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Exhibit 10.03    
    

 
 

Base Agreement #4902RL0436    
    

        This Base Agreement ("Base Agreement") dated as of March 24, 2002, between International Business Machines
Corporation ("Buyer") and Adaptec, Inc. ("Supplier"), establishes the basis for a multinational
procurement relationship under which Supplier will provide Buyer the Products and Services described in SOWs issued under this Base Agreement. Products and Services acquired by Buyer on or after the
Effective Date will be covered by this Base Agreement. This Base Agreement will remain in effect until terminated. 

1.0   Definitions:  

Capitalized terms used in this Agreement but not defined in this Agreement shall have the definitions as set forth in the Asset Purchase Agreement dated as of the Closing Date
between Supplier and Buyer.

        "Affiliates" means entities that control, are controlled by, or are under common control with, a party to this Agreement. 

        "Agreement" means this Base Agreement and any relevant Statements of Work ("SOW"), Work
Authorizations ("WA"), and other attachments or appendices specifically referenced in this Agreement. 

        "Effective Date" means the Closing Date as defined in the Asset Purchase Agreement. 

        "Excluded Property means the Licensed Software as defined in Intellectual Property Agreement as it exists as of the Closing Date. 

        "Field Replaceable Unit" or "FRU" means a Product, Product component, Product subassembly,
Product documentation, Product code, or other Product part used to service a Customer system. 

        "Participation Agreement" or "PA" means an agreement signed by one or more Affiliates
which incorporates by reference the terms and conditions in this Base Agreement, any relevant SOW, and other attachments or appendices specifically referenced in the PA. 

        "Personnel" means agents, employees or subcontractors engaged or appointed by Buyer or Supplier. 

        "Prices" means the agreed upon payment and currency for Products and Services, including all applicable fees, payments and taxes
(excluding each party's income taxes), as specified in the relevant SOW and/or WA. 

        "Product" means an item or items that Supplier prepares for or provides to Buyer as described in a SOW. 

        "Services" means work that Supplier performs for Buyer as described in a SOW. 

        "Statement of Work" or "SOW" means any document that: 

	1.
	identifies
itself as a statement of work;

	2.
	is
signed by both parties;

	3.
	incorporates
by reference the terms and conditions of this Base Agreement; and

	4.
	describes
the Products and Services, including any requirements, specifications or schedules. 

        "Work Authorization" or "WA" means Buyer's authorization in either electronic or tangible
form for Supplier to conduct transactions under this Agreement in accordance with the applicable SOW (i.e., 

1

 

a
purchase order, bill of lading, or other Buyer designated document). A SOW is a WA only if designated as such in writing by Buyer. 

2.0   Statement of Work  

        Supplier will provide the Products or Services as specified in the relevant SOW only when specified in a WA. Supplier will begin work only after receiving a WA
from Buyer. Buyer may request changes to a SOW and Supplier will have an opportunity to accept or reject changes, providing a written analysis for its reasons to reject along with the impact of such
changes. Changes accepted by Buyer will be specified in an amended SOW or change order signed by both parties. Supplier will maintain the capability to supply Product spare parts (i.e., the entire
Product or portions of the Product as described herein or as may be subsequently described by Buyer, including, without limitation all FRUs) during the term of the relevant SOW and for a period of
seven (7) years thereafter, or longer period as may be required by law upon Buyer or Supplier. Supplier will give Buyer a last time buy option at the end of such seven (7) year period,
and shall also offer any follow on products that are compatible with Products herein. During the period up to and including the last time buy option, pricing for such Product shall be at the
production level prices as set forth in the SOW. Pricing terms for purchase of FRUs by Buyer after such last time buy will be set forth in the applicable SOW. Supplier will notify Buyer of its intent
to withdraw any Product and will continue to deliver such withdrawn Products for the periods as specified in the relevant SOW. 

3.0   Pricing  

        Supplier will provide Products and Services to Buyer for the Prices. The Prices for Products and Services specified in a WA and accepted by Buyer will be the only
amount due to Supplier from Buyer for such Products and Services. 

        Terms
for payment will be specified in the relevant SOW and/or WA. Payment of invoices will not be deemed acceptance of Products or Services, but rather such Products or Services will be
subject to inspection, test, acceptance or rejection by Buyer until successful integration into Buyer's products, or for a period as specified in the relevant SOW, whichever occurs first. Buyer may,
at its option, either reject Products or Services that do not comply with the specifications and requirements for a refund plus any inspection, test and transportation charges paid by Buyer, or
require prompt correction or replacement of such Products upon Buyer's written instruction. Buyer may reject entire lots of Products which do not meet quality levels as specified in the relevant SOW
and/or WA. 

5.0   Electronic Commerce  

        To the extent permitted by local law, the parties will conduct transactions using an electronic commerce approach under which the parties will electronically
transmit and receive legally binding purchase and sale obligations ("Documents"), including electronic credit entries transmitted by Buyer to the Supplier account specified in the relevant SOW and/or
WA. The parties will enter into a separate agreement governing the transmission of such electronic transactions and associated responsibilities of the parties. 

6.0   Warranties  

6.1   Ongoing Warranties  

        Supplier makes the following ongoing representations and warranties: 

	6.1.1.
	it
has the right to enter into this Agreement and its performance of this Agreement will comply, at its own expense, with the terms of any contract,
obligation, law, regulation or 

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ordinance
to which it is or becomes subject (including but not limited to all applicable privacy laws); 

	6.1.2
	to
the best of Supplier's knowledge, no claim, lien, or action exists or is threatened against Supplier that would interfere with Buyer's use or sale of
the Products. In the event that Supplier becomes aware of any such claim lien or action, Supplier will immediately notify Buyer in writing of the same;

	6.1.3
	Products
and Services do not infringe any intellectual property right of a third party;

	6.1.4
	all
authors have agreed not to assert their moral rights (personal rights associated with authorship of a work under applicable law) in the Products, to
the extent permitted by law;

	6.1.5
	Products
are free from defects in design (except for written designs provided by Buyer unless such designs are based entirely on Supplier's
specifications), material and workmanship, are safe for use consistent with and will conform to the warranties, specifications and requirements, including but not limited to quality requirements, in
this Agreement for the time period from the date of shipment as specified in the relevant SOW and/or WA;

	6.1.6
	none
of the Products contain nor are any of the Products manufactured using ozone depleting substances known as halons, chlorofluorocarbons,
hydrochlorofluorocarbons, methyl chloroform and carbon tetrachloride as defined by the Montreal Protocol;

	6.1.7
	Products
are new and do not contain used or reconditioned parts;

	6.1.8
	it
is knowledgeable with, and is and will remain in full compliance with all applicable export and import laws, regulations, orders, and policies
(including, but not limited to, securing all necessary clearance requirements, export and import licenses and exemptions from, and making all proper filings with appropriate governmental bodies and/or
disclosures relating to the release or transfer of technology and software to non U.S. nationals);

	6.1.9
	it
will not export, directly or indirectly, any technology, software or commodities provided by Buyer or their direct product to any of the countries or
to nationals of those countries, wherever located, listed in U.S. Export Administration Regulations' Country Groups D:1 and E:2, as modified from time to time, unless authorized by appropriate
government license or regulations;

	6.1.10
	it
is an expert fully competent in all phases of the work involved in providing Services furnished under this Agreement, that Supplier shall not deny any
responsibility or obligation to Buyer on the ground that Buyer provided recommendations or assistance with regard to any aspect of the Agreement, and that Supplier acknowledges that Buyer has relied
and will rely on Supplier's capacity as an expert;

	6.1.11
	the
Products shall not contain any computer code, programming instruction, or set of instructions (including without limitation, self-replicating and self
propagating programming instructions commonly called viruses and worms) that is constructed with the ability to damage, interfere with, or otherwise adversely affect computer programs, data files, or
hardware, without the consent or intent of the computer user;

	6.1.12
	the
Products and parts will not experience undetected data integrity problems, data loss, or related issues, that Supplier shall develop and maintain a test procedure
to assess parts under consideration for future Products, that Supplier will periodically assess the compliance of parts being used to build current Products with this warranty, and that Supplier will
provide the results of such assessments to Buyer upon request; and

	6.1.13
	Products
which interact in any capacity with date data, when used in accordance with their associated documentation, are capable of correctly processing, providing,
receiving and 

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displaying
date data, as well as exchanging accurate date data with all products that are capable of correctly processing, providing, receiving and displaying date data, as well as exchange accurate
date data with other products. 

        Notwithstanding
any provision of Section 6.1.3, 6.1.4 or 6.1.11 to the contrary, Buyer shall have no claim against Supplier for a breach of warranty set forth therein if such
claim is based solely upon the Excluded Property. 

