Section 9, the Executive shall
devote his full time and attention during normal business hours to the business and affairs of the
Company and the Executive shall use reasonable efforts to carry out all duties and responsibilities
assigned to him faithfully and efficiently.

 

 

 

3. Compensation.

(a) Base Salary. During the Employment Period, the Executive shall continue to
receive annual base salary at the rate in effect as of the date of this Agreement, payable in
accordance with the regular payroll practices of the Company. The Executive’s base salary shall be
reviewed annually by the Committee, in accordance with the Company’s standard practices for
executives generally, and may be increased as determined by the Committee, in its sole discretion.

(b) Annual Bonus and Incentive Plans; Other Benefits. During the Employment Period:
(i) the Executive shall be entitled to participate in any short-term and long-term incentive
programs established and/or maintained by the Company for its senior level executives generally;
(ii) the Executive shall be entitled to participate in all incentive, savings and retirement plans,
practices, policies and programs of the Company to at least the same extent as other senior
executives of the Company; (iii) the Executive and/or the Executive’s family, as the case may be,
shall be eligible for participation in, and shall receive all benefits under, all welfare benefit
plans, practices, policies and programs provided by the Company to at least the same extent as
other senior executives of the Company; and (iv) the Executive shall be entitled to, and the
Company shall provide the Executive with, not less than the number of weeks of vacation during each
calendar year to which the Executive is entitled as of the date of this Agreement. In addition to
the foregoing, the Executive shall be entitled to annual reimbursement of up to $5,000 per year for
tax and financial planning and tax preparation, or such greater amount as may be authorized by the
Committee, in its sole discretion.

(c) Expenses. During the Employment Period, the Executive shall be entitled to
receive advancement or prompt reimbursement for all reasonable expenses incurred or anticipated to
be incurred by the Executive in carrying out the Executive’s duties under this Agreement, provided
that the Executive complies with the generally applicable policies, practices and procedures of the
Company for submission of expense reports, receipts, or similar documentation of such expenses.

(d) Notwithstanding anything herein to the contrary or otherwise, except to the extent any
expense, reimbursement or in-kind benefit provided pursuant to Sections 3(b), 3(c) and 5(a) does
not constitute a “deferral of compensation” within the meaning of Section 409A of the Internal
Revenue Code of 1986, as amended from time to time (“Code”), and its implementing regulations and
guidance (“Section 409A”) (i) the amount of expenses eligible for reimbursement or in-kind benefits
provided to the Executive during any calendar year will not affect the amount of expenses eligible
for reimbursement or in-kind benefits provided to the Executive in any other calendar year, (ii)
the reimbursements for expenses for which the Executive is entitled to be reimbursed shall be made
on or before the last day of the calendar year following the calendar year in which the applicable
expense is incurred and (iii) the right to payment or reimbursement or in-kind benefits hereunder
may not be liquidated or exchanged for any other benefit.

4. Termination of Employment.

(a) Death or Disability. The Executive’s employment and the Employment Period shall
terminate automatically upon the Executive’s death or long term Disability during the Employment
Period. “Disability” means a condition entitling the Executive to benefits under the Company’s
Long Term Disability Plan, policy or arrangement.

 

2

 

(b) By the Company. The Company may terminate the Executive’s employment under this
Agreement during the Employment Period for Cause or without Cause. “Cause” means:

(i) the continued failure by the Executive to substantially perform his duties as contemplated
by this Agreement (other than any such failure resulting from his incapacity due to physical or
mental illness or injury or any such actual or anticipated failure after the issuance by the
Executive of a Notice of Termination for Good Reason) over a period of not less than thirty days
after a demand for substantial performance is delivered to the Executive by the Board or by the
Chief Executive Officer of the Company, which demand identifies the manner in which it is believed
that the Executive has not substantially performed his duties;

(ii) the willful misconduct of the Executive materially and demonstrably injurious to the
Company (including, without limitation, any breach by the Executive of Section 9 of this
Agreement); provided that no act or failure to act on the Executive’s part will be considered
willful if done, or omitted to be done, by him in good faith and with reasonable belief that his
action or omission was in the best interest of the Company;

(iii) the Executive’s conviction of a misdemeanor, which, as determined in good faith by the
Board, constitutes a crime of moral turpitude and gives rise to material harm to the Company or to
any subsidiary or affiliate of the Company; or

(iv) the Executive’s conviction of a felony (including, without limitation, any felony
constituting a crime of moral turpitude).

