Document:

exv10w28

Exhibit 10.28

AMENDED AND RESTATED OPTION AGREEMENT NO. 2

     This AMENDED AND RESTATED OPTION AGREEMENT No. 2 (this “Agreement”), dated April   8  ,
2010, is entered into by and between China Environment Fund III, L.P. (the “Holder”), Sun
Kwok Ping (), holder of Hong Kong document of identity No. DA9001901 (the “Founder”),
Tai Feng Investments Limited, a British Virgin Islands company (the “Founder Holdco”) and
Nobao Renewable Energy Holdings Limited, a Cayman Islands company (the “Company”).

RECITALS

	A.	 	The Holder, the Founder and the Company previously entered into the Option Agreement No. 2 on
January 15, 2010 (the “Prior Agreement”).
	 
	B.	 	The Founder proposes to transfer all of his shares in the Company to
the Founder Holdco, which is wholly owned by the Founder.
	 
	C.	 	In connection with such transfer, the parties hereto desire to amend
and restate the Prior Agreement by entering into this Agreement on the
terms and conditions set forth herein, which shall amend, restate,
supersede and replace in its entirety the Prior Agreement.

WITNESSETH

     NOW, THEREFORE, in consideration of the premises set forth above, the mutual promises and
covenants set forth herein and other good and valuable consideration, the Parties agree as follows:

     1. Purchase During Exercise Period. Subject to the terms and conditions set forth in
this Agreement, the Holder shall be entitled, at any time during the Exercise Period, to purchase
(such right, the “Purchase Option”) from the Founder Holdco, at an aggregate price of US$1
(the “Exercise Price”), a number of fully paid Ordinary Shares, par value US$0.001 per
share, of the Company (the “Ordinary Shares”) held by the Founder Holdco equal to the
“Adjustment Number” (as defined below). Subject to the terms and conditions set forth in this
Agreement, the Adjustment Number shall be the number of Ordinary Shares such that, if transferred
to the Holder, would result in the Holder’s Percentage Interest as of the publication of 2010
Fiscal Year Revenue having a 2% increment.

     2. Termination. Subject to Section 4(c), the Exercise Period shall not commence, and
this Agreement and all rights and obligations hereunder shall terminate, if the 2010 Fiscal Year
Revenue, as determined pursuant to this Agreement, compared to the 2009 Fiscal Year Revenue, has a
25% or more increment. Notwithstanding any other provision to the contrary, the Exercise Period
shall not commence, and this Agreement and all rights and obligations hereunder shall terminate,
upon a Qualified IPO as defined in Schedule A to the Articles of Association of the
Company, as amended.

     3. Determination of Revenue. 

 

 

     (a) Revenue. Simultaneously with the delivery of the financial statements for each of
the 2009 Fiscal Year and 2010 Fiscal Year pursuant to Section 8.1 of the Shareholders Agreement,
but in any event within 60 days after the end of such Fiscal Year of the Company, the Company shall
deliver to the Holder and the Founder Holdco, together with such financial statements, (i) an
audited statement of profits and losses for such Fiscal Year, audited by the accounting firm agreed
by the Company and the Holder, prepared in accordance with IFRS, and (ii) a statement of Revenue
and cost breakdown by project for such Fiscal Year issued by the Company and confirmed by the
accounting firm in writing, setting forth in reasonable detail the calculation of 2009 Fiscal Year
Revenue or 2010 Fiscal Year Revenue, as applicable; provided, that if the Company fails to deliver
such financial statements, statement of profits and losses, or such statement within 60 days after
the end of the 2009 Fiscal Year and the 2010 Fiscal Year, respectively, the increment of 2010
Fiscal Year Revenue, compared to the 2009 Fiscal Year Revenue, will be conclusively deemed lower
than 25% and the Exercise Period will commence on the business day next following the 60th day
after the end of the 2010 Fiscal Year. The Holder shall have the right to object to the
determination of the 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue in accordance with
Section 3(b) below.

     (b) Objection Procedure

     (i) Unless the Holder gives written notice to the Founder Holdco and the Company of
its objection (an “Objection”) to the Company’s calculation of the 2009 Fiscal Year
Revenue and/or 2010 Fiscal Year Revenue within 30 days following its receipt of the
financial statements and accompanying chief financial officer’s certificate, the Company’s
calculation shall be final and binding upon the parties for purposes of this Agreement. If
the Holder waives in writing its right to deliver an Objection with respect to any such
determination, the applicable determination shall be final and binding upon the parties as
of the date of delivery of such waiver. Any Objection shall specify in reasonable detail
the nature of any disagreement so asserted. Upon request of the Holder, the Company shall
promptly provide a representative of the Holder such access to the books and records of the
Company and its Subsidiaries as are reasonably necessary to confirm the Company’s
calculation of the 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue and the Holder
agrees to maintain any such information in strict confidence (except for such disclosure to
advisors or otherwise as appropriate in connection with the proceedings referred to below
in clause (ii)). During the 15-day period following the delivery of an Objection, the
Founder Holdco and the Holder shall attempt in good faith to resolve any differences which
they may have with respect to any matter specified in the Objection.

     (ii) If at the end of such 15-day period, the Founder Holdco and the Holder shall have
failed to reach written agreement with respect to all matters specified in any Objection,
any matter that remains in dispute shall promptly be submitted to an independent accounting
firm of internationally recognized standing (the “Accountant”) designated by the
Founder Holdco and the Holder within ten days after the expiration of such 15-day period,
or, if they cannot agree

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on an accounting firm, such dispute shall be promptly referred to the HKIAC and an
independent accounting firm of internationally recognized standing shall be appointed
thereby. The Accountant shall consider only the matters specified in the Objection. The
Accountant shall act promptly to resolve all matters specified in the Objection, and shall
give its decision within 30 days after the referral of the matter to it. Upon resolution
by the Accountant of all matters specified in the Objection, the Accountant shall determine
the 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue and/or whether the increment
of 2010 Fiscal Year Revenue, compared to the 2009 Fiscal Year Revenue, is lower than 25%,
as applicable, on the basis of the matters it has resolved. The Accountant’s decisions and
determinations with respect to all matters specified in the Objection and its determination
as to the 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue shall be final and
binding upon the Founder Holdco and the Holder. The costs and expenses of the Accountant
shall be borne equally by the Founder Holdco, on the one hand, and the Holder, on the other
hand.

