Document:

exv10w9

 

Exhibit 10.9

RENEGY HOLDINGS, INC.

2007 EQUITY INCENTIVE PLAN

     1. Purposes of the Plan. The purposes of this Plan are:

	 	•	 	to attract and retain the best available personnel for positions of
substantial responsibility,
	 
	 	•	 	to provide additional incentive to Employees, Directors and Consultants, and
	 
	 	•	 	to promote the success of the Company’s business.

          The Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Restricted
Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units and Performance Shares.

     2. Definitions. As used herein, the following definitions will apply:

          (a) “Administrator” means the Board or any of its Committees as will be administering
the Plan, in accordance with Section 4 of the Plan.

          (b) “Affiliate” means any employer with which the Company would be considered a single
employer, within the meaning of Section 414(b) and 414(c) of the Code, applied using 80% as the
percentage of ownership required under such Code sections.

          (c) “Applicable Laws” means the requirements relating to the administration of
equity-based awards under U.S. state corporate laws, U.S. federal and state securities laws, the
Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction where Awards are, or will be, granted under
the Plan.

          (d) “Award” means, individually or collectively, a grant under the Plan of Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units or
Performance Shares.

          (e) “Award Agreement” means the written or electronic agreement setting forth the
terms and provisions applicable to each Award granted under the Plan. The Award Agreement is
subject to the terms and conditions of the Plan.

          (f) “Award Transfer Program” means any program instituted by the Committee which would
permit Participants the opportunity to transfer any outstanding Awards to a financial institution
or other person or entity approved by the Committee.

          (g) “Board” means the Board of Directors of the Company.

 

 

          (h) “Change in Control” means the occurrence of any of the following events:

               (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the total
voting power represented by the Company’s then outstanding voting securities;

               (ii) The consummation of the sale or disposition by the Company of all or substantially all
(80% percent) of the Company’s assets;

               (iii) A change in the composition of the Board occurring within a one (1)-year period, as a
result of which fewer than a majority of the directors are Incumbent Directors. “Incumbent
Directors” means directors who either (A) are Directors as of the effective date of the Plan, or
(B) are elected, or nominated for election, to the Board with the affirmative votes of at least a
majority of the Incumbent Directors at the time of such election or nomination (but will not
include an individual whose election or nomination is in connection with an actual or threatened
proxy contest relating to the election of directors to the Company); or

               (iv) The consummation of a merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity or its parent) at least fifty
percent (50%) of the total voting power represented by the voting securities of the Company or such
surviving entity or its parent outstanding immediately after such merger or consolidation.

          (i) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a
section of the Code herein will be a reference to any successor or amended section of the Code.

          (j) “Committee” means a committee of Directors or of other individuals satisfying
Applicable Laws appointed by the Board in accordance with Section 4 hereof.

          (k) “Common Stock” means the common stock of the Company.

          (l) “Company” means Renegy Holdings, Inc., a Delaware corporation, or any successor
thereto.

          (m) “Consultant” means any person, including an advisor, engaged by the Company or a
Parent or Subsidiary to render services to such entity.

          (n) “Director” means a member of the Board.

          (o) “Disability” means total and permanent disability as defined in Section 22(e)(3)
of the Code, and except in the case of Incentive Stock Options, as defined in Section 409A.

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          (p) “Employee” means any person, including Officers and Directors, employed by the
Company or any Parent or Subsidiary of the Company. Neither service as a Director nor payment of a
director’s fee by the Company will be sufficient to constitute “employment” by the Company.

          (q) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          (r) “Exchange Program” means a program under which (i) outstanding Awards are
surrendered or cancelled in exchange for Awards of the same type (which may have higher or lower
exercise prices and different terms), Awards of a different type, and/or cash, and/or (ii) the
exercise price of an outstanding Award is reduced. The Administrator will determine the terms and
conditions of any Exchange Program in its sole discretion.

          (s) “Fair Market Value” means, as of any date, the value of Common Stock determined as
follows:

               (i) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq Global Select Market, the Nasdaq Global Market or
the Nasdaq Capital Market of The Nasdaq Stock Market, its Fair Market Value will be the closing
sales price for such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or system on the day of determination, as reported in The Wall Street Journal or such
other source as the Administrator deems reliable;

               (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, the Fair Market Value of a Share will be the mean between the high bid and
low asked prices for the Common Stock on the day of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems reliable;

               (iii) In the absence of an established market for the Common Stock, the Fair Market Value will
be determined in good faith by the Administrator consistent with Section 409A.

          (t) “Fiscal Year” means the fiscal year of the Company.

          (u) “Incentive Stock Option” means an Option intended to qualify as an incentive stock
option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

          (v) “Inside Director” means a Director who is an Employee.

          (w) “Nonstatutory Stock Option” means an Option that by its terms does not qualify or
is not intended to qualify as an Incentive Stock Option.

          (x) “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

          (y) “Option” means a stock option granted pursuant to the Plan.

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          (z) “Outside Director” means a Director who is not an Employee.

          (aa) “Parent” means a “parent corporation” of the Company, whether now or hereafter
existing, as defined in Section 424(e) of the Code.

          (bb) “Participant” means the holder of an outstanding Award.

          (cc) “Performance Share” means an Award denominated in Shares which may be earned in
whole or in part upon attainment of performance goals or other vesting criteria as the
Administrator may determine pursuant to Section 10.

          (dd) “Performance Unit” means an Award which may be earned in whole or in part upon
attainment of performance goals or other vesting criteria as the Administrator may determine and
which may be settled for cash, Shares or other securities or a combination of the foregoing
pursuant to Section 10.

          (ee) “Period of Restriction” means the period during which the transfer of Shares of
Restricted Stock are subject to restrictions and therefore, the Shares are subject to a substantial
risk of forfeiture. Such restrictions may be based on the passage of time, the achievement of
target levels of performance, or the occurrence of other events as determined by the Administrator.

          (ff) “Plan” means this 2007 Equity Incentive Plan.

          (gg) “Restricted Stock” means Shares issued pursuant to a Restricted Stock Award under
Section 7 of the Plan, or issued pursuant to the early exercise of an Option.

          (hh) “Restricted Stock Unit” means a bookkeeping entry representing an amount equal to
the Fair Market Value of one Share, granted pursuant to Section 8. Each Restricted Stock Unit
represents an unfunded and unsecured obligation of the Company.

          (ii) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3,
as in effect when discretion is being exercised with respect to the Plan.

          (jj) “Section 409A” means Section 409A of the Code and the guidance issued by the
United States Department of the Treasury or Internal Revenue Service.