(c) By the Executive. The Executive may terminate employment under this Agreement for
Good Reason or without Good Reason. “Good Reason” means:

(i) any reduction in the Executive’s base salary; or

(ii) material failure by the Company to comply with any provision of Sections 2 and 3 of this
Agreement (including, but not limited to, a diminution in the Executive’s authority, duties, or
responsibilities) other than an isolated, insubstantial or inadvertent failure that is not taken in
bad faith and is remedied by the Company within 30 days after receipt of written notice thereof
from the Executive.

Notwithstanding the foregoing, “Good Reason” for purposes of Section 4(c)(i) shall not include
a reduction in base salary if such reduction is coincident with a reduction applicable to all
members of the senior management team. A termination of employment by the Executive for Good
Reason shall be effectuated by giving the Company written notice (“Notice of Termination for Good
Reason”) of the termination, setting forth in reasonable detail the specific conduct that
constitutes Good Reason and the specific provision(s) of this Agreement on which the Executive
relies. Such Notice of Termination for Good Reason must be received by the Company no later than
the 60th day after the event, or last in a series of events, that gives rise to Good
Reason. The Company shall have 30 days to remedy the conduct set forth in the Notice of
Termination for Good Reason. A termination of employment by the Executive for Good Reason shall be
effective on the 60th business day following the date when the Notice of Termination for
Good Reason is given, unless the conduct set forth in the notice is remedied by the Company within
the 30-day period. A termination of the Executive’s employment by the Executive without Good
Reason shall be effected by giving the Company at least 30 days’ advance written notice of the
termination.

(d) Date of Termination. The “Date of Termination” means the date of the Executive’s
death, the date of the Executive’s Disability, or the date the termination of the Executive’s
employment under this Agreement by the Company for Cause or without Cause or by the Executive for
Good Reason or without Good Reason, as the case may be, is effective. The Employment Period
shall end on the Date of Termination.

 

3

 

(e) Separation from Service. For purposes of determining under Section 409A whether
there has been a “separation from service” with the meaning of Treasury Regulation Section
1.409A-1(h) (or any successor regulation), the Executive shall be deemed to have incurred a
separation from service if his employment has been terminated in accordance with this Section 4 and
he is performing less than 50% of the average level of bona fide services he was performing for the
Company in the immediately preceding 36-month period (“Separation From Service”). In addition,
notwithstanding any other provision of this Agreement to the contrary, any payment or benefit
described in Section 5 that represents a “deferral of compensation” within the meaning of Section
409A shall only be paid or provided to Executive upon a Separation From Service as defined herein.

5. Obligations of the Company upon Termination.

(a) By the Company Other Than for Cause; or By the Executive for Good Reason. If,
during the Employment Period, the Company terminates the Executive’s employment under this
Agreement (other than for Cause) or the Executive terminates employment under this Agreement for
Good Reason:

(1) the Executive shall be entitled to continued payment for two years after the
Separation From Service of the Executive’s current base salary (as in effect on the Date of
Termination), which amounts shall be paid in installments over such two-year period pursuant
to the Company’s normal payroll policy,

(2) the Executive shall be entitled to receive the following bonus payments: (i)
either (A) if the Separation from Service occurs following the end of a fiscal year but
prior to the date that an annual bonus for such previously completed fiscal year, if any, is
approved by the Company’s Board of Directors, a bonus payment equal to the bonus payment
that the Executive would have received for such prior fiscal year without regard to the
Executive not having remained employed by the Company on the date that such bonus payment
would otherwise have been paid to the Executive, with any such bonus amount to be paid at
the same time as annual bonuses for such prior fiscal year are paid by the Company under the
applicable bonus program generally but in no event later than March 15th of the
calendar year following the calendar year that includes the last day of the applicable
fiscal year or (B) if Separation from Service occurs following the end of a fiscal year but
after the date that an annual bonus for such previously completed fiscal year is approved
(or determined not to be payable by the Company’s Board or Directors), a bonus payment equal
to an amount representing 100% of the Executive’s target bonus for the Executive’s salary
grade for the fiscal year of the Company in which such Separation from Service occurs,
multiplied by a fraction, the numerator of which is the number of days in such current
fiscal year through the Separation from Service, and the denominator of which is 365, with
any such amount to be paid at the same time as annual bonuses for the fiscal year in which
such Separation from Service occurs are paid by the Company under the applicable bonus
program generally but in no event later than December 31st of the calendar year following
the calendar year that includes the last day of the applicable fiscal year and (ii)
continued payment for the two fiscal years ending immediately after the Separation from
Service of a bonus equal to the average of the annual bonuses earned by the Executive over
the three complete years (or if less than three complete years, the average bonus earned
during such lesser number of complete years) preceding the Date of Termination (that is, not
including the bonus year that
includes the Date of Termination) with each such bonus payment being paid at the same
time as annual bonuses are paid by the Company under the applicable bonus program; and