     4. Covenants.

     Without limiting any other covenant of the Company and the Founder Holdco under the Memorandum
and Articles of Association of the Company and the Shareholders Agreement:

     (a) the Company shall not change any method of accounting or accounting practice or policy,
other than (i) pursuant to guidance provided by any applicable regulatory authority, with the
Holder’s consent, or (ii) as recommended by the Company’s independent auditors, with the Holder’s
consent, which consent shall not be unreasonably withheld;

     (b) the Company shall not directly or indirectly change the allocation of items of revenue,
income and/or gain between, or the principles applied to allocate items of revenue, income and/or
gain in, EMC related profits on the one hand, and other items of income or gain on the other hand;

     (c) if there is any change to any Accounting Rules prior to an IPO of the Company, the Company
shall employ the adjusted Accounting Rules to re-calculate the 2009 Fiscal Year Revenue and 2010
Fiscal Year Revenue and deliver the re-calculated 2009 Fiscal Year Revenue and 2010 Fiscal Year
Revenue to the Holder and the Founder Holdco within 60 days after such change. The 2009 Fiscal
Year Revenue and 2010 Fiscal Year Revenue can be re-calculated from time to time prior to the IPO
of the Company, due to change of the Accounting Rules. Determination of the re-calculated 2009
Fiscal Year Revenue and 2010 Fiscal Year Revenue shall be in accordance with Section 3 of this
Agreement; and

     (d) if the 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue is adjusted prior to the
IPO, and if, accordingly, the Holder is not entitled to exercise the Purchase Option, any and all
Ordinary Shares that have been purchased by the Holder by

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exercising the Purchase Option shall be repurchased by the Founder Holdco at the Exercise
Price.

     5. Definitions. As used herein, the following terms shall have the following
meanings:

     (a) “Exercise Period” means the period beginning on the date (if any) that it is
determined in accordance with Section 3 hereof that the increment of 2010 Fiscal Year Revenue,
compared to the 2009 Fiscal Year Revenue, is lower than 25% and ending at 5:00 p.m., Beijing time
on the tenth anniversary of June 24, 2009, or if such date is not a Business Day, then 5:00 p.m.,
Beijing time on the following Business Day, or ending at the tenth anniversary of the date of
publication of the final re-calculated 2009 Fiscal Year Revenue and/or 2010 Fiscal Year Revenue in
accordance with Section 4(c) hereof, whichever is longer.

     (b) “Fiscal Year” means, with respect to each year, the one-year period ending on
December 31 of such year.

     (c) “Percentage Interest” of the Holder means, as of the date of publication of 2010
Fiscal Year Revenue, the quotient, expressed as a percentage, obtained by dividing (i) the number
of Ordinary Shares then owned by the Holder on an as-converted basis (giving effect to the
conversion and exchange of all securities or rights of the Holder that are convertible or
exchangeable into Ordinary Shares, including shares implied by the ESOP but excluding shares
transferred pursuant to the Option Agreements) by (ii) the number of Ordinary Shares then
outstanding on an as-converted basis (giving effect to the conversion and exchange of all
securities or rights that are convertible or exchangeable into Ordinary Shares, including shares
implied by the ESOP).

     (d) “Accounting Rules” means the accounting policies and critical accounting estimates
and assumptions (including without limitation, those descriptions under Note 3 from Page 10 to Page
23 and Note 5 from Page 24 to Page 25 in the report attached as Exhibit B hereto) employed by
PricewaterhouseCoopers in connection with preparation of the Company’s consolidated 2008 audit
report.

     (e) “IPO” means the first firmly underwritten registered public offering by the
Company of its Ordinary Shares pursuant to a registration statement that is filed with and declared
effective by a Governmental Authority in a jurisdiction.

     (f) “EMC” means energy management contracts projects, which are central heating and
cooling refurbishment and replacements for existing buildings and installation projects for new
buildings. In the EMC, the Company (including the PRC Companies) designs, manufactures and
installs ground-source heat pump (“GSHP”) systems under long-term (which shall be no less
than 10 years) service contracts, which have an annual energy management fee, to large scale
commercial businesses, such as hotels and supermarkets. The Company (including the PRC Companies)
will retain the title to various GSHP related equipment and facilities until expiration of term
under a service contract. For avoidance of confusion, EMC shall include, but not limited to, the

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long term service contracts described in the report attached as Exhibit B hereto. The Holder
shall reserve the right to determine whether a contract constitutes an EMC. However, such
determination shall not be made in conflict with the provisions hereof.

     (g) “EPC” means engineering-procurement construction projects. In the EPC, the
Company (including the PRC Companies) designs and installs central heating/cooling/hot water system
using its GSHP technology on a single project basis, charging an upfront fee to large scale
commercial customers, including large office buildings, industrial parks, and financial centres.
By the completion of the project, customers must settle the payment to and assume ownership of the
system from the Company.

     (h) “Normal Business” means heat pump related sales contracts, EPC, EMC and other heat
pump related businesses.

     (i) “Revenue” means the audited consolidated revenue generated from the Normal
Business only.

     (j) Capitalized terms not otherwise defined herein shall have the meanings given to such terms
in the Shareholders Agreement. All accounting terms not otherwise defined herein have the meanings
assigned under IFRS.

     6. Methods of Exercise.

     During the Exercise Period, the Holder may exercise, in whole or in part, the Purchase Option
pursuant to this Agreement by either of the following methods:

     (a) Cash Exercise. The Holder may exercise by delivering a notice of exercise, in the
form attached as Exhibit A hereto (a “Notice of Exercise”) to the Founder Holdco and paying
to the Founder Holdco an amount (i) in cash (by check or wire transfer of immediately available
funds), (ii) by cancellation of indebtedness of the Founder Holdco owed to the Holder, if any, or
(iii) by a combination of (i) and (ii), equal to the aggregate Exercise Price for the number of
Ordinary Shares being purchased by such Holder.

     (b) Net Exercise. Alternatively, the Holder may exercise by:

     (i) delivering a Notice of Exercise to the Founder Holdco; and

     (ii) receiving such lesser number of Ordinary Shares calculated in accordance with the
formula below representing the satisfaction of the payment to the Founder Holdco of an
amount equal to the aggregate Exercise Price for the number of Ordinary Shares being
purchased.

In the event the Holder chooses to exercise the Purchase Option pursuant to this Agreement in
accordance with this Section 6(b) (a “Net Exercise”), the Founder Holdco shall transfer to
the Holder a number of Ordinary Shares computed using the following formula:

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X = [Y * (A-B)]/A

where:

X = the number of Ordinary Shares to be transferred to the Holder

Y = the number of Ordinary Shares purchasable under this Agreement or, if only a
portion of the Purchase Option is being exercised, the number of Ordinary Shares
for which the Purchase Option is being exercised (at the date of such calculation)

A = the fair market value of one Ordinary Share (at the date of such calculation)

B = the Exercise Price (as adjusted to the date of such calculation).

