Document:

Exhibit 10.7A

                        AMENDMENT TO EMPLOYMENT AGREEMENT

                THIS AMENDMENT TO EMPLOYMENT AGREEMENT (the "AGREEMENT") is made
as of July __,  2007,  by and among  Rodman & Renshaw  Holding,  LLC, a Delaware
limited  liability  company  ("Holding")  and Rodman & Renshaw,  LLC, a Delaware
limited liability  company ("R&R"),  each having its principal place of business
at 1270 Avenue of the  Americas,  New York, NY 10017,  and Edward Rubin,  with a
principal place of business c/o 1270 Avenue of the Americas,  New York, NY 10017
(the "EXECUTIVE").

                              W I T N E S S E T H :
                              - - - - - - - - - -

        WHEREAS,  the  parties  hereto are  parties to that  certain  Employment
Agreement dated as of March 1, 2007 between the Executive, Holding and R&R; and

        WHEREAS,  the  parties  desire  to amend  and  restate  Exhibit A to the
Agreement to modify the bonus plan applicable to the Executive.

        NOW  THEREFORE,  in  consideration  of the agreements of the parties set
forth  herein and other good and  valuable  consideration,  the  parties  hereto
hereby agree as follows:

        1.      Exhibit A - SUMMARY  OF BONUS  PLAN to the  Agreement  is hereby
deleted in its entirety and replaced with a new Exhibit A - AMENDED AND RESTATED
SUMMARY OF BONUS PLAN in the form annexed hereto as Schedule 1.

        2       All other terms and conditions  contained in the Agreement shall
remain in full force and effect and shall not be affected by this Amendment.
<PAGE>

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first above written.

                                       /s/ Edward Rubin
                                       -----------------------------------------
                                       EDWARD RUBIN

                                       RODMAN & RENSHAW HOLDING, LLC

                                       By: /s/ Thomas Pinou
                                           -------------------------------------
                                           Thomas Pinou, Chief Financial Officer

                                       RODMAN & RENSHAW, LLC

                                       By: /s/ Thomas Pinou
                                           -------------------------------------
                                           Thomas Pinou, Chief Financial Officer

                                     - 2 -
<PAGE>

                                   SCHEDULE 1
                                   ----------

                              SUMMARY OF BONUS PLAN
                                    EXHIBIT A

                The Executive  shall  participate in the Bonus Plan (the "Plan")
summarized below.  Capitalized terms used but not defined below have the meaning
assigned  to such terms in the  Employment  Agreement  to which this  summary is
attached.

                a.      The   Participants   in  the  Plan   shall  be   Michael
Vasinkevich,  Edward  Rubin,  and John J.  Borer,  III (each a  "PRINCIPAL"  and
collectively the  "PRINCIPALS").  A Participant who ceases to be employed by the
Company for any reason shall not be entitled to any payment  under the Plan with
respect to any fiscal year of the Company  commencing  after such termination of
employment,  but the Participant (or his estate or designated  beneficiary)  may
receive a payment from the Plan with respect to the year of  termination  of the
Participant's  employment to the extent so provided  herein or in his employment
agreement with the Company.

                b.      The aggregate amount payable pursuant to the Plan to the
Principals for each fiscal year or portion thereof during the Employment Term of
each  Participant  shall be determined  by the Committee  before the end of each
fiscal year of the Company  that  commences  on or after  January 1, 2007.  Such
determination  shall be made by the Committee  based on the overall  revenue and
profits of the Company and the productivity of the  Participants.  The amount to
be paid  under  this Plan for the fiscal  year that  commenced  January 1, 2007,
shall  be  determined  by  reference  to the  Company's  and  the  Participant's
performance  for the entire year, and no incentive  compensation  in addition to
that payable under the Plan shall be paid to the  Participants for the two-month
period that ended February 28, 2007.

                                     - 3 -
<PAGE>

                c.      In no event will the sum of the  amounts  payable  under
the Plan to or in respect of all the Principals with respect to a fiscal year of
the Company, together with the Base Compensation payable to the Principals under
their employment agreements and (without duplication) the salary, bonuses, other
current and deferred compensation and benefits (excluding any insurance premiums
paid for key man life  insurance  for the  benefit of the Company and any equity
based compensation granted prior to July 10, 2007), and associated payroll taxes
imposed on the  Company,  with  respect to all  employees of the Company and its
subsidiaries,  exceed  55%  of  the  gross  revenues  of  the  Company  and  its
subsidiaries as determined  under United States  Generally  Accepted  Accounting
Principles as consistently  applied and reflected on the consolidated  financial
statements  of the Company (the  "REVENUE-BASED  CAP") for that  period.  To the
extent the  aggregate  of the  amounts  paid under the Plan with  respect to any
fiscal year is less than the Revenue-Based  Cap amount,  the difference shall be
added to the Revenue-Based Cap amount for subsequent fiscal years of the Company
in determining  the amounts that may be paid under the Plan with respect to such
years. It is anticipated  that, in general,  the aggregate amounts paid annually
under the Bonus Plan with  respect  to each  fiscal  year or portion  thereof to
which the  Revenue-Based  Cap is applicable will be  approximately  equal to the
Revenue-Based Cap amount for such year or portion thereof, except insofar as the
Board of Holding  reasonably  determines,  in consultation  with the Principals,
that  amounts  are  required  to be set aside to provide  for  expansion  of the
business or businesses of the Company, for working capital, and to fund reserves
for the payment of its obligations.

                                     - 4 -
<PAGE>

                d.      The  allocable  share of each of the  Principals  of the
aggregate  amount  to be paid  under  the  Plan for each  fiscal  year  shall be
determined by the Committee  before the end of each fiscal year, by reference to
the individual  productivity  of the Principal  during such year and his overall
contribution  to the profits and success of the Company during such period.  The
amount  payable to each  Participant  under the Plan with  respect to any fiscal
year, to the extent not paid during that fiscal year,  shall be paid on the 15th
day of the third month  following the end of the fiscal year. It is  anticipated
that amounts will be advanced to each  Principal by the Company as  compensation
on a quarterly  basis during the fiscal year, or at such other  intervals as the
Committee  may  determine  to be  appropriate,  based  on  projections  by  such
committee as to the  aggregate  amounts  expected to be paid to or in respect of
the  Principals  under this Plan for the fiscal  year as  further  described  in
paragraph  (e) below.  If the  aggregate  amount  advanced to or in respect of a
Principal under the preceding  sentence for a fiscal year of the Company exceeds
the amount  ultimately  determined  to be  payable in respect of that  Principal
under the Plan for such year,  the excess shall be refunded by the Principal (or
his  successor,  executor or  administrator,  as the case may be) to the Company
within 10 days after the Committee informs the Principal of such determination.

                e.      In  determining  the  amounts  to be  advanced  to  each
Principal  on an  estimated  basis  during  a  fiscal  year,  the  Committee  is
authorized  to cause  estimated  payments to be made from time to time under the
Plan  equal  in the  aggregate  to 90% of the  payments  under  the Plan for the
preceding  fiscal year, as and when made to the  Participants  in such preceding
fiscal  year.  If,  however,  a  determination  is  made  by the  Committee,  in
consultation  with the  Principals,  that the maximum  amount payable under

                                     - 5 -
<PAGE>

this Plan for a fiscal  year is  anticipated  to be less than 90% of the amounts
paid under the Plan for the preceding fiscal year, the amounts  authorized to be
advanced under this  paragraph and the preceding  paragraph (d) shall be limited
to 90% of the projected payments under the Plan for the current fiscal year.

                f.      The parties  acknowledge that the Committee may endeavor
in good faith, in consultation  with  compensation  consultants  retained by the
Committee, to amend the Plan for post-2007 fiscal period taking into account the
evolving circumstances of the Company.  Notwithstanding the foregoing,  any such
amendment  to the Plan will  provide  the  Principals  with the  opportunity  to
receive incentive  compensation,  for fiscal years or portions thereof following
2007,  that is no less favorable to the Principals  than that which was provided
to them under the  provisions  of the Plan,  as  summarized  in  paragraphs  (a)
through (e) above, for prior periods. The provisions of the Plan as set forth in
the  preceding  paragraphs  shall  continue to apply until such an  amendment is
agreed upon by the parties and adopted by the Company.

                                     - 6 -exv10w5

 

Exhibit 10.5

Dolan Media Company

2007 Incentive Compensation Plan

 

 

Table of Contents

	 	 	 	 	 
	 	 	Page
	Section 1. Establishment, Purpose and Duration
	 	 	1	 
	1.1 Effective Date and Purpose
	 	 	1	 
	1.2 Duration of the Plan
	 	 	1	 
	Section 2. Definitions
	 	 	1	 
	2.1 Annual Incentive Award
	 	 	1	 
	2.2 Award
	 	 	1	 
	2.3 Award Agreement
	 	 	1	 
	2.4 Beneficiary
	 	 	1	 
	2.5 Board
	 	 	1	 
	2.6 Bonus Opportunity
	 	 	2	 
	2.7 Cause
	 	 	2	 
	2.8 Change in Control
	 	 	2	 
	2.9 Code
	 	 	3	 
	2.10 Committee
	 	 	4	 
	2.11 Common Stock
	 	 	4	 
	2.12 Company
	 	 	4	 
	2.13 Covered Employee
	 	 	4	 
	2.14 Deferred Compensation Awards
	 	 	4	 
	2.15 Deferred Stock
	 	 	4	 
	2.16 Disability
	 	 	4	 
	2.17 Dividend Equivalent
	 	 	4	 
	2.18 Effective Date
	 	 	4	 
	2.19 Eligible Person
	 	 	4	 
	2.20 Employer
	 	 	4	 
	2.21 Exchange Act
	 	 	4	 
	2.22 Exercise Date
	 	 	4	 
	2.23 Fair Market Value
	 	 	4	 
	2.24 Grant Date
	 	 	5	 
	2.25 Grantee
	 	 	5	 
	2.26 Incentive Stock Option
	 	 	5	 
	2.27 including
	 	 	5	 
	2.28 Non-Qualified Stock Option
	 	 	5	 
	2.29 Option
	 	 	5	 
	2.30 Option Price
	 	 	5	 
	2.31 Performance-Based Exception
	 	 	5	 
	2.32 Performance Goal
	 	 	5	 
	2.33 Performance Measures
	 	 	6	 
	2.34 Performance Period
	 	 	6	 
	2.35 Performance Unit
	 	 	6	 
	2.36 Person
	 	 	6	 
	2.37 Restricted Stock
	 	 	6	 
	2.38 Restricted Stock Unit or RSU
	 	 	6	 
	2.39 Restrictions
	 	 	6	 

i

 

	 	 	 	 	 
	 	 	Page
	2.40 Retirement
	 	 	6	 
	2.41 Rule 16b-3
	 	 	6	 
	2.42 SEC
	 	 	6	 
	2.43 Section 16 Non-Employee Director
	 	 	7	 
	2.44 Section 16 Person
	 	 	7	 
	2.45 Settlement Date
	 	 	7	 
	2.46 Share
	 	 	7	 
	2.47 Stock Appreciation Right or SAR
	 	 	7	 
	2.48 Strike Price
	 	 	7	 
	2.49 Subsidiary
	 	 	7	 
	2.50 Substitute Award
	 	 	7	 
	2.51 Term
	 	 	7	 
	2.52 Termination of Service
	 	 	7	 
	2.53 Year
	 	 	7	 
	Section 3. Administration
	 	 	7	 
	3.1 Committee
	 	 	7	 
	3.2 Powers of the Committee
	 	 	8	 
	Section 4. Shares Subject to the Plan and Adjustments
	 	 	10	 
	4.1 Number of Shares Available for Grants
	 	 	10	 
	4.2 Adjustments in Authorized Shares and Awards
	 	 	10	 
	4.3 Compliance With Code Section 162(m)
	 	 	11	 
	4.4 Performance Based Exception Under Section 162(m)
	 	 	11	 
	Section 5. Eligibility and General Conditions of Awards
	 	 	14	 
	5.1 Eligibility
	 	 	14	 
	5.2 Award Agreement
	 	 	14	 
	5.3 General Terms and Termination of Service
	 	 	14	 
	5.4 Nontransferability of Awards
	 	 	15	 
	5.5 Cancellation and Rescission of Awards
	 	 	16	 
	5.6 Substitute Awards
	 	 	16	 
	5.7 Exercise by Non-Grantee
	 	 	16	 
	5.8 No Cash Consideration for Awards
	 	 	16	 
	Section 6. Stock Options
	 	 	17	 
	6.1 Grant of Options
	 	 	17	 
	6.2 Award Agreement
	 	 	17	 
	6.3 Option Price
	 	 	17	 
	6.4 Vesting
	 	 	17	 
	6.5 Grant of Incentive Stock Options
	 	 	17	 
	6.6 Exercise and Payment
	 	 	18	 
	Section 7. Stock Appreciation Rights
	 	 	19	 
	7.1 Grant of SARs
	 	 	19	 
	7.2 Award Agreements
	 	 	19	 
	7.3 Strike Price
	 	 	20	 
	7.4 Vesting
	 	 	20	 
	7.5 Exercise and Payment
	 	 	20	 

ii

 