THE WARRANTIES IN THIS AGREEMENT ARE IN LIEU OF ALL OTHER WARRANTIES AND CONDITIONS, EXPRESS OR IMPLIED, INCLUDING THOSE WARRANTIES OR CONDITIONS OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE.

6.2   Warranty Redemption  

        Subject to Section 9.0 Supplier Liability for Third Party Claims, if Products or Services do not comply with the warranties in this Agreement, Supplier
will repair or replace Products (at the latest revision level) or re-perform Services, or credit or refund the Price of Products or Services, such remedy at Buyer's discretion. For such
Products, Supplier will issue to Buyer a Return Material Authorization ("RMA") within five (5) days of Buyer's notice. If Supplier fails to repair or replace Products or re-perform
Services within an agreed upon time as specified in the relevant SOW, Buyer may return Products which do not conform to the warranties in this Agreement from any Buyer location to the nearest
authorized Supplier location at cost of Supplier and Supplier will, at cost of Supplier, return any repaired or replaced Product in a timely manner, as set forth in the relevant SOW. 

6.3   Post Warranty Service  

        Supplier will offer post warranty Services as specified in the relevant SOW or identify a third party which will provide such Services. Supplier will not delegate
post warranty Services under this Agreement to a third party without the written consent of Buyer, such consent not to be unreasonably withheld. In the event a third party or Buyer will provide such
Services, Supplier will provide the designated party with the information required for the performance of the Services. 

6.4   Epidemic Defects  

        Supplier will, at Buyer's discretion, repair or replace, or credit or refund Products that are Defective as specified in the relevant SOW ("Defective Products"),
or where a safety defect is found. Supplier will commence such performance within five (5) calendar days of Buyer's notice to Supplier of Defective Products. Notwithstanding the provisions of
Section 10.0 of this BA, Supplier will reimburse Buyer for all actual and reasonable expenses (up to a maximum reimbursement of $1.5 million per Product base part number) incurred by
Buyer for such repair and replacement of Defective Products, including expenses associated with problem diagnosis, field and finished goods inventory repair, and replacement. 

7.0   Delivery  

7.1   Delivery Logistics  

        Supplier agrees to deliver Products in accordance with the delivery dates and delivery locations anywhere in the world stated in Buyer's purchase orders, or other
delivery dates or delivery locations that may have been mutually agreed to by the parties in writing. Delivery under this Agreement means delivery to such location. Buyer may cancel or reschedule the
delivery date or change the delivery point as specified in the relevant SOW and/or WA. The term of sale will be specified in a SOW or WA. Buyer may issue a twelve (12) month rolling forecast
for quantities of Products that may be required. 

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Supplier
will only deliver the Products specified in a WA. ANY PRODUCT QUANTITIES CITED IN OR PURSUANT TO THIS AGREEMENT, EXCEPT FOR QUANTITIES CITED IN A WA, ARE PRELIMINARY
AND NON-BINDING ONLY. BUYER MAKES NO REPRESENTATION OR WARRANTY AS TO THE QUANTITY OF PRODUCTS THAT IT WILL PURCHASE, IF ANY.

7.2   On-Time Delivery  

        The lead-time for Buyer to issue a WA prior to delivery will be specified in a SOW. Products specified in a WA for delivery with such
lead-time will be delivered on time. A delivery is deemed to be "on time" when it arrives at the delivery destination on the scheduled delivery date, not prior to nor subsequent to the
scheduled delivery date unless otherwise stated in the SOW. Supplier will use commercially reasonable efforts when Buyer requests delivery with a shorter lead-time. If Supplier cannot
comply with a delivery commitment, Supplier will promptly notify Buyer of a revised delivery date and Buyer may: 

	1.
	cancel
without charge Products or Services not yet delivered;

	2.
	require
Supplier to deliver Products using priority freight delivery at Supplier's expense for the incremental freight charges; and

	3.
	exercise
all other remedies provided at law, in equity and in this Agreement. 

7.3   Replenishment  

        Supplier will participate in replenishment logistics programs presented by Buyer as set forth in Section 15. 

8.0   Intellectual Property  

        Supplier grants Buyer all intellectual property rights licensable by Supplier which are necessary for Buyer to use and sell the Products in accordance with the
terms of this Base Agreement and any applicable SOWs or WAs. This Agreement does not grant either party any other intellectual property rights, including, but not limited to the right to use the other
party's or their Affiliates' trademarks, trade names or service marks. 

9.0   Supplier Liability for Third Party Claims  

9.1   General Indemnification  

        Supplier will defend, hold harmless and indemnify, including legal fees, Buyer and Buyer Personnel against third party claims that arise or are alleged to have
arisen as a result of negligent or intentional acts or omissions of Supplier or Supplier Personnel or breach by Supplier of any term of this Agreement. 

9.2   Intellectual Property Indemnification  

        Supplier will defend,, cooperate in the defense of, hold harmless and indemnify, including legal fees, Buyer and Buyer Personnel from third party claims made
against Buyer and Buyer Personnel that Supplier's Products or Services infringe the intellectual property rights of a third party. If such a claim 

5

 

is
or is likely to be made, Supplier will, at its own expense, exercise the first of the following remedies that is practicable: 

	1.
	obtain
for Buyer the right to continue to use and sell the Products and Services consistent with this Agreement;

	2.
	modify
the Products and Services so they are non-infringing and in compliance with this Agreement;

	3.
	replace
the Products and Services, or other affected Services, with non-infringing ones that comply with this Agreement; or

	4.
	at
Buyer's request, accept the cancellation of infringing Services and the return of the infringing Products and refund any amount paid by Buyer. 

        Buyer
will give Supplier prompt notice of third party claims against Buyer, and cooperate in the investigation, settlement and defense of such claims at Supplier's expense. Supplier's
settlement of any such claim is subject to Buyer's written consent, such consent not to be unreasonably withheld. 

9.3   Exceptions to Indemnification  

        Supplier will have no obligation to indemnify Buyer or Buyer Personnel for claims that Supplier's Products or Services infringe the intellectual property rights
of a third party to the extent such claims arise as a result of: 

	1.
	The
Excluded Property in the Products or Services; provided that such infringement or claim is based solely on the use of such Excluded Property.

	2.
	Supplier's
implementation of a Buyer or Buyer Personnel originated design and such infringement or claim would have been avoided in the absence of such implementation; or

	3.
	Buyer's
modification of the Products except for intended modifications required for use of the Products and such infringement or claim would have been avoided in the absence of such
modification. 

10.0 Limitation of Liability between Supplier and Buyer  

        In no event will either party be liable to the other for any lost revenues, lost profits, incidental, indirect, consequential, special or punitive damages. This
mutual Limitation of Liability does not limit the obligations and liability of Supplier provided in Section 9.0 Supplier Liability for Third Party Claims or Subsection 6.4 Defects. In no event
will either party be liable for the respective actions or omissions of its Affiliates under this Agreement. 

11.0 Supplier and Supplier Personnel  

        The parties are independent contractors and this Agreement does not create an agency relationship between Buyer and Supplier or Buyer and Supplier Personnel. Each
party assumes no liability or responsibility for the other party's Personnel. Each party will: 

	1.
	ensure
it and its Personnel are in compliance with all laws, regulations, ordinances, and licensing requirements;

	2.
	be
responsible for the supervision, control, compensation, withholdings, health and safety of its Personnel;

	3.
	inform
the other party if a former employee of that party will be assigned work under this Agreement, such assignment subject to the other party's approval (except for former Buyer
Personnel employed by Supplier in accordance with the terms of the Asset Purchase 

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Agreement
signed by the parties on the Closing Date and current Buyer Personnel who have been employed by Supplier for a period of more than one (1) year); and 

	4.
	ensure
Personnel working on behalf of that party at the other party's premises comply with the other party's on site guidelines and upon request, provide that other party Buyer, for
export evaluation purposes, the country of citizenship and permanent residence and immigration status of those persons. Each party retains the right to refuse to accept persons made available by the
other party for export control reasons. 

12.0 Insurance  

        Supplier will maintain at its expense: 

	1.
	commercial
general or public liability insurance with a minimum limit per occurrence or accident of 1,000,000 USD (or local currency equivalent);

	2.
	workers'
compensation or employer's liability insurance as required by local law, such policies waiving any subrogation rights against Buyer; and

	3.
	automobile
liability insurance as required by local statute but not less than 1,000,000 USD (or local currency equivalent) if a vehicle will be used in the performance of this
Agreement. 

        Insurance
required under clauses (1) and (3) will be primary or noncontributory regarding insured damages or expenses, and will be purchased from insurers with an AM Best
Rating of B+ or better and a financial class rating of 11 or better. 