For purposes of this Section 6(b), the fair market value of an Ordinary Share shall be the average
of the closing prices of the Ordinary Shares quoted (i) in the over-the-counter market in which the
Ordinary Shares are traded, or (ii) on any exchange or electronic securities market on which the
Ordinary Shares are listed for trading, as applicable, for the 30 trading days prior to the date of
determination of fair market value (or such shorter period of time during which such Ordinary
Shares were traded over-the-counter or on such exchange). If the Ordinary Shares are not traded on
the over-the-counter market, an exchange or an electronic securities market, the fair market value
of an Ordinary Share shall be determined by dividing:

     (i) the cash price at which a willing seller would sell and a willing buyer would buy
all of the issued and outstanding Ordinary Shares in a transaction negotiated at arm’s
length by unaffiliated third parties, each being apprised of and considering all relevant
facts, circumstances and factors, and neither acting under compulsion or time constraints,
by

     (ii) the number of then issued and outstanding Ordinary Shares.

In the case of any determination of the fair market value of the Ordinary Shares pursuant to this
Section 6(b), fair market value shall not include any discount (i) by reason of such Ordinary
Shares representing a minority interest, or (ii) to reflect the fact that such Ordinary Shares are
illiquid and subject to the restrictions on transfer set forth in this Agreement, the Shareholders
Agreement, the Right of First Refusal and Co-Sale Agreement, dated January 15, 2010, by and among
the Company, the Founder Holdco, the Holder and other parties thereto (the “ROFR
Agreement”) and the Memorandum and Articles.

If the Founder Holdco and the Holder cannot agree on the fair market value of an Ordinary Share
within 30 days after the date upon which the Holder delivers a Notice of Exercise to the Founder
Holdco (the “Negotiation Period”), the valuation shall be made by an appraiser of
internationally recognized standing designated jointly by the Founder Holdco and the Holder within
ten days after the expiration of the Negotiation Period or, if

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they cannot so agree on an appraiser, such dispute shall be promptly referred to the HKIAC and an
appraiser of nationally recognized standing shall be appointed thereby. The valuation shall be
made by such appraiser within 20 days of its designation by the HKIAC. Any valuation made by an
appraiser under this Section 6(b) shall be determinative of such value and binding upon the Founder
Holdco and the Holder. The cost of such valuation shall be borne equally by the Founder Holdco and
the Holder, but each party shall bear its own legal expenses, if any, incurred in connection
therewith.

     (c) Partial Exercise. The Purchase Option may be exercised for less than the full
number of Ordinary Shares subject to the Purchase Option, in which case the number of Ordinary
Shares receivable upon the exercise of the Purchase Option as a whole, and the sum payable upon the
exercise of the Purchase Option as a whole, shall be proportionately reduced.

     7. Certificates. Upon the exercise of the Purchase Option pursuant to this Agreement,
one or more certificates for the number of Ordinary Shares so purchased shall be issued and
delivered by the Company to the Holder as soon as practicable thereafter, and in any event within
ten days of the delivery by the Holder to the Founder Holdco of the Notice of Exercise. The date
of delivery of such certificates is referred to herein as the “Delivery Date.”

     8. Dividend, Subdivision, Combination, Reclassification, Reorganization, Consolidation,
Merger or Sale of Assets. The number of and kind of securities that may be transferred
pursuant to this Agreement and the Exercise Price shall be subject to adjustment from time to time
as follows:

     (a) In case of any reclassification, capital reorganization, or change in the shares of the
Company, or consolidation or merger of the Company with or into another corporation, or the sale of
all or substantially all of the assets of the Company to another corporation pursuant to which the
holders of Ordinary Shares shall be entitled to receive shares, securities, cash or other property
with respect to or in exchange for Ordinary Shares, then, as a condition to such reclassification,
reorganization, change, consolidation, merger or sale, the Founder Holdco shall make appropriate
provision so that the Holder (or its permitted transferees) shall have the right at any time prior
to the expiration of the Exercise Period to acquire, at a total per-share price equal to that
payable pursuant to this Agreement, the kind and amount of shares, securities, cash or other
property receivable in connection with such reclassification, reorganization, change,
consolidation, merger or sale by a holder of the same number of Ordinary Shares as were purchasable
by the Holder immediately prior to such reclassification, reorganization, change, consolidation,
merger or sale. In any such case, appropriate provisions shall be made with respect to the rights
and interest of the Holder so that the provisions hereof shall thereafter be applicable with
respect to any shares, securities, cash or other property deliverable upon exercise hereof, and
appropriate adjustments shall be made to the purchase price per Ordinary Share payable hereunder,
provided that the aggregate purchase price shall remain the same.

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     The Company shall not effect any such consolidation, merger or sale, unless prior to the
consummation thereof, the successor corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such assets in such sale shall assume, by
written instrument mailed or delivered to the Holder at the last address of the Holder appearing on
the books of the Company, the obligation to deliver to the Holder such shares, securities, cash or
other property as, in accordance with the foregoing provisions, the Holder may be entitled to
purchase. If a purchase, tender or exchange offer is made to and accepted by the holders of more
than 50% of the outstanding Ordinary Shares, the Company shall not effect any consolidation, merger
or sale with the Person having made such offer or with any Affiliate of such Person, unless prior
to the consummation of such consolidation, merger or sale the Holder shall have been given a
reasonable opportunity to then elect to receive pursuant to this Agreement either the stock,
securities, cash or other property then issuable with respect to the Ordinary Shares or the stock,
securities, cash or other property, or the equivalent, issued to holders of Ordinary Shares in
accordance with such offer.

     (b) If the Company shall, at any time or from time to time, (i) declare a dividend on the
Ordinary Shares payable in shares of its capital stock (including Ordinary Shares), (ii) subdivide
the outstanding Ordinary Shares, (iii) combine the outstanding Ordinary Shares into a smaller
number of shares, or (iv) issue any shares of its capital stock in a reclassification of the
Ordinary Shares (including any such reclassification in connection with a consolidation or merger
in which the Company is the continuing corporation), then in each such case, the Exercise Price in
effect at the time of the record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and kind of shares of capital stock
issuable on such date shall be proportionately adjusted so that the Holder, upon exercise of the
Purchase Option after such date, shall be entitled to receive, upon payment of the same aggregate
amount as would have been payable before such date, the aggregate number and kind of shares of
capital stock which, if the Purchase Option had been exercised immediately prior to such date, such
Holder would have owned upon such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification. Any such adjustment shall become effective
immediately after the record date of such dividend or the effective date of such subdivision,
combination or reclassification. Such adjustment shall be made successively whenever any event
listed above shall occur. If a dividend is declared and such dividend is not paid, the Exercise
Price shall again be adjusted to be the Exercise Price in effect immediately prior to such record
date.

     (c) Notice of Adjustment. When any adjustment is required to be made in the number or
kind of shares purchasable upon exercise of this Agreement, or in the Exercise Price, the Founder
Holdco shall provide the Holder with not less than 20 days’ prior written notice of the date on
which the event requiring such adjustment is to take place and information, reasonably detailed,
regarding the pertinent facts of such event, as well as the calculation of the adjusted Exercise
Price and the adjusted number of Ordinary Shares or securities, cash or other property thereafter
purchasable upon exercise of this Agreement.