          (kk) “Section 16(b)” means Section 16(b) of the Exchange Act.

          (ll) “Separation from Service” means a termination of employment with the Company and
all Affiliates that is a “separation from service” within the meaning of Section 409A.

          (mm) “Service Provider” means an Employee, Director or Consultant.

          (nn) “Share” means a share of the Common Stock, as adjusted in accordance with
Section 13 of the Plan.

          (oo) “Specified Employee” means a “specified employee” within the meaning of Section
409A and the Company’s specified employee identification policy, if any.

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          (pp) “Stock Appreciation Right” means an Award, granted alone or in connection with an
Option, that pursuant to Section 9 is designated as a Stock Appreciation Right.

          (qq) “Subsidiary” means a “subsidiary corporation” of the Company, whether now or
hereafter existing, as defined in Section 424(f) of the Code.

     3. Stock Subject to the Plan.

          (a) Stock Subject to the Plan. Subject to the provisions of Section 13 of the Plan,
the maximum aggregate number of Shares that may be issued under the Plan is 1,000,000 Shares. The
Shares may be authorized, but unissued, or reacquired Common Stock.

          (b) Automatic Share Reserve Increase. The number of Shares available for issuance
under the Plan will be increased on the first day of each Fiscal Year beginning with the 2009
Fiscal Year, in an amount equal to the least of (A) 500,000 Shares, (B) four percent (4%) of the
outstanding Shares on the last day of the immediately preceding Fiscal Year or (C) such number of
Shares determined by the Board; provided, however, that the maximum aggregate number of Shares that
may be issued under the Plan as Incentive Stock Options shall remain 1,000,000 Shares.

          (c) Lapsed Awards. If an Award expires or becomes unexercisable without having been
exercised in full, is surrendered pursuant to an Exchange Program, or, with respect to Restricted
Stock, Restricted Stock Units, Performance Units or Performance Shares, is forfeited to or
repurchased by the Company due to failure to vest, the unpurchased Shares (or for Awards other than
Options or Stock Appreciation Rights the forfeited or repurchased Shares) which were subject
thereto will become available for future grant or sale under the Plan (unless the Plan has
terminated). With respect to Stock Appreciation Rights, only Shares actually issued pursuant to a
Stock Appreciation Right will cease to be available under the Plan; all remaining Shares under
Stock Appreciation Rights will remain available for future grant or sale under the Plan (unless the
Plan has terminated). Shares that have actually been issued under the Plan under any Award will
not be returned to the Plan and will not become available for future distribution under the Plan;
provided, however, that if Shares issued pursuant to Awards of Restricted Stock, Restricted Stock
Units, Performance Shares or Performance Units are repurchased by the Company or are forfeited to
the Company, such Shares will become available for future grant under the Plan. Shares used to pay
the exercise price of an Award or to satisfy the tax withholding obligations related to an Award
will become available for future grant or sale under the Plan. To the extent an Award under the
Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the
number of Shares available for issuance under the Plan. Notwithstanding the foregoing and, subject
to adjustment as provided in Section 13, the maximum number of Shares that may be issued upon the
exercise of Incentive Stock Options will equal the aggregate Share number stated in Section 3(a),
plus, to the extent allowable under Section 422 of the Code and the Treasury Regulations
promulgated thereunder, any Shares that become available for issuance under the Plan pursuant to
this Section 3(c).

          (d) Share Reserve. The Company, during the term of this Plan, will at all times
reserve and keep available such number of Shares as will be sufficient to satisfy the requirements
of the Plan.

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     4. Administration of the Plan.

          (a) Procedure.

               (i) Multiple Administrative Bodies. Different Committees with respect to different
groups of Service Providers may administer the Plan.

               (ii) Section 162(m). To the extent that the Administrator determines it to be
desirable to qualify Awards granted hereunder as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the Plan will be administered by a Committee of two (2) or
more “outside directors” within the meaning of Section 162(m) of the Code.

               (iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt
under Rule 16b-3, the transactions contemplated hereunder will be structured to satisfy the
requirements for exemption under Rule 16b-3.

               (iv) Other Administration. Other than as provided above, the Plan will be
administered by (A) the Board or (B) a Committee, which committee will be constituted to satisfy
Applicable Laws.

          (b) Powers of the Administrator. Subject to the provisions of the Plan, and in the
case of a Committee, subject to the specific duties delegated by the Board to such Committee, the
Administrator will have the authority, in its discretion:

               (i) to determine the Fair Market Value;

               (ii) to select the Service Providers to whom Awards may be granted hereunder;

               (iii) to determine the number of Shares to be covered by each Award granted hereunder;

               (iv) to approve forms of Award Agreements for use under the Plan;

               (v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any
Award granted hereunder. Such terms and conditions include, but are not limited to, the exercise
price, the time or times when Awards may be exercised (which may be based on performance criteria),
any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Award or the Shares relating thereto, based in each case on such factors as the
Administrator will determine;

               (vi) to determine the terms and conditions of any, and to institute, any Exchange Program in
accordance with Applicable Laws;

               (vii) to determine the terms and conditions of any, and to institute any Award Transfer
Program in accordance with Section 12(b) and Applicable Laws;

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               (viii) to construe and interpret the terms of the Plan and Awards (except Incentive Stock
Options that qualify as such) granted pursuant to the Plan in accordance with Section 409A;

               (ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of satisfying applicable
foreign laws;

               (x) to modify or amend each Award (subject to Section 18(c) of the Plan) in accordance with
Section 409A, including but not limited to the discretionary authority to extend the
post-termination exercisability period of Awards and to extend the maximum term of an Option
(subject to Section 6(b) regarding Incentive Stock Options);

               (xi) to allow Participants to satisfy withholding tax obligations in such manner as prescribed
in Section 14;

               (xii) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Award previously granted by the Administrator;

               (xiii) to allow a Participant to defer the receipt of the payment of cash or the delivery of
Shares that would otherwise be due to such Participant under an Award pursuant to such procedures
as the Administrator may determine in accordance with Section 409A; and

               (xiv) to make all other determinations deemed necessary or advisable for administering the
Plan.

          (c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations
and interpretations will be final and binding on all Participants and any other holders of Awards.

     5. Eligibility. Nonstatutory Stock Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, Performance Shares and Performance Units may be granted to Service
Providers. Incentive Stock Options may be granted only to Employees.

     6. Stock Options.

          (a) Limitations. Each Option will be designated in the Award Agreement as either an
Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation,
to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive
Stock Options are exercisable for the first time by the Participant during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds one hundred thousand dollars
($100,000), such Options will be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options will be taken into account in the order in which they were
granted. The Fair Market Value of the Shares will be determined as of the date of grant of the
Option. The number of Shares subject to the Option shall also be fixed on the date of grant.