13.0 Term and Termination  

13.1 Termination of this Base Agreement  

        Either party may terminate this Base Agreement, without any cancellation charge, for a material breach of this Agreement by the other party or if the other party
becomes insolvent or files or has filed against it a petition in bankruptcy ("Cause"), to the extent permitted by law. Such termination will be effective at the end of a thirty (30) day written
notice period if the Cause remains uncured. Either party may terminate this Base Agreement without Cause when there are no outstanding SOWs or WAs. 

13.2 Termination of a SOW or WA  

        Either party may terminate a SOW with Cause upon written notice to the other party. Unless otherwise provided for in a SOW, either party may terminate a SOW
without Cause. Buyer may terminate a WA with or without Cause. 

        Upon
termination by Buyer, in accordance with Buyer's written direction, Supplier will immediately: 

	1.
	cease
work;

	2.
	prepare
and submit to Buyer an itemization of all completed and partially completed Products and Services;

	3.
	deliver
to Buyer Products satisfactorily completed up to the date of termination at the agreed upon Prices in the relevant SOW and/or W A; and

	4.
	deliver
upon request any work in process. 

        In
the event Buyer terminates without Cause, Buyer will compensate Supplier for the actual and reasonable expenses incurred by Supplier for work in process up to and including the date
of 

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termination,
provided Supplier uses reasonable efforts to mitigate Buyer's liability under this Subsection by, among other actions, accepting the return of, returning to its suppliers, selling to
others, or otherwise using the canceled Products (including raw materials or works in process) and provided such expenses do not exceed the Prices. 

14.0 General  

14.1 Amendments  

        This Agreement may only be amended by a writing specifically referencing this Agreement which has been signed by authorized representatives of the parties. 

14.2 Assignment  

        Neither party will assign their rights or delegate or subcontract their duties under this Agreement to third parties or Affiliates without the prior written
consent of the other party, such consent not to be withheld unreasonably, except that either party may assign this Agreement in conjunction with the sale of a substantial part of its business
utilizing this Agreement. Any unauthorized assignment of this Agreement is void. 

14.3 Choice of Law and Forum; Waiver of Jury Trial; Limitation of Action  

        This Agreement and the performance of transactions under this Agreement will be governed by the laws of the country where the Buyer entering into the relevant
agreement or PA is located, except that the laws of the State of New York applicable to contracts executed in and performed entirely within that State, without reference to conflicts of laws
principles of such state, will apply if any part of the transaction is performed within the United States. The United Nations Convention on Contracts for the International Sale of Goods does not
apply. The parties expressly waive any right to a jury trial regarding disputes related to this Agreement. Unless otherwise provided by local law without the possibility of contractual waiver or
limitation, any legal or other action related to this Agreement must be commenced no later than two (2) years from the date on which the cause of action arose. 

14.4 Communications  

        All communications between the parties regarding this Agreement will be conducted through the parties' representatives as specified in the relevant SOW. 

14.5 Counterparts  

        This Agreement may be signed in one or more counterparts, each of which will be deemed to be an original and all of which when taken together will constitute the
same agreement. Any copy of this Agreement made by reliable means (for example, photocopy or facsimile) is considered an original. 

14.6 Exchange of Information  

        All information exchanged is non confidential. If either party requires the exchange of confidential information, it will be made under a separate signed
confidentiality agreement between the parties. The parties will not publicize the terms of this Agreement, or the relationship, in any advertising, marketing or promotional materials without prior
written consent of the other party except as may be required by law, provided the party publicizing obtains any confidentiality treatment available. Supplier will use information regarding this
Agreement only in the performance of this Agreement. For any business personal information relating to Supplier Personnel that Supplier provides to Buyer, Supplier has 

8

 

obtained
the agreement of the Supplier Personnel to release the information to Buyer and to allow Buyer to use such information in connection with this Agreement. 

14.7 Freedom of Action  

        This Agreement is nonexclusive and unless otherwise specified in the relevant SOW, either party may design, develop, manufacture, acquire or market competitive
products or services. Buyer will independently establish prices for resale of Products or Services and is not obligated to announce or market any Products or Services and does not guarantee the
success of its marketing efforts, if any. 

14.8 Force Majeure  

        Other than payments due herein, neither party will be in default or liable for any delay or failure to comply with this Agreement due to any act beyond the
control of the affected party, excluding labor disputes, provided such party immediately notifies the other. 

14.9 Obligations of Affiliates  

        Affiliates will acknowledge acceptance of the terms of this Agreement through the signing of a P A before conducting any transaction under this Agreement. 

14.10 Prior Communications and Order of Precedence  

        This Agreement replaces any prior oral or written agreements or other communication between the parties with respect to the subject matter of this Agreement,
excluding any confidential disclosure agreements. In the event of any conflict in these documents, the order of precedence will be: 

	1.
	the
quantity, payment and delivery terms of the relevant W A;

	2.
	the
relevant SOW;

	3.
	this
Base Agreement; and

	4.
	the
remaining terms of the relevant W A. 

14.11 Record Keeping and Audit Rights  

        Supplier will maintain (and provide to Buyer upon request) relevant business and accounting records to support invoices under this Agreement and proof of required
permits and professional licenses, for a period of time as required by local law, but not for less than three (3) years following completion or termination of the relevant SOW and/or W A. All
accounting records will be maintained in accordance with generally accepted accounting principles. 

14.12 Severability  

        If any term in this Agreement is found by competent judicial authority to be unenforceable in any respect, the validity of the remainder of this Agreement will be
unaffected, provided that such unenforceability does not materially affect the parties' rights under this Agreement. 

14.13 Survival  

        Any provisions of this SOW that by their nature extend beyond its termination or expiration will remain in effect until fulfilled, and apply to respective
successors and assignees. 

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14.14 Waiver  

        An effective waiver under this Agreement must be in writing signed by the party waiving its right. A waiver by either party of any instance of the other party's
noncompliance with any obligation or responsibility under this Agreement will not be deemed a waiver of subsequent instances. 

15.0 Replenishment  

15.1 Pull Definitions  

        Replenishment program Pull definitions are set forth in the applicable Product Unique Attachment. 

15.2 Planning  

        Buyer will issue a PPO to Supplier for all Pull Products. The parties will agree to a Profile for each Pull Product as specified in the relevant SOW. Buyer may
issue a Planning Schedule at intervals as specified in the Profile, the most recent Planning Schedule to supersede all previous Planning Schedules. The Planning Schedule provides a forecast of
requirements for the Pull Products and establishes the Liability Horizon Quantity and Upside Flexibility, if any, with the Supplier. Supplier will
respond to the Planning Schedule and PPO as specified in the relevant SOW. The parties will conduct communications regarding the subject matter of this Replenishment Logistics section as specified in
the relevant SOW. 

15.3 Pull Delivery  

        Supplier will deliver to Buyer on the delivery date the Pull Products specified in the Pull Notifications issued by Buyer, provided such Pull Notifications do not
exceed the Liability Horizon Quantity. To the extent practicable, Supplier will comply with Pull Notifications for quantities of Pull Products in excess of the Liability Horizon Quantity but within
the Upside Flexibility. Where the Parties have agreed to an SMI process as specified in the Profile, Supplier will deliver Pull Products without a Pull Notification. Risk of loss and title will pass
to Buyer as specified in the relevant SOW. 

15.4 Pull Limitation of Liability  

        Unless the Pull Products are specified in a Planning Schedule, in conjunction with the Liability Horizon in a Profile, Buyer makes no representation or warranty
and assumes no liability regarding the quantity of Pull Products that it will purchase. Buyer assumes no liability for materials procured or products built beyond the Liability Horizon Quantity.
Supplier will apply Overages towards future Pull Notifications and the parties will agree to a reconciliation amount and a disposition of Overage Products, if any, as specified in the relevant SOW.
The reconciliation amount will be reduced by any amount realized by Supplier for Pull Products (including raw materials or works-in-progress) used, returned or sold to any
party other than Buyer, and any other reductions agreed to by the parties. 

15.5 Order of Precedence:  

        Notwithstanding subsection 14.10 of this Agreement, in the event of any conflict in the documents contained in this Agreement involving Pull Products, the order
of precedence will be: (i) the relevant P A, but only to the extent it applies to the parties signing such P A; (ii) the Profile section of the relevant SOW; (iii) the relevant
SOW, excluding the Profile section; (iv) this section entitled, "Replenishment Logistics"; and (v) this Agreement, excluding this section entitled, "Replenishment Logistics". 