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     9. No Dilution or Impairment. The Founder Holdco and the Company will not, by
amendment of the Company’s Memorandum and Articles of Association, or through reorganization,
consolidation, merger, dissolution, sale of assets or any other voluntary action involving the
Company, avoid or seek to avoid the observance or performance of any of the terms of this
Agreement, but will at all times in good faith assist in the carrying out of all such terms and in
the taking of all such action as may be necessary or appropriate in order to protect the rights of
the Holder against dilution or other impairment. Without limiting the generality of the foregoing,
the Company will not increase the par value of any shares receivable upon exercise of the Purchase
Option, and the Founder Holdco at all times will take all such action as may be necessary or
appropriate in order that the Founder Holdco may validly and legally transfer fully paid shares
pursuant to this Agreement.

     10. No Fractional Shares or Scrip. No fractional shares or scrip representing
fractional shares shall be issued upon the exercise of the Purchase Option, but in lieu of such
fractional shares the Founder Holdco shall make a cash payment therefor on the basis of the
Exercise Price then in effect.

     11. Representations, Warranties and Covenants of the Founder Holdco

     (a) Sale of Shares. The Founder Holdco covenants that the Ordinary Shares, when sold
and delivered pursuant to this Agreement, will be duly authorized, validly issued, fully paid and
non-assessable, and free from all taxes and liens with respect thereto.

     (b) Covenants as to Exercise of Purchase Option. The Founder Holdco covenants that
the Founder Holdco will at all times during the Exercise Period, hold a sufficient number of
Ordinary Shares to provide for the exercise of the Purchase Option pursuant to this Agreement.

     12. Restrictive Legend. The share certificates for the Ordinary Shares acquired
hereunder shall be stamped or imprinted with a legend in substantially the following form (unless
registered under the Securities Act or if the Holder delivers to the Founder Holdco an opinion of
counsel (who may be an employee of the Holder) reasonably satisfactory in form and substance to the
Founder Holdco, that such shares do not require registration under the Securities Act or any
applicable state securities laws):

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED, OR THE LAWS OF ANY OTHER JURISDICTION. THEY MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION
STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR A COMPARABLE
DOCUMENT UNDER THE LAWS OF ANY OTHER JURISDICTION OR AN OPINION OF COUNSEL THAT
SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.
THE OFFERING OF

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THESE SECURITIES HAS NOT BEEN REVIEWED OR APPROVED BY ANY STATE SECURITIES
ADMINISTRATOR.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A SHAREHOLDERS
AGREEMENT, DATED AS OF JANUARY 15, 2010, AMONG THE COMPANY AND CERTAIN OF ITS
SHAREHOLDERS, A COPY OF WHICH IS ON FILE WITH THE COMPANY. NO SALE, ASSIGNMENT,
TRANSFER, PLEDGE, ENCUMBRANCE OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED
HEREBY SHALL BE EFFECTIVE UNLESS AND UNTIL THE TERMS AND CONDITIONS OF SAID
SHAREHOLDERS AGREEMENT SHALL HAVE BEEN COMPLIED WITH IN FULL.

Any certificate issued at any time in exchange or substitution for any certificate bearing such
legend (except a new certificate issued upon completion of a public distribution pursuant to a
registration statement under the Securities Act) shall also bear such legend unless, in the opinion
of counsel selected by the Holder (who may be an employee of the Holder) and reasonably acceptable
to the Founder Holdco, the securities represented thereby need no longer be subject to restrictions
on resale under the Securities Act.

     13. Purchase Option and Shares Transferable

     (a) Subject to compliance with the terms and conditions of the Shareholders Agreement and this
Section 13, this Agreement and all rights hereunder are assignable, in whole or in part, by the
Holder. With respect to any assignment of this Agreement or any offer, sale or other disposition
of Ordinary Shares acquired pursuant to the exercise of the Purchase Option prior to registration
of such shares, the Holder agrees to give written notice to the Founder Holdco prior thereto,
describing briefly the manner thereof, together with a written opinion of such holder’s counsel, or
other evidence, if reasonably requested by the Founder Holdco, to the effect that such assignment
or offer, sale or other disposition may be effected without registration or qualification (under
the Securities Act as then in effect or any U.S. federal or state or other applicable securities
law then in effect) of such shares and indicating whether or not under the Securities Act
certificates for such shares to be sold or otherwise disposed of require any restrictive legend as
to applicable restrictions on transferability in order to ensure compliance with such law. Upon
receiving such written notice and reasonably satisfactory opinion or other evidence, if so
requested, the Founder Holdco, as promptly as practicable, shall notify such Holder that such
Holder may assign this Agreement or sell or otherwise dispose of such shares, all in accordance
with the terms of the notice delivered to the Founder Holdco. If a determination has been made
pursuant to this Section 13 that the opinion of counsel for the Holder or other evidence is not
reasonably satisfactory to the Founder Holdco, the Founder Holdco shall so notify the Holder
promptly with details thereof after such determination has been made. Each certificate
representing the shares transferred in accordance with this Section 13 shall bear a legend as to
the applicable restrictions on transferability in order to ensure compliance with such laws, unless
in the aforesaid opinion of counsel for the Holder, such legend is not required in order to ensure

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compliance with such laws. The Company may issue stop transfer instructions to its transfer
agent in connection with such restrictions.

     (b) Notwithstanding anything to the contrary contained herein, the Holder may, at any time and
from time to time, assign this Agreement or transfer any Ordinary Shares acquired pursuant to the
exercise of the Purchase Option and all rights hereunder and thereunder, in whole or in part,
without charge to the Holder (except for transfer taxes) to any of the Holder’s shareholders,
partners or members by way of distribution or dividend, or to one or more of the Holder’s
Affiliates, so long as any such Affiliate is controlled exclusively by the entity making such
transfer. Any such transfer shall solely require that the Holder give written notice thereof to
the Founder Holdco; for greater certainty, none of the terms and conditions set forth in Section
13(a) shall be applicable to any transfer governed by this Section 13(b).

     14. Rights of Shareholders. The Holder shall not be entitled to vote or receive
dividends or be deemed the holder of the Ordinary Shares or any other securities of the Company
which may at any time be transferable on the exercise of the Purchase Option for any purpose, nor
shall anything contained herein be construed to confer upon the Holder, in respect of such shares,
any of the rights of a shareholder of the Company or any right to vote upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any corporate action
(whether upon any recapitalization, issuance of stock, reclassification of Ordinary Shares, change
of par value, consolidation, merger, conveyance, or otherwise) or to receive notice of meetings, or
to receive dividends or subscription rights or otherwise until the Purchase Option shall have been
exercised and the Ordinary Shares purchasable upon the exercise hereof shall have become
deliverable, as provided herein.