 

4

 

(3) for the eighteen month period following the Separation From Service (subject to
earlier termination as described below), if the Executive elects to receive continuation
coverage under the Company’s group health plans pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”), the Executive shall be entitled to: (i) waiver by the
Company of the COBRA premium costs of medical, prescription, dental and vision coverage, if
any, under the Company’s group health plans (as in effect from time to time) for the
Executive and, to the extent permitted under COBRA, the Executive’s spouse and eligible
dependents, if any, for the first two calendar months of the eighteen month continuation
period; and (ii) following the initial two-month period, the Executive shall be entitled to
reimbursement from the Company for the COBRA premium costs of medical, prescription, dental
and vision coverage, if any, under the Company’s group health plans for the Executive and,
to the extent permitted under COBRA, the Executive’s spouse and eligible dependents, if any,
with such reimbursement not to exceed the COBRA rates for such coverage; provided, however,
that the Executive shall be required to submit to the Company reasonable evidence of payment
by the Executive of any such COBRA premiums in order to obtain reimbursement from the
Company and that the Executive may not submit any requests for reimbursement of such
payments more than once per calendar month. Notwithstanding anything to the contrary set
forth above, the Company, in its sole discretion, may discontinue any coverage contemplated
hereunder in the event that such continuation is not permitted under or would adversely
affect the tax status of the plan or plans of the Company pursuant to which the coverage is
provided, in which case the Company shall make supplemental severance payments to the
Executive in monthly amounts equal to the amounts to which the Executive otherwise would
have been entitled to reimbursement hereunder in respect of such coverage for the remainder
of the period that the Company otherwise would have been obligated to make reimbursements
hereunder to the Executive. Any amounts that are reimbursed to the Executive by the Company
or paid directly to the Executive as supplemental severance payments will be considered
taxable income to the Executive and any taxes on such amounts will be the Executive’s
responsibility and subject to applicable tax withholding.

In addition, the Executive shall be entitled to receive executive level outplacement assistance
under any outplacement assistance program then being maintained by the Company in accordance with
the terms of any such program, or if no such program then exists, in an amount not to exceed
$10,000; provided that any reimbursable expense must be incurred by the Executive no later than the
end of the second calendar year following the year of the Separation From Service. The Executive
shall also become vested in any outstanding options, restricted stock or other equity incentive
awards only to the extent provided for under the terms governing such equity incentive award. The
Company shall also pay, or cause to be paid, to the Executive, in a lump sum in cash within 30 days
after the Separation From Service (or, in the case of the pro-rated Annual Bonus Amount, at the
time such bonus would otherwise be paid), the following accrued but unpaid cash compensation of the
Executive (the “Accrued Obligations”): (X) the Executive’s base salary through the Date of
Termination that has not yet been paid, (Y) any accrued but unpaid vacation pay, and (Z) any
unreimbursed employee business expenses; provided, however, that the Company’s obligation to make
any payments, or cause any payments to be made, under this paragraph (a) to the extent any such
payment shall not have accrued as of the day before the Date of Termination shall also be
conditioned upon the Executive’s execution, and non-revocation, of a written release, substantially
in the form attached hereto as Annex 1, of any and all claims against the Company and all
related parties with respect to all matters arising out of the Executive’s employment under this
Agreement or the termination thereof (other than any entitlements under the terms of this Agreement
to indemnification or under any other plans or programs of the Company in which the Executive
participated and under which the Executive has accrued and is due a benefit). The payments and
benefits described in this paragraph (a) (other than those payments and benefits accrued as of the
day before the Date of Termination) will be paid, or will begin to be paid or provided, as
applicable, after the applicable release review period and revocation period have expired, and as
if the Executive signed the release on the last day of the release review period.

 

5

 

To the extent compliance with the requirements of Treas. Reg. § 1.409A-3(i)(2) (or any successor
provision) is necessary to avoid the application of an additional tax under Section 409A to
payments due to the Executive upon or following his Separation From Service, then notwithstanding
any other provision of this Agreement (or any otherwise applicable plan, policy, agreement or
arrangement), any such payments that are otherwise due within six months following the Executive’s
Separation From Service will be deferred (without interest) and paid to the Executive in a lump sum
immediately following that six month period. This provision shall not be construed as preventing
payments pursuant to Section 5 equal to an amount up to 2 times the lesser of (a) the Executive’s
annualized compensation for the year prior to the Separation From Service, and (b) the maximum
amount that may be taken into account under a qualified plan pursuant to section 401(a)(17) of the
Code, being paid to the Executive in the first six months following the Separation From Service.