[Remainder
of Page Intentionally Blank] 

10

 

	 
	 	 
	 	 
	 	 
	 	 
	 	 

	ACCEPTED AND AGREED TO:	 	ACCEPTED AND AGREED TO:
	

By:	
 	

/s/ Lisa M. Dooley	
 	

3/21/02	
 	

By:	
 	

/s/ David A. Young	
 	

3/24/02
	 	 	
	 	 	 	

	 	 	Buyer Signature	 	Date	 	 	 	Supplier Signature	 	Date
	

Lisa M. Dooley
 Printed Name

IBM xSeries ECAT Procurement Manager
 Title & Organization

3039 Cornwallis Road, RTP. NC. 27709
 Buyer Address	
 	

David A. Young
 Printed Name

V.P. & C.F.O.
 Title & Organization

 Supplier Address:

11

QuickLinks

Exhibit 10.03

Base Agreement #4902RL0436<Page>

                                                                    EXHIBIT 10.1

                              EMPLOYMENT AGREEMENT

This Employment Agreement ("AGREEMENT") is made and entered into as of this
14 day of APRIL 2004 by and between Mirant Corporation (hereinafter "MIRANT"),
and M. Michele Burns (hereinafter "EXECUTIVE").

                              W I T N E S S E T H:

WHEREAS, Mirant desires to secure the services of Executive as an executive of
Mirant; and

WHEREAS, Executive desires to be employed by Mirant in this capacity; and

WHEREAS, Mirant and Executive wish to enter into this Employment Agreement
setting forth the terms and conditions of such employment.

NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties hereby agree as follows:

     1.   EMPLOYMENT DUTIES.

          (a)    Mirant hereby agrees to employ Executive (i) as its Executive
     Vice President and (ii) effective upon the effective date of the
     resignation of Mirant's current Chief Financial Officer, as Mirant's Chief
     Financial Officer, and Executive hereby agrees to accept such employment
     upon the terms and conditions set forth in this Agreement. Executive will
     have such additional titles as determined by Mirant's Board of Directors
     (the "BOARD") and the powers, duties, and responsibilities from time to
     time assigned to her by the Board or Mirant's Chief Executive Officer, and
     Executive will report directly to the Chief Executive Officer of Mirant.

          (b)    During the Term (as defined in Section 2), Executive agrees to
     be a full-time employee of Mirant and devote her full and exclusive
     business time, energy and skill to the business and affairs of Mirant. She
     shall perform all of her duties properly and faithfully in the best
     interest of Mirant and will not intentionally become involved in any
     personal matters which adversely affect or reflect on Mirant. Executive may
     (i) engage in community, charitable, and educational activities, (ii)
     manage personal investments, (iii) serve on those corporate boards or
     committees that she disclosed in writing to Mirant as of the Effective
     Date, provided that such activities do not materially conflict or interfere
     with the performance of Executive's obligations under this Agreement, and
     (iv) serve on those additional corporate boards or committees as the Board
     in its sole discretion shall approve.

     2.   TERM.  The term of this Agreement will commence on such date,
following the date an order of the United States Bankruptcy Court for the
Northern District of Texas (Fort Worth Division (the "BANKRUPTCY COURT"))
approving this Agreement becomes final and nonappealable, as may be agreed to by
the parties, but in no event later than May 3, 2004 (the

<Page>

"EFFECTIVE DATE"), and shall continue for a period of three (3) years after the
Effective Date; PROVIDED that the term of employment hereunder shall be
automatically extended for two successive one-year renewal periods commencing on
the third and fourth anniversaries of the Effective Date, respectively, unless
either party shall have given notice to the other party that such party does not
desire to extend the term of this Agreement, such notice to be given at least
ninety (90) days prior to the third anniversary or fourth anniversary of the
Effective Date, respectively, in which case the term of employment hereunder
shall terminate as of the third anniversary of the Effective Date or the fourth
anniversary of the Effective Date, respectively (the term of employment
hereunder, including any such extensions in accordance with this Section 2,
shall be referred to herein as the "TERM"). Notwithstanding the foregoing, the
Term may be earlier terminated by either party hereto in accordance with the
provisions of Section 5 of this Agreement. At the end of the Term, if it has not
been terminated earlier pursuant to Section 5, Executive will become an at-will
employee of Mirant.

     3.   COMPENSATION.

          (a)    SALARY. As of the commencement of this Agreement, during the
     Term, Mirant shall pay Executive a salary of $600,000 per year ("ANNUAL
     BASE SALARY"), paid in equal installments every two weeks. Mirant shall
     evaluate the compensation provided to Executive on an annual basis and
     shall make such adjustments as Mirant deems appropriate, with the
     understanding that Executive's Annual Base Salary will not be reduced
     during the Term without her consent.

          (b)    ANNUAL CASH BONUS. Mirant shall pay Executive a cash bonus with
     respect to her first calendar year of employment (without any proration
     whatsoever) of at least 75% of her Annual Base Salary (the "2004 TARGET
     BONUS"), payable in accordance with Mirant's normal practices, provided
     that Executive shall be eligible to receive a cash bonus for such year of
     up to two times the 2004 Target Bonus. Thereafter, with respect to
     subsequent calendar years of the Term, the terms of her cash bonus will be
     tied to the same goals as those of other senior Mirant executives;
     provided, however, that (i) the target for such cash bonus (the "TARGET
     BONUS") shall be no less than 75% of Executive's then-current Annual Base
     Salary, and (ii) the amount of such cash bonus for which Executive is
     eligible shall be from zero to 2 times the Executive's Target Bonus. Such
     cash bonuses shall be determined and paid at such times and under such
     terms and conditions as cash bonuses are determined and paid to other
     senior Mirant executives.

          (c)    EMERGENCE BONUS. Within five (5) business days after Mirant's
     emergence from bankruptcy (or the first paydate thereafter, pursuant to
     Mirant's payroll policy, if later), Mirant shall pay an emergence bonus
     ("EMERGENCE BONUS") to Executive in a cash lump sum equal to not less than
     200% of Executive's then-current Annual Base Salary, provided that
     Executive has been continuously employed by Mirant through the date of such
     emergence. For purposes of this Agreement, "emergence" shall occur when a
     plan of reorganization that is confirmed by the Bankruptcy Court becomes
     effective, as a result of which the business of Mirant is maintained on an
     ongoing basis, whether maintained by Mirant, the reorganized debtor or by
     an entity that has acquired all or substantially all of Mirant's or the
     debtor in possession's assets. Executive shall also be

                                        2
<Page>

     eligible to receive an additional cash payment in an amount equal to
     Executive's then-current Annual Base Salary subject to the same terms and
     conditions as are applicable to Mirant's Chief Executive Officer and
     Management Council for receipt of bonuses under Mirant's Key Employee
     Retention Program as may be approved by the Bankruptcy Court.

          (d)    RETENTION BONUS. If Executive has been continuously employed by
     Mirant through April 1, 2006, within five (5) business days thereafter,
     Mirant will pay Executive a lump sum amount in cash equal to $500,000 (the
     "FIRST RETENTION BONUS"). If Executive has been continuously employed by
     Mirant through April 1, 2007, within five (5) business days thereafter,
     Mirant will pay Executive a lump sum amount in cash equal to $500,000 (the
     "SECOND RETENTION BONUS"; the First Retention Bonus together with the
     Second Retention Bonus, collectively, the "RETENTION BONUSES")).

          (e)    MAKE-WHOLE PAYMENTS. Within five (5) business days after the
     Effective Date, Mirant will pay Executive a lump sum amount in cash equal
     to $1,500,000 (the "FIRST MAKE-WHOLE PAYMENT"). If Executive has been
     continuously employed by Mirant through April 1, 2005, within five (5)
     business days thereafter, Mirant will pay Executive a lump sum amount in
     cash equal to $1,000,000 (the "SECOND MAKE-WHOLE PAYMENT"). If Executive
     has been continuously employed by Mirant through April 1, 2006, within five
     (5) business days thereafter, Mirant will pay Executive a lump sum amount
     in cash equal to $500,000 (the "THIRD MAKE-WHOLE PAYMENT;" the First
     Make-Whole Payment, the Second Make-Whole Payment and the Third Make-Whole
     Payment, collectively, the "MAKE-WHOLE PAYMENTS")).

          (f)    EQUITY AWARDS. In addition to the Emergence Bonus in Section
     3(c) above, on and after the date of Mirant's emergence from bankruptcy,
     Mirant shall grant to Executive long-term incentive compensation awards on
     the same, or a not less favorable, basis and with the same, or not less
     favorable, terms and conditions (including vesting schedules and
     acceleration provisions, if any) generally applicable to grants of such
     awards made to other similarly situated senior executives of Mirant. The
     Board may approve any additional equity awards for Executive that the Board
     determines in its sole discretion.