     15. Notices. Any notice required or permitted pursuant to this Agreement shall be
given in writing and shall be given either personally or by sending it by next-day or second-day
courier service, fax, electronic mail or similar means to the address as shown below the signature
of such party on the signature page of this Agreement (or at such other address as such party may
designate by fifteen (15) days’ advance written notice to the other parties given in accordance
with this Section 15). Where a notice is sent by next-day or second-day courier service, service
of the notice shall be deemed to be effected by properly addressing, pre-paying and sending by
next-day or second-day service through an internationally-recognized courier a letter containing
the notice, with a confirmation of delivery, and by two (2) days having passed after the letter
containing the same is sent as aforesaid. Where a notice is sent by fax or electronic mail,
service of the notice shall be deemed to be effected on the same day on which it is properly
addressed and sent through a transmitting organization with a reasonable confirmation of delivery.

     16. “Market Stand-Off” Agreement. The Holder hereby agrees that, during the period of
time specified by the Company and an underwriter of Ordinary Shares or other securities of the
Company, following the effective date of (i) a registration statement of the Company filed under
the Securities Act, or (ii) a comparable offering document filed under the applicable laws and
regulations of any foreign governmental authority, it shall not, to the extent requested by the
Company and such underwriter,

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directly or indirectly sell, offer to sell, contract to sell (including, without limitation,
any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to
donees who agree to be similarly bound) any securities of the Company held by it at any time during
such period, except Ordinary Shares included in such registration or offering; provided, however,
that:

     (a) all officers and directors of the Company, and each Person who holds one percent (1%) or
more of the Company’s outstanding shares, enter into similar agreements;

     (b) such market stand-off time period shall not exceed 90 days; and

     (c) the foregoing agreement shall not prohibit privately negotiated transfers of Ordinary
Shares among the Holder and its Affiliates.

     The Holder agrees to provide to the underwriters of any public offering such further agreements as
such underwriters may reasonably request in connection with this market stand-off agreement,
provided that the terms of such agreements are substantially consistent with the provisions of this
Section 16. In order to enforce the foregoing covenant, the Company may impose stop-transfer
instructions with respect to the securities of the Company held by the Holder (and the shares or
securities of every other Person subject to the foregoing restriction) until the end of such
period.

     Notwithstanding the foregoing, the obligations described in this Section 16 shall not apply to (i)
a registration relating solely to employee benefit plans on Form S-1 or Form S-8 or similar forms
which may be promulgated in the future, (ii) a registration relating solely to a transaction under
Rule 145 of the Securities Act, or (iii) any offering which would the equivalent of clause (i) or
(ii) under the applicable laws and regulations of any foreign governmental authority.

     17. Change, Waiver, Etc. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally except by an instrument in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is sought.

     18. Remedies. The Founder Holdco stipulates that the remedies at law of the Holder in
the event of any default by the Founder Holdco in the performance of or compliance with any of the
terms of this Agreement are not and will not be adequate, and that the same may be specifically
enforced.

     19. Governing Law. This Agreement and all actions arising out of or in connection
with this Agreement shall be governed by and construed in accordance with the laws of the Hong
Kong, without regard to the conflicts of law provisions of the Hong Kong.

     20. Dispute Resolution.

     (a) The parties agree to negotiate in good faith to resolve any dispute between them regarding
this Agreement. If the negotiations do not resolve the dispute to the

12

 

reasonable satisfaction of the parties, then each party that is a company, shall nominate one
(1) authorized officer as its representative. The parties or their representatives, as the case
may be, shall, within thirty (30) days of a written request by any party to call such a meeting,
meet in person and alone (except for one (1) assistant for each party) and shall attempt in good
faith to resolve the dispute. If the disputes cannot be resolved by such senior managers in such
meeting, the parties agree that they shall, if requested in writing by any party, meet within
thirty (30) days after such written notification for one (1) day with an impartial mediator and
consider dispute resolution alternatives other than formal arbitration. If an alternative method of
dispute resolution is not agreed upon within thirty (30) days after the one (1) day mediation, any
party may begin formal arbitration proceedings to be conducted in accordance with subsection (b)
below. This procedure shall be a prerequisite before taking any additional action hereunder.

     (b) In the event the parties are unable to settle a dispute between them regarding this
Agreement in accordance with subsection (a) above, such dispute shall he referred to and finally
settled by arbitration at the HKIAC in accordance with the Hong Kong International Arbitration
Centre Administered Arbitration Rules in effect, which rules are deemed to be incorporated by
reference into this subsection (b), subject to the following: (i) the arbitration tribunal shall
consist of three (3) arbitrators to be appointed according to the Hong Kong International
Arbitration Centre Administered Arbitration Rules; and (ii) the language of the arbitration shall
be English. Notwithstanding anything in this Agreement or in the Hong Kong International
Arbitration Centre Administered Arbitration Rules or otherwise, the arbitration tribunal shall not
have the power to award injunctive relief or any other equitable remedy of any kind against any
Holder unless such award both (x) is expressly appealable to and subject to de novo review by the
courts of Hong Kong, and (y) would not, if upheld, have the effect of impairing, restricting, or
imposing any conditions on the right or ability of such Holder or its affiliates to conduct its
respective business operations or to make or dispose of any other investment. The prevailing party
shall be entitled to reasonable attorney’s fees, costs and necessary disbursements in addition to
any other relief to which such party may be entitled.

     21. Rights and Obligations Survive Exercise of Purchase Option. Unless otherwise
provided herein, the rights and obligations of the Founder Holdco, the Company, the Holder and the
holder of the Ordinary Shares issued upon exercise of this Purchase Option, shall survive any
exercise of the Purchase Option.

     21. Prior Agreement. This Agreement constitutes the full and entire understanding and
agreement among the parties hereto with regard to the subjects hereof, and supersedes all other
agreements between or among any of the parties with respect to the subject matter hereof (including
the Prior Agreement).

[Signature page follows]

13

 

IN WITNESS WHEREOF this Agreement has been signed by the duly authorised representatives of the
parties on the date first written above.

	 	 	 	 	 
	 	TAI FENG INVESTMENTS LIMITED
 	 
	 	By:  	/s/ Sun Kwok Ping
 	 
	 	 	Name:  	Sun Kwok Ping 	 
	 	 	Title:  	Director 	 
	 
	 	Address: c/o Sun Kwok Ping, Building No. 4, 150

Yong He Road, Shanghai, China, 200072

Fax: 86-21-6631-2459	 
	 
	 	 	 
	 	/s/ Sun Kwok Ping
 	 
	 	SUN KWOK PING 	 
	 	 	 
	 	Address: Building No. 4, 150 Yong He Road,

Shanghai, China, 200072

Fax: 86-21-6631-2459	 
	 

 

 

IN WITNESS WHEREOF this Agreement has been signed by the duly authorised representatives of the
parties on the date first written above.