(b) Death or Disability. If the Executive’s employment is terminated by reason of the
Executive’s death or Disability during the Employment Period, the Company shall pay the Accrued
Obligations to the Executive or the Executive’s estate or legal representative, as applicable, in a
lump sum in cash within 30 days after the Date of Termination. In such event, the Company shall
have no further obligations under this Agreement or otherwise to or with respect to the Executive;
and for any entitlements under the terms of any other plans or programs of the Company in which the
Executive participated and under which the Executive has become entitled to a benefit.

(c) By the Company for Cause; By the Executive Other than for Good Reason. If the
Executive’s employment is terminated by the Company for Cause during the Employment Period, or the
Executive voluntarily terminates employment during the Employment Period, other than for Good
Reason, the Company shall pay the Executive, or shall cause the Executive to be paid, the
Executive’s base salary through the Date of Termination that has not been paid and the amount of
any declared but unpaid bonuses, accrued but unpaid vacation pay, and unreimbursed employee
business expenses, and the Company shall have no further obligations under this Agreement or
otherwise to or with respect to the Executive other than for any entitlements under the terms of
any other plans or programs of the Company in which the Executive participated and under which the
Executive has become entitled to a benefit.

6. Change in Control. It is the intention of the parties that payments to be made to
the Executive whether under the terms of this Agreement or otherwise shall not constitute “excess
parachute payments” within the meaning of Section 280G of the Code and any regulations thereunder.
If the independent accountants serving as auditors for the Company on the date of this Agreement
(or any other independent certified public accounting firm designated by the Company) determine
that any payment or distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this Agreement or
otherwise) would be nondeductible by the Company pursuant to Section 280G of the Code (or any
successor provision), then the amounts payable or distributable under this Agreement will be
reduced to the maximum amount which may be paid or distributed without causing such payments or
distributions to be nondeductible. The determination shall take into account (a) whether the
payments or distributions are “parachute payments” under Section 280G, (b) the amount of payments
and distributions under this Agreement that constitute reasonable compensation, and (c) the present
value of such payments and distributions determined in accordance
with Treasury Regulations in effect from time to time. If a reduction is required in
accordance with this Section 6, cash payments will be reduced before any acceleration of vesting or
forfeiture conditions are eliminated and future payments will be reduced before amounts that are
immediately payable.

7. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any plan, program, policy or practice provided by
the Company for which the Executive may qualify. Vested benefits and other amounts that the
Executive is otherwise entitled to receive on or after the Date of Termination under any plan,
policy, practice or program of, or any contract or agreement with, the Company shall be payable in
accordance with such plan, policy, practice, program, contract or agreement, as the case may be,
except as explicitly modified by this Agreement.

 

6

 

8. No Mitigation. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable to the Executive
under any of the provisions of this Agreement and such amounts shall not be reduced, regardless of
whether the Executive obtains other employment.

9. Confidential Information; Non-solicitation; Non-competition.

(a) The Executive agrees and acknowledges that by reason of his employment by and service to
the Company, he will have access to, become exposed to and/or become knowledgeable about
confidential information of the Company (the “Confidential Information”) from time to time during
the Employment Period, including, without limitation, proposals, plans, inventions, practices,
systems, programs, processes, methods, techniques, research, records, supplier sources, customer
lists and other forms of business information that are not known to the Company’s competitors, are
not recognized as being encompassed within standard business or management practices and/or are
kept secret and confidential by the Company. Executive agrees that at no time during or after the
Employment Period will he disclose or use the Confidential Information except as may be required in
the prudent course of business for the benefit of the Company. The Executive also agrees to be
subject to the Company’s Code of Ethics and Business Conduct as in effect from time to time during
the Employment Period.

(b) The Executive acknowledges that the Company is generally engaged in business throughout
the United States. During the Executive’s employment by the Company and for two years after the
Date of Termination or the expiration of the Employment Period, the Executive agrees that he will
not, unless acting with the prior written consent of the Company, directly or indirectly, own,
manage, control, or participate in the ownership, management or control of, or be employed or
engaged by, or otherwise affiliated or associated with, as an officer, director, employee,
consultant, independent contractor or otherwise, any other corporation, partnership,
proprietorship, firm, association or other business entity, which is engaged in any business,
including the wholesale distribution of pharmaceutical products, that, or otherwise engage in any
business that, as of the Date of Termination or expiration of the Employment Period, as applicable,
is engaged in by the Company, has been reviewed with the Board for development to be owned or
managed by the Company, and/or has been divested by the Company but as to which the Company has an
obligation to refrain from involvement, but only for so long as such restriction applies to the
Company; provided, however, that the ownership of not more than 5% of the equity of a publicly
traded entity shall not be deemed to be a violation of this paragraph. During such two-year
period, Executive also agrees to make himself reasonably available to the Company for consulting at
a per diem rate that reflects his annual salary as in an effect prior to his termination of
employment (plus reimbursement of Executive’s reasonable expenses). Notwithstanding the foregoing,
the Executive shall be relieved of the covenants provided for in this subsection in the event that
the Company fails to make payments to Executive as provided for in Section 5(a) of this Agreement.