          (g)    EXPENSE REIMBURSEMENT. Mirant will reimburse Executive for all
     reasonable expenditures incurred by Executive in the course of her
     employment or in promoting the interests of Mirant, consistent with
     Mirant's requirements that supporting documentation be provided, including,
     without limitation, expenditures for (i) transportation, lodging, and meals
     during overnight business trips, (ii) business meals and entertainment,
     (iii) supplies and business equipment, (iv) long-distance telephone calls
     and cell phone usage, and (v) membership dues for business and professional
     associations, publications, and any other association of which Executive
     becomes a member in connection with the performance of her duties.

          (h)    COUNTRY CLUB. Mirant will pay on behalf of Executive the
     initiation fee (in an amount not to exceed $50,000) for an individual
     membership at a country club of her choice, consistent with Mirant's
     requirements that supporting documentation be provided.

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<Page>

          (i)    PERQUISITE ALLOWANCE. During the Term, for the purpose of
     reimbursing Executive for certain perquisites not otherwise provided by
     Mirant, Mirant will provide Executive with a perquisite allowance of
     $18,000 per year, consistent with Mirant's requirements that supporting
     documentation be provided, which for years beginning in 2005, shall be
     pro-rated based on the number of days Executive was employed by Mirant
     during each calendar year. For 2004, the $18,000 perquisite allowance shall
     not be pro-rated.

     4.   EMPLOYEE BENEFITS.

          (a)    BENEFIT AND PERQUISITE PROGRAMS. Executive shall be entitled,
     during the Term, to participate in all employee benefit and perquisite
     programs maintained by Mirant for the benefit of its employees, including
     benefits and perquisites available to senior officers of Mirant and/or
     Mirant's Management Council, according to the terms of such plans. During
     the Term, Mirant shall make available coverage for Executive's domestic
     partner and dependent children either through its existing medical and
     dental plan, through the purchase of one or more insurance policies, or
     through a self-insured medical and dental reimbursement plan. If Mirant
     elects to make such coverage available through the purchase of insurance or
     through the use of a self-insured reimbursement plan, such insurance or
     self-insured reimbursement plan shall provide benefits that are
     substantially similar to those of Mirant's highest cost medical and dental
     options. The relative rates of the cost of such coverage paid by Executive
     and Mirant shall be comparable to the relative rates of the cost paid by
     similarly situated employees and Mirant for similar coverage for
     dependents. Mirant shall also gross-up any applicable premiums relating to
     such coverage for tax purposes so that the economic benefit to Executive is
     the same as if such coverage was provided on a non-taxable basis.

          (b)    VACATION. Executive will be entitled to four (4) weeks' paid
     vacation annually. Consistent with Mirant's vacation policy, unused
     vacation time not exceeding forty (40) hours will accumulate and carry over
     to subsequent years. Any unused vacation at the date of termination of this
     Agreement for any reason will be paid to Executive at the time of
     termination.

          (c)    CONTINUED WELFARE BENEFITS. Notwithstanding anything else
     contained in this Agreement, after termination or expiration of Executive's
     employment for any reason other than Cause (as defined in Section 5(b),
     below), Executive and her domestic partner and dependent children (if then
     covered) will, for a twenty-four (24) month period from the date of
     termination, be entitled to remain on any medical and dental plans on the
     same basis as during her employment (including payment by Mirant of the
     costs and expenses associated with such programs on the same terms as when
     Executive was employed with Mirant). In meeting its obligations under this
     provision, Mirant and Executive will take all actions which may be
     necessary or appropriate to comply with criteria set forth by Mirant's
     insurance carriers and other program providers.

                                        4
<Page>

     5.   TERMINATION OF EMPLOYMENT.

          (a)    DEATH OR DISABILITY. In the event of Executive's death or total
     disability, this Agreement shall terminate immediately. Executive shall be
     deemed totally disabled if she is eligible to receive long-term disability
     benefits under Mirant's then existing long-term disability plan. In the
     event of her death or total disability, Executive or her estate will be
     entitled to such benefits, if any, as are provided under the terms of
     various Mirant health insurance, life insurance, pension and disability
     plans. In addition, Mirant shall pay to Executive (or her estate) all
     Accrued Obligations (as defined below) in a lump sum in cash within thirty
     (30) days after the date of termination. "ACCRUED OBLIGATIONS" shall mean,
     as of the date of termination, the sum of (A) Executive's Annual Base
     Salary through the date of termination to the extent not theretofore paid,
     (B) except as otherwise previously requested by Executive, the amount of
     any bonus, incentive compensation, deferred compensation and other cash
     compensation accrued by Executive as of the date of termination to the
     extent not theretofore paid, and (C) any vacation pay, expense
     reimbursements and other cash entitlements accrued by Executive as of the
     date of termination to the extent not theretofore paid. In addition, the
     Executive (or her estate) will be paid the Retention Bonuses and Make-Whole
     Payments, in each case to the extent not previously paid to Executive, and
     all of Executive's then-outstanding equity awards shall immediately become
     fully vested (with stock option exercisability continuing until the later
     of one year following the Executive's death or total disability or the end
     of any extended exercise period relating to death or disability provided
     for under the terms of the applicable equity plan). Except as otherwise set
     forth in this Section 5(a) or this Agreement, in the event of a termination
     pursuant to this Section 5(a), Executive will not be entitled to any
     further benefits or compensation under this Agreement except to the extent
     mandated by law.

          (b)    TERMINATION FOR CAUSE. Mirant may terminate this Agreement and
     Executive's employment immediately hereunder for Cause (as hereinafter
     defined). In the event this Agreement terminates by reason of the
     termination of Executive's Employment by Mirant for Cause, Mirant shall pay
     to Executive all Accrued Obligations in a lump sum in cash within thirty
     (30) days after the date of termination. "CAUSE" shall mean that: (i)
     Executive has been convicted of (or pleads guilty or nolo contendere) to a
     felony, other than one involving Limited Vicarious Liability (as
     hereinafter defined), (ii) Executive has engaged in conduct that
     constitutes gross neglect or gross misconduct with respect to her
     employment duties which results in material harm to Mirant, or (iii)
     Executive has materially breached this Agreement and failed to cure such
     breach (if susceptible to cure) within thirty (30) days after receipt by
     Executive of written notice from Mirant of such breach. For purposes of
     this Agreement, "LIMITED VICARIOUS LIABILITY" shall mean any liability
     which is (1) based on acts of Mirant for which Executive is responsible
     solely as a result of her office(s) with Mirant and (2) provided that (A)
     she was not involved in such acts and either had no prior knowledge of such
     actions or promptly acted reasonably and in good faith to attempt to
     prevent the acts causing such liability or (B) she did not have a
     reasonable basis to believe that a law was being violated by such acts. The
     foregoing notwithstanding, Mirant may not terminate

                                        5
<Page>

     Executive's employment for Cause unless: (x) a determination that Cause
     exists is made and approved by three-quarters (3/4) of the Board (excluding
     Executive, if she is then a member of the Board), (y) Executive is given at
     least five (5) days' prior written notice of the Board meeting called to
     make such determination, and (z) Executive and her legal counsel are given
     the opportunity to address such meeting prior to a vote of the Board.
     Except as otherwise set forth in this Section 5(b), in the event of a
     termination pursuant to this Section 5(b), Executive will not be entitled
     to any further benefits or compensation under this Agreement except to the
     extent mandated by law. Termination pursuant to this Section 5(b) shall be
     deemed a termination for Cause.

          (c)    TERMINATION BY MIRANT WITHOUT CAUSE. Mirant shall have the
     additional right to terminate this Agreement and Executive's employment
     without Cause, and not due to Executive's total disability or death, by
     giving Executive written notice of termination. Such termination shall be
     effective immediately upon receipt of notice by Executive. In the event of
     a termination (x) pursuant to this Section 5(c) or (y) by reason of
     delivery by Mirant of a notice that Mirant does not desire to extend the
     term of this Agreement beyond the third or fourth anniversary of the
     Effective Date as provided in Section 2 above, prior to the fifth
     anniversary of the Effective Date, Mirant shall pay to Executive, not later
     than thirty (30) days following the date of termination, (i) a lump sum
     payment in cash (the "SEPARATION PAYMENT") equal to the product of (A)
     times (B), where (A) is the sum of Executive's then-current Annual Base
     Salary immediately prior to the date of termination, plus her Target Bonus
     for the fiscal year in which the date of termination occurs, or the 2004
     Target Bonus, whichever is applicable to the calendar year of termination,
     and (B) is 2 (the "SEVERANCE MULTIPLIER"); (ii) the Accrued Obligations;
     and (iii) the Retention Bonuses and Make-Whole Payments, in each case to
     the extent not previously paid to Executive. In addition, all of
     Executive's then-outstanding equity awards shall immediately become fully
     vested (with stock option exercisability continuing until the end of the
     originally stated term of such options).