	 	 	 	 	 
	 	 	Page
	7.6 Grant Limitations
	 	 	20	 
	Section 8. Restricted Stock
	 	 	20	 
	8.1 Grant of Restricted Stock
	 	 	20	 
	8.2 Award Agreement
	 	 	20	 
	8.3 Consideration for Restricted Stock
	 	 	20	 
	8.4 Vesting
	 	 	20	 
	8.5 Effect of Forfeiture
	 	 	20	 
	8.6 Escrow; Legends
	 	 	21	 
	8.7 Stockholder Rights in Restricted Stock
	 	 	21	 
	Section 9. Restricted Stock Units
	 	 	21	 
	9.1 Grant of Restricted Stock Units
	 	 	21	 
	9.2 Award Agreement
	 	 	21	 
	9.3 Crediting Restricted Stock Units
	 	 	21	 
	Section 10. Deferred Stock
	 	 	22	 
	10.1 Grant of Deferred Stock
	 	 	22	 
	10.2 Award Agreement
	 	 	22	 
	10.3 Deferred Stock Elections
	 	 	23	 
	10.4 Deferral Account
	 	 	23	 
	Section 11. Performance Units
	 	 	24	 
	11.1 Grant of Performance Units
	 	 	24	 
	11.2 Value/Performance Goals
	 	 	24	 
	11.3 Earning of Performance Units
	 	 	25	 
	11.4 Adjustment on Change of Position
	 	 	25	 
	11.5 Dividend Rights
	 	 	25	 
	Section 12. Annual Incentive Awards
	 	 	25	 
	12.1 Annual Incentive Awards
	 	 	25	 
	12.2 Determination of Amount of Annual Incentive Awards
	 	 	25	 
	12.3 Time of Payment of Annual Incentive Awards
	 	 	26	 
	12.4 Form of Payment of Annual Incentive Awards
	 	 	26	 
	Section 13. Change in Control
	 	 	26	 
	13.1 Acceleration of Vesting
	 	 	26	 
	13.2 Special Treatment In the Event of a Change in Control
	 	 	27	 
	Section 14. Dividend Equivalents
	 	 	27	 
	Section 15. Stockholders’ Agreement
	 	 	27	 
	Section 16. Amendments and Termination
	 	 	28	 
	16.1 Amendment and Termination
	 	 	28	 
	16.2 Previously Granted Awards
	 	 	28	 
	Section 17. Beneficiary Designation
	 	 	28	 
	Section 18. Withholding
	 	 	28	 
	18.1 Required Withholding
	 	 	28	 
	18.2 Notification under Section 83(b) of the Code
	 	 	29	 

iii

 

	 	 	 	 	 
	 	 	Page
	Section 19. General Provisions
	 	 	29	 
	19.1 Governing Law
	 	 	29	 
	19.2 Severability
	 	 	29	 
	19.3 Successors
	 	 	29	 
	19.4 Requirements of Law
	 	 	30	 
	19.5 Securities Law Compliance
	 	 	30	 
	19.6 Section 409A
	 	 	30	 
	19.7 No Rights as a Stockholder
	 	 	31	 
	19.8 Awards Not Taken Into Account for Other Benefits
	 	 	31	 
	19.9 Employment Agreement Supersedes Award Agreement
	 	 	31	 
	19.10 Non-Exclusivity of Plan
	 	 	31	 
	19.11 No Trust or Fund Created
	 	 	31	 
	19.12 No Right to Continued Employment or Awards
	 	 	31	 
	19.13 Military Service
	 	 	32	 
	19.14 Construction
	 	 	32	 
	19.15 No Fractional Shares
	 	 	32	 
	19.16 Plan Document Controls
	 	 	32	 

iv

 

Dolan Media Company

2007 Incentive Compensation Plan

Section 1.

Establishment, Purpose and Duration

     1.1 Effective Date and Purpose. Dolan Media Company, a Delaware corporation (the
“Company), hereby amends and restates the Dolan Media Company 2006 Equity Incentive Plan (the “2006
Plan”), and renames it the Dolan Media Company 2007 Incentive Compensation Plan (the “Plan”). The
Plan is intended to attract and retain exceptionally qualified employees, consultants and directors
upon whom, in large measure, the sustained progress, growth and profitability of the Company
depend. By encouraging employees, consultants and directors of the Company and its subsidiaries to
acquire a proprietary interest in the Company’s growth and performance, the Company intends to
motivate employees, consultants and directors to achieve long-term Company goals and to more
closely align such persons’ interests with those of the Company’s other stockholders. The Plan was
approved by the Board on June 22, 2007 (the “Effective Date”), subject to approval by the Company’s
stockholders.

     1.2 Duration of the Plan. The Plan shall commence on the Effective Date and shall
remain in effect, subject to the right of the Board of Directors of the Company to amend or
terminate the Plan at any time pursuant to Section 16 hereof, until the earlier to occur of (a) the
date all Shares subject to the Plan shall have been purchased or acquired and the Restrictions on
all Restricted Stock granted under the Plan shall have lapsed, according to the Plan’s provisions,
and (b) ten (10) years from the Effective Date of the Plan. The termination of the Plan shall not
adversely affect any Awards outstanding on the date of termination.

Section 2.

Definitions

     As used in the Plan, in addition to terms elsewhere defined in the Plan, the following terms
shall have the meanings set forth below:

     2.1 “Annual Incentive Award” means a performance bonus determined under Section 12.

     2.2 “Award” means any Option (including Non-Qualified Stock Options and Incentive
Stock Options), Stock Appreciation Right, Restricted Stock, Share, Restricted Stock Unit, Deferred
Stock, Performance Unit, Substitute Award, Dividend Equivalent or Annual Incentive Award.

     2.3 “Award Agreement
” means any written agreement, contract, or other instrument or document evidencing any Award
granted hereunder between the Company and the Grantee.

     2.4 “Beneficiary” means the Person designated to receive Plan benefits, if any,
following the Grantee’s death in accordance with Section 17.

     2.5 “Board” means the Board of Directors of the Company.

1

 

     2.6 “Bonus Opportunity” means a Grantee’s threshold, target and maximum bonus
opportunity for a Year, provided that such bonus opportunity shall be either (i) to the extent that
the Grantee has entered into an employment agreement with the Company, the threshold, target and
maximum bonus levels, if any, specified in the employment agreement for such Year based on the
Grantee’s base salary in effect on the first day of such Year, or (ii) if there is no employment
agreement in effect between the Company and the Grantee as of the first day of such Year or if the
employment agreement does not specify such bonus levels, the percentage of such Grantee’s base
salary in effect on the first day of such Year (or such later date as such person is designated as
a Grantee) as determined by the Committee in its sole discretion within the first ninety (90) days
of such Year (or before such later date as such person is designated as a Grantee).

     2.7 “Cause” means, as determined by the Committee, the occurrence of any one of the
following: (a) any act of dishonesty, willful misconduct, gross negligence, intentional or
conscious abandonment or neglect of duty; (b) commission of a criminal activity, fraud or
embezzlement; (c) any unauthorized disclosure or use of confidential information or trade secrets;
or (d) any violation of any non-compete or non-disclosure agreement between an Eligible Person and
any Employer; provided, however, that in the event a Grantee is a party to an employment agreement
with the Company or a Subsidiary that contains a different definition of Cause, the definition of
Cause contained in such employment agreement shall be controlling.

     2.8 “Change in Control” means, with respect to Awards other than Deferred
Compensation Awards, the occurrence of any one or more of the following: (i) the acquisition by any
Person of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of more
than fifty percent (50%) of the outstanding voting Shares; provided, however, a Change in Control
shall not be deemed to occur solely because more than fifty percent (50%) of the outstanding voting
Shares is acquired by (A) a trustee or other fiduciary holding securities under one or more
employee benefit plans maintained by the Company or any of its subsidiaries, or (B) any Person
which, immediately prior to such acquisition, is owned directly or indirectly by the stockholders
of the Company in approximately the same proportion as their ownership of voting Shares immediately
prior to such acquisition; (ii) a merger, consolidation or other reorganization involving the
Company if the stockholders of the Company and their affiliates, immediately before such
merger, consolidation or other reorganization, do not, as a result of such merger,
consolidation, or other reorganization, own directly or indirectly, more than fifty percent (50%)
of the combined voting power of the then outstanding voting shares of the Person resulting from
such merger, consolidation or other reorganization; (iii) a complete liquidation or dissolution of
the Company; or (iv) the sale or other disposition of all or substantially all of the assets of the
Company and its subsidiaries determined on a consolidated basis. Notwithstanding the foregoing,
unless otherwise provided in an Award Agreement, an initial public offering of the Shares of the
Company (an “IPO”) shall not constitute a Change in Control for purposes of the Plan or any Award
Agreement hereunder.

     “Change in Control” means, with respect to Deferred Compensation Awards, the occurrence one or
more of any of the following:

     (a) A Change in the Ownership of the Company. A change in ownership of the Company shall
occur on the date that any one Person, or more than one Person acting as a

2

 

“Group” (as defined
under Code Section 409A), acquires ownership of stock of the Company that, together with stock held
by such Person or Group, constitutes more than 50% of the total fair market value or total voting
power of the stock of the Company; provided, however, that, if any one Person, or more than one
Person acting as a Group, is considered to own more than 50% of the total fair market value or
total voting power of the stock of the Company, the acquisition of additional stock by the same
Person or Persons is not considered to cause a change in the ownership of the Company.

     (b) A Change in the Effective Control of the Company. A change in the effective control of
the Company occurs on the date that any one Person, or more than one Person acting as a Group,
acquires (or has acquired during the 12-month period ending on the date of the most recent
acquisition by such Person or Persons) ownership of stock of the Company possessing 50% or more of
the total voting power of the stock of the Company; or

     (c) A Change in the Ownership of a Substantial Portion of the Company’s Assets. A change in
the ownership of a substantial portion of the Company’s assets occurs on the date that any one
Person, or more than one Person acting as a Group, acquires (or has acquired during the 12-month
period ending on the date of the most recent acquisition by such Person or Persons) assets from the
Company that have a total Gross Fair Market Value (as defined below) equal to or more than 50% of
the total Gross Fair Market Value of all of the assets of the Company immediately prior to such
acquisition or acquisitions; provided, however, that, a transfer of assets by the Company is not
treated as a change in the ownership of such assets if the assets are transferred to:

     (i) a stockholder of the Company (immediately before the asset transfer) in exchange
for or with respect to its stock;

     (ii) an entity, 50% or more of the total Fair Market Value or voting power of which is
owned, directly or indirectly, by the Company;

     (iii) a Person, or more than one Person acting as a Group, that owns, directly or
indirectly, 50% or more of the total Fair Market Value or voting power of all the
outstanding stock of the Company; or

     (iv) an entity, at least 50% of the total Fair Market Value or voting power of which is
owned, directly or indirectly, by a Person described in clause (iii) of this paragraph
2.8(c).

     For purposes of this definition, Gross Fair Market Value means the value of the assets of the
Company, or the value of the assets being disposed of, determined without regard to any liabilities
associated with such assets.

     For all purposes of the latter definition of Change in Control that applies to Deferred
Compensation Awards, stock ownership is determined under Code Section 409A.

