Document:

Exhibit 10.1

Exhibit 10.1

SEPARATION AGREEMENT AND GENERAL RELEASE

THIS SEPARATION AGREEMENT AND GENERAL RELEASE (the “Agreement”) is made and entered into the
6th day of July, 2009, but effective as of March 31, 2009 (the “Effective Date”), by and between
Private Bancorp, Inc. (the “Company”), and Dennis Klaeser (“Klaeser”).

RECITALS

A. Klaeser was employed by the Company as its Chief Financial Officer until February 6, 2009
at which time the Company advised Klaeser that his period of service as Chief Financial Officer was
terminated and that his employment with the Company and all of its affiliates would terminate
effective March 31, 2009.

B. Klaeser and the Company are parties to a term sheet agreement entered into in December 2007
(the “Term Sheet Agreement”), pursuant to which, subject to delivery of a waiver and general
release, Klaeser would became entitled to certain severance benefits in connection with the
termination of his employment on March 31, 2009.

C. Due to uncertainty surrounding the application of the American Recovery and Reinvestment
Act of 2009 (“ARRA”) to certain provisions of the Emergency Economic Stabilization Act of 2008, as
amended by ARRA (“EESA”) on the Company’s ability to provide such severance benefits to Klaeser,
the Company has refrained from providing any such benefits to Klaeser.

D. On June 15, 2009, the United States Department of Treasury published interim final rules
relating to EESA, which interim final rules provide that certain limitations set forth in EESA
prohibiting the payment of any severance benefits are not effective until June 15, 2009, the date
the interim final rules were published in the Federal Register, and that such rules appear to
permit the Company to provide the severance benefits to Klaeser.

E Klaeser and the Company desire to enter into this Agreement, which is the waiver and general
release contemplated by the Term Sheet Agreement, and which also evidences the parties intent to
comply with the interim final rule.

NOW, THEREFORE, in consideration of the above premises and the following mutual covenants and
conditions, the parties agree as follows:

1. Termination of Employment. Effective the close of business on March 31, 2009
(“Termination Date”), Klaeser’s employment with the Company terminated along with all other
positions he held with the Company. Klaeser acknowledges that he has not and, further, agrees that
he will not hereafter seek reinstatement, recall or re-employment with the Company.

 

 

 

2. Payments. In accordance with the Term Sheet Agreement and as additional
consideration, Klaeser shall receive the following amounts and entitlements in connection with his
separation from the Company:

(a) Severance Payments. The Company shall pay Klaeser severance pay equal to one
year’s current base salary of $310,000, plus the average of Klaeser’s bonus amount for the years
2006-2008, or $155,833. This sum of $465,833 will be paid in substantially equal monthly
installments of $38,819.41 (less applicable withholdings) in accord with the Company’s normal
payroll practices, modified as follows. Payments will commence after the receipt of this signed
agreement and expiration of the revocation period described below in paragraph 11(b). The first
payment will be made on the first regular payroll date following expiration of the revocation
period described in Section 11(b) below and will include the monthly installment payments that
would have been due for the months of April, May and June 2009, as well as the monthly installment
for July 2009. Thereafter, the monthly installment payments will be made on the first regular
payroll date occurring during the month until the aggregate sum of $465,833 has been paid.

(b) Vacation/Expenses. Klaeser acknowledges that he has received payment of all of
his accrued but unused vacation as of March 31, 2009 and reimbursement of all businesses expenses
he incurred prior to March 31, 2009.

(c) Medical and Dental Benefits. Klaeser was entitled to elect to continue his
medical and dental insurance coverage, as mandated by COBRA for up to 18 months. If Klaeser has so
elected, and to the extent he remains eligible for continued coverage under COBRA, the Company
will, for twelve (12) months, pay the difference between the COBRA continuation coverage premium
and the premium paid by active employees. These subsidy payments are subject to payroll tax
withholding. After the twelve-month period, Klaeser will be solely responsible for paying the
COBRA premiums.

(d) No 2008 Bonus; No Pro Rata 2009 Bonus. Klaeser did not earn a bonus for 2008. No
pro rata 2009 bonus is payable.

(e) Withholding. The Company and Klaeser acknowledge and agree that all payments made
pursuant to this Paragraph 2 are “wages” for purposes of FICA, FUTA and income tax withholding
(other than as may be excluded as a working condition fringe) and the Company shall therefore
withhold from any payments hereunder the amounts it determines to be necessary to satisfy all tax
withholding obligations.

(f) Outplacement Assistance; Legal Services. The Company will pay to Klaeser $12,500
to reimburse him for legal fees paid to Barack Ferrazzano Kirschbaum & Nagelberg LLP, his legal
counsel in regard to this Separation Agreement and General Release, and $25,000 on his behalf to
Shields Meneley Partners, his executive outplacement firm.