          (b) Term of Option. The term of each Option will be stated in the Award Agreement.
In the case of an Incentive Stock Option, the term will be ten (10) years from the date of

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grant or
such shorter term as may be provided in the Award Agreement. Moreover, in the case of an Incentive
Stock Option granted to a Participant who, at the time the Incentive Stock Option is granted, owns
stock representing more than ten percent (10%) of the total combined voting power of all classes of
stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option will be
five (5) years from the date of grant or such shorter term as may be provided in the Award
Agreement.

          (c) Option Exercise Price and Consideration.

               (i) Exercise Price. The per share exercise price for the Shares to be issued pursuant
to exercise of an Option will be determined by the Administrator, subject to the following:

                    (1) In the case of an Incentive Stock Option

                         a) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of stock of the Company
or any Parent or Subsidiary, the per Share exercise price will be no less than one hundred ten
percent (110%) of the Fair Market Value per Share on the date of grant.

                         b) granted to any Employee other than an Employee described in subparagraph (a) immediately
above, the per Share exercise price will be no less than one hundred percent (100%) of the Fair
Market Value per Share on the date of grant.

                    (2) In the case of a Nonstatutory Stock Option, the per Share exercise price will be no less
than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.

                    (3) Notwithstanding the foregoing, Options may be granted with a per Share exercise price of
less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant
pursuant to a transaction described in, and in a manner consistent with, Section 424(a) of the Code
and Section 409A.

               (ii) Waiting Period and Exercise Dates. At the time an Option is granted, the
Administrator will fix the period within which the Option may be exercised and will determine any
conditions that must be satisfied before the Option may be exercised.

               (iii) Form of Consideration. The Administrator will determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the case of an
Incentive Stock Option, the Administrator will determine the acceptable form of consideration at
the time of grant, and the Administrator will consider specifying the form of payment at the time
of grant for all Options. Such consideration may consist entirely of: (1) cash; (2) check; (3)
promissory note, (4) other Shares, provided that such Shares have a Fair Market Value on the date
of surrender equal to the aggregate exercise price of the Shares as to which such Option will be
exercised and provided that accepting such Shares, in the sole discretion of the Administrator,
will not result in any adverse accounting consequences to the Company; (5)
consideration received by the Company under a broker-assisted (or other) cashless exercise
program implemented by the Company in connection with the Plan; (6) such other consideration and
method

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of payment for the issuance of Shares to the extent permitted by Applicable Laws; or (7) any
combination of the foregoing methods of payment.

          (d) Exercise of Option.

               (i) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder
will be exercisable according to the terms of the Plan and at such times and under such conditions
as determined by the Administrator and set forth in the Award Agreement. An Option may not be
exercised for a fraction of a Share.

                    An Option will be deemed exercised when the Company receives: (i) notice of exercise (in such
form as the Administrator may specify from time to time) from the person entitled to exercise the
Option, and (ii) full payment for the Shares with respect to which the Option is exercised
(together with applicable withholding taxes). Full payment may consist of any consideration and
method of payment authorized by the Administrator and permitted by the Award Agreement and the
Plan. Shares issued upon exercise of an Option will be issued in the name of the Participant or,
if requested by the Participant, in the name of the Participant and his or her spouse. Until the
Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends or any other
rights as a stockholder will exist with respect to the Shares subject to an Option, notwithstanding
the exercise of the Option. The Company will issue (or cause to be issued) such Shares promptly
after the Option is exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the Shares are issued, except as provided in Section 13 of the
Plan.

               Exercising an Option in any manner will decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.

               (ii) Termination of Relationship as a Service Provider. If a Participant ceases to be
a Service Provider, other than upon the Participant’s termination as the result of the
Participant’s death or Disability, the Participant may exercise his or her Option within such
period of time as is specified in the Award Agreement to the extent that the Option is vested on
the date of termination (but in no event later than the expiration of the term of such Option as
set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the
Option will remain exercisable for three (3) months following the Participant’s termination.
Unless otherwise provided by the Administrator, if on the date of termination the Participant is
not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
will revert to the Plan. If after termination the Participant does not exercise his or her Option
within the time specified by the Administrator, the Option will terminate, and the Shares covered
by such Option will revert to the Plan.

               (iii) Disability of Participant. If a Participant ceases to be a Service Provider as
a result of the Participant’s Disability, the Participant may exercise his or her Option within
such period of time as is specified in the Award Agreement to the extent the Option is vested on
the date of termination (but in no event later than the expiration of the term of such Option as
set
forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the
Option will remain exercisable for twelve (12) months following the Participant’s termination.

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Unless otherwise provided by the Administrator, if on the date of termination the Participant is
not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
will revert to the Plan. If after termination the Participant does not exercise his or her Option
within the time specified herein, the Option will terminate, and the Shares covered by such Option
will revert to the Plan.

               (iv) Death of Participant. If a Participant dies while a Service Provider, the Option
may be exercised following the Participant’s death within such period of time as is specified in
the Award Agreement to the extent that the Option is vested on the date of death (but in no event
may the option be exercised later than the expiration of the term of such Option as set forth in
the Award Agreement), by the Participant’s designated beneficiary, provided such beneficiary has
been designated prior to Participant’s death in a form acceptable to the Administrator. If no such
beneficiary has been designated by the Participant, then such Option may be exercised by the
personal representative of the Participant’s estate or by the person(s) to whom the Option is
transferred pursuant to the Participant’s will or in accordance with the laws of descent and
distribution. In the absence of a specified time in the Award Agreement, the Option will remain
exercisable for twelve (12) months following Participant’s death. Unless otherwise provided by the
Administrator, if at the time of death Participant is not vested as to his or her entire Option,
the Shares covered by the unvested portion of the Option will immediately revert to the Plan. If
the Option is not so exercised within the time specified herein, the Option will terminate, and the
Shares covered by such Option will revert to the Plan.

          (e) No Deferral Feature. No Option may have any feature that would allow for the
deferral of compensation (within the meaning of Section 409A) other than the deferral of
recognition of income until the later of the exercise of disposition of the Option or the time
shares acquired subject to the exercise of the Option first become substantially vested (as defined
in Treasury Regulation Section 1.83-3(b)).

     7. Restricted Stock.

          (a) Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the
Administrator, at any time and from time to time, may grant Shares of Restricted Stock to Service
Providers in such amounts as the Administrator, in its sole discretion, will determine.