     2.9 “Code” means the Internal Revenue Code of 1986 (and any successor thereto), as
amended from time to time. References to a particular section of the Code include references to
regulations and rulings thereunder and to successor provisions.

3

 

     2.10 “Committee” has the meaning set forth in Section 3.1(a).

     2.11 “Common Stock” means common stock, par value $.001 per share, of the Company.

     2.12 “Company” has the meaning set forth in Section 1.1.

     2.13 “Covered Employee” means a Grantee who, as of the last day of the fiscal year in
which the value of an Award is includable in income for federal income tax purposes, is one of the
group of “covered employees,” within the meaning of Code Section 162(m), with respect to the
Company.

     2.14 “Deferred Compensation Awards” means Awards that could be subject to liability
under Code Section 409A and do not qualify for an exemption from Code Section 409A coverage.

     2.15 “Deferred Stock” means a right, granted as an Award under Section 10, to receive
payment in the form of Shares (or measured by the value of Shares) at the end of a specified
deferral period.

     2.16 “Disability” means a Grantee’s inability to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment that can be expected to result in death or can
be expected to last for a continuous period of not less than twelve (12) months, as determined by
the Committee.

     2.17 “Dividend Equivalent” means any right to receive payments equal to dividends or
property, if and when paid or distributed, on Shares or Restricted Stock Units.

     2.18 “Effective Date” has the meaning set forth in Section 1.1.

     2.19 “Eligible Person” means any employee of an Employer, non-employee director of
the Company or consultant engaged by an Employer.

     2.20 “Employer” means the Company or any Subsidiary.

     2.21 “Exchange Act” means the Securities and Exchange Act of 1934, as amended, or any
successors thereto, and the rules and regulations promulgated thereunder, all as shall be amended
from time to time.

     2.22 “Exercise Date” means the date the holder of an Award that is subject to
exercise delivers notice of such exercise to the Company, accompanied by such payment,
attestations, representations and warranties or other documentation as required hereunder, under
the applicable Award Agreement or as the Committee may otherwise specify.

     2.23 “Fair Market Value” means, as of any applicable date, (a) the closing sales
price for one Share on such date as reported on the New York Stock Exchange or, if the foregoing
does not apply, on such other market system or stock exchange on which the Company’s Common Stock
is then listed or admitted to trading, or on the last previous day on which a sale was

4

 

reported if
no sale of a Share was reported on such date, or (b) if the foregoing subsection (a) does not
apply, the fair market value of a Share as reasonably determined in good faith by the Board in
accordance with Code Section 409A. For purposes of subsection (b), the determination of such Fair
Market Value by the Board will be made no less frequently than every twelve (12) months and will
either (x) use one of the safe harbor methodologies permitted under Proposed Treasury Regulation
Section 1.409-1(b)(iv)(B)(2) (or such other similar final regulation provision as may be provided)
or (y) include, as applicable, the value of tangible and intangible assets of the Company, the
present value of future cash flows of the Company, the market value of stock or other equity interests
in similar corporations and other entities engaged in trades or businesses substantially similar to
those engaged in by the Company, the value of which can be readily determined through objective
means (such as through trading prices or an established securities market or an amount paid in an
arms’ length private transaction), and other relevant factors such as control premiums or discounts
for lack of marketability and whether the valuation method is used for other purposes that have a
material economic effect on the Company, its stockholders or its creditors. Notwithstanding the
foregoing, the Fair Market Value of a Share on the date that the initial public offering price per
Share of an IPO is determined shall be equal to such initial public offering price per Share in the
IPO.

     2.24 “Grant Date” means the date on which an Award is granted, which date may be
specified in advance by the Committee.

     2.25 “Grantee” means an Eligible Person who has been granted an Award.

     2.26 “Incentive Stock Option” means an Option granted under Section 6 that is
intended to meet the requirements of Code Section 422.

     2.27 “including” or “includes” means “including, but not limited to,” or
“includes, but is not limited to,” respectively.

     2.28 “Non-Qualified Stock Option” means an Option granted under Section 6 that is not
intended to be an Incentive Stock Option.

     2.29 “Option” means an Incentive Stock Option or Non-Qualified Stock Option.

     2.30 “Option Price” means the price at which a Share may be purchased by a Grantee
pursuant to an Option.

     2.31 “Performance-Based Exception” means the performance-based exception from the tax
deductibility limitations of Code Section 162(m) contained in Code Section 162(m)(4)(C) (including
the special provision for options thereunder).

     2.32 “Performance Goal” means the objective or subjective criteria determined by the
Committee, the degree of attainment of which will affect (a) in the case of an Award other than an
Annual Incentive Award, the amount of the Award the Grantee is entitled to receive or retain, and
(b) in the case of an Annual Incentive Award, the portion of the individual’s Bonus Opportunity
potentially payable as an Annual Incentive Award. Performance Goals may contain threshold, target
and maximum levels of achievement and, to the extent the Committee intends an Award (including an
Annual Incentive Award) to comply with the Performance-Based

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Exception, the Performance Goals shall
be chosen from among the Performance Measures set forth in Section 4.4(a).

     2.33 “Performance Measures” has the meaning set forth in Section 4.4(a).

     2.34 “Performance Period” means that period established by the Committee at the time
any Performance Unit is granted or at any time thereafter during which any performance goals
specified by the Committee with respect to such Award are to be measured.

     2.35 “Performance Unit” any grant pursuant to Section 11 of (i) a bonus consisting of
cash or other property the amount or value of which, and/or the entitlement to which, is
conditioned upon the attainment of any performance goals specified by the Committee, or (ii) a unit
valued by reference to a designated amount of property other than Shares.

     2.36 “Person” means any individual, sole proprietorship, corporation, partnership,
joint venture, limited liability company, association, joint-stock company, trust, unincorporated
organization, institution, public benefit corporation, entity or government instrumentality,
division, agency, body or department.

     2.37 “Restricted Stock” means any Share issued as an Award under the Plan that is
subject to Restrictions.

     2.38 “Restricted Stock Unit” or “RSU” means the right granted as an Award under the
Plan to receive a Share, conditioned on the satisfaction of Restrictions imposed by the Committee,
which Restrictions may be time-based, performance-based or based upon the occurrence of one or more
events or conditions.

     2.39 “Restrictions” means any restriction on a Grantee’s free enjoyment of the Shares
or other rights underlying Awards, including (a) that the Grantee or other holder may not sell,
transfer, pledge,
or assign a Share or right, and (b) such other restrictions as the Committee may impose in the
Award Agreement (including any restriction on the right to vote such Share and the right to receive
any dividends). Restrictions may be based upon the passage of time or the satisfaction of
performance criteria or the occurrence of one or more events or conditions, and shall lapse
separately or in combination upon such conditions and at such time or times, in installments or
otherwise, as the Committee shall specify. Awards subject to a Restriction shall be forfeited if
the Restriction does not lapse prior to such date or the occurrence of such event or the
satisfaction of such other criteria as the Committee shall determine.

     2.40 “Retirement” means a Termination of Service, other than for Cause, death or
Disability, on or after reaching age 55 with five (5) years of service with an Employer, as
determined by the Committee.

     2.41 “Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange Act, as
amended from time to time, together with any successor rule.

     2.42 “SEC” means the United States Securities and Exchange Commission, or any
successor thereto.

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     2.43 “Section 16 Non-Employee Director” means a member of the Board who satisfies the
requirements to qualify as a “non-employee director” under Rule 16b-3.

     2.44 “Section 16 Person” means a person who is subject to potential liability under
Section 16(b) of the Exchange Act with respect to transactions involving equity securities of the
Company.

     2.45 “Settlement Date” means the payment date for Restricted Stock Units or Deferred
Stock, as set forth in Section 9.3(b) or 10.4(c), as applicable.

     2.46 “Share” means a share of the Common Stock of the Company.

     2.47 “Stock Appreciation Right” or “SAR” means a right granted as an Award under the
Plan to receive, as of the date specified in the Award Agreement, an amount equal to the number of
Shares with respect to which the SAR
is exercised, multiplied by the excess of (a) the Fair Market Value of one Share on the
Exercise Date over (b) the Strike Price.

     2.48 “Strike Price” means the per Share price used as the baseline measure for the
value of an SAR, as specified in the applicable Award Agreement.

     2.49 “Subsidiary” means any Person that directly, or through one (1) or more
intermediaries, is controlled by the Company and that would be treated as part of a single
controlled group of corporations with the Company under Sections 414(b) and 414(c) of the Code if
the language “at least 50 percent” is used instead of “at least 80 percent” each place it appears
in Code Sections 1563(a)(1), (2) and (3) and Treasury Regulation Section 1.414(c)-2.

     2.50 “Substitute Award” has the meaning set forth in Section 5.6.

     2.51 “Term” means the period beginning on the Grant Date of an Option or SAR and
ending on the date such Option or SAR expires, terminates or is cancelled.

     2.52 “Termination of Service” occurs on the first day on which an individual is for
any reason no longer providing services to an Employer in the capacity of an employee, director or
consultant or with respect to an individual who is an employee or consultant to a Subsidiary, the
first day on which such entity ceases to be a Subsidiary of the Company.

     2.53 “Year” means a calendar year.

Section 3.

Administration

     3.1 Committee.

     (a) Subject to Section 3.2, the Plan shall be administered by the Compensation Committee of
the Board unless otherwise determined by the Board (the “Committee”). The members of the
Committee shall be appointed by the Board from time to time and may be removed by the Board from
time to time. To the extent the Board considers it desirable to comply with Rule 16b-3 or meet the
Performance-Based Exception, the Committee shall consist

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of two or more directors of the Company,
all of whom qualify as “outside directors” within the meaning of Code Section 162(m) and Section 16
Non-Employee Directors. The number of
members of the Committee shall from time to time be increased or decreased, and shall be
subject to such conditions, in each case if and to the extent the Board deems it appropriate to
permit transactions in Shares pursuant to the Plan to satisfy such conditions of Rule 16b-3 and the
Performance-Based Exception as then in effect.

     (b) Subject to Section 4.4(c), the Committee may delegate to the Chief Executive Officer of
the Company any or all of the authority of the Committee with respect to the grant of Awards to
Grantees, other than Grantees who are executive officers, or are (or are expected to be) Covered
Employees and/or are Section 16 Persons at the time any such delegated authority is exercised.

     3.2 Powers of the Committee. Subject to and consistent with the provisions of the
Plan, the Committee shall have full power and authority and sole discretion as follows:

     (a) to determine when, to whom (i.e., what Eligible Persons) and in what types and amounts
Awards should be granted;

     (b) to grant Awards to Eligible Persons in any number, and to determine the terms and
conditions applicable to each Award (including conditions intended to comply with Code Section
409A, the number of Shares or the amount of cash or other property to which an Award will relate,
any Option Price or Strike Price, grant price or purchase price, any limitation or Restriction, any
schedule for or performance conditions relating to the earning of the Award or the lapse of
limitations, forfeiture restrictions, restrictive covenants, restrictions on exercisability or
transferability, any performance goals, including those relating to the Company and/or a Subsidiary
and/or any division thereof and/or an individual, and/or vesting based on the passage of time,
based in each case on such considerations as the Committee shall determine);

     (c) to determine the benefit (including any Bonus Opportunity) payable under any Award and to
determine whether any performance or vesting conditions, including Performance Measures or
Performance Goals, have been satisfied;

     (d) to determine whether or not specific Awards shall be granted in connection with other
specific Awards;

     (e) to determine the Term, as applicable;

     (f) to determine the amount, if any, that a Grantee shall pay for Restricted Stock, whether to
permit or require the payment of cash dividends thereon to be deferred and the terms related
thereto, when Restricted Stock (including Restricted Stock acquired upon the exercise of an Option)
shall be forfeited and whether such Shares shall be held in escrow or other custodial arrangement;

     (g) to determine whether, to what extent and under what circumstances an Award may be settled
in, or the exercise price of an Award may be paid in, cash, Shares, other Awards or other property,
or an Award may be accelerated, vested, canceled, forfeited or surrendered or any terms of the
Award may be waived, and to accelerate the exercisability of, and to accelerate

8

 

or waive any or all of the terms and conditions applicable to, any Award or any group of
Awards for any reason and at any time or to extend the period subsequent to the Termination of
Service within which an Award may be exercised;