	 	 	 	 	 
	 	CHINA ENVIRONMENT FUND III, L.P.

 	 
	 	By:  	/s/ Donald Chang Ye
 	 
	 	 	Name:  	Donald Chang Ye 	 
	 	 	Title:  	Managing Partner 	 
	 
	 	Address: A2302, SP Tower, Tsinghua Science Park,

Beijing 100084 China

Fax: 86-10-8215-1150	 

 

 

IN WITNESS WHEREOF this Agreement has been signed by the duly authorised representatives of the
parties on the date first written above.

	 	 	 	 	 
	 	NOBAO RENEWABLE ENERGY HOLDINGS LIMITED

 	 
	 	By:  	/s/ Sun Kwok Ping
 	 
	 	 	Name:  	Sun Kwok Ping 	 
	 	 	Title:  	Director 	 
	 
	 	Address: Building No. 4, 150 Yong He Road,

Shanghai, China, 200072

Fax: 86-21-6631-2459	 

 

 

EXHIBIT A

NOTICE OF EXERCISE

			
	To:	 	Tai Feng Investments Limited

c/o Sun Kwok Ping, Building No. 4, 150 Yong He Road, Shanghai, China,
200072

Fax: 86-21-6631-2459

     2. The undersigned hereby elects to purchase                      Ordinary Shares (“Ordinary
Shares”) pursuant to the terms of the Amended and Restated Option Agreement No. 2 dated
April           , 2010 by and among China Environment Fund III, L.P., Sun Kwok Ping (), Tai Feng
Investments Limited and Nobao Renewable Energy Holdings Limited (the “Agreement”).
Capitalized terms used and not otherwise defined herein have the meanings ascribed to them in
the Agreement.

     3. The undersigned shall exercise the Purchase Option (i) by means of a cash payment, and
tenders herewith, payment in full for the purchase price of the Ordinary Shares being
purchased, or (ii) by means of a Net Exercise in accordance with the terms of Section 6(b) of
the Agreement, together with all applicable taxes, if any.

     4. Please cause the Company to issue a certificate or certificates representing said
Ordinary Shares in the name of the undersigned or in such other name as is specified below:

	 	 	 
	 	 	 
	 	 	 
	 	(Name)	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	(Address)	 

     5. The undersigned hereby represents and warrants that the aforesaid Ordinary Shares are
being acquired for the account of the undersigned for investment and not with a view to, or for
resale, in connection with the distribution thereof, and that the undersigned has no present
intention of distributing or reselling such shares.

	 	 	 	 
	 	 	 	 
	 	 	(Signature)	 
	 	 	 	 
	 	 	 	 
	 	 	(Name)	 
	 	 	 	 
	 	 	 	 
	(Date)	 	(Title)	 

 

 

EXHIBIT B

CONSOLIDATED FINANCIAL STATEMENTS AND INDEPENDENT

AUDITOR’S REPORTExhibit 10.38

Exhibit 10.38

AMENDED AND RESTATED

P.F. CHANG’S CHINA BISTRO, INC.

NON-EMPLOYEE DIRECTOR COMPENSATION PLAN

1. Establishment and Objectives of the Plan

P.F. Chang’s China Bistro, Inc., a Delaware corporation (the “Company”), by action of its
Board of Directors (the “Board”), adopted this P.F. Chang’s China Bistro, Inc. Non-Employee
Director Compensation Plan (the “Plan”) for the benefit of Non-Employee Directors of the Company,
effective April 17, 2008. The Plan was first amended and restated effective April 28, 2009, and is
hereby amended and restated effective as of April 22, 2010. The Plan is a deferred compensation
plan intended to advance the interests of the Company by providing the Company an advantage in
attracting and retaining Non-Employee Directors and by providing Non-Employee Directors with
additional incentive to serve the Company by increasing their proprietary interest in the success
of the Company. All equity-based awards under this Plan shall be made pursuant to an Equity Plan.

2. Definitions

As used in the Plan, the following definitions apply to the terms indicated below.

(a) “Account” means a bookkeeping reserve account to which Restricted Stock Units and
Stock-Based Awards are credited on behalf of Non-Employee Directors.

(b) “Affiliate” means any entity, whether now or hereafter existing, which controls, is
controlled by, or is under common control with, the Company (including, but not limited to, joint
ventures, limited liability companies and partnerships), as determined by the Board.

(c) “Annual Meeting” means the annual meeting of stockholders of the Company held on the
relevant Annual Meeting Date.

(d) “Annual Meeting Date” means the date of the Company’s Annual Meeting for the relevant Plan
Year.

(e) “Annual Retainer” means the retainer fee established by the Board in accordance with
Section 4.1 and payable to a Non-Employee Director for services performed as a member of the Board
of Directors.

(f) “Appointment Date” means the date that a New Director first joins the Board as a
Non-Employee Director, provided such date is not an Annual Meeting Date.

(g) “Award” means a Restricted Stock Unit granted under the Equity Plan as provided in the
Plan as set forth herein, and a Cash-Settled Stock Appreciation Right, Option, or Stock-Based Award
granted under the Equity Plan as provided in the Plan prior to its amendment and restatement as set
forth herein.

(h) “Board” or “Board of Directors” means the Board of Directors of the Company.

 

 

 

(i) “Cash-Settled Stock Appreciation Right” means a Stock Appreciation Right settled and paid
in cash granted pursuant to the Equity Plan and the Plan prior to the amendment and restatement of
the Plan as set forth herein.

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

(1) an Ownership Change Event or a series of related Ownership Change Events (collectively, a
“Transaction”) in which the stockholders of the Company immediately before the Transaction do not
retain immediately after the Transaction, in substantially the same proportions as their ownership
of shares of the Company’s voting stock immediately before the Transaction, direct or indirect
beneficial ownership of more than fifty percent (50%) of the total combined voting power of the
outstanding voting securities of the Company or, in the case of an Ownership Change Event, the
entity to which the assets of the Company were transferred (the “Transferee”) as the case may be;
or

(2) the liquidation of the Company.

For purposes of the preceding sentence, indirect beneficial ownership shall include, without
limitation, an interest resulting from ownership of the voting securities of one or more
corporations or other business entities which own the Company or the Transferee, as the case may
be, either directly or through one or more subsidiary corporations or other business entities. The
Board shall have the right to determine whether multiple sales or exchanges of the voting
securities of the Company or multiple Ownership Change Events are related, and its determination
shall be final, binding and conclusive.

(k) “Change in Control Event” shall have the meaning ascribed thereto under Code Section
409A(a)(2)(A)(v) with respect to a change in the ownership or effective control of the Company, or
in the ownership of a substantial portion of the assets of the Company.