 

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(g) Other. Except as otherwise set forth in this Paragraph 2 or as provided in
Paragraph 3 below, no other sums or amounts of any kind (contingent or otherwise) shall be paid or
provided to Klaeser in respect of his employment by the Company, or as additional separation
amounts, and any further such sums or amounts (whether or not owed) are hereby expressly waived by
Klaeser. Klaeser acknowledges that all other employee benefits ceased as of March 31, 2009.

3. Equity. Klaeser’s stock options and restricted stock units have been or will be
treated according to the terms of the applicable plans and agreements as summarized in Exhibit A to
this Agreement.

4. General Release. As required by the Term Sheet Agreement, and in consideration of
the additional payments and benefits to be made or provided by the Company to Klaeser in Paragraphs
2 and 3 above, Klaeser, with full understanding of the contents and legal effect of this General
Release and having the right and opportunity to consult with his counsel, waives, releases and
discharges the Company, its shareholders, officers, directors, supervisors, members, managers,
employees, agents, representatives, attorneys, parent companies, divisions, subsidiaries and
affiliates, and all related entities of any kind or nature, and its and their predecessors,
successors, heirs, executors, administrators, and assigns (collectively, the “Released Parties”)
from any and all claims, actions, causes of action, grievances, suits, charges, or complaints of
any kind or nature whatsoever, that he ever had or now has, whether fixed or contingent, liquidated
or unliquidated, known or unknown, suspected or unsuspected, and whether arising in tort, contract,
statute, or equity, before any federal, state, local, or private court, agency, arbitrator,
mediator, or other entity, regardless of the relief or remedy. Without limiting the generality of
the foregoing, it being the intention of the parties to make this General Release as broad and as
general as the law permits, this Release specifically includes any and all subject matter and
claims arising from any alleged violation by the Released Parties under the Age Discrimination in
Employment Act of 1967, as amended; Title VII of the Civil Rights Act of 1964, as amended; the
Civil Rights Act of 1866, as amended by the Civil Rights Act of 1991 (42 U.S.C. § 1981); the
Rehabilitation Act of 1973, as amended; the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”); the Illinois Wage Payment and Collection Act; the Illinois Human Rights Act, the
Cook County Human Rights Ordinance, the Chicago Human Rights Ordinance, and other similar state or
local laws; the Americans with Disabilities Act; the Family and Medical Leave Act; the Worker
Adjustment and Retraining Notification Act; the Older Worker Benefits Protection Act, the Equal Pay
Act; Executive Order 11246; Executive Order 11141; and any other statutory claim, employment or
other contract or implied contract claim and claims under any company severance policy or plan, and
under any incentive compensation program, claim for equity or phantom equity, or common law claim
for wrongful discharge, breach of an implied covenant of good faith and fair dealing, defamation,
intentional infliction of emotional distress, negligence or invasion of privacy arising out of or
involving his employment with the Company, the termination of his employment with the Company, or
involving any continuing effects of his employment with the Company or termination of employment
with the Company. Klaeser further acknowledges that he is aware that statutes exist that render
null and void releases and discharges of any claims, rights, demands, liabilities, action and
causes of action which are unknown to the releasing or discharging party at the time of execution
of the release and discharge. Klaeser hereby expressly waives, surrenders and agrees to forego any protection to which he would otherwise be entitled by virtue of the
existence of any such statute in any jurisdiction including, but not limited to, the State of
Illinois.

 

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Excluded from this release are any claims which cannot be waived or released by law, including
but not limited to the right to file a charge with or participate in an investigation conducted, by
certain government agencies. Klaeser does, however, waive Klaeser’s right to any monetary recovery
should any agency (such as the Equal Employment Opportunity Commission) pursue any claims on
Klaeser’s behalf. Klaeser represents and warrants that he has not filed any complaint, charge, or
lawsuit against the Company with any government agency or any court.

Klaeser acknowledges that this Agreement constitutes and may be pleaded as, a bar to any such
claim, action, cause of action or proceeding. The foregoing notwithstanding, this Paragraph 4 and
Exhibit B shall not preclude Klaeser from (i) filing a claim with respect to the enforcement of the
terms of this Agreement; (ii) enforcing rights, if any, to indemnification as may be provided for
under the Company’s by-laws or under any directors’ and officers’ liability insurance; and (iii)
challenging the release of his age discrimination claims under the ADEA. If Klaeser sues the
Company for any released claim, Klaeser shall be liable to the Company for its reasonable
attorneys’ fees and other litigation costs incurred in defending against such a suit.
Alternatively, in the event Klaeser sues the Company (other than under the ADEA), Klaeser may, at
the Company’s option, be required to return all monies and other benefits paid to Klaeser pursuant
to this Agreement.