     (h) to determine with respect to Awards granted to Eligible Persons, whether, to what extent
and under what circumstances cash, Shares, other Awards, other property and other amounts payable
with respect to an Award will be deferred, either at the election of the Grantee or if and to the
extent specified in the Award Agreement automatically or at the election of the Committee (for
purposes of limiting loss of deductions pursuant to Code Section 162(m) or otherwise) and to
provide for the payment of interest or other rate of return determined with reference to a
predetermined actual investment or independently set interest rate, or with respect to other bases
permitted under Code Sections 162(m), 409A or otherwise, for the period between the date of
exercise and the date of payment or settlement of the Award;

     (i) to make, amend, suspend, waive and rescind rules and regulations relating to the Plan;

     (j) to appoint such agents as the Committee may deem necessary or advisable to administer the
Plan;

     (k) to determine the terms and conditions of all Award Agreements applicable to Eligible
Persons (which need not be identical) and, with the consent of the Grantee (except as provided in
this Section 3.2(k) and Sections 5.5 and 15.2), to amend any such Award Agreement at any time;
provided that the consent of the Grantee shall not be required for any amendment (i) which does not
adversely affect the rights of the Grantee, or (ii) which is necessary or advisable (as determined
by the Committee) to carry out the purpose of the Award as a result of any new applicable law or
regulation or change in an existing applicable law or regulation or interpretation thereof, or
(iii) to the extent the Award Agreement specifically permits amendment without consent;

     (l) to impose such additional terms and conditions upon the grant, exercise or retention of
Awards as the Committee may, before or concurrently with the grant thereof, deem appropriate,
including limiting the percentage of Awards which may from time to time be exercised by a Grantee,
and including requiring the Grantee to enter into restrictive covenants;

     (m) to correct any defect or supply any omission or reconcile any inconsistency, and to
construe and interpret the Plan, the rules and regulations, and Award Agreement or any other
instrument entered into or relating to an Award under the Plan;

     (n) to take any other action with respect to any matters relating to the Plan for which it is
responsible and to make all other decisions and determinations, including factual determinations,
as may be required under the terms of the Plan or as the Committee may deem necessary or advisable
for the administration of the Plan;

     (o) to determine whether a Grantee has a Disability or a Retirement; and

     (p) to determine whether and under what circumstances a Grantee has incurred a Termination of
Service (e.g., whether Termination of Service was for Cause).

9

 

     Any action of the Committee with respect to the Plan shall be final, conclusive and binding on
all Persons, including the Company, its Subsidiaries, any Grantee, any Eligible Person, any Person
claiming any rights under the Plan from or through any Grantee, and stockholders, except to the
extent the Committee may subsequently modify, or take further action not consistent with, its prior
action. If not specified in the Plan, the time at which the Committee must or may make any
determination shall be determined by the Committee, and any such determination may thereafter be
modified by the Committee. The express grant of any specific power to the Committee, and the
taking of any action by the Committee, shall not be construed as limiting any power or authority of
the Committee.

     All determinations of the Committee shall be made by a majority of its members; provided that
any determination affecting any Awards made or to be made to a member of the Committee may, at the
Board’s election, be made by the Board.

Section 4.

Shares Subject to the Plan and Adjustments

     4.1 Number of Shares Available for Grants.

     (a) Subject to adjustment as provided in Section 4.2, the aggregate number of Shares which may
be delivered under the Plan shall not exceed 300,000 Shares. If any Shares subject to an Award
granted hereunder are forfeited or such Award otherwise terminates without the delivery of such
Shares, the Shares subject to such Award, to the extent of any such forfeiture or termination,
shall again be available for grant under the Plan. If any Shares subject to an Award granted
hereunder are withheld or applied as payment in connection with the exercise of an Award (including
the withholding of Shares on the exercise of a SAR that is settled in Shares) or, except with
respect to Shares of Restricted Stock, the withholding or payment of taxes related thereto, such
Shares shall again be available for grant under the Plan.

     (b) The Committee shall from time to time determine the appropriate methodology for
calculating the number of Shares that have been delivered pursuant to the Plan. Shares delivered
pursuant to the Plan may be, in whole or in part, authorized and unissued Shares, or treasury
Shares, including Shares repurchased by the Company for purposes of the Plan.

     (c) The maximum number of shares of Common Stock that may be issued under the Plan in this
Section 4.1 shall not be affected by (i) the payment in cash of dividends or Dividend Equivalents
in connection with outstanding Awards; or (ii) any Shares required to satisfy Substitute Awards.

     4.2 Adjustments in Authorized Shares and Awards.

     (a) In the event that the Committee determines that any dividend or other distribution
(whether in the form of cash, Shares, or other securities or property), stock split or combination,
forward or reverse merger, reorganization, subdivision, consolidation or reduction of capital,
recapitalization, consolidation, scheme of arrangement, split-up, spin-off or combination
involving the Company or repurchase or exchange of Shares, issuance of warrants or other rights to
purchase Shares or other securities of the Company, or other similar corporate transaction or event
affects the Shares such that an adjustment is determined by the Committee to be

10

 

appropriate in
order to prevent dilution or enlargement of the benefits or potential benefits intended to be made
available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust
any or all of: (a) the number and type of Shares (or other securities or property) with respect to
which Awards may be granted, (b) the number and type of Shares (or other securities or property)
subject to outstanding Awards, (c) the grant or exercise price with respect to any Award or, if
deemed appropriate, make provision for a cash payment to the holder of an outstanding Award, (d)
the number and kind of Shares of outstanding Restricted Stock or relating to any other outstanding
Award in connection with which Shares are subject, and (e) the number of Shares with respect to
which Awards may be granted to a Grantee; provided, in each case, that with respect to Awards of
Incentive Stock Options intended to continue to qualify as Incentive Stock Options after such
adjustment, no such adjustment shall be authorized to the extent that such adjustment would cause
the Incentive Stock Option to violate Section 424(a) of the Code; and provided further that the
number of Shares subject to any Award denominated in Shares shall always be a whole number.

     (b) Notwithstanding Section 4.2(a), any adjustments made pursuant to Section 4.2(a) shall be
made in such a manner as to ensure that after such adjustment, the Awards continue not to be
deferred compensation subject to Code Section 409A (or if such Awards are already subject to Code
Section 409A, so as not to give rise to liability under Code Section 409A).

     4.3 Compliance With Code Section 162(m).

     (a) Section 162(m) Compliance. To the extent the Committee determines that compliance
with the Performance-Based Exception is desirable with respect to an Award, Sections 4.3 and 4.4
shall apply. In the event that changes are made to Code Section 162(m) to permit flexibility with
respect to any Awards available under the Plan, the Committee may, subject to this Section 4.3,
make any adjustments to such Awards as it deems appropriate.

     (b) Annual Individual Limitations. No Grantee may be granted Awards for Options,
SARs, Restricted Stock, Deferred Stock, Restricted Stock Units or Performance Units (or any other
Award which is determined by reference to the value of Shares or appreciation in the value of
Shares) with respect to a number of Shares in any one (1) calendar year which, when added to any
other Award denominated in Shares granted to such Grantee in the same calendar year, shall exceed
Fifty Thousand (50,000) Shares. If an Award denominated in Shares is cancelled, the Shares subject
to the cancelled Award continue to count against the maximum number of Shares which may be granted
to a Grantee in any calendar year. All Shares specified in this Section 4.3(b) shall be adjusted
to the extent necessary to reflect adjustments to Shares required by Section 4.2. No Grantee may
be granted a cash Award in any one (1) calendar year, the maximum payout for which, when added to
the maximum payout for all other cash Awards granted to such Grantee in the same calendar year,
shall exceed 300% of the Grantee’s annual
base salary (up to a maximum of $1,000,000 of base salary) as of the first day of such
calendar year (or, if later, as of the date on which the Grantee becomes an employee of an
Employer).

     4.4 Performance Based Exception Under Section 162(m).

     (a) Performance Measures. Subject to Section 4.4(d), unless and until the Committee
proposes for stockholder vote and stockholders approve a change in the general Performance

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Measures
set forth in this Section 4.4(a), for Awards (other than Options and SARs) designed to qualify for
the Performance-Based Exception, the objective performance criteria shall be based upon one or more
of the following (each a “Performance Measure”):

     (i) Earnings before interest, tax, depreciation or amortization (“EBITDA”) (actual and
adjusted and either in the aggregate or on a per-Share basis);

     (ii) Earnings (either in the aggregate or on a per-Share basis);

     (iii) Net income or loss (either in the aggregate or on a per-Share basis);

     (iv) Operating profit;

     (v) Growth or rate of growth in cash flow;

     (vi) Cash flow provided by operations (either in the aggregate or on a per-Share basis);

     (vii) Free cash flow (either in the aggregate on a per-Share basis);

     (viii) Costs;

     (ix) Gross revenues;

     (x) Reductions in expense levels;

     (xi) Operating and maintenance cost management and employee productivity;

     (xii) Stockholder returns (including return on assets, investments, equity, or gross
sales);

     (xiii) Return measures (including return on assets, equity, or sales);

     (xiv) Growth or rate of growth in return measures;

     (xv) Share price (including growth measures and total stockholder return or attainment
by the Shares of a specified value for a specified period of time);

     (xvi) Net economic value;

     (xvii) Economic value added;

     (xviii) Aggregate product unit and pricing targets;

     (xix) Strategic business criteria, consisting of one or more objectives based on
meeting specified revenue, market share, market penetration, geographic business expansion
goals, objectively identified project milestones, production volume levels, cost targets,
and goals relating to acquisitions or divestitures;

12

 

     (xx) Achievement of business or operational goals such as market share and/or business
development;

     (xxi) Achievement of diversity objectives;

     (xxii) Results of customer satisfaction surveys; and/or

     (xxiii) Debt ratings, debt leverage and debt service;

provided that applicable Performance Measures may be applied on a pre- or post-tax basis; and
provided further that the Committee may, on the Grant Date of an Award intended to comply with the
Performance-Based Exception, and in the case of other Awards, at any time, provide that the formula
for such Award may include or exclude items to measure specific objectives, such as losses from
discontinued operations, extraordinary gains or losses, the cumulative effect of accounting
changes, acquisitions or divestitures, foreign exchange impacts and any unusual, nonrecurring gain
or loss.

     (b) Flexibility in Setting Performance Measures. For Awards intended to comply with
the Performance-Based Exception, the Committee shall set the Performance Measures within the time
period prescribed by Section 162(m) of the Code. The levels of performance required with respect
to Performance Measures may be expressed in absolute or relative levels and may be based upon a set
increase, set positive result, maintenance of the status quo, set decrease or set negative result.
Performance Measures may differ for Awards to different Grantees. The Committee shall specify the
weighting (which may be the same or different for multiple objectives) to be given to each
performance objective for purposes of determining the final amount payable with respect to any such
Award. Any one or more of the Performance Measures may apply to the Grantee, a department, unit,
division or function within the Company or any one or more Subsidiaries; and may apply either alone
or relative to the performance of other businesses or individuals (including industry or general
market indices).

     (c) Adjustments. The Committee shall have the discretion to adjust the determinations
of the degree of attainment of the pre-established performance goals; provided, however, that
Awards which are designed to qualify for the Performance-Based Exception may not (unless the
Committee determines to amend the Award so that it no longer qualified for the Performance-Based
Exception) be adjusted upward (the Committee shall retain the discretion to adjust such Awards
downward). The Committee may not, unless the Committee determines to amend the Award so that it no
longer qualifies for the Performance-Based Exception, delegate any responsibility with respect to
Awards intended to qualify for the Performance-Based
Exception. All determinations by the Committee as to the achievement of the Performance
Measure(s) shall be in writing prior to payment of the Award.

     (d) Changes to Performance Measures. In the event that applicable laws, rules or
regulations change to permit Committee discretion to alter the governing Performance Measures
without obtaining stockholder approval of such changes, and still qualify for the Performance-Based
Exception, the Committee shall have sole discretion to make such changes without obtaining
stockholder approval.

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Section 5.

Eligibility and General Conditions of Awards

     5.1 Eligibility. The Committee may in its discretion grant Awards to any Eligible
Person, whether or not he or she has previously received an Award.