          (b) Restricted Stock Agreement. Each Award of Restricted Stock will be evidenced by
an Award Agreement that will specify the Period of Restriction, the number of Shares granted, and
such other terms and conditions as the Administrator, in its sole discretion, will determine.
Unless the Administrator determines otherwise, the Company as escrow agent will hold Shares of
Restricted Stock until the restrictions on such Shares have lapsed.

          (c) Transferability. Except as provided in this Section 7, Shares of Restricted Stock
may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Period of Restriction.

          (d) Other Restrictions. The Administrator, in its sole discretion, may impose such
other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate.

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          (e) Removal of Restrictions. Except as otherwise provided in this Section 7, Shares
of Restricted Stock covered by each Restricted Stock grant made under the Plan will be released
from escrow as soon as practicable after the last day of the Period of Restriction or at such other
time as the Administrator may determine. The Administrator, in its discretion, may accelerate the
time at which any restrictions will lapse or be removed.

          (f) Voting Rights. During the Period of Restriction, Service Providers holding Shares
of Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares,
unless the Administrator determines otherwise.

          (g) Dividends and Other Distributions. During the Period of Restriction, Service
Providers holding Shares of Restricted Stock will be entitled to receive all dividends and other
distributions paid with respect to such Shares, unless the Administrator provides otherwise. If
any such dividends or distributions are paid in Shares, the Shares will be subject to the same
restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect
to which they were paid.

          (h) Return of Restricted Stock to Company. On the date set forth in the Award
Agreement, the Restricted Stock for which restrictions have not lapsed will revert to the Company
and again will become available for grant under the Plan.

     8. Restricted Stock Units.

          (a) Grant. Restricted Stock Units may be granted at any time and from time to time as
determined by the Administrator. After the Administrator determines that it will grant Restricted
Stock Units under the Plan, it will advise the Participant in an Award Agreement of the terms,
conditions, and restrictions related to the grant, including the number of Restricted Stock Units.

          (b) Vesting Criteria and Other Terms. The Administrator will set vesting criteria in
its discretion, which, depending on the extent to which the criteria are met, will determine the
number of Restricted Stock Units that will be paid out to the Participant. The Administrator may
set vesting criteria based upon the achievement of Company-wide, business unit, or individual goals
(including, but not limited to, continued employment), or any other basis determined by the
Administrator in its discretion.

          (c) Earning Restricted Stock Units. Upon meeting the applicable vesting criteria, the
Participant will be entitled to receive a payout as determined by the Administrator.
Notwithstanding the foregoing, at any time after the grant of Restricted Stock Units, the
Administrator, in its sole discretion, may reduce or waive in accordance with Section 409A any
vesting criteria that must be met to receive a payout.

          (d) Form and Timing of Payment. Subject to Section 8(e), payments of earned
Restricted Stock Units will be made as soon as practicable after the date(s) determined by the
Administrator and set forth in the Award Agreement. The Administrator, in its sole
discretion, may only settle earned Restricted Stock Units in cash, Shares, or a combination of
both.

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          (e) Payments to Specified Employees. Notwithstanding anything to the contrary in
Section 8(d), Restricted Stock Units payable upon a Separation from Service of a Specified
Employee, to the extent they constitute nonqualified deferred compensation subject to Section 409A,
shall not be paid or issued until within the 30-day period commencing with the first day of the
seventh month following the month of the Specified Employee’s Separation from Service; provided
that if such 30-day period begins in one calendar year and ends in another calendar year, the
Participant shall have no right to designate the calendar year of payment.

          (f) Cancellation. On the date set forth in the Award Agreement, all unearned
Restricted Stock Units will be forfeited to the Company.

          (g) No Acceleration. Except as would not cause taxation under Section 409A(a)(1)(B),
no acceleration of the time or form of payment of a Restricted Stock Unit may be permitted under
the Plan or any Award.

     9. Stock Appreciation Rights.

          (a) Grant of Stock Appreciation Rights. Subject to the terms and conditions of the
Plan, a Stock Appreciation Right may be granted to Service Providers at any time and from time to
time as will be determined by the Administrator, in its sole discretion.

          (b) Number of Shares. The Administrator will have complete discretion to determine
the number of Stock Appreciation Rights granted to any Service Provider, which number shall be
fixed on the date of grant.

          (c) Exercise Price and Other Terms. The per share exercise price for the Shares to be
issued pursuant to exercise of a Stock Appreciation Right will be determined by the Administrator
and will be no less than one hundred percent (100%) of the Fair Market Value per Share on the date
of grant. Otherwise, subject to Section 6(a) of the Plan, the Administrator, subject to the
provisions of the Plan and except as would cause taxation under Section 409A(a)(1)(B), will have
complete discretion to determine the terms and conditions of Stock Appreciation Rights granted
under the Plan.

          (d) Stock Appreciation Right Agreement. Each Stock Appreciation Right grant will be
evidenced by an Award Agreement that will specify the exercise price, the term of the Stock
Appreciation Right, the conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion and which would not cause taxation under Section
409A(a)(1)(B), will determine.

          (e) Expiration of Stock Appreciation Rights. A Stock Appreciation Right granted under
the Plan will expire upon the date determined by the Administrator, in its sole discretion, and set
forth in the Award Agreement. Notwithstanding the foregoing, the rules of Section 6(d) also will
apply to Stock Appreciation Rights.

          (f) Payment of Stock Appreciation Right Amount. Upon exercise of a Stock Appreciation
Right, a Participant will be entitled to receive payment from the Company in an amount determined
by multiplying:

-12-

 

               (i) The difference between the Fair Market Value of a Share on the date of exercise over the
exercise price; times

               (ii) The number of Shares with respect to which the Stock Appreciation Right is exercised.

     At the discretion of the Administrator, the payment upon Stock Appreciation Right exercise may
be in cash, in Shares of equivalent value, or in some combination thereof.

          (g) No Acceleration. Except as would not cause taxation under Section 409A(a)(1)(B),
no acceleration of the time or form of payment of a Stock Appreciation Right may be permitted under
the Plan or any Award.

     10. Performance Units and Performance Shares.

          (a) Grant of Performance Units/Shares. Performance Units and Performance Shares may
be granted to Service Providers at any time and from time to time, as will be determined by the
Administrator, in its sole discretion. The Administrator will have complete discretion in
determining the number of Performance Units and Performance Shares granted to each Participant.

          (b) Value of Performance Units/Shares. Each Performance Unit will have an initial
value that is established by the Administrator on or before the date of grant. Each Performance
Share will have an initial value equal to the Fair Market Value of a Share on the date of grant.