(l) “Code” means the Internal Revenue Code of 1986, as amended, and the regulations and
guidance promulgated thereunder.

(m) “Common Stock” means the Company’s common stock, par value $0.001 per share.

(n) “Company” means P.F. Chang’s China Bistro, Inc., a Delaware corporation.

(o) “Disability” or “Disabled” means the inability to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment that is expected to
result in death or last for a continuous period of not less than twelve months, as determined in
accordance with Code Section 409A.

(p) “Dividend Equivalent” means a credit to the account of a Non-Employee Director in an
amount equal to the cash dividends, declared and paid on one share of Common Stock for each share
of Common Stock represented by an Award held by such Non-Employee Director to the extent provided
in Section 6 of the Plan.

 

2

 

(q) “Elected Payment Date” means the date (if any) elected by a Non-Employee Director pursuant
to Section 5 of this Plan for the payment of vested Restricted Stock Units or Stock-Based Awards.

(r) “Election Form” means the form approved by the Board for use by a Non-Employee Director to
select the form of payment of the Annual Retainer and an Elected Payment Date, if applicable.

(s) “Election” mean a Non-Employee Director’s election as to the method of payment of the
Annual Retainer and Payment Election, if applicable.

(t) “Equity Plan” means any equity compensation plan that has been approved by the Company’s
stockholders, from time to time, provided that such equity compensation plan provides for the
applicable Award.

(u) “Fair Market Value” means the closing price of a share of Common Stock as quoted on such
national or regional securities exchange or market system constituting the primary market for the
Common Stock on the last trading day prior to the day of determination, as reported in The Wall
Street Journal or such other source as the Company deems reliable.

(v) “New Director” means a Non-Employee Director of the Company who first becomes a member of
the Board of Directors on a date that is not an Annual Meeting Date.

(w) “Non-Employee Director” means a member of the Board who, at the time of his or her
service, is not an employee of the Company or any Affiliate.

(x) “Option” means a nonstatutory stock option to purchase one share of Common Stock granted
pursuant to the Equity Plan and the Plan prior to the amendment and restatement of the Plan as set
forth herein.

(y) “Ownership Change Event” means any of the following which occurs with respect to the
Company: (i) the direct or indirect sale or exchange in a single or series of related transactions
by the stockholders of the Company of more than 50% of the voting stock of the Company; (ii) a
merger or consolidation in which the Company is a party; or (iii) the sale, exchange or transfer of
all or substantially all, as determined by the Board in its discretion, of the assets of the
Company.

(z) “Payment Date” means the date on which the first of the events set forth in Section
4.3(b)(iii) shall occur.

(aa) “Payment Election” means a written election made in accordance with the provisions of
Section 5 to select an Elected Payment Date with regard to an award of Restricted Stock Units or
Stock-Based Awards.

(bb) “Plan” means this Amended and Restated P.F. Chang’s China Bistro, Inc. Non-Employee
Director Compensation Plan.

(cc) “Plan Year” means the twelve-month period coinciding with the calendar year.

 

3

 

(dd) “Prorated Amount” means, with respect to a New Director, an amount equal to: (1) the
Annual Retainer reduced by the product of (x) the quotient determined by dividing (i) the Annual
Retainer by (ii) 365 days, multiplied by (y) the number of days between the Appointment Date and
the Annual Meeting Date immediately preceding the New Director’s Appointment Date (excluding the
Annual Meeting Date itself).

(ee) “Restricted Stock Unit” means a unit established on the Company’s books equivalent to one
share of Common Stock, which unit was granted pursuant to the Equity Plan and the Plan. Restricted
Stock Units are credited with Dividend Equivalents.

(ff) “Stock-Based Award” means a Stock-Based Award as defined under the Equity Plan; for
purposes of this Plan, each Stock-Based Award shall represent a unit on the Company’s books which
is equivalent to the Fair Market Value of one share of Common Stock and shall be settled and paid
in cash as provided for under the Plan. Stock-Based Awards are credited with Dividend Equivalents.

(gg) “Termination Date” means the date on which the Non-Employee Director ceases to be a
member of the Board of Directors of the Company.

(hh) “Vesting Date” means, with respect to each Award, the applicable date upon which such
Award vests pursuant to Section 5.

3. Administration of the Plan

Except as otherwise provided herein, the Plan shall be administered by the Board. The Board
shall have full authority to administer the Plan, including authority to interpret and construe any
provision of the Plan and the terms of any Award granted under it and to adopt such rules and
regulations for administering the Plan as it may deem necessary. Decisions of the Board shall be
final and binding on all parties.

4. Annual Retainer

4.1 Amount of Annual Retainer. Until changed by resolution of the Board, the amount of the
Annual Retainer will be $175,000 for each Non-Employee Director, plus $20,000 for the Lead
Director, $20,000 for the Chair of the Audit Committee, and $10,000 for each of the Chairs of the
Compensation and Executive Development Committee and the Nominating and Corporate Governance
Committee.

4.2 Entitlement to Annual Retainer

(a) Each Non-Employee Director who is duly elected and qualified as such at the Annual Meeting
or who is otherwise serving as a Non-Employee Director immediately following the Annual Meeting,
shall receive an Annual Retainer, a portion of which may be paid in cash and a portion (or all) of
which shall be paid in Restricted Stock Units, as provided in Section 4.3.

(b) Each New Director shall receive an Annual Retainer equal to the Prorated Amount on his or
her Appointment Date, a portion of which may be paid in cash and a portion of which shall be paid
in Restricted Stock Units, as provided in Section 4.3.

 

4

 

4.3 Payment of Annual Retainer in Cash and/or Restricted Stock Units. Each Non-Employee
Director shall receive payment of 50% of the Annual Retainer in the form of cash and 50% in the
form of Restricted Stock Units, provided that each Non-Employee Director may make an Election in
accordance with Section 5 to have all or a specified percentage of the cash portion of the Annual
Retainer payable in Restricted Stock Units.

(a) The portion of the Annual Retainer that is paid in cash, if any, shall be paid in
accordance with the Company’s policies for payment of cash retainers.

(b) The portion of the Annual Retainer payable in Restricted Stock Units shall consist of the
number of Restricted Stock Units (rounded down to the nearest whole number) determined by dividing
(i) the amount of the Annual Retainer payable in Restricted Stock Units by (ii) the Fair Market
Value of one share of Common Stock on the Annual Meeting Date or the Appointment Date, as
applicable. Such Restricted Stock Units shall (i) be granted and credited to the Non-Employee
Director’s Account (in addition to Restricted Stock Units previously granted and credited to the
Non-Employee Director’s Account) on the Annual Meeting Date or the Appointment Date, as applicable;
(ii) vest on the earliest of (I) the next Annual Meeting Date after the date on which the
Restricted Stock Units are credited to the Non-Employee Director’s Account, (II) the Non-Employee
Director’s death or Disability or (III) a Change in Control; (iii) be settled in shares of Common
Stock if and to the extent vested no later than 30 days following the earlier of (I) the Elected
Payment Date, or (II) the effective date of a Change in Control Event; and (iv) be subject to the
terms and conditions of the applicable Equity Plan under which the Restricted Stock Units are
granted.