     5.2 Award Agreement. To the extent not set forth in the Plan, the terms and
conditions of each Award shall be set forth in an Award Agreement.

     5.3 General Terms and Termination of Service. Except as provided in an Award
Agreement or as otherwise provided below in this Section 5.3, all Options or SARs that have not
been exercised, or any other Awards that remain subject to Restrictions or which are not otherwise
vested or exercisable, at the time of a Termination of Service shall be cancelled and forfeited to
the Company. Any Restricted Stock that is forfeited by the Grantee upon Termination of Service
shall be reacquired by the Company, and the Grantee shall sign any document and take any other
action required to assign such Shares back to the Company.

     (a) Options and SARS. Except as otherwise provided in an Award Agreement:

     (i) If the Grantee incurs a Termination of Service due to his or her death, Disability
or Retirement, the Options or SARs may thereafter be exercised, to the extent they were
vested and exercisable at the time of such Termination of Service, for a period of one (1)
year from the date of such Termination of Service (but not beyond the original Term). To
the extent the Options or SARs are not exercised at the end of such one-year period, the
Options or SARs shall be immediately cancelled and forfeited to the Company. To the extent
the Options and SARs are not vested and exercisable at the date of such Termination of
Service, they shall be immediately cancelled and forfeited to the Company.

     (ii) If the Grantee incurs a Termination of Service for Cause, all Options and SARs
shall be immediately cancelled and forfeited to the Company.

     (iii) If the Grantee incurs a Termination of Service either without Cause or due
to a reason other than his or her death, Disability or Retirement, the Options and SARs
may thereafter be exercised, to the extent they were vested and exercisable at the time of
such Termination of Service, for a period of sixty (60) days from the date of such
Termination of Service (but not beyond the original Term). To the extent the Options or
SARs are not exercised at the end of such sixty day period, the Options or SARs shall be
immediately cancelled and forfeited to the Company. To the extent the Options and SARs are
not vested and exercisable at the date of such Termination of Service, they shall be
immediately cancelled and forfeited to the Company.

     (b) Restricted Stock. Except as otherwise provided in an Award Agreement:

     (i) If Termination of Service occurs by reason of the Grantee’s death or Disability,
such Grantee’s Restricted Stock shall become immediately vested and no longer subject to the
applicable Restrictions.

14

 

     (ii) If Termination of Service occurs for any reason other than the Grantee’s death or
Disability while the Grantee’s Restricted Stock is subject to a Restriction(s), all of such
Grantee’s Restricted Stock that is unvested or still subject to Restrictions shall be
forfeited by the Grantee.

     (c) Dividend Equivalents. If Dividend Equivalents have been credited with respect to
any Award and such Award (in whole or in part) is forfeited, all Dividend Equivalents issued in
connection with such forfeited Award (or portion of an Award) shall also be forfeited to the
Company.

     (d) Waiver by Committee. Notwithstanding the foregoing provisions of this Section
5.3, the Committee may in its sole discretion as to all or part of any Award as to any Grantee, at
the time the Award is granted or thereafter, determine that Awards shall become exercisable or
vested upon a Termination of Service, determine that Awards shall continue to become exercisable or
vested in full or in installments after Termination of Service, extend the period for exercise of
Options or SARs following Termination of Service (but not beyond the original Term), or provide
that any Award shall in whole or in part not be forfeited upon such Termination of Service.
Notwithstanding the preceding sentence, the Committee shall not have the authority under this
Section 5.3(d) to take any action with respect to an Award to the extent that such action would
cause an Award that is not intended to be deferred compensation subject to Code Section 409A to be
subject thereto (or if such Awards are already subject to Code Section 409A, so as not to give rise
to liability under Code Section 409A).

     5.4 Nontransferability of Awards.

     (a) Each Award and each right under any Award shall be exercisable only by the Grantee during
the Grantee’s lifetime, or, if permissible under applicable law, by the Grantee’s guardian or legal
representative.

     (b) No Award (prior to the time, if applicable, Shares are delivered in respect of such
Award), and no right under any Award, may be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by a Grantee other than by will or by the laws of descent
and distribution (or, in the case of Restricted Stock, to the Company), and any such purported
assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and
unenforceable against the Company or any Subsidiary; provided that the designation of a Beneficiary
to receive benefits in the event of the Grantee’s death shall not constitute an assignment,
alienation, pledge, attachment, sale, transfer or encumbrance for purposes of this Section 5.4(b).
If so determined by the Committee, a Grantee may, in the manner established by the Committee,
designate a Beneficiary or Beneficiaries to exercise the rights of the Grantee, and to receive any
distribution with respect to any Award upon the death of the Grantee. A transferee, Beneficiary,
guardian, legal representative or other person claiming any rights under the Plan from or through
any Grantee shall be subject to the provisions of the Plan and any applicable Award Agreement,
except to the extent the Plan and Award Agreement otherwise provide with respect to such persons,
and to any additional restrictions or limitations deemed necessary or appropriate by the Committee.

15

 

     (c) Notwithstanding subsections (a) and (b) above, to the extent provided in the Award
Agreement, Non-Qualified Stock Options, may be transferred, without consideration, to a Permitted
Transferee. For this purpose, a “Permitted Transferee” in respect of any Grantee means any member
of the Immediate Family of such Grantee, any trust of which all of the primary beneficiaries are
such Grantee or members of his or her Immediate Family, or any partnership, limited liability
company, corporation or and similar entity of which all of the partners, members or stockholders
are such Grantee or members of his or her Immediate Family; and the “Immediate Family” of a Grantee
means the Grantee’s spouse, former spouse, children, stepchildren, grandchildren, parents,
stepparents, siblings, grandparents, nieces and nephews, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships. Such Award
may be exercised by such Permitted Transferee in accordance with the terms of such Award.

     (d) Nothing herein shall be construed as requiring the Committee to honor the order of a
domestic relations court regarding an Award, except to the extent required under applicable law.

     5.5 Cancellation and Rescission of Awards. Unless the Award Agreement specifies
otherwise, the Committee may cancel, rescind, suspend, withhold, or otherwise limit or restrict any
unexercised or unsettled Award at any time if the Grantee is not in compliance with all applicable
provisions of the Award Agreement and the Plan or is in violation of any restrictive covenant or
other agreement with an Employer.

     5.6 Substitute Awards. The Committee may, in its discretion and on such terms and
conditions as the Committee considers appropriate in the circumstances, grant Substitute Awards
under the Plan. For purposes of this Section 5.6, “Substitute Award” means an Award granted under
the Plan in substitution for stock and stock-based awards (“Acquired Entity Awards”) held
by current and former employees or non-employee directors of, or consultants to, another
corporation or entity who become Eligible Persons as the result of a merger, consolidation or
combination of the
employing corporation or other entity (the “Acquired Entity”) with the Company or a
Subsidiary or the acquisition by the Company or a Subsidiary of property or stock of the Acquired
Entity immediately prior to such merger, consolidation, acquisition or combination
(“Acquisition Date”) in order to preserve for the Grantee the economic value of all or a
portion of such Acquired Entity Award at such price as the Committee determines necessary to
achieve preservation of economic value.

     5.7 Exercise by Non-Grantee. If any Award is exercised as permitted by the Plan by
any Person other than the Grantee, the exercise notice shall be accompanied by such documentation
as may reasonably be required by the Committee, including, without limitation, evidence of
authority of such Person or Persons to exercise the Award and, if the Committee so specifies,
evidence satisfactory to the Company that any death taxes payable with respect to such Shares have
been paid or provided for.

     5.8 No Cash Consideration for Awards. Awards may be granted for no cash consideration
or for such minimal cash consideration as may be required by applicable law.

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Section 6.

Stock Options

     6.1 Grant of Options. Subject to and consistent with the provisions of the Plan,
Options may be granted to any Eligible Person in such number, and upon such terms, and at any time
and from time to time as shall be determined by the Committee.

     6.2 Award Agreement. Each Option grant shall be evidenced by an Award Agreement in
such form as the Committee may approve that shall specify the Grant Date, the Option Price, the
Term (not to exceed ten (10) years from its Grant Date unless the Committee otherwise specifies in
the Award Agreement), the number of Shares to which the Option pertains, the time or times at which
such Option shall be exercisable and such other provisions (including Restrictions) not
inconsistent with the provisions of the Plan as the Committee shall determine.

     6.3 Option Price. The purchase price per Share purchasable under an Option shall be
determined by the Committee; provided, however, that such purchase price shall not be less than one
hundred percent (100%) of the Fair Market Value of a Share on the Grant Date. Subject to the
adjustment allowed in Section 4.2, neither the Committee nor the Board shall have the authority or
discretion to change the Option Price of any outstanding Option.

     6.4 Vesting. Shares subject to an Option shall become vested and exercisable as specified in the
applicable Award Agreement.

     6.5 Grant of Incentive Stock Options. At the time of the grant of any Option, the
Committee may in its discretion designate that such Option shall be made subject to additional
restrictions to permit it to qualify as an Incentive Stock Option. Any Option designated as an
Incentive Stock Option:

     (a) shall be granted only to an employee of the Company or a Subsidiary Corporation (as
defined below);

     (b) shall have an Option Price of not less than one hundred percent (100%) of the Fair Market
Value of a Share on the Grant Date, and, if granted to a person who owns capital stock (including
stock treated as owned under Section 424(d) of the Code) possessing more than ten percent (10%) of
the total combined voting power of all classes of capital stock of the Company or any Subsidiary
Corporation (a “10% Owner”), have an Option Price not less than one hundred ten percent
(110%) of the Fair Market Value of a Share on its Grant Date;

     (c) shall have a Term of not more than ten (10) years (five (5) years if the Grantee is a 10%
Owner) from its Grant Date, and shall be subject to earlier termination as provided herein or in
the applicable Award Agreement;

     (d) shall not have an aggregate Fair Market Value (as of the Grant Date) of the Shares with
respect to which Incentive Stock Options (whether granted under the Plan or any other equity
incentive plan of the Grantee’s employer or any parent or Subsidiary Corporation (“Other
Plans”)) are exercisable for the first time by such Grantee during any calendar year
(“Current Grant”), determined in accordance with the provisions of Section 422 of the Code,
which exceeds $100,000 (the “$100,000 Limit”);

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     (e) shall, if the aggregate Fair Market Value of the Shares (determined on the Grant Date)
with respect to the Current Grant and all Incentive Stock Options previously granted under the Plan
and any Other Plans which are exercisable for the first time during a calendar year (“Prior
Grants”) would exceed the $100,000 Limit, be, as to the portion in excess of the $100,000
Limit, exercisable as a separate option that is not an Incentive Stock Option at such date or dates
as are provided in the Current Grant;

     (f) shall require the Grantee to notify the Committee of any disposition of any Shares
delivered pursuant to the exercise of the Incentive Stock Option under the circumstances described
in Section 421(b) of the Code (relating to holding periods and certain disqualifying dispositions)
(“Disqualifying Disposition”), within ten (10) days of such a Disqualifying Disposition;

     (g) shall by its terms not be assignable or transferable other than by will or the laws of
descent and distribution and may be exercised, during the Grantee’s lifetime, only by the Grantee;
provided, however, that the Grantee may, to the extent provided in the Plan in any manner specified
by the Committee, designate in writing a Beneficiary to exercise his or her Incentive Stock Option
after the Grantee’s death; and

     (h) shall, if such Option nevertheless fails to meet the foregoing requirements, or otherwise
fails to meet the requirements of Section 422 of the Code for an Incentive Stock Option, be treated
for all purposes of this Plan, except as otherwise provided in subsections (d) and (e) above, as an
Option that is not an Incentive Stock Option.

     For purposes of this Section 6.5, “Subsidiary Corporation” means a corporation other
than the Company in an unbroken chain of corporations beginning with the Company if, at the time of
granting the Option, each of the corporations other than the last corporation in the unbroken chain
owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain. Notwithstanding the foregoing and
Sections 3.2(k) or 15.2, the Committee may, without the consent of the Grantee, at any time before
the exercise of an Option (whether or not an Incentive Stock Option), take any action necessary to
prevent such Option from being treated as an Incentive Stock Option.