          (d)    TERMINATION BY EXECUTIVE FOR GOOD REASON. Executive may resign
     for Good Reason on thirty (30) days' written notice to Mirant, provided she
     previously notified Mirant in writing of the circumstances forming the
     basis for "Good Reason" as set forth below and Mirant failed to cure such
     circumstances within thirty (30) days of receiving such notice. In the
     event of a termination pursuant to this Section 5(d) prior to the fifth
     anniversary of the Effective Date, Executive will be entitled to all of the
     severance compensation and benefits set forth in Section 5(c) above,
     subject to the terms set forth in Section 5(c) above. For purposes of this
     Agreement, "GOOD REASON" shall mean, without Executive's written consent:

                 (i)     Assignment to Executive of any duties inconsistent in
          any material respect with Executive's position (including titles and
          reporting relationships), authority, duties or responsibilities as
          contemplated by this Agreement, or any other action by Mirant which
          results in a significant diminution in such position, authority,
          duties or responsibilities; provided, however, that (A) the
          consummation of a chapter 11 plan or plans for Mirant Americas
          Generation LLC and its direct and indirect subsidiaries (collectively,
          "MAG"); (B) the sale of

                                        6
<Page>

          substantially all of the assets or stock of MAG; (C) any other
          separation of the assets and business of MAG from the management and
          control of Mirant; or (D) the appointment of a trustee pursuant to
          Chapter 11 of the Bankruptcy Code for Mirant or MAG shall not
          constitute Good Reason within the meaning of this Section 5(d)(i);

                 (ii)    Any failure by Mirant to comply with any of the
          provisions of this Agreement regarding Executive's Annual Base Salary,
          bonus, equity incentive, benefits and perquisites, and other benefits
          and amounts payable to Executive under this Agreement;

                 (iii)   Executive being required to relocate to a principal
          place of employment more than fifty (50) miles from her principal
          place of employment with Mirant in Atlanta, Georgia, as of the
          Effective Date; or

                 (iv)    Any purported termination by Mirant of Executive's
          employment otherwise than as expressly permitted by this Agreement.

          (e)    TERMINATION BY EXECUTIVE FOR OTHER THAN GOOD REASON. Executive
     may resign for other than Good Reason on sixty (60) days' written notice to
     Mirant. During such sixty (60) day notice period, Mirant may relieve
     Executive of her duties, but this shall not relieve Mirant of its
     obligations to pay Executive her entire Annual Base Salary for the entire
     notice period. At the conclusion of such notice period, she will not be
     entitled to any further compensation or benefits hereunder, other than the
     Accrued Obligations, previously accrued, vested benefits or as otherwise
     provided for in this Agreement.

          (f)    TERMINATION IN CONNECTION WITH CHANGE IN CONTROL. In the event
     that a Change in Control occurs during the Term and Executive's employment
     thereafter terminates within one (1) year of such Change in Control by
     reason of the discharge of Executive by Mirant other than for Cause, and
     not due to death, total disability or expiration of the Term, or by reason
     of the resignation of Executive for Good Reason, or in the event
     Executive's employment is terminated by Mirant (other than for Cause, and
     not due to death, total disability or expiration of the Term) prior to a
     Change in Control but at the request of any third party participating in or
     causing the Change in Control, Executive will be entitled to all of the
     severance compensation and benefits set forth in Section 5(c) above;
     provided, however, that if the Change in Control occurs by reason of the
     occurrence of the circumstances described in clause (iv) of this Section
     5(f) before Mirant and its subsidiaries emerge from bankruptcy, Executive
     shall receive the Emergence Bonus in lieu of the Separation Payment;
     provided further, however, that Executive shall receive all change in
     control benefits provided to Mirant's Chief Executive Officer under the
     Chief Executive Officer's individual employment agreement with Mirant to
     the extent that the benefits under such agreement are more favorable to
     Executive than, and not duplicative of, the severance compensation and
     benefits to which Executive is entitled as set forth above. Any stock
     options or other equity-based awards that were outstanding immediately
     prior to the Change in Control shall, to the extent not

                                        7
<Page>

     then vested, fully vest and become exercisable prior to the Change in
     Control. "CHANGE IN CONTROL" shall mean the first to occur of any of the
     following events:

                 (i)     Any "person" (as defined in Section 13(d) and 14(d) of
          the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT")),
          excluding for this purpose, (i) Mirant or any subsidiary of Mirant, or
          (ii) any employee benefit plan of Mirant or any subsidiary of Mirant,
          or any person or entity organized, appointed or established by Mirant
          for or pursuant to the terms of any such plan which acquires
          beneficial ownership of voting securities of Mirant, is or becomes the
          "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
          directly or indirectly of securities of Mirant representing more than
          20% of the combined voting power of Mirant's then outstanding
          securities; provided, however, that no Change in Control will be
          deemed to have occurred as a result of (v) a change in ownership
          percentage resulting solely from an acquisition of securities by
          Mirant; (w) the consummation of a chapter 11 plan or plans for MAG;
          (x) the sale of substantially all of the assets or stock of MAG; (y)
          any other separation of the assets and business of MAG from the
          management and control of Mirant; or (z) the appointment of a trustee
          pursuant to Chapter 11 of the Bankruptcy Code for Mirant or MAG; or

                 (ii)    The Incumbent Directors (as hereinafter defined) cease
          for any reason, including without limitation, as a result of a tender
          offer, proxy contest, merger or similar transaction, to constitute at
          least a majority of the Board, provided that any person becoming a
          director of Mirant subsequent to the Effective Date shall be
          considered an Incumbent Director if such person's election or
          nomination for election was approved by a vote of at least two-thirds
          (2/3) of the Incumbent Directors; but provided further, that any such
          person whose initial assumption of office is in connection with an
          actual or threatened election contest relating to the election of
          members of the Board or other actual or threatened solicitation of
          proxies or consents by or on behalf of a "person" (as defined in
          Section 13(d) and 14(d) of the Exchange Act) other than the Board,
          including by reason of agreement intended to avoid or settle any such
          actual or threatened contest or solicitation, shall not be considered
          an Incumbent Director; or

                 (iii)   Consummation of a reorganization, merger or
          consolidation or sale or other disposition of all or substantially all
          of the assets of Mirant (a "BUSINESS COMBINATION"), in each case,
          unless, following such Business Combination, all or substantially all
          of the individuals and entities who were the beneficial owners of
          outstanding voting securities of Mirant immediately prior to such
          Business Combination beneficially own, directly or indirectly, more
          than 80% of the combined voting power of the then outstanding voting
          securities entitled to vote generally in the election of directors, as
          the case may be, of the company resulting from such Business
          Combination (including, without limitation, a company which, as a
          result of such transaction, owns Mirant or all or substantially all of
          Mirant's assets either directly or through one or more subsidiaries)
          in substantially the same proportions as their ownership, immediately
          prior to such Business

                                        8
<Page>

          Combination, of the outstanding voting securities of Mirant; provided,
          however, that (w) the consummation of a chapter 11 plan or plans for
          MAG; (x) the sale of substantially all of the assets or stock of MAG;
          (y) any other separation of the assets and business of MAG from the
          management and control of Mirant; or (z) the appointment of a trustee
          pursuant to Chapter 11 of the Bankruptcy Code for Mirant or MAG shall
          not constitute a Business Combination for purposes of this Agreement;
          or

                 (iv)    Approval by the stockholders of Mirant of a complete
          liquidation or dissolution of Mirant.

          For purposes of this Agreement, "INCUMBENT DIRECTORS" shall mean: (x)
          for periods subsequent to the Effective Date and before the date of
          the emergence of Mirant and its subsidiaries from bankruptcy, persons
          who, as of the Effective Date, constitute the Board, and (y) for
          periods on and after the date of the emergence of Mirant and its
          subsidiaries from bankruptcy, persons who, as of the date of the
          emergence of Mirant and its subsidiaries from bankruptcy, constitute
          the Board.

          (g)    MITIGATION AND OFFSET. In no event shall Executive be obligated
     to seek other employment or take any other action by way of mitigation of
     the amounts payable to Executive under any of the provisions of this
     Agreement, nor shall earnings of Executive offset or otherwise reduce the
     amounts to which Executive may be entitled hereunder.

          (h)    RELEASE. As a condition of receiving any Separation Payment for
     which she otherwise qualifies under this Section 5, Executive agrees to
     execute, deliver and not revoke (within the time period permitted by
     applicable law) a general release of claims arising out of Executive's
     employment with, and termination of employment from, Mirant, in the form
     attached hereto as EXHIBIT A (adjusted as necessary to conform to then
     existing legal requirements). Executive acknowledges and agrees that,
     except as specifically described in this Section 5 or in Section 4(c), all
     of her rights to any compensation (other than salary earned through the
     date of termination of employment), benefits, bonuses or severance from
     Mirant or its subsidiaries or affiliates shall cease upon termination of
     her employment with Mirant; provided, however, such release shall in no way
     limit or release Mirant from or delay Mirant's obligation to pay or
     distribute amounts, or provide other benefits, required to be paid,
     distributed or provided under this Section 5, whether before or after
     execution of such release.