          (c) Performance Objectives and Other Terms. The Administrator will, subject to 409A,
set performance objectives or other vesting provisions (including, without limitation, continued
status as a Service Provider) in its discretion which, depending on the extent to which they are
met, will determine the number or value of Performance Units/Shares that will be paid out to the
Service Providers. The time period during which the performance objectives or other vesting
provisions must be met will be called the “Performance Period.” Each Award of Performance
Units/Shares will be evidenced by an Award Agreement that will specify the Performance Period, and
such other terms and conditions as the Administrator, in its sole discretion and except as would
cause taxation under Section 409A(a)(1)(B), will determine. The Administrator may set performance
objectives based upon the achievement of Company-wide, divisional, or individual goals, applicable
federal or state securities laws, or any other basis determined by the Administrator in its
discretion.

          (d) Earning of Performance Units/Shares. After the applicable Performance Period has
ended, the holder of Performance Units/Shares will be entitled to receive a payout of the number of
Performance Units/Shares earned by the Participant over the Performance Period, to be determined as
a function of the extent to which the corresponding performance objectives or other vesting
provisions have been achieved. After the grant of a Performance Unit/Share, the Administrator, in
its sole discretion, may, except as would cause taxation under Section
409A(a)(1)(B), reduce or waive any performance objectives or other vesting provisions for such
Performance Unit/Share.

-13-

 

          (e) Form and Timing of Payment of Performance Units/Shares. Subject to Section 10(f),
payment of earned Performance Units/Shares will be made as soon as practicable after the expiration
of the applicable Performance Period. The Administrator, in its sole discretion, may pay earned
Performance Units/Shares in the form of cash, in Shares (which have an aggregate Fair Market Value
equal to the value of the earned Performance Units/Shares at the close of the applicable
Performance Period) or in a combination thereof.

          (f) Payments to Specified Employees. Notwithstanding anything to the contrary in
Section 10(e) and except as would not cause taxation under Section 409A(a)(1)(B), Performance
Units/Shares payable upon a Separation from Service of a Specified Employee, to the extent they
constitute nonqualified deferred compensation subject to Section 409A, shall not be paid or issued
until within the 30-day period commencing with the first day of the seventh month following the
month of the Specified Employee’s Separation from Service; provided that if such 30-day period
begins in one calendar year and ends in another calendar year, the Participant shall have no right
to designate the calendar year of payment.

          (g) Cancellation of Performance Units/Shares. On the date set forth in the Award
Agreement, all unearned or unvested Performance Units/Shares will be forfeited to the Company, and
again will be available for grant under the Plan.

          (h) No Acceleration. Except as would not cause taxation under Section 409A(a)(1)(B),
no acceleration of the time or form of payment of a Performance Units/Shares Unit may be permitted
under the Plan or any Award.

     11. Leaves of Absence/Transfer Between Locations. Unless the Administrator provides
otherwise or except as required by Applicable Laws, vesting of Awards granted hereunder will be
suspended during any unpaid leave of absence. A Service Provider will not cease to be an Employee
in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations
of the Company or between the Company, its Parent, or any Subsidiary. For purposes of Incentive
Stock Options, no such leave may exceed ninety (90) days, unless reemployment upon expiration of
such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of
absence approved by the Company is not so guaranteed, then three (3) months following the
ninety-first (91st) day of such leave any Incentive Stock Option held by the Participant
will cease to be treated as an Incentive Stock Option and will be treated for tax purposes as a
Nonstatutory Stock Option.

     12. Transferability of Awards.

          (a) General. Unless determined otherwise by the Administrator, an Award may not be
sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will
or by the laws of descent or distribution and may be exercised, during the lifetime of the
Participant, only by the Participant. If the Administrator makes an Award transferable, such Award
will contain such additional terms and conditions as the Administrator deems appropriate.

          (b) Award Transfer Program. Notwithstanding any contrary provision of the Plan, other
than the last sentence of this Section 12(b), the Committee shall have all discretion and authority
to determine and implement the terms and conditions of any Award Transfer Program

-14-

 

instituted
pursuant to this Section 12(b) and shall have the authority to amend the terms of any Award
participating, or otherwise eligible to participate in, the Award Transfer Program pursuant to its
original terms, including (but not limited to) the authority to (i) amend (including to extend) the
expiration date, post-termination exercise period and/or forfeiture conditions of any such Award,
(ii) amend or remove any provisions of the Award relating to the Award holder’s continued service
to the Company, (iii) amend the permissible payment methods with respect to the exercise or
purchase of any such Award, (iv) amend the adjustments to be implemented in the event of changes in
the capitalization and other similar events with respect to such Award, and (v) make such other
changes to the terms of such Award as the Committee deems necessary or appropriate in its sole
discretion. The other provisions of this Section 12(b) notwithstanding, (i) the Award Transfer
Program shall not amend an Award or this Plan so as not to comply with Applicable Laws, including
without limitation Section 409A, and (ii) the Committee shall not, without the written consent of
the Participant, amend any Incentive Stock Option in a way that would cause such Option to cease to
be treated as an incentive stock option under Section 422 of the Code.

     13. Adjustments; Dissolution or Liquidation; Merger or Change in Control.

          (a) Adjustments. In the event that any dividend or other distribution (whether in the
form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or
exchange of Shares or other securities of the Company, or other change in the corporate structure
of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or
enlargement of the benefits or potential benefits intended to be made available under the Plan,
will adjust the number and class of Shares that may be delivered under the Plan and/or the number,
class, and price of Shares covered by each outstanding Award and the numerical Share limits in
Section 3 of the Plan.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator will notify each Participant as soon as practicable
prior to the effective date of such proposed transaction. To the extent it has not been previously
exercised, an Award will terminate immediately prior to the consummation of such proposed action.

          (c) Merger or Change in Control. In the event of a merger or Change in Control, each
outstanding Award will be treated as the Administrator determines, including, without limitation,
that each Award be assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. The Administrator will not be
required to treat all Awards similarly in the transaction.

          In the event that the successor corporation does not assume or substitute for the Award, the
Participant will fully vest in and have the right to exercise all of his or her outstanding Options
and Stock Appreciation Rights, including Shares as to which such Awards would not otherwise be
vested or exercisable, all restrictions on Restricted Stock and Restricted Stock Units will lapse,
and, with respect to Awards with performance-based vesting, all performance goals or other vesting
criteria will be deemed achieved at one hundred percent (100%) of target levels and all
other terms and conditions met. In addition, if an Option or Stock Appreciation Right is not
assumed or substituted in the event of a Change in Control, the Administrator will notify the
Participant in writing or electronically that the Option or Stock Appreciation Right will be fully

-15-

 

vested and exercisable for a period of time determined by the Administrator in its sole discretion,
and the Option or Stock Appreciation Right will terminate upon the expiration of such period.