     6.6 Exercise and Payment.

     (a) Except as may otherwise be provided by the Committee in an Award Agreement, Options shall
be exercised by the delivery of a written notice (“Notice”) to the Company setting forth
the number of Shares to be exercised, accompanied by full payment (including any applicable tax
withholding) for the Shares made by any one or more of the following means on the Exercise Date (or
such other date as may be permitted in writing by the Secretary of the Company):

     (i) cash, personal check or wire transfer;

     (ii) with the approval of the Committee, Shares or Shares of Restricted Stock valued at
the Fair Market Value of a Share on the Exercise Date; or

     (iii) subject to applicable law, through the sale of the Shares acquired on

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exercise of
the Option through a broker-dealer to whom the Grantee has submitted an irrevocable notice
of exercise and irrevocable instructions to deliver promptly to the Company the amount of
sale or loan proceeds sufficient to pay for such Shares, together with, if requested by the
Company, the amount of applicable withholding taxes payable by Grantee by reason of such
exercise.

     (b) The Committee may in its discretion specify that, if any Shares of Restricted Stock
(“Tendered Restricted Shares”) are used to pay the Option Price, (x) all the Shares
acquired on exercise of the Option shall be subject to the same restrictions as the Tendered
Restricted Shares, determined as of the date of exercise of the Option, or (y) a number of Shares
acquired on exercise of the Option equal to the number of Tendered Restricted Shares shall be
subject to the same restrictions as the Tendered Restricted Shares, determined as of the date of
exercise of the Option.

     (c) At the discretion of the Committee and subject to applicable law, the Company may loan a
Grantee all or any portion of the amount payable by the Grantee to the Company upon exercise of the
Option on such terms and conditions as the Committee may determine.

     (d) If the Option is exercised as permitted by the Plan by any Person other than the Grantee,
the Notice shall be accompanied by documentation as may reasonably be required by the Company,
including, evidence of authority of such Person or Persons to exercise the Option.

     (e) At the time a Grantee exercises an Option or to the extent provided by the Committee in
the applicable Award Agreement, in lieu of accepting payment of the Option Price of the Option and
delivering the number of Shares of Common Stock for which the Option is being exercised, the
Committee may direct that the Company either (i) pay the Grantee a cash amount, or (ii) issue a
lesser number of Shares of Common Stock, in any such case, having a Fair Market Value on the
Exercise Date equal to the amount, if any, by which the aggregate Fair Market Value (or such other
amount as may be specified in the applicable Award Agreement, in the case of an exercise occurring
concurrent with a Change in Control) of the Shares of Common Stock as to which the Option is being
exercised exceeds the aggregate Option Price for such Shares, based on such terms and conditions as
the Committee shall establish.

Section 7.

Stock Appreciation Rights

     7.1 Grant of SARs. Subject to and consistent with the provisions of the Plan, the
Committee, at any time and from time to time, may grant SARs to any Eligible Person on a standalone
basis only (i.e., not in tandem with an Option). The Committee may impose such conditions or
restrictions on the exercise of any SAR as it shall deem appropriate.

     7.2 Award Agreements. Each SAR shall be evidenced by an Award Agreement in such form
as the Committee may approve, which shall contain such terms and conditions not inconsistent with
the provisions of the Plan as shall be determined from time to time by the Committee. Unless
otherwise provided in the Award Agreement, no SAR grant shall have a Term of more than ten (10)
years from the date of grant of the SAR.

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     7.3 Strike Price. The Strike Price of an SAR shall be determined by the Committee in
its sole discretion; provided that the Strike Price shall not be less than 100% of the Fair Market
Value of a Share on the Grant Date of the SAR.

     7.4 Vesting. Shares subject to an SAR shall become vested and exercisable as
specified in the applicable Award Agreement.

     7.5 Exercise and Payment. Except as may otherwise be provided by the Committee in an
Award Agreement, SARs shall be exercised by the delivery of a written notice to the Company,
setting forth the number of Shares with respect to which the SAR is to be exercised. No payment of an SAR shall be made
unless applicable tax withholding requirements have been satisfied in accordance with Section 18.1
or otherwise. Any payment by the Company in respect of an SAR may be made in cash, Shares, other
property, or any combination thereof, as the Committee, in its sole discretion, shall determine.

     7.6 Grant Limitations. The Committee may at any time impose any other limitations or
Restrictions upon the exercise of SARs which it deems necessary or desirable in order to achieve
desirable tax results for the Grantee or the Company.

Section 8.

Restricted Stock

     8.1 Grant of Restricted Stock. Subject to and consistent with the provisions of the
Plan, the Committee, at any time and from time to time, may grant Restricted Stock to any Eligible
Person in such amounts as the Committee shall determine.

     8.2 Award Agreement. Each grant of Restricted Stock shall be evidenced by an Award
Agreement that shall specify the Restrictions, the number of Shares subject to the Restricted Stock
Award, and such other provisions not inconsistent with the provisions of this Plan as the Committee
shall determine. The Committee may impose such Restrictions on any Award of Restricted Stock as it
deems appropriate, including time-based Restrictions, Restrictions based upon the achievement of
specific performance goals, Restrictions based on the occurrence of a specified event, and/or
Restrictions under applicable securities laws.

     8.3 Consideration for Restricted Stock. The Committee shall determine the amount, if
any, that a Grantee shall pay for Restricted Stock.

     8.4 Vesting. Shares subject to a Restricted Stock Award shall become vested as
specified in the applicable Award Agreement (thereafter being referred to as “Unrestricted
Stock”). For purposes of calculating the number of Shares of Restricted Stock that become
Unrestricted Stock as set forth above, Share amounts shall be rounded to the nearest whole Share
amount.

     8.5 Effect of Forfeiture. If Restricted Stock is forfeited, and if the Grantee was
required to pay for such Shares or acquired such Restricted Stock upon the exercise of an Option,
the Grantee shall be deemed to have resold such Restricted Stock to the Company at a price equal to
the lesser of (x) the amount
paid by the Grantee for such Restricted Stock or the exercise price of the Option, as
applicable, and (y) the Fair Market Value of a Share on the date of such

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forfeiture. The Company
shall pay to the Grantee the deemed sale price as soon as is administratively practical. Such
Restricted Stock shall cease to be outstanding, and shall no longer confer on the Grantee thereof
any rights as a stockholder of the Company, from and after the date of the event causing the
forfeiture, whether or not the Grantee accepts the Company’s tender of payment for such Restricted
Stock.

     8.6 Escrow; Legends. The Committee may provide that the certificates for any
Restricted Stock (x) shall be held (together with a stock power executed in blank by the Grantee)
in escrow by the Secretary of the Company until such Restricted Stock becomes nonforfeitable or is
forfeited and/or (y) shall bear an appropriate legend restricting the transfer of such Restricted
Stock under the Plan. If any Restricted Stock becomes nonforfeitable, the Company shall cause
certificates for such Shares to be delivered without such legend or shall cause a release of
restrictions on a book entry account maintained by the Company’s transfer agent.

     8.7 Stockholder Rights in Restricted Stock. Restricted Stock, whether held by a
Grantee or in escrow or other custodial arrangement by the Secretary of the Company, shall confer
on the Grantee all rights of a stockholder of the Company, except as otherwise provided in the Plan
or Award Agreement. At the time of a grant of Restricted Stock, the Committee may require the
payment of cash dividends thereon to be deferred and, if the Committee so determines, reinvested in
additional Shares of Restricted Stock. Stock dividends and deferred cash dividends issued with
respect to Restricted Stock shall be subject to the same restrictions and other terms as apply to
the Shares of Restricted Stock with respect to which such dividends are issued. The Committee may
in its discretion provide for payment of interest on deferred cash dividends.

Section 9.

Restricted Stock Units

     9.1 Grant of Restricted Stock Units. Subject to and consistent with the provisions of
the Plan and Sections 409A(2), (3) and (4) of the Code, the Committee, at any time and from time to
time, may grant Restricted Stock Units to any Eligible Person, in such amount and upon such terms
as the Committee shall determine. A Grantee shall have no voting rights in Restricted Stock Units.

     9.2 Award Agreement. Each grant of Restricted Stock Units shall be evidenced by an
Award Agreement that shall specify the Restrictions, the number of Shares subject to the Restricted
Stock Units granted, and such other provisions as the Committee shall determine in accordance with
the Plan and Code Section 409A. The Committee may impose such Restrictions on Restricted Stock
Units, including time-based Restrictions based on the achievement of specific performance goals,
time-based Restrictions following the achievement of specific performance goals, Restrictions based
on the occurrence of a specified event, and/or Restrictions under applicable securities laws.

     9.3 Crediting Restricted Stock Units. The Company shall establish an account
(“RSU Account”) on its books for each Eligible Person who receives a grant of Restricted
Stock Units. Restricted Stock Units shall be credited to the Grantee’s RSU Account as of the Grant
Date of such Restricted Stock Units. RSU Accounts shall be maintained for recordkeeping purposes
only

21

 

and the Company shall not be obligated to segregate or set aside assets representing
securities or other amounts credited to RSU Accounts. The obligation to make distributions of
securities or other amounts credited to RSU Accounts shall be an unfunded, unsecured obligation of
the Company.

     (a) Crediting of Dividend Equivalents. Except as otherwise provided in an Award
Agreement, whenever dividends are paid or distributions made with respect to Shares, Dividend
Equivalents shall be credited to RSU Accounts on all Restricted Stock Units credited thereto as of
the record date for such dividend or distribution. Such Dividend Equivalents shall be credited to
the RSU Account in the form of additional Restricted Stock Units in a number determined by dividing
the aggregate value of such Dividend Equivalents by the Fair Market Value of a Share at the payment
date of such dividend or distribution.

     (b) Settlement of RSU Accounts. The Company shall settle an RSU Account by delivering
to the holder thereof (which may be the Grantee or his or her Beneficiary, as applicable) a number
of Shares equal to the whole number of Shares underlying the Restricted Stock Units then credited
to the Grantee’s RSU Account (or a specified portion in the event of any partial settlement);
provided that any fractional Shares underlying Restricted Stock Units remaining in the RSU Account
on the Settlement Date shall be distributed in cash in an amount equal to the Fair Market Value of
a Share as of the Settlement Date multiplied by the remaining fractional Restricted Stock Unit.
Unless otherwise provided in an Award Agreement, the Settlement Date for all Restricted Stock Units
credited to a Grantee’s RSU Account shall be the as soon as administratively practical following
when Restrictions applicable to an Award of Restricted Stock Units have lapsed, but in no event
shall such Settlement Date be later than March 15 of the calendar year following the calendar year
in which the Restrictions applicable to an Award of Restricted Stock Units have lapsed. Unless
otherwise provided in an Award Agreement, in the event of a Grantee’s Termination of Service prior
to the lapse of such Restrictions, such Grantee’s Restricted Stock Units shall be immediately
cancelled and forfeited to the Company.

Section 10.

Deferred Stock

     10.1 Grant of Deferred Stock. Subject to and consistent with the provisions of the
Plan and Sections 409A(a)(2), (3), and (4) of the Code, the Committee, at any time and from time to
time, may grant Deferred Stock to any Eligible Person in such number, and upon such terms, as the
Committee, at any time and from time to time, shall determine (including, to the extent allowed by
the Committee, grants at the election of a Grantee to convert Shares to be acquired upon lapse of
restrictions on Restricted Stock or Restricted Stock Units into such Deferred Stock). A Grantee
shall have no voting rights in Deferred Stock.

     10.2 Award Agreement. Each grant of Deferred Stock shall be evidenced by an Award
Agreement that shall specify the number of Shares underlying the Deferred Stock subject to an
Award, the Settlement Date such Shares of Deferred Stock shall be settled and such other provisions
as the Committee shall determine that are in accordance with the Plan and Code Section 409A.

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     10.3 Deferred Stock Elections.