          (i)    GROSS-UP PAYMENT FOR EXCESS PARACHUTE TAXES. In the event that
     the aggregate of all payments or benefits made or provided to, or that may
     be made or provided to, Executive under this Agreement or otherwise (the
     "AGGREGATE PAYMENT") is determined to constitute an "excess parachute
     payment," as such term is defined in Section 280G(b) of the Internal
     Revenue Code, Mirant shall pay to Executive prior to the time any excise
     tax imposed by Section 4999 of the Internal Revenue Code ("EXCISE TAX") is
     payable with respect to such Aggregate Payment, an additional amount which,
     after the imposition of all income and excise taxes thereon, is equal to
     the Excise Tax on

                                        9
<Page>

     the Aggregate Payment. The determination of whether the Aggregate Payment
     constitutes an excess parachute payment and, if so, the amount to be
     provided to Executive and the time of payment pursuant to this Section 5(i)
     shall be made by an independent auditor (the "AUDITOR") selected jointly by
     Mirant and Executive and paid by Mirant. The Auditor shall be a nationally
     recognized United States public accounting firm which has not, during the
     two (2) years preceding the date of its selection, acted in any way on
     behalf of Mirant or any affiliate thereof. If Executive and Mirant cannot
     agree on the firm to serve as the Auditor, then Executive and Mirant shall
     each select one accounting firm and those two firms shall jointly select
     the accounting firm to serve as the Auditor. Notwithstanding the foregoing,
     in the event that the amount of Executive's Excise Tax liability is
     subsequently determined to be greater than the Excise Tax liability with
     respect to which any initial payment to Executive under this Section 5(i)
     has been made (and such determination is confirmed by the Auditor), Mirant
     shall pay to Executive an additional amount (grossed up for all taxes) with
     respect to such additional Excise Tax (and any interest and penalties
     thereon) at the time and in the amount reasonably determined by the
     Auditor. Similarly, if the amount of Executive's Excise Tax liability is
     subsequently determined to be less than the Excise Tax liability with
     respect to which any prior payment to Executive has been made under this
     Section 5(i) (and such determination is confirmed by the Auditor),
     Executive shall refund to Mirant the excess amount received, after
     reduction for any nonrefundable tax, penalties and/or interest incurred by
     Executive in connection with the receipt of such excess, and such refund
     shall be paid promptly after Executive has received any corresponding
     refund of excess Excise Tax paid to the Internal Revenue Service. Executive
     and Mirant shall cooperate with each other in connection with any
     proceeding or claim relating to the existence or amount of liability for
     Excise Tax, and all reasonable expenses incurred by Executive in connection
     therewith shall be paid by Mirant promptly upon notice of demand from
     Executive.

     6.   COVENANT NOT TO SOLICIT.

          (a)    NON-SOLICITATION OF EMPLOYEES. Throughout the Term, and for a
     period of two (2) years thereafter, Executive shall not solicit or attempt
     to solicit, directly or indirectly by assisting others, any employees of
     Mirant in order to induce such employees to leave Mirant or become employed
     or affiliated with any other person, company or entity.

          (b)    INJUNCTIVE RELIEF. Executive acknowledges that the covenant not
     to solicit is a reasonable means of protecting and preserving Mirant's
     investment in its business and in Executive's employment. Executive agrees
     that any breach of this covenant will result in irreparable damage and
     injury to Mirant and that Mirant will be entitled to injunctive relief in
     any court of competent jurisdiction without the necessity of posting any
     bond.

          (c)    ENFORCEABILITY OF COVENANT. Mirant and Executive agree that
     Executive's obligation under the covenant not to solicit is separate and
     distinct from other provisions of this Agreement, and the failure or
     alleged failure of Mirant to perform its obligations

                                       10
<Page>

     under any other provisions of this Agreement shall not constitute a defense
     to the enforceability of this covenant not to solicit. As provided in this
     Section 6 above, the parties also agree that the covenant not to solicit
     survives the expiration or termination of this Agreement.

     7.   NONDISCLOSURE OF TRADE SECRETS AND CONFIDENTIAL INFORMATION.

          (a)    TRADE SECRETS DEFINED. As used in this Agreement, the term
     "Trade Secret" shall mean any and all information which is not commonly
     known by or available to the general public and which information (i)
     derives economic value, actual or potential, from not being generally known
     to, and not being readily ascertainable by proper means by, other persons
     who can obtain economic value from its disclosure or use, and (ii) is the
     subject of efforts that are reasonable under the circumstances to maintain
     its secrecy. Such information shall include, but not be limited to, any
     customer lists, customer billing information, technical information
     regarding Mirant products sold by Mirant, sales techniques and information
     concerning personnel assignments, and matters concerning the financial
     affairs and management of Mirant.

          (b)    NONDISCLOSURE OF TRADE SECRETS. Throughout the Term and at all
     times following the expiration or termination of this Agreement, Executive
     shall not directly or indirectly transmit or disclose any trade secret of
     Mirant to any person, concern or entity. The obligations under this Section
     7(b) shall remain in effect as long as the information constitutes a trade
     secret under applicable law.

          (c)    CONFIDENTIAL INFORMATION DEFINED. As used in this Agreement,
     the term "Confidential Information" shall mean all information that is not
     a trade secret and that Mirant generally considers or would generally
     consider to be confidential.

          (d)    NONDISCLOSURE OF CONFIDENTIAL INFORMATION. Throughout the Term
     and for a period of two (2) years thereafter, Executive shall not, either
     directly or indirectly, use, transmit or disclose any Confidential
     Information to any person, concern or entity except as necessary to perform
     Executive's duties under this Agreement or otherwise with the prior written
     consent of Mirant.

          (e)    INJUNCTIVE RELIEF. Executive acknowledges that these
     nondisclosure covenants are a reasonable means of protecting and preserving
     Mirant's interests in the confidentiality of this information. Executive
     agrees that any breach of these covenants will result in irreparable damage
     and injury to Mirant and that Mirant will be entitled to injunctive relief
     in any court of competent jurisdiction without the necessity of posting any
     bond.

          (f)    ENFORCEABILITY OF COVENANTS. Mirant and Executive agree that
     Executive's obligations under these nondisclosure covenants are separate
     and distinct from other provisions of this Agreement, and the failure or
     alleged failure of Mirant to perform its obligations under any provision of
     this Agreement shall not constitute a defense to the enforceability of
     these nondisclosure covenants. As provided in this Section 7 above, the

                                       11
<Page>

     parties also agree that the nondisclosure covenants survive the expiration
     or termination of this Agreement.

     8.   MISCELLANEOUS.

          (a)    WITHHOLDING TAXES. All amounts payable hereunder will be
     subject to the withholding of all applicable taxes and deductions required
     by any applicable law.

          (b)    LITIGATION COSTS. In the event of any dispute arising out of or
     under this Agreement or Executive's employment with Mirant, if a court of
     competent jurisdiction determines that Executive has prevailed on the
     issues in the court proceeding, Mirant shall, upon presentment of
     appropriate documentation, at Executive's election, pay or reimburse
     Executive for all reasonable legal and other professional fees and other
     reasonable expenses incurred in connection therewith by Executive.

          (c)    PROFESSIONAL FEES. Mirant shall promptly pay all professional
     fees and expenses incurred by Executive in connection with the negotiation
     and preparation of this Agreement and related agreements, including the
     fees and expenses of her counsel and other professionals, up to a maximum
     of $50,000. Mirant shall gross up for tax purposes any deemed income to
     Executive arising pursuant to the payments provided under this Section
     8(c), so that the economic benefit is the same to Executive as if such
     payments were provided on a non-taxable basis to Executive.

          (d)    WARRANTY BY EXECUTIVE. Executive represents and warrants to
     Mirant that Executive is not subject to any contract, agreement, judgment,
     order or decree of any kind, or any restrictive agreement of any character,
     that restricts Executive's ability to perform her obligations under this
     Agreement or that would be breached by Executive upon her performance of
     her duties pursuant to this Agreement.