          For the purposes of this subsection (c), an Award will be considered assumed if, following the
Change in Control, the Award confers the right to purchase or receive, for each Share subject to
the Award immediately prior to the Change in Control, the consideration (whether stock, cash, or
other securities or property) received in the Change in Control by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the Change in Control is not
solely common stock of the successor corporation or its Parent, the Administrator may, with the
consent of the successor corporation, provide for the consideration to be received upon the
exercise of an Option or Stock Appreciation Right or upon the payout of a Restricted Stock Unit,
Performance Unit or Performance Share, for each Share subject to such Award, to be solely common
stock of the successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the Change in Control.

          Notwithstanding anything in this Section 13(c) to the contrary, an Award that vests, is earned
or paid-out upon the satisfaction of one or more performance goals will not be considered assumed
if the Company or its successor modifies any of such performance goals without the Participant’s
consent; provided, however, a modification to such performance goals only to reflect the successor
corporation’s post-Change in Control corporate structure will not be deemed to invalidate an
otherwise valid Award assumption.

     14. Tax Withholding.

          (a) Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to
an Award (or exercise thereof), the Company will have the power and the right to deduct or
withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy
federal, state, local, foreign or other taxes (including the Participant’s FICA obligation)
required to be withheld with respect to such Award (or exercise thereof).

          (b) Withholding Arrangements. The Administrator, in its sole discretion and pursuant
to such procedures as it may specify from time to time, may permit a Participant to satisfy such
tax withholding obligation, in whole or in part by (without limitation) (a) paying cash,
(b) electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market
Value equal to the minimum statutory amount required to be withheld, or (c) delivering to the
Company already-owned Shares having a Fair Market Value equal to the minimum statutory amount
required to be withheld. The Fair Market Value of the Shares to be withheld or delivered will be
determined as of the date that the taxes are required to be withheld.

     15. No Effect on Employment or Service. Neither the Plan nor any Award will confer
upon a Participant any right with respect to continuing the Participant’s relationship as a Service
Provider with the Company, nor will they interfere in any way with the Participant’s right or the
Company’s right to terminate such relationship at any time, with or without cause, to the
extent permitted by Applicable Laws.

-16-

 

     16. Date of Grant. The date of grant of an Award will be, for all purposes, the date
on which the Administrator makes the determination granting such Award, or such other later date as
is determined by the Administrator, but in each case the Administrator shall have fixed, for each
Award to be granted, the identity of the Participant, the maximum number of Shares subject to the
Award, and the Fair Market Value/grant price of the Award. Notice of the determination will be
provided to each Participant within a reasonable time after the date of such grant.

     17. Term of Plan. Subject to Section 21 of the Plan, the Plan will become effective
upon its adoption by the Board. It will continue in effect for a term of ten (10) years from the
date adopted by the Board, unless terminated earlier under Section 18 of the Plan.

     18. Amendment and Termination of the Plan.

          (a) Amendment and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.

          (b) Stockholder Approval. The Company will obtain stockholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws.

          (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan will impair the rights of any Participant, unless mutually agreed otherwise
between the Participant and the Administrator, which agreement must be in writing (which may
include e-mail) and signed by the Participant and the Company. Termination of the Plan will not
affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to
Awards granted under the Plan prior to the date of such termination.

     19. Conditions Upon Issuance of Shares.

          (a) Legal Compliance. Shares will not be issued pursuant to the exercise of an Award
unless the exercise of such Award and the issuance and delivery of such Shares will comply with
Applicable Laws and will be further subject to the approval of counsel for the Company with respect
to such compliance.

          (b) Investment Representations. As a condition to the exercise of an Award, the
Company may require the person exercising such Award to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.

     20. Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, will relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority will not have been obtained.

     21. Stockholder Approval. The Plan will be subject to approval by the stockholders of
the Company within twelve (12) months after the date the Plan is adopted by the Board. Such
stockholder approval will be obtained in the manner and to the degree required under Applicable
Laws.

-17-exv10w10

 

Exhibit 10.10

RENEGY HOLDINGS, INC.

2007 EQUITY INCENTIVE PLAN

NOTICE OF GRANT OF STOCK OPTION

     Unless otherwise defined herein, the terms defined in the 2007 Equity Incentive Plan (the
“Plan”) will have the same defined meanings in this Notice of Grant of Stock Option (the “Notice of
Grant”) and Terms and Conditions of Stock Option Grant, attached hereto as Exhibit A
(together, the “Agreement”).

	 	 	 	 	 	 	 
	 

	 	Participant:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Address:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	 

	 	 

     Participant has been granted an Option to purchase Common Stock of the Company, subject to the
terms and conditions of the Plan and this Agreement, as follows:

	 	 	 	 	 	 	 
	 

	 	Grant Number
	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Date of Grant	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Vesting Commencement Date	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Number of Shares Granted	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Exercise Price per Share
	 	$          
                 
                 
                 
           
                	 	 
	 
	 	 	 	 	 	 
	 

	 	Total Exercise Price
	 	$          
                 
                 
                 
           
                	 	 
	 
	 	 	 	 	 	 
	 

	 	Type of Option
	 	___  Incentive Stock Option	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	___  Nonstatutory Stock Option	 	 
	 
	 	 	 	 	 	 
	 

	 	Term/Expiration Date	 	 	 	 
	 

	 	 	 	 	 	 

     Vesting Schedule:

     Subject to accelerated vesting as set forth below or in the Plan, this Option will be
exercisable, in whole or in part, in accordance with the following schedule:

     [Twenty-five percent (25%) of the Shares subject to the Option will vest twelve (12) months
after the Vesting Commencement Date, and one forty-eighth (1/48th) of the Shares subject
to the Option will vest each month thereafter on the same day of the month as the Vesting
Commencement Date (and if there is no corresponding day, on the last day of the month), subject to
Participant continuing to be a Service Provider through each such date.]

 

 

     Termination Period:

     This Option will be exercisable for [three (3) months] after Participant ceases to be a
Service Provider, unless such termination is due to Participant’s death or Disability, in which
case this Option will be exercisable for [twelve (12) months] after Participant ceases to be a
Service Provider. Notwithstanding the foregoing, in no event may this Option be exercised after
the Term/Expiration Date as provided above and may be subject to earlier termination as provided in
Section 13(c) of the Plan.