     (a) Making of Deferral Elections. If and to the extent permitted by the Committee, an
Eligible Person may elect (a “Deferral Election”) at such times and in accordance with
rules and procedures adopted by the Committee (which shall comport with Code Section 409A), to
receive all or any portion of his salary and/or bonus (including any cash or Share Award, other
than an Options or SARs) in the form of a number of shares of Deferred Stock equal to the quotient
of the amount of salary and/or cash bonus or other permissible Award to be paid in the form of
Deferred Stock divided by the Fair Market Value of a Share on the date such salary or bonus or
other such Award would otherwise be paid in cash or distributed in Shares. The Grant Date for an
Award of Deferred Stock made pursuant to a Deferral Election shall be the date the deferrable
amount subject to a Deferral Election would otherwise have been paid to the Grantee in cash or
Shares.

     (b) Timing of Deferral Elections. An initial Deferral Election must be filed with the
Secretary of the Company no later than December 31 of the year preceding the calendar year in which
the amounts subject to the Deferral Election would otherwise be earned, subject to such
restrictions and advance filing requirements as the Company may impose. A Deferral Election shall
be irrevocable as of the filing deadline. Each Deferral Election shall remain in effect with
respect to subsequently earned amounts unless the Eligible Person revokes or changes such Deferral
Election. Any such revocation or change shall have prospective application only.

     (c) Subsequent Deferral Elections. A Deferral Election (other than an initial
Deferral Election) made with respect to a Deferred Compensation Award must meet the timing
requirements for a subsequent deferral election as specified in Treasury Regulation § 1.409A-2(b).

     10.4 Deferral Account.

     (a) Establishment of Deferral Accounts. The Company shall establish an account
(“Deferral Account”) on its books for each Eligible Person who receives a grant of Deferred
Stock or makes a Deferral Election. Deferred Stock shall be credited to the Grantee’s Deferral
Account as of the Grant Date of such Deferred Stock. Deferral Accounts shall be maintained for
recordkeeping purposes only and the Company shall not be obligated to segregate or set aside assets
representing securities or other amounts credited to Deferral Accounts. The obligation to make
distributions of securities or other amounts credited to Deferral Accounts shall be an unfunded,
unsecured obligation of the Company.

     (b) Crediting of Dividend Equivalents. Except as otherwise provided in an Award
Agreement, whenever dividends are paid or distributions made with respect to Shares, Dividend
Equivalents shall be credited to Deferral Accounts on all Deferred Stock credited thereto as of the
record date for such dividend or distribution. Such Dividend Equivalents shall be credited to the
Deferral Account in the form of additional Deferred Stock in a number determined by dividing the
aggregate value of such Dividend Equivalents by the Fair Market Value of a Share at the payment
date of such dividend or distribution.

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     (c) Settlement of Deferral Accounts. The Company shall settle a Deferral Account by
delivering to the holder thereof (which may be the Grantee or his or her Beneficiary or estate, as
applicable) a number of Shares equal to the whole number of Shares of Deferred Stock then credited
to the Grantee’s Deferral Account (or a specified portion in the event of any partial settlement);
provided that any fractional Shares of Deferred Stock remaining in the Deferral Account on the
Settlement Date shall be distributed in cash in an amount equal to the Fair Market Value of a Share
as of the Settlement Date multiplied by the remaining fractional Share. The Settlement Date for
all Deferred Stock credited in a Grantee’s Deferral Account shall be determined in accordance with
Code Section 409A and shall be specified in the applicable Award Agreement or Deferral Election.
The Settlement Date for Deferred Stock, as may be permitted by the Committee in its discretion and
as specified in the Award Agreement or Deferral Election, is limited to one or more of the
following events: (1) a specified date (as contemplated by applicable guidance under Code Section
409A), (2) a Change in Control (within the meaning of the definition that applies to Deferred
Compensation Awards), (3) the Grantee’s “separation from service” as provided in Code Section
409A(2)(A)(i), (4) the Grantee’s death, (5) the Grantee’s Disability or (6) an “unforeseeable
emergency” of the Grantee as provided in Code Section 409A(2)(A)(vi).

Section 11.

Performance Units

     11.1 Grant of Performance Units. Subject to and consistent with the provisions of the
Plan, Performance Units may be granted to any Eligible Person in such number and upon such terms,
and at any time and from time to time, as shall be determined by the Committee. Performance Units
shall be evidenced by an Award Agreement in such form as the Committee may approve, which shall
contain such terms and conditions not inconsistent with the provisions of the Plan as shall be
determined from time to time by the Committee.

     11.2 Value/Performance Goals. The Committee shall set performance goals in its
discretion which, depending on the extent to which they are met during a Performance Period, will
determine the number or value of Performance Units that will be paid to the Grantee at the end of
the Performance Period. Each Performance Unit shall have an initial value that is established by
the Committee at the time of grant. The performance goals for Awards of Performance Units shall be
set by the Committee at threshold, target and maximum performance levels with the number or value
of the Performance Units payable tied to the degree of attainment of the various performance levels
during the Performance Period. No payment shall be made with respect to a Performance Unit Award if the
threshold performance level is not satisfied. If performance goals are attained between the
threshold and target performance levels or between the target and maximum performance levels, the
number or value of Performance Units under such Award shall be determined by linear interpolation,
unless otherwise provided in an Award Agreement. With respect to Covered Employees and to the
extent the Committee deems it appropriate to comply with Section 162(m) of the Code, all
performance goals shall be based on objective Performance Measures satisfying the requirements for
the Performance-Based Exception, and shall be set by the Committee within the time period
prescribed by Section 162(m) of the Code and related regulations.

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     11.3 Earning of Performance Units. Except as provided in Section 13, after the
applicable Performance Period has ended, the holder of Performance Units shall be entitled to
payment based on the level of achievement of performance goals set by the Committee and as
described in Section 11.2. If the Performance Unit is intended to comply with the
Performance-Based Exception, the Committee shall certify the level of achievement of the
performance goals in writing before the Award is settled. At the discretion of the Committee, the
Award Agreement may specify that an Award of Performance Units is payable in cash, Shares,
Restricted Stock or Restricted Stock Units.

     11.4 Adjustment on Change of Position. If a Grantee is promoted, demoted or
transferred to a different business unit of the Company during a Performance Period, then, to the
extent the Committee determines that the Award, the performance goals, or the Performance Period
are no longer appropriate, the Committee may adjust, change, eliminate or cancel the Award, the
performance goals, or the applicable Performance Period, as it deems appropriate in order to make
them appropriate and comparable to the initial Award, the performance goals, or the Performance
Period.

     11.5 Dividend Rights. At the discretion of the Committee, a Grantee may be entitled
to receive any dividends or Dividend Equivalents declared with respect to Shares deliverable in
connection with grants of Performance Units which have been earned, but not yet delivered to the
Grantee.

Section 12.

Annual Incentive Awards

     12.1 Annual Incentive Awards. Subject to and consistent with the provisions of the Plan,
Annual Incentive Awards may be granted to any Eligible Person in accordance with the provisions of
this Section 12. The Committee shall designate the individuals eligible to be granted an Annual
Incentive Award for a Year within the first ninety (90) days of such year; provided that for a
hiring or promotion after such period which makes any individual who is not a “covered person”
within the meaning of Code Section 162(m) eligible to be granted an Annual Incentive Award, the
designation shall not be later than the elapse of 25% of the remainder of such Year after such
hiring or promotion. The Committee may designate an Eligible Person as eligible for a full Year or
for a period of less
than a full Year. The opportunity to be granted an Annual Incentive Award shall be evidenced by an
Award Agreement or in such form as the Committee may approve, which shall specify the individual’s
Bonus Opportunity, the Performance Goals, and such other terms not inconsistent with the Plan as
the Committee shall determine.

     12.2 Determination of Amount of Annual Incentive Awards.

     (a) Aggregate Maximum. The Committee may establish guidelines as to the maximum
amount of Annual Incentive Awards payable for any Year.

     (b) Establishment of Performance Goals and Bonus Opportunities. Within the first
ninety (90) days of each Year, the Committee shall establish Performance Goals for the Year (which
may be the same or different for some or all Eligible Persons) and shall establish the

25

 

threshold,
target and maximum Bonus Opportunity for each Grantee for the attainment of specified threshold,
target and maximum Performance Goals. Performance Goals and Bonus Opportunities may be weighted
for different factors and measures as the Committee shall determine.

     (c) Committee Certification and Determination of Amount of Annual Incentive Award.
The Committee shall determine and certify in writing the degree of attainment of Performance Goals
as soon as administratively practicable after the end of each Year but not later than sixty (60)
days after the end of such Year. The Committee shall determine an individual’s maximum Annual
Incentive Award based on the level of attainment of the Performance Goals (as certified by the
Committee) and the individual’s Bonus Opportunity. The Committee reserves the discretion to reduce
(but not below zero) the amount of an individual’s Annual Incentive Award below the maximum Annual
Incentive Award. The determination of the Committee to reduce (or not pay) an individual’s Annual
Incentive Award for a Year shall not affect the maximum Annual Incentive Award payable to any other
individual. No Annual Incentive Award shall be payable to an individual unless at least the
threshold Performance Goal is attained.

     (d) Termination of Service. If a Grantee has a Termination of Service during the
Year, the Committee may, in its absolute discretion and under such rules as the Committee may from
time to time prescribe, authorize the payment of an Annual Incentive Award to such Grantee in
accordance with the foregoing provisions of this Section 12.2 and in the absence of such
determination by the Committee the Grantee shall receive no Annual Incentive Award for such Year.

     12.3 Time of Payment of Annual Incentive Awards. Annual Incentive Awards shall be paid as
soon as administratively practicable after the Committee determines the amount of the Award payable
under Section 12 but not later than two and one-half months after the end of such Year.

     12.4 Form of Payment of Annual Incentive Awards.
An individual’s Annual Incentive Award for a Year shall be paid in cash, Shares,
Restricted Stock, Options or any other form of an Award or any combination thereof as provided in
the Award Agreement or in such form as the Committee may approve.

Section 13.

Change in Control

     13.1 Acceleration of Vesting. Upon the occurrence of an event satisfying the
definition of “Change in Control” with respect to a particular Award, unless otherwise provided in
an Award Agreement, such Award shall become vested, all Restrictions shall lapse and all
Performance Goals shall be deemed to be met, as applicable; provided, however, that no payment of
an Award shall be accelerated to the extent such payment would cause such Award to be subject to
the adverse consequences described in Code Section 409A. The Committee may, in its discretion,
include such further provisions and limitations in any Award Agreement as it may deem desirable.

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     13.2 Special Treatment In the Event of a Change in Control(a) . In order to maintain
the Grantee’s rights upon the occurrence of any event satisfying the definition of “Change in
Control” with respect to an Award, the Committee, as constituted before such event, may, in its
sole discretion, as to any such Award, either at the time the Award is made hereunder or any time
thereafter, take any one or more of the following actions: (i) make such adjustment to any such
Award then outstanding as the Committee deems appropriate to reflect such Change in Control; or
(ii) cause any such Award then outstanding to be assumed, or new rights substituted therefore, by
the acquiring or surviving entity after such Change in Control. Additionally, in the event of any
Change in Control with respect to Options and SARs, the Committee, as constituted before such
Change in Control, may, in its sole discretion, (i) cancel any outstanding unexercised Options or
SARs (whether or not vested) that have a per Share Option Price or Strike Price (as applicable)
which is greater than the per Share Fair Market Value as of the date of the Change in Control; or
(ii) cancel any outstanding unexercised Options or SARs (whether or not vested) that have a per
Share Option Price or Strike Price (as applicable) which is less than or equal to the per Share
Fair Market Value as of the date of the Change in Control in exchange for a cash payment of an
amount equal to (x) the difference between the per share Fair Market Value as of the date of the
Change in Control and the Option Price or Strike Price multiplied by (y) the total number of Shares
underlying such Option or SAR that are vested and exercisable at the time of the Change in Control.

Section 14.

Dividend Equivalents

     The Committee is authorized to grant Awards of Dividend Equivalents alone or in conjunction
with other Awards, on such terms and conditions as the Committee shall determine in accordance with
Code Section 409A. Unless otherwise provided in the Award Agreement or in Sections 9 and 10 of the
Plan, Dividend Equivalents shall be paid immediately when accrued and, in no event, later than
March 15 of the calendar year following the calendar year in which such Dividend Equivalents
accrue. Unless otherwise provided in the Award Agreement or in
Sections 9 and 10 of the Plan, if the Grantee incurs a Termination of Service prior to the
date such Dividend Equivalents accrue, the Grantee’s right to such Dividend Equivalents shall be
immediately forfeited.