(c) The Executive also agrees that he will not, directly or indirectly, during the period
described in paragraph (b) of this Section 9 induce any person who is an employee, officer,
director, or agent of the Company, to terminate such relationship, or employ, assist in employing
or otherwise be associated in business with any present or former employee or officer of the
Company, including without limitation those who commence such positions with the Company after the
Date of Termination.

 

7

 

(d) The Executive acknowledges and agrees that the restrictions contained in this Section 9
are reasonable and necessary to protect and preserve the legitimate interests, properties, goodwill
and business of the Company, that the Company would not have entered into this Agreement in the
absence of such restrictions and that irreparable injury will be suffered by the Company should the
Executive breach the provisions of this Section. The Executive represents and acknowledges that
(i) the Executive has been advised by the Company to consult the Executive’s own legal counsel in
respect of this Agreement, (ii) the Executive has consulted with and been advised by his own
counsel in respect of this Agreement, and (iii) the Executive has had full opportunity, prior to
execution of this Agreement, to review thoroughly this Agreement with the Executive’s counsel.

(e) The Executive further acknowledges and agrees that a breach of the restrictions in this
Section 9 will not be adequately compensated by monetary damages. The Executive agrees that actual
damage may be difficult to ascertain and that, in the event of any such breach, the Company shall
be entitled to injunctive relief in addition to such other legal or equitable remedies as may be
available to the Company. In the event that the provisions of this Section 9 should ever be
adjudicated to exceed the limitations permitted by applicable law in any jurisdiction, it is the
intention of the parties that the provision shall be amended such that those provisions are made
consistent with the maximum limitations permitted by applicable law, that such amendment shall
apply only within the jurisdiction of the court that made such adjudication and that those
provisions otherwise be enforced to the maximum extent permitted by law.

(f) If the Executive breaches his obligations under this Section 9, he agrees that suit may be
brought, and that he consents to personal jurisdiction, in the United States District Court for the
Eastern District of Pennsylvania, or if such court does not have jurisdiction or will not accept
jurisdiction, in any court of general jurisdiction in Chester County, Pennsylvania; consents to the
non-exclusive jurisdiction of any such court in any such suit, action or proceeding; and waives any
objection which he may have to the laying of venue of any such suit, action or proceeding in any
such court. The Executive also irrevocably and unconditionally consents to the service of any
process, pleadings, notices or other papers.

(g) For purposes of this Section 9, the term “Company” shall be deemed to include each
Subsidiary of the Company.

10. Successors.

(a) This Agreement is personal to the Executive and, without the prior written consent of the
Company, shall not be assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s
legal representatives.

(b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.

(c) The Company shall require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or assets of the
Company expressly to assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would have been required to perform it if no such succession had taken
place. As used in this Agreement, “Company” shall mean both the Company as defined above and any
such successor that assumes and agrees to perform this Agreement, by operation of law or otherwise.

 

8

 

11. Miscellaneous.

(a) This Agreement shall be governed by, and construed in accordance with, the laws of the
Commonwealth of Pennsylvania, without reference to principles of conflict of laws. The captions of
this Agreement are not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified except by a written agreement executed by the parties
hereto or their respective successors and legal representatives. This Agreement supersedes the
provisions of, and the Executive shall not be entitled to any rights or benefits, including but not
limited to termination rights or severance benefits, under any other agreement with or commitment
of the Company or any of its subsidiaries or affiliates, including but not limited to the
Employment Agreement dated September 4, 1997 between AmerisourceBergen Services Corporation
(formerly known as AmeriSource Health Corporation) and the Executive.

(b) All notices and other communications under this Agreement shall be in writing and shall be
given by hand to the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to the Executive, to the address on file with the Company.

If to the Company:

AmerisourceBergen Corporation

1300 Morris Drive

Chesterbrook, PA 19087

Attention: General Counsel

or to such other address as either party furnishes to the other in writing in accordance with
this paragraph (b) of Section 11. Notices and communications shall be effective when actually
received by the addressee.