          (e)    INDEMNIFICATION. Executive shall be indemnified and held
     harmless to the fullest extent permitted under Mirant's Articles of
     Incorporation, Bylaws, and applicable law, including the U.S. Bankruptcy
     Code (11 U.S.C. Section 101 et seq.), from any and all claims, lawsuits,
     losses, damages, assessments, amounts paid in settlement, penalties,
     expenses, costs and liabilities of any kind or nature, including without
     limitation, court costs and reasonable attorneys' fees, which Executive may
     sustain directly as a result of, or in connection with, any act or omission
     by Mirant or its employees or any claim, suit or other proceeding brought
     or threatened by a third party (including but not limited to governmental
     or regulatory agencies or bodies) in connection with Executive's employment
     with Mirant or any subsidiary or affiliate thereof. Mirant shall maintain
     directors' and officers' liability insurance coverage for Executive in an
     amount required to satisfy such indemnification during the Term and, for
     any act or omission occurring during the Term, at all times thereafter for
     the duration of any period of limitations during which any action may be
     brought against Executive; provided, such coverage shall not be in an
     amount less than the highest amount covering members of the Board and
     Mirant's officers.

                                       12
<Page>

          (f)    WAIVER. The waiver by any party to this Agreement of a breach
     of any of the provisions of this Agreement shall not operate or be
     construed as a waiver of any subsequent breach.

          (g) SEVERABILITY. The invalidity or unenforceability of any particular
     provision of this Agreement shall not affect the other provisions of this
     Agreement, and this Agreement shall be construed in all respects as if such
     invalid or unenforceable provision were omitted.

          (h) ASSIGNMENT AND SUCCESSORS. This Agreement may be assigned by
     Mirant without Executive's consent to an affiliated entity of Mirant,
     including any survivor entity or other successor in interest, but no such
     assignment shall relieve Mirant of its full responsibilities hereunder.
     This Agreement shall inure to the benefit of and be binding upon the
     parties hereto and upon their respective legal representatives and
     successors in interest.

          (i)    ENTIRE AGREEMENT. This Agreement constitutes the entire
     Agreement between the parties with respect to the subject matter hereof and
     supersedes any prior agreements.

          (j)    GOVERNING LAW. This Agreement shall be governed by the laws of
     the State of Georgia, without regard to its principles of conflict of laws.

          (k)    NOTICE. Whenever any notice is required, it shall be given in
     writing addressed as follows:

                 To Mirant:       Mirant Corporation
                                  1155 Perimeter Center West
                                  Atlanta, Georgia 30338-5416
                                  Attention: Chief Executive Officer

                 To Executive:    The most recent address on file with Mirant

     Notice shall be deemed given and effective three (3) days after the deposit
     in the U.S. mail of a writing addressed as above and sent first class mail,
     certified, return receipt requested, the next business day after deposit
     with a reputable overnight courier or when actually received. Either party
     may change the address to which notices shall be delivered or mailed by
     notifying the other party of such change in accordance with this Section
     8(k).

          (l)    AMENDMENTS. This Agreement may not be amended or modified
     except in writing signed by both parties.

          (m)    TERM OF AGREEMENT. The term of this Agreement is co-extensive
     with the Term of employment as set forth in Section 2. Termination shall
     not affect any right or

                                       13
<Page>

     obligation of any party which is accrued or vested prior to or upon such
     termination or by its terms continues following the termination of the
     Term.

          (n)    CONFLICT. In the case of conflict between the terms of this
     Agreement (the "Agreement Terms") and the provisions of any plan, policy,
     or practice of Mirant, as in effect from time to time, otherwise applicable
     to Executive (the "Standard Provisions"), Executive's rights or Mirant's
     obligations shall be established by whichever of the Agreement Terms or
     Standard Provisions would be more beneficial to Executive; PROVIDED,
     HOWEVER, that, notwithstanding any other provisions of this Agreement to
     the contrary, Executive shall not be entitled to participate in Mirant's
     Key Employee Retention Program or any other similar plan adopted by Mirant
     with respect to the period expiring on the third anniversary of the
     Effective Date.

          (o)    COUNTERPARTS. This Agreement may be executed in several
     counterparts, each of which will be deemed an original, but all of which
     taken together will constitute one and the same instrument.

                  [Remainder of Page Intentionally Left Blank]

                                       14
<Page>

IN WITNESS WHEREOF, the parties hereto having duly executed and delivered this
Employment Agreement as of the date first written above.

MIRANT CORPORATION

By:       /s/ Vance N. Booker
     ---------------------------
Name:         Vance N. Booker                         /s/ M. MICHELE BURNS
     ----------------------------                 ------------------------------
Title:    Senior Vice President                       M. MICHELE BURNS
      ---------------------------

<Page>

                                    EXHIBIT A

                                 FORM OF RELEASE

                                 GENERAL RELEASE

1.   For valuable consideration, the adequacy of which is hereby acknowledged,
the undersigned ("Executive"), for herself, her spouse, heirs, administrators,
children, representatives, executors, successors, assigns, and all other persons
claiming through Executive, if any (collectively, "Releasers"), knowingly and
voluntarily releases and forever discharges Mirant Corporation, its affiliates,
subsidiaries, divisions, successors and assigns and the current, future and
former employees, officers, directors, shareholders, representatives, attorneys,
trustees and agents (collectively referred to throughout this General Release as
"Released Parties") from any and all claims, causes of action, demands, fees and
liabilities of any kind whatsoever, whether known and unknown, against any of
the Released Parties, Executive has, has ever had or may have as of the date of
execution of this General Release (hereinafter "Claims"), including, but not
limited to, any Claims for, arising out of, or under:

-    the Executive's employment and termination of employment with Mirant
     Corporation ("Mirant");

-    The National Labor Relations Act, as amended;

-    Title VII of the Civil Rights Act of 1964, as amended;

-    The Civil Rights Act of 1991;

-    Sections 1981 through 1988 of Title 42 of the United States Code, as
     amended;

-    The Civil Rights Act of 1866, as amended;

-    The Equal Pay Act, as amended;

-    The Employee Retirement Income Security Act of 1974, as amended;

-    The Immigration Reform and Control Act, as amended;

-    The Americans with Disabilities Act of 1990, as amended;

-    The Age Discrimination in Employment Act of 1967, as amended;

                                     - 16 -
<Page>

-    The Older Workers Benefit Protection Act of 1990, as amended;

-    The Worker Adjustment and Retraining Notification Act, as amended;

-    The Occupational Safety and Health Act, as amended;

-    The Family and Medical Leave Act of 1993, as amended;

     -  any other federal, state or local civil or human rights law or any other
        local, state or federal law, regulation or ordinance, any applicable
        Executive Order program and each of their State and local counterparts;

     -  any public policy, contract, tort, common law or policies and/or
        practices of Mirant; and/or

     -  attorneys' fees, costs and other expenses.

Notwithstanding anything herein to the contrary, this General Release shall not
apply to: (i) Executive's rights of indemnification and directors and officers
liability insurance coverage to which she was entitled immediately prior to DATE
with regard to her service as an officer of Mirant (including, without
limitation, under Section 8(e) of that certain Employment Agreement between
Mirant and Executive dated as of April 1, 2004 (the "Employment Agreement"));
(ii) Executive's rights under any tax-qualified pension plan or claims for
accrued vested benefits under any other employee benefit plan, policy or
arrangement maintained by Mirant or under COBRA; (iii) Executive's rights under
the provisions of the Employment Agreement which are intended to survive
termination of employment; or (iv) Executive's rights as a stockholder. Excluded
from this General Release are any claims which cannot be waived by law.

2.      Executive acknowledges and recites that:

        (a)    Executive has executed this General Release knowingly and
               voluntarily;

        (b)    Executive has read and understands this General Release in its
               entirety, including the waiver of rights under the Age
               Discrimination in Employment Act;

        (c)    Executive has been advised and directed orally and in writing
               (and this subparagraph (c) constitutes such written direction) to
               seek legal counsel and any other advice she wishes with respect
               to the terms of this General Release before executing it;

                                     - 17 -
<Page>

        (d)    Executive has sought such counsel, or freely and voluntarily
               waives the right to consult with counsel, and Executive has had
               an opportunity, if she so desires, to discuss with counsel the
               terms of this General Release and their meaning;

        (e)    Executive enters into this General Release knowingly and
               voluntarily, without duress or reservation of any kind, and after
               having given the matter full and careful consideration; and

        (f)    Executive has been offered 21 calendar days after receipt of this
               General Release to consider its terms before executing it.

3.      This General Release shall be governed by the internal laws (and not the
choice of law principles) of the State of Georgia, except for the application of
pre-emptive Federal law.

4.      Executive shall have 7 days from the date hereof to revoke this General
Release by providing written notice of the revocation to Mirant's Chief
Executive Officer, as provided in Section 8(k) of the Employment Agreement, in
which event this General Release shall be unenforceable and null and void.

                                                M. MICHELE BURNS

                                                --------------------------------
Date:                                           Executive
      --------------------------

                                     - 18 -

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