Section 15.

Stockholders’ Agreement

     Notwithstanding anything in the Plan to the contrary, no Shares with respect to any Award
under the Plan shall be delivered to any Grantee prior to the execution and delivery to the Company
by the Grantee of a joinder to the Stockholders’ Agreement dated as of September 1, 2004 between
the Company and the Stockholders of the Company, as it may be amended, restated or otherwise in
effect from time to time and any such other agreements or documents as the Committee may require;
provided, however, a Grantee shall not be required to execute the Stockholders’ Agreement on or
after an IPO.

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Section 16.

Amendments and Termination

     16.1 Amendment and Termination. Subject to Section 16.2, the Board may at any time
amend, alter, suspend, discontinue or terminate the Plan in whole or in part without the approval
of the Company’s stockholders, provided that (a) any amendment shall be subject to the approval of
the Company’s stockholders if such approval is required by any federal or state law or regulation
or any stock exchange or automated quotation system on which the Shares may then be listed or
quoted, and (b) any Plan amendment or termination will not accelerate the timing of any payments
that constitute deferred compensation under Code Section 409A unless such acceleration of payment
is permitted by Code Section 409A.

     16.2 Previously Granted Awards. Except as otherwise specifically provided in the Plan
(including Sections 3.2(k), 5.5 and this Section 16.2) or an Award Agreement, no termination,
amendment or modification of the Plan shall adversely affect in any material way any Award
previously granted under the Plan without the written consent of the Grantee of such Award.

Section 17.

Beneficiary Designation

     Each Grantee under the Plan may, from time to time, name any Beneficiary or Beneficiaries (who
may be named contingently or successfully) to whom any benefit under the Plan is to be paid in case
of his or her death before he or she receives any or all of such benefit. Each such designation
shall revoke all prior designations by the same Grantee, shall be in a form prescribed by the
Company, and will be effective only when filed by the Grantee in writing with the Company during
the Grantee’s lifetime. In the absence of any such designation, benefits remaining unpaid at the
Grantee’s death shall be paid to the Grantee’s estate.

Section 18.

Withholding

     18.1 Required Withholding.

     (a) The Committee in its sole discretion may provide that when taxes are to be withheld in
connection with the exercise of an Option or an SAR or upon the lapse of Restrictions on an Award
or upon payment of any benefit or right under this Plan (the Exercise Date, the date such
Restrictions lapse or such payment of any other benefit or right occurs hereinafter referred to as
the “Tax Date”), the Grantee may elect to make payment for the withholding of federal,
state and local taxes, including Social Security and Medicare (“FICA”) taxes, by one or a
combination of the following methods:

     (i) payment of an amount in cash equal to the amount to be withheld;

     (ii) requesting the Company to withhold from those Shares that would otherwise be
received upon exercise of the Option or an SAR or upon the lapse of Restrictions on an
Award, a number of Shares having a Fair Market Value on the Tax Date equal to the amount to
be withheld; or

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     (iii) withholding from any compensation otherwise due to the Grantee.

     The Committee in its sole discretion may provide that the maximum amount of tax withholding
upon exercise of an Option or an SAR to be satisfied by withholding Shares upon exercise of such
Option pursuant to clause (iii) above shall not exceed the minimum amount of taxes, including FICA
taxes, required to be withheld under federal, state and local law. An election by Grantee under
this subsection is irrevocable. Any fractional share amount and any additional withholding not
paid by the withholding or surrender of Shares must be paid in cash. If no timely election is
made, the Grantee must deliver cash to satisfy all tax withholding requirements.

     (b) Any Grantee who makes a Disqualifying Disposition (as defined in Section 6.5(f)) or an
election under Section 83(b) of the Code shall remit to the Company an amount sufficient to satisfy
all resulting tax withholding requirements in the same manner as set forth in subsection (a).

     (c) No Award shall be settled, whether in cash or in Shares, unless the applicable tax
withholding requirements have been met to the satisfaction of the Committee.

     18.2 Notification under Section 83(b) of the Code. If the Grantee, in connection with
the exercise of any Option, or the grant of Restricted Stock, makes the election permitted under
Section 83(b) of the Code to include in such Grantee’s gross income in the year of transfer the
amounts specified in Section 83(b) of the Code, then such Grantee shall notify the Company of such
election within ten (10) days of filing the notice of the election with the Internal Revenue
Service, in addition to any filing and notification
required pursuant to regulations issued under Section 83(b) of the Code. The Committee may,
in connection with the grant of an Award or at any time thereafter, prohibit a Grantee from making
the election described above.

Section 19.

General Provisions

     19.1 Governing Law. The validity, construction, and effect of the Plan and any rules
and regulations relating to the Plan shall be determined in accordance with the laws of the State
of Delaware other than its law respecting choice of laws and applicable federal law.

     19.2 Severability. If any provision of this Plan or any Award is or becomes or is
deemed to be invalid, illegal or unenforceable in any jurisdiction, or as to any Person or Award,
or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be
construed or deemed amended without, in the determination of the Committee, materially altering the
intent of the Plan or the Award, it shall be stricken and the remainder of the Plan and any such
Award shall remain in full force and effect.

     19.3 Successors. All obligations of the Company under the Plan with respect to Awards
granted hereunder shall be binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise of
all or substantially all of the business and/or assets of the Company.

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     19.4 Requirements of Law. The granting of Awards and the delivery of Shares under the
Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or national securities exchanges or markets as may be required.
Notwithstanding any provision of the Plan or any Award, Grantees shall not be entitled to exercise,
or receive benefits under, any Award, and the Company (or any Subsidiary) shall not be obligated to
deliver any Shares or deliver benefits to a Grantee, if such exercise or delivery would constitute
a violation by the Grantee, the Company or a Subsidiary of any applicable law or regulation.

     19.5 Securities Law Compliance. If the Committee deems it necessary to comply with
any applicable securities law, or the requirements of any securities exchange or market upon which
Shares may be listed, the Committee may impose any restriction on Awards or Shares acquired
pursuant to Awards under the Plan as it may deem advisable. All evidence of Share ownership
delivered pursuant to any Award or the exercise thereof shall be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under the rules, regulations or
other requirements of the
SEC, any securities exchange or market upon which Shares are then listed, and any applicable
securities law. If so requested by the Company, the Grantee shall make a written representation
and warranty to the Company that he or she will not sell or offer to sell any Shares unless a
registration statement shall be in effect with respect to such Shares under the Securities Act of
1933, as amended, and any applicable state securities law or unless he or she shall have furnished
to the Company an opinion of counsel, in form and substance satisfactory to the Company, that such
registration is not required.

     If the Committee determines that the exercise or nonforfeitability of, or delivery of benefits
pursuant to, any Award would violate any applicable provision of securities laws or the listing
requirements of any national securities exchange or national market system on which are listed any
of the Company’s equity securities, then the Committee may postpone any such exercise,
nonforfeitability or delivery to comply with all such provisions at the earliest practicable date.

     19.6 Section 409A. To the extent applicable and notwithstanding any other provision
of this Plan, this Plan and Awards hereunder shall be administered, operated and interpreted in
accordance with Code Section 409A and Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or other guidance
that may be issued after the date on which the Board approves the Plan; provided, however, in the
event that the Committee determines that any amounts payable hereunder may be taxable to a Grantee
under Code Section 409A and related Department of Treasury guidance prior to the payment and/or
delivery to such Grantee of such amount, the Company may (i) adopt such amendments to the Plan and
related Award, and appropriate policies and procedures, including amendments and policies with
retroactive effect, that the Committee determines necessary or appropriate to preserve the intended
tax treatment of the benefits provided by the Plan and Awards hereunder and/or (ii) take such other
actions as the Committee determines necessary or appropriate to comply with or exempt the Plan
and/or Awards from the requirements of Code Section 409A and related Department of Treasury
guidance, including such Department of Treasury guidance and other interpretive materials as may be
issued after the date on which the Board approves the Plan. The Company and its Subsidiaries make
no guarantees to any Person regarding the tax treatment of Awards or payments made under the

30

 

Plan, and, notwithstanding the above provisions and any agreement or understanding to the contrary, if
any Award, payments or other amounts due to a Grantee (or his or her beneficiaries, as applicable)
results in, or causes in any manner, the application of an accelerated or additional tax, fine or
penalty under Code Section 409A or otherwise to be imposed, then the Grantee (or his or her
beneficiaries, as applicable) shall be solely liable for the payment of, and the Company and its
Subsidiaries shall have no obligation or liability to pay or reimburse (either directly or
otherwise) the Grantee (or his or her beneficiaries, as applicable) for, any such additional taxes,
fines or penalties.

     19.7 No Rights as a Stockholder. No Grantee shall have any rights as a stockholder of
the Company with respect to the Shares (except as provided in Section 8.7 with respect to
Restricted Stock) which may be
deliverable upon exercise or payment of such Award until such Shares have been delivered to
him or her.

     19.8 Awards Not Taken Into Account for Other Benefits. Awards shall be special
incentive payments to the Grantee and shall not be taken into account in computing the amount of
salary or compensation of the Grantee for purposes of determining any pension, retirement, death or
other benefit under (a) any pension, retirement, profit-sharing, bonus, insurance or other employee
benefit plan of an Employer, except as such plan shall otherwise expressly provide, or (b) any
agreement between an Employer and the Grantee, except as such agreement shall otherwise expressly
provide.

     19.9 Employment Agreement Supersedes Award Agreement. In the event a Grantee is a
party to an employment agreement with the Company or a Subsidiary that provides for vesting or
extended exercisability of equity compensation Awards on terms more favorable to the Grantee than
the Grantee’s Award Agreement or this Plan, the employment agreement shall be controlling; provided
that (a) if the Grantee is a Section 16 Person, any terms in the employment agreement requiring
Compensation Committee of the Board, Board or stockholder approval in order for an exemption from
Section 16(b) of the Exchange Act to be available shall have been approved by the Compensation
Committee of the Board, the Board or the stockholders, as applicable, and (b) the employment
agreement shall not be controlling to the extent the Grantee and Grantee’s Employer agree it shall
not be controlling.

     19.10 Non-Exclusivity of Plan. Neither the adoption of the Plan by the Board nor its
submission to the stockholders of the Company for approval shall be construed as creating any
limitations on the power of the Board to adopt such other compensatory arrangements for employees
as it may deem desirable.

     19.11 No Trust or Fund Created. Neither the Plan nor any Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary relationship between the
Company or any Subsidiary and a Grantee or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any Subsidiary pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor of the Company or any
Subsidiary.

     19.12 No Right to Continued Employment or Awards. No employee shall have the right to
be selected to receive an Award under this Plan or, having been so selected, to be selected to

31

 

receive a future Award. The grant of an Award shall not be construed as giving a Grantee the right
to be retained in the employ of the Company or any Subsidiary or to be retained as a director of
the Company or any Subsidiary. Further, the Company or a Subsidiary may at any time terminate the
employment of a Grantee free from any liability, or any claim under the Plan, unless otherwise
expressly provided in the Plan or in any Award Agreement.

     19.13 Military Service. Awards shall be administered in accordance with Section
414(u) of the Code and the Uniformed Services Employment and Reemployment Rights Act of 1994.

     19.14 Construction. The following rules of construction will apply to the Plan: (a)
the word “or” is disjunctive but not necessarily exclusive, and (b) words in the singular include
the plural, words in the plural include the singular, and words in the neuter gender include the
masculine and feminine genders and words in the masculine or feminine gender include the other
neuter genders. The headings of sections and subsections are included solely for convenience of
reference, and if there is any conflict between such headings and the text of this Plan, the text
shall control.

     19.15 No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award, and the Committee shall determine whether cash, other
securities, or other property shall be paid or transferred in lieu of any fractional Shares, or
whether such fractional Shares or any rights thereto shall be canceled, terminated, or otherwise
eliminated.

     19.16 Plan Document Controls. This Plan and each Award Agreement constitute the
entire agreement with respect to the subject matter hereof and thereof; provided that in the event
of any inconsistency between this Plan and such Award Agreement, the terms and conditions of the
Plan shall control.

32

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