5. Elections

5.1 Election Rules. Elections shall be made by filing an Election Form with the Secretary of
the Company in accordance with the following rules.

(a) Elections must be made by December 31st of the Plan Year immediately preceding
the Plan Year for which such Election is effective, provided, however, that Elections by a New
Director may be made prior to the Appointment Date.

(b) Subject to the rules set forth herein for making Elections, a Non-Employee Director may
elect the following Elected Payment Dates for vested Restricted Stock Units: (i) the Non-Employee
Director’s Termination Date, or (ii) the earlier of the date that is the third anniversary of the
date on which the Restricted Stock Units are credited to the Non-Employee Director’s Account or the
Non-Employee Director’s Termination Date. In the absence of a valid election, the Elected Payment
Date for vested Restricted Stock Units is the earlier of the date that is the third anniversary of
the date on which the Restricted Stock Units are credited to the Non-Employee Director’s Account or
the Non-Employee Director’s Termination Date.

(c) Elections may not be revoked or modified with respect to the Annual Retainer payable
during any Plan Year for which the Elections are effective, except to the extent permitted under
Section 409A of the Code. Elections will remain in effect from Plan Year to Plan Year unless
modified prospectively by the Non-Employee Director for a subsequent Plan Year. Modifications to a
Non-Employee Director’s current Elections for any subsequent Plan
Year may be made by filing a new Election Form by December 31st of the Plan Year
preceding the Plan Year for which the modified Elections are to become effective.

 

5

 

5.2 Change of Elected Payment Date. An Elected Payment Date with regard to an Award of
Stock-Based Awards or Restricted Stock Units may be changed only if the following are satisfied:
(i) the subsequent election shall not take effect until at least 12 months after the date on which
the subsequent election is made; (ii) the Elected Payment Date under the subsequent Payment
Election must be at least five years after the Elected Payment Date of the current Payment
Election; and (iii) the subsequent Payment Election is made at least 12 months prior to the Elected
Payment Date under the current Payment Election.

6. Dividend Equivalent Rights

A Non-Employee Director shall be entitled to receive Dividend Equivalents with respect to the
payment of cash dividends on Common Stock on or after April 22, 2010, if the cash-dividend record
date precedes the date on which outstanding Restricted Stock Units or Stock-Based Awards, as
applicable, held by such Non-Employee Directors are settled. Such Dividend Equivalents shall be
paid by crediting the Non-Employee Director with additional whole Restricted Stock Units or whole
Stock-Based Award units, as applicable, as of the cash-dividend payment date. The number of
additional Restricted Stock Units or Stock-Based Award units, as applicable, (rounded to the
nearest whole number) to be so credited shall be determined by dividing (a) the amount of cash
dividends paid on the cash-dividend payment date with respect to the number of shares of Common
Stock represented by the Restricted Stock Units or Stock-Based Award units, as applicable,
previously credited to the Non-Employee Director by (b) the Fair Market Value per share of Common
Stock on the cash-dividend payment date. Such additional Restricted Stock Units or Stock-Based
Award units, as applicable, shall be subject to the same terms and conditions and shall be settled
in the same manner and at the same time (or as soon thereafter as practicable) as the Restricted
Stock Units or Stock-Based Award units, as applicable, originally subject to the Award.

7. Adjustments for Changes in Capital Structure, Etc.

The provisions of the Equity Plan governing changes in capital structure, etc., shall apply to
Awards granted pursuant to the Equity Plan as provided under this Plan.

8. Modification and Termination

The Board may at any time and from time to time, alter, amend, modify or terminate the Plan in
whole or in part.

9. Successors

All obligations of the Company under the Plan will be binding on any successor to the Company,
whether the existence of the successor is the result of a direct or indirect purchase of all or
substantially all of the business and/or assets of the Company, or a merger, consolidation, or
otherwise.

 

6

 

10. Reservation of Rights

Nothing in this Plan or in any Award provided under this Plan will be construed to limit in
any way the right of the Board or the stockholders to remove a Non-Employee Director from the Board
of Directors.

11. Miscellaneous

11.1 Gender and Number. Except where otherwise indicated by the context, any masculine term
used herein will also include the feminine; the plural will include the singular and the singular
will include the plural.

11.2 Requirements of Law. The issuance of payments under the Plan will be subject to all
applicable laws, rules, and regulations.

11.3 Tax Law Compliance. To the extent any provision of the Plan or action by the Board or
Plan Administrator would subject any Non-Employee Director to liability for interest or additional
taxes under Code Section 409A, it will be deemed null and void, to the extent permitted by law and
deemed advisable by the Board. It is intended that the Plan and all Awards granted thereunder will
comply with Section 409A of the Code and any regulations and guidelines issued thereunder, and the
Plan and all Award agreements shall be interpreted and construed on a basis consistent with such
intent. The Plan and all Award agreements may be amended in any respect deemed necessary (including
retroactively) by the Board in order to preserve compliance with Section 409A of the Code.

11.4 Unfunded Status of the Plan. The Plan is intended to constitute and at all times shall be
interpreted and administered so as to qualify as an unfunded deferred compensation plan. To the
extent that any Non-Employee Director or other person acquires a right to receive payments from the
Company pursuant to the Plan or any Award made under the Plan, such right shall be no greater than
the right of any unsecured general creditor of the Company. The Company may (but shall have no
obligation to) establish a grantor trust in accordance with Revenue Procedure 92-64, 1992-2 C.B.
422 (1992) to which it may contribute shares of Common Stock to meet the Company’s obligations to
deliver such shares upon the Elected Payment Date with respect to vested Restricted Stock Units.

11.5 Governing Law. The validity, construction and effect of the Plan, of Award agreements
entered into pursuant to the Plan, and of any rules, regulations, determinations or decisions made
by the Plan Administrator relating to the Plan or such Award agreements, and the rights of any and
all persons having or claiming to have any interest herein or hereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the State of Delaware,
without regard to its conflict of laws principles.

11.6 Nontransferability. A Non-Employee Director’s Account and Awards may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by
the laws of descent and distribution. All rights with respect to an Account and other Awards will
be available during the Non-Employee Director’s lifetime only to the Non-Employee Director or the
Non-Employee Director’s guardian or legal representative. The Board of Directors may, in its
discretion, require a Non-Employee Director’s guardian or legal
representative to supply it with evidence the Board of Directors deems necessary to establish
the authority of the guardian or legal representative to act on behalf of the Non-Employee
Director.

* * * * *

 

7

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