     By Participant’s signature and the signature of the Company’s representative below,
Participant and the Company agree that this Option is granted under and governed by the terms and
conditions of the Plan and this Agreement. Participant has reviewed the Plan and this Agreement in
their entirety, has had an opportunity to obtain the advice of counsel prior to executing this
Agreement and fully understands all provisions of the Plan and Agreement. Participant hereby
agrees to accept as binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions relating to the Plan and Agreement. Participant further agrees to
notify the Company upon any change in the residence address indicated below.

	 	 	 
	PARTICIPANT

	 	RENEGY HOLDINGS, INC.
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 

	 	 
	Print Name

	 	Title
	 
	 	 
	Address:
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 

- 2 -

 

EXHIBIT A

TERMS AND CONDITIONS OF STOCK OPTION GRANT

     1. Grant. The Company hereby grants to the Participant named in the Notice of Grant
(the “Participant”) an option (the “Option”) to purchase the number of Shares, as set forth in the
Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise
Price”), subject to all of the terms and conditions in this Agreement and the Plan, which is
incorporated herein by reference. Subject to Section 18(c) of the Plan, in the event of a conflict
between the terms and conditions of the Plan and the terms and conditions of this Agreement, the
terms and conditions of the Plan will prevail.

     If designated in the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is
intended to qualify as an ISO under Section 422 of the Code. However, if this Option is intended
to be an ISO, to the extent that it exceeds the $100,000 rule of Code Section 422(d) it will be
treated as a Nonstatutory Stock Option (“NSO”).

     2. Vesting Schedule. Except as provided in Section 3, the Option awarded by this
Agreement will vest in accordance with the vesting provisions set forth in the Notice of Grant.
Shares scheduled to vest on a certain date or upon the occurrence of a certain condition will not
vest in Participant in accordance with any of the provisions of this Agreement, unless Participant
will have been continuously a Service Provider from the Date of Grant until the date such vesting
occurs.

     3. Administrator Discretion. The Administrator, in its discretion, may accelerate the
vesting of the balance, or some lesser portion of the balance, of the unvested Option at any time,
subject to the terms of the Plan. If so accelerated, such Option will be considered as having
vested as of the date specified by the Administrator.

     4. Exercise of Option. This Option may be exercised only within the term set out in
the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the
terms of this Agreement.

          This Option is exercisable by delivery of an exercise notice, in the form attached as
Exhibit B (the “Exercise Notice”) or in a manner and pursuant to such procedures as the
Administrator may determine, which will state the election to exercise the Option, the number of
Shares in respect of which the Option is being exercised (the “Exercised Shares”), and such other
representations and agreements as may be required by the Company pursuant to the provisions of the
Plan. The Exercise Notice will be completed by Participant and delivered to the Company. The
Exercise Notice will be accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares together with any applicable tax withholding. This Option will be deemed to be exercised
upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate
Exercise Price.

     5. Method of Payment. Payment of the aggregate Exercise Price will be by any of the
following, or a combination thereof, at the election of Participant:

          (a) cash;

- 3 -

 

          (b) check;

          (c) consideration received by the Company under a formal cashless exercise program adopted by
the Company in connection with the Plan; or

          (d) surrender of other Shares, provided that such Shares have a Fair Market Value on the date
of surrender equal to the aggregate Exercise Price of the Exercised Shares and that accepting such
Shares, in the sole discretion of the Administrator, will not result in any adverse accounting
consequences to the Company.

     6. Tax Obligations.

          (a) Withholding of Taxes. Notwithstanding any contrary provision of this Agreement,
no certificate representing the Shares will be issued to Participant, unless and until satisfactory
arrangements (as determined by the Administrator) will have been made by Participant with respect
to the payment of income, employment and other taxes which the Company determines must be withheld
with respect to such Shares. To the extent determined appropriate by the Company in its
discretion, it shall have the right (but not the obligation) to satisfy any tax withholding
obligations by reducing the number of Shares otherwise deliverable to Participant. If Participant
fails to make satisfactory arrangements for the payment of any required tax withholding obligations
hereunder at the time of the Option exercise, Participant acknowledges and agrees that the Company
may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.

          (b) Notice of Disqualifying Disposition of ISO Shares. If the Option granted to
Participant herein is an ISO, and if Participant sells or otherwise disposes of any of the Shares
acquired pursuant to the ISO on or before the later of (i) the date two (2) years after the Grant
Date, or (ii) the date one (1) year after the date of exercise, Participant will immediately notify
the Company in writing of such disposition. Participant agrees that Participant may be subject to
income tax withholding by the Company on the compensation income recognized by Participant.

          (c) Section 409A. Under Section 409A, an option that vests after December 31, 2004
that was granted with a per Share exercise price that is determined by the Internal Revenue Service
(the “IRS”) to be less than the Fair Market Value of a Share on the date of grant (a “Discount
Option”) may be considered “deferred compensation.” A Discount Option may result in (i) income
recognition by Participant prior to the exercise of the option, (ii) an additional twenty percent
(20%) federal income tax, and (iii) potential penalty and interest charges. The Discount Option
may also result in additional state income, penalty and interest charges to the Participant.
Participant acknowledges that the Company cannot and has not guaranteed that the IRS will agree
that the per Share exercise price of this Option equals or exceeds the Fair Market Value of a Share
on the Date of Grant in a later examination. Participant agrees that if the IRS determines that
the Option was granted with a per Share exercise price that was less than the Fair Market Value of
a Share on the date of grant, Participant will be solely responsible for Participant’s costs
related to such a determination.

- 4 -

 

     7. Rights as Stockholder. Neither Participant nor any person claiming under or
through Participant will have any of the rights or privileges of a stockholder of the Company in
respect of any Shares deliverable hereunder unless and until certificates representing such Shares
will have been issued, recorded on the records of the Company or its transfer agents or registrars,
and delivered to Participant. After such issuance, recordation and delivery, Participant will have
all the rights of a stockholder of the Company with respect to voting such Shares and receipt of
dividends and distributions on such Shares.

     8. No Guarantee of Continued Service. PARTICIPANT ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE
PROVIDER AT THE WILL OF THE COMPANY (OR THE PARENT OR SUBSIDIARY EMPLOYING OR RETAINING
PARTICIPANT) AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THE OPTION OR ACQUIRING SHARES
HEREUNDER. PARTICIPANT FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR
IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND WILL NOT INTERFERE IN ANY WAY WITH PARTICIPANT’S RIGHT OR THE RIGHT OF THE
COMPANY (OR THE PARENT OR SUBSIDIARY EMPLOYING OR RETAINING PARTICIPANT) TO TERMINATE PARTICIPANT’S
RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

     9. Address for Notices. Any notice to be given to the Company under the terms of this
Agreement will be addressed to the Company at Renegy Holdings, Inc., [ADDRESS], or at such other
address as the Company may hereafter designate in writing.