(c) The invalidity or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement. If any provision of this
Agreement shall be held invalid or unenforceable in part, the remaining portion of such provision,
together with all other provisions of this Agreement, shall remain valid and enforceable and
continue in full force and effect to the fullest extent consistent with law.

(d) Notwithstanding any other provision of this Agreement, the Company may withhold from
amounts payable under this Agreement all federal, state, local and foreign taxes that are required
to be withheld by applicable laws or regulations.

(e) The Executive’s or the Company’s failure to insist upon strict compliance with any
provision of, or to assert any right under, this Agreement (including, without limitation, the
right of the Executive to terminate employment for Good Reason pursuant to paragraph (c) of Section
5 of this
Agreement) shall not be deemed to be a waiver of such provision or right or of any other
provision of or right under this Agreement.

(f) Anything to the contrary herein notwithstanding, all benefits or payments provided by the
Company to the Executive that would be deemed to constitute “nonqualified deferred compensation”
within the meaning of Section 409A are intended to comply with Section 409A of the Code. If,
however, any such benefit or payment is deemed to not comply with Section 409A of the Code, the
Company and the Executive agree to renegotiate in good faith any such benefit or payment
(including, without limitation, as to the timing of any severance payments payable hereof) so that
either (i) Section 409A of the Code will not apply or (ii) compliance with Section 409A will be
achieved.

 

9

 

(g) This Agreement may be executed in several counterparts, each of which shall be deemed an
original, and said counterparts shall constitute but one and the same instrument.

12. The respective rights and obligations of the parties hereunder shall survive any
termination of the Executive’s employment to the extent necessary to the intended preservation of
such rights and obligations, including, but not by way of limitation, those rights and obligations
set forth in Sections 3, 5, 6, 9 and 11.

IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and, pursuant to the
authorization of the Committee, the Company has caused this Agreement to be executed in its name on
its behalf, in each case on the date(s) set forth below.

	 	 	 	 	 	 	 
	AMERISOURCEBERGEN CORPORATION	 	 
	 	 	 	 	 	 	 
	By:	 	/s/ John G. Chou	 	 
	 	 	 	 	 
	 	 	Name:

Title:
	 	John G. Chou 

Senior Vice President, General Counsel & Secretary
	 	 
	 	 	 	 	 	 	 
	Date: 11/24/08	 	 

	 	 	 
	EXECUTIVE	 	 
	 	 	 
	/s/ R. David Yost
	 	 
	 	 	 
	R. David Yost	 	 
	 	 	 
	Date: 11/24/08	 	 

 

10

 

ANNEX 1

SEPARATION OF EMPLOYMENT AGREEMENT

AND GENERAL RELEASE

THIS SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE (the “Agreement”) is made as of
this
 _____ 

day of _____, _____, by and between AmerisourceBergen Corporation (the “Company”) and

 _____ 

(the “Executive”).

WHEREAS, Executive formerly was employed as _____;

WHEREAS, Executive and Company entered into an Employment Agreement, dated
 _____,

 _____, (the “Employment Agreement”) which provides for certain severance benefits in the event that
Executive’s employment is terminated on account of a reason set forth in the Employment Agreement;

WHEREAS, Executive and the Company mutually desire to terminate Executive’s employment on an
amicable basis, such termination to be effective  _____  _____,
 _____ (the “Date of Resignation”);
and

WHEREAS, in connection with the termination of Executive’s employment, the parties have agreed
to a separation package and the resolution of any and all disputes between them.

NOW, THEREFORE, IT IS HEREBY AGREED by and between Executive and the Company as follows:

1. (a) Executive, for and in consideration of the commitments of the Company as set forth in
Paragraph 5 of this Agreement, and intending to be legally bound, does hereby REMISE, RELEASE AND
FOREVER DISCHARGE the Company, its affiliates, subsidiaries and parents, and its officers,
directors, employees, and agents, and its and their respective successors and assigns, heirs,
executors, and administrators (each, a “Releasee” and collectively, “Releasees”) from all causes of
action, suits, debts, claims and demands whatsoever in law or in equity, which Executive ever had,
now has, or hereafter may have, whether known or unknown, or which Executive’s heirs, executors, or
administrators may have, by reason of any matter, cause or thing whatsoever, from the beginning of
Executive’s employment to the date of this Agreement, and particularly, but without limitation of
the foregoing general terms, any claims arising from or relating in any way to Executive’s
employment relationship with the Company and/or its predecessors, subsidiaries or affiliates, the
terms and conditions of that employment relationship, and the termination of that employment
relationship, including, but not limited to, any claims arising under the Age Discrimination in
Employment Act, the Older Workers Benefit Protection Act (“OWBPA”), Title VII of The Civil Rights
Act of 1964, the Americans with Disabilities Act, the Family and Medical Leave Act of 1993, the
Employee Retirement Income Security Act of 1974, the Pennsylvania Human Relations Act, and any
other claims under any federal, state or local common law, statutory, or regulatory provision, now
or hereafter recognized, and any claims for attorneys’ fees and costs. This Agreement is effective
without regard to the legal nature of the claims raised and without regard to whether any such
claims are based upon tort, equity, implied or express contract or discrimination of any sort.

 

11

 

(b) To the fullest extent permitted by law, and subject to the provisions of Paragraph 10
below, Executive represents and affirms that (i) Executive has not filed or caused to be filed on
Executive’s behalf any claim for relief against the Company or any Releasee and, to the best of
Executive’s knowledge and belief, no outstanding claims for relief have been filed or asserted
against the Company or any Releasee on Executive’s behalf; (ii) Executive has not reported any
improper, unethical or illegal conduct or activities to any supervisor, manager, department head,
human resources representative, agent or other representative of the Company, to any member of the
Company’s legal or compliance departments, or to the ethics hotline, and has no knowledge of any
such improper, unethical or illegal conduct or activities; and (iii) Executive will not file,
commence, prosecute or participate in any judicial or arbitral action or proceeding against the
Company or any Releasee based upon or arising out of any act, omission, transaction, occurrence,
contract, claim or event existing or occurring on or before the date of this Agreement.

(c) Nothing in the Agreement will be deemed to release the Company from (i) claims solely to
enforce this Agreement, (ii) claims for indemnification under the Company’s By-Laws, or (iii)
claims for payment or reimbursement pursuant to any employee benefit plan, policy or arrangement of
the Company.

2. In consideration of the Company’s agreements as set forth in Paragraph 5 herein, Executive
agrees to be bound by the terms of Section 9 of the Employment Agreement.

3. Executive agrees and recognizes that Executive has permanently and irrevocably severed
Executive’s employment relationship with the Company, that Executive shall not seek employment with
the Company or any affiliated entity at any time in the future, and that the Company has no
obligation to employ Executive in the future.

4. Executive further agrees that Executive will not disparage or subvert the Company, or make
any statement reflecting negatively on the Company, its affiliated corporations or entities, or any
of their officers, directors, employees, agents or representatives, including, but not limited to,
any matters relating to the operation or management of the Company, Executive’s employment and the
termination of Executive’s employment, irrespective of the truthfulness or falsity of such
statement. The Company agrees that none of its officers, directors, employees, agents or
representatives will disparage or subvert the Executive, or make any statement reflecting
negatively on the Executive, including, but not limited to, any matters relating to the Executive’s
performance or the termination of Executive’s employment, irrespective of the truthfulness or
falsity of such statement.

5. In consideration for Executive’s agreement as set forth herein, the Company agrees that the
Company shall provide the following:

[insert description of severance benefits to which Executive is entitled under the
Employment Agreement]; and

[(b)] To the extent covered by directors’ and officers’ liability insurance on the Date
of Resignation, the Company will maintain, for no less than 6 years following the Date of
Resignation, directors’ and officers’ liability insurance covering the Executive’s potential
liability in connection with his employment by the Company in amounts and on terms that are
commensurate with the coverage provided to its active officers and directors of the Company.

6. Executive understands and agrees that the payments, benefits and agreements provided in
this Agreement are being provided to Executive in consideration for Executive’s acceptance and
execution of, and in reliance upon Executive’s representations in, this Agreement. Executive
acknowledges that if Executive had not executed this Agreement containing a release of all claims
against the Company, Executive would only have been entitled to the payments provided in the
Company’s standard severance pay plan for employees.

 

12

 

7. Executive acknowledges and agrees that the Company previously has satisfied any and all
obligations owed to Executive under any employment agreement or offer letter Executive has with the
Company and, further, that this Agreement supersedes any employment agreement or offer letter
Executive has with the Company, and any and all prior agreements or understandings, whether written
or oral, between the parties shall remain in full force and effect to the extent not inconsistent
with this Agreement, and further, that, except as set forth expressly herein, no promises or
representations have been made to Executive in connection with the termination of Executive’s
employment agreement or offer letter with the Company, or the terms of this Agreement.

8. Executive agrees not to disclose the terms of this Agreement to anyone, except Executive’s
spouse, attorney and, as necessary, tax/financial advisor. Likewise, the Company agrees that the
terms of this Agreement will not be disclosed except as may be necessary to obtain approval or
authorization to fulfill its obligations hereunder or as required by law. It is expressly
understood that any violation of the confidentiality obligation imposed hereunder constitutes a
material breach of this Agreement.