     10. Grant is Not Transferable. This Option may not be transferred in any manner
otherwise than by will or by the laws of descent or distribution and may be exercised during the
lifetime of Participant only by Participant.

     11. Binding Agreement. Subject to the limitation on the transferability of this grant
contained herein, this Agreement will be binding upon and inure to the benefit of the heirs,
legatees, legal representatives, successors and assigns of the parties hereto.

     12. Additional Conditions to Issuance of Stock. If at any time the Company will
determine, in its discretion, that the listing, registration or qualification of the Shares upon
any securities exchange or under any state or federal law, or the consent or approval of any
governmental regulatory authority is necessary or desirable as a condition to the issuance of
Shares to Participant (or his or her estate), such issuance will not occur unless and until such
listing, registration, qualification, consent or approval will have been effected or obtained free
of any conditions not acceptable to the Company. The Company will make all reasonable efforts to
meet the requirements of any such state or federal law or securities exchange and to obtain any
such consent or approval of any such governmental authority. Assuming such compliance, for income
tax purposes the Exercised Shares will be considered transferred to Participant on the date the
Option is exercised with respect to such Exercised Shares.

- 5 -

 

     13. Plan Governs. This Agreement is subject to all terms and provisions of the Plan.
In the event of a conflict between one or more provisions of this Agreement and one or more
provisions of the Plan, the provisions of the Plan will govern. Capitalized terms used and not
defined in this Agreement will have the meaning set forth in the Plan.

     14. Administrator Authority. The Administrator will have the power to interpret the
Plan and this Agreement and to adopt such rules for the administration, interpretation and
application of the Plan as are consistent therewith and to interpret or revoke any such rules
(including, but not limited to, the determination of whether or not any Shares subject to the
Option have vested). All actions taken and all interpretations and determinations made by the
Administrator in good faith will be final and binding upon Participant, the Company and all other
interested persons. No member of the Administrator will be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan or this Agreement.

     15. Electronic Delivery. The Company may, in its sole discretion, decide to deliver
any documents related to Options awarded under the Plan or future Options that may be awarded under
the Plan by electronic means or request Participant’s consent to participate in the Plan by
electronic means. Participant hereby consents to receive such documents by electronic delivery and
agrees to participate in the Plan through any on-line or electronic system established and
maintained by the Company or another third party designated by the Company.

     16. Captions. Captions provided herein are for convenience only and are not to serve
as a basis for interpretation or construction of this Agreement.

     17. Agreement Severable. In the event that any provision in this Agreement will be
held invalid or unenforceable, such provision will be severable from, and such invalidity or
unenforceability will not be construed to have any effect on, the remaining provisions of this
Agreement.

     18. Modifications to the Agreement. This Agreement constitutes the entire
understanding of the parties on the subjects covered. Participant expressly warrants that he or
she is not accepting this Agreement in reliance on any promises, representations, or inducements
other than those contained herein. Modifications to this Agreement or the Plan can be made only in
an express written contract executed by a duly authorized officer of the Company.

     19. Amendment, Suspension or Termination of the Plan. By accepting this Award,
Participant expressly warrants that he or she has received an Option under the Plan, and has
received, read and understood a description of the Plan. Participant understands that the Plan is
discretionary in nature and may be amended, suspended or terminated by the Company at any time.

     20. Governing Law. This Agreement will be governed by the laws of the State of
[Arizona], without giving effect to the conflict of law principles thereof. For purposes of
litigating any dispute that arises under this Option or this Agreement, the parties hereby submit
to and consent to the jurisdiction of the State of [Arizona], and agree that such litigation will
be conducted in the courts of [                    ] County, [Arizona], or the federal courts for the
United States for the District of [Arizona], and no other courts, where this Option is made and/or
to be performed.

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EXHIBIT B

RENEGY HOLDINGS, INC.

2007 EQUITY INCENTIVE PLAN

EXERCISE NOTICE

Renegy Holdings, Inc.

[ADDRESS]

Attention:                     

     1. Exercise of Option. Effective as of today,                     , ___, the
undersigned (“Purchaser”) hereby elects to purchase                      shares (the “Shares”) of the
Common Stock of Renegy Holdings, Inc. (the “Company”) under and pursuant to the 2007 Equity
Incentive Plan (the “Plan”) and the Stock Option Agreement dated ___ (the “Agreement”). The
purchase price for the Shares will be $                    , as required by the Agreement.

     2. Delivery of Payment. Purchaser herewith delivers to the Company the full purchase
price of the Shares and any required tax withholding to be paid in connection with the exercise of
the Option.

     3. Representations of Purchaser. Purchaser acknowledges that Purchaser has received,
read and understood the Plan and the Agreement and agrees to abide by and be bound by their terms
and conditions.

     4. Rights as Stockholder. Until the issuance (as evidenced by the appropriate entry
on the books of the Company or of a duly authorized transfer agent of the Company) of the Shares,
no right to vote or receive dividends or any other rights as a stockholder will exist with respect
to the Shares subject to the Option, notwithstanding the exercise of the Option. The Shares so
acquired will be issued to Participant as soon as practicable after exercise of the Option. No
adjustment will be made for a dividend or other right for which the record date is prior to the
date of issuance, except as provided in Section 13 of the Plan.

     5. Tax Consultation. Purchaser understands that Purchaser may suffer adverse tax
consequences as a result of Purchaser’s purchase or disposition of the Shares. Purchaser
represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in
connection with the purchase or disposition of the Shares and that Purchaser is not relying on the
Company for any tax advice.

     6. Entire Agreement; Governing Law. The Plan and Agreement are incorporated herein by
reference. This Exercise Notice, the Plan and the Agreement constitute the entire agreement of the
parties with respect to the subject matter hereof and supersede in their entirety all prior

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undertakings and agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser’s interest except by means of a writing
signed by the Company and Purchaser. This agreement is governed by the internal substantive laws,
but not the choice of law rules, of the State of [Arizona].

	 	 	 
	Submitted by:

	 	Accepted by:
	 
	 	 
	PURCHASER

	 	RENEGY HOLDINGS, INC.
	 
	 	 
	 

	 	 
	Signature

	 	By
	 
	 	 
	 

	 	 
	Print Name

	 	Its
	 
	 	 
	Address:
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 

	 	 
	 
	 	 
	 

	 	 
	 

	 	Date Received

- 8 -

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