9. Executive represents that Executive does not presently have in Executive’s possession any
records and business documents, whether on computer or hard copy, and other materials (including
but not limited to computer disks and tapes, computer programs and software, office keys,
correspondence, files, customer lists, technical information, customer information, pricing
information, business strategies and plans, sales records and all copies thereof) (collectively,
the “Corporate Records”) provided by the Company and/or its predecessors, subsidiaries or
affiliates or obtained as a result of Executive’s prior employment with the Company and/or its
predecessors, subsidiaries or affiliates, or created by Executive while employed by or rendering
services to the Company and/or its predecessors, subsidiaries or affiliates. Executive
acknowledges that all such Corporate Records are the property of the Company. In addition,
Executive shall promptly return in good condition any and all beepers, credit cards, cellular
telephone equipment, business cards and computers. As of the Date of Resignation, the Company will
make arrangements to remove, terminate or transfer any and all business communication lines
including network access, cellular phone, fax line and other business numbers.

10. Nothing in this Agreement shall prohibit or restrict Executive from: (i) making any
disclosure of information required by law; (ii) providing information to, or testifying or
otherwise assisting in any investigation or proceeding brought by, any federal regulatory or law
enforcement agency or legislative body, any self-regulatory organization, or the Company’s
[designated legal, compliance or human resources officer]; or (iii) filing, testifying,
participating in or otherwise assisting in a proceeding relating to an alleged violation of any
federal, state or municipal law relating to fraud, or any rule or regulation of the Securities and
Exchange Commission or any self-regulatory organization.

11. The parties agree and acknowledge that the agreement by the Company described herein, and
the settlement and termination of any asserted or unasserted claims against the Releasees, are not
and shall not be construed to be an admission of any violation of any federal, state or local
statute or regulation, or of any duty owed by any of the Releasees to Executive.

12. Executive agrees and recognizes that should Executive breach any of the obligations or
covenants set forth in this Agreement, the Company will have no further obligation to provide
Executive
with the consideration set forth herein, and will have the right to seek repayment of all
consideration paid up to the time of any such breach. Further, Executive acknowledges in the event
of a breach of this Agreement, Releasees may seek any and all appropriate relief for any such
breach, including equitable relief and/or money damages, attorney’s fees and costs.

 

13

 

13. Executive further agrees that the Company shall be entitled to preliminary and permanent
injunctive relief, without the necessity of proving actual damages, as well as to an equitable
accounting of all earnings, profits and other benefits arising from any violations of this
Agreement, which rights shall be cumulative and in addition to any other rights or remedies to
which the Company may be entitled.

14. This Agreement and the obligations of the parties hereunder shall be construed,
interpreted and enforced in accordance with the laws of the Commonwealth of Pennsylvania.

15. Executive certifies and acknowledges as follows:

(a) That Executive has read the terms of this Agreement, and that Executive understands its
terms and effects, including the fact that Executive has agreed to RELEASE AND FOREVER DISCHARGE
the Company and each and every one of its affiliated entities from any legal action arising out of
Executive’s employment relationship with the Company and the termination of that employment
relationship;

(b) That Executive has signed this Agreement voluntarily and knowingly in exchange for the
consideration described herein, which Executive acknowledges is adequate and satisfactory to
Executive and which Executive acknowledges is in addition to any other benefits to which Executive
is otherwise entitled;

(c) That Executive has been and is hereby advised in writing to consult with an attorney prior
to signing this Agreement;

(d) That Executive does not waive rights or claims that may arise after the date this
Agreement is executed;

(e) That the Company has provided Executive with a period of twenty-one (21) days within which
to consider this Agreement, and that Executive has signed on the date indicated below after
concluding that this Agreement is satisfactory to Executive; and

(f) Executive acknowledges that this Agreement may be revoked by Executive within seven (7)
days after execution, and it shall not become effective until the expiration of such seven day
revocation period. In the event of a timely revocation by Executive, this Agreement will be deemed
null and void and the Company will have no obligations hereunder.

[SIGNATURE PAGE FOLLOWS]

 

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Intending to be legally bound hereby, Executive and the Company executed the foregoing
Separation of Employment Agreement and General Release this
 _____ day of
 _____,
 _____.

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Witness:	 	 
	 	 	 	 	 	 	 
	[Executive]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	AMERISOURCEBERGEN CORPORATION	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By: 

	 	 	 	 	 	Witness:	 	 
	 

	 
	 	 	 	 	 	 
	 	Name:
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 	Title:
	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 

 

15

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