5. Breach/Indemnification. Klaeser will fully indemnify the Company and its
shareholders, members, managers, officers, directors, employees and independent contractors against
and will hold its shareholders, members, managers, officers, directors, employees and independent
contractors harmless from any and all claims, costs, damages, demands, expenses (including without
limitation attorneys’ fees), judgments, losses or other liabilities of any kind or nature
whatsoever arising from or directly or indirectly related to any material breach or failure by
Klaeser to comply with any or all of the provisions of this Agreement. Klaeser further agrees that
his continuing entitlement to the amounts described in Paragraphs 2 and 3 is contingent on his
compliance with the provisions of this Agreement. Further, Klaeser acknowledges that a breach of
any provision of this Agreement by him shall entitle the Company, at its sole discretion, to cease
making payments under this Agreement and to recover amounts already paid hereunder. The Company
will fully indemnify Klaeser against and will hold him harmless from any and all claims, costs,
damages, demands, expenses (including without limitation attorneys’ fees), judgments, losses or
other liabilities of any kind or nature whatsoever arising from or directly or indirectly related
to any material breach or failure by the Company to comply with any or all of the provisions of
this Agreement.

6. Nondisparagement. Klaeser represents that he has not and will not make, release or
cause to be made or released any disparaging, untrue, or misleading written or oral statements
about or relating to the Company or its products or services (or about or relating to any officer,
director, member, agent, employee, or other person acting on the Company’s behalf). The Company
will not make, release or cause to be made any public statements about Klaeser, his employment with
the Company or termination thereof which are inconsistent with the Company’s prior public statements relating to Klaeser’s employment with the Company or
termination thereof.

 

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7. Confidentiality; Restrictive Covenants. Klaeser acknowledges and agrees that his
obligations and the Company’s rights under the Restrictive Covenant provisions of the Term Sheet
Agreement relating to confidentiality, non-competition and non-solicitation to continue to apply as
if such provisions were set forth in full in this Agreement.

8. Company Property. Klaeser has returned all Company property in his possession or
control, including but not limited to all Company credit cards, documents, memoranda, information
(either in electronic or paper form), computers or related equipment, telephones, PDAs, keys,
identification cards and anything else belonging to the Company. Additionally, Klaeser agrees not
to enter, damage, interfere with, log on to, or otherwise use in any way any Company information
system at any time. Klaeser further represents that he has not destroyed, deleted or otherwise
removed from the Company any property belonging to the Company and agrees that he will not destroy,
delete or otherwise remove from the Company any property belonging to the Company.

9. Severability. If any provision of this Separation Agreement and General Release
shall be found by a court to be invalid or unenforceable, in whole or in part, then such provision
shall be construed and/or modified or restricted to the extent and in the manner necessary to
render the same valid and enforceable, or shall be deemed excised from this Agreement, as the case
may require, and this Agreement shall be construed and enforced to the maximum extent permitted by
law, as if such provision had been originally incorporated herein as so modified or restricted, or
as if such provision had not been originally incorporated herein, as the case may be. The parties
further agree to seek a lawful substitute for any provision found to be unlawful; provided, that,
if the parties are unable to agree upon a lawful substitute, the parties desire and request that a
court or other authority called upon to decide the enforceability of this Agreement modify the
Agreement so that, once modified, the Agreement will be enforceable to the maximum extent permitted
by the law in existence at the time of the requested enforcement.

10. Waiver. A waiver by the Company of a breach of any provision of this Separation
Agreement and General Release by Klaeser shall not operate or be construed as a waiver or estoppel
of any subsequent breach by Klaeser. No waiver by the Company shall be valid unless in writing and
signed by an authorized officer of the Company.

11. Miscellaneous Provisions.

(a) Announcements. Klaeser agrees and acknowledges that he will make no announcement
about his termination or about the affairs of the Company which is in any manner inconsistent with
the terms of this Agreement, and further agrees and acknowledges that any press or other written,
oral or electronic public releases, or statements concerning his termination, the terms of this
Agreement shall be issued by the Company only.

 

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(b) Knowing and Voluntarily. Klaeser represents and certifies that he has carefully
read and fully understands all of the provisions and effects of this Agreement, has knowingly and
voluntarily entered into this Agreement freely and without coercion, and acknowledges that he has
consulted with an attorney prior to executing this Agreement and, by this Agreement, the Company
advised him that he has up to 21 days to consider this Agreement and Klaeser has been advised that
if he signs this Agreement, he has seven days following the date on which he signs this Agreement
to revoke it, and this Agreement will not be effective until after this seven (7) day period has
lapsed. If Klaeser does not accept this Agreement by the end of the 21-day consideration period,
or if Klaeser accepts and then revokes within the seven (7) day period, the offer contained in this
Agreement shall expire and be of no further force or effect. Klaeser is voluntarily entering into
this Agreement, and neither the Company nor its agents, representatives, or attorneys made any
representations concerning the terms or effects of this Agreement other than those contained in the
Agreement itself. Further, Klaeser acknowledges that the consideration provided him in exchange
for his execution of this Separation Agreement and General Release includes consideration in
addition to what he would otherwise be entitled to as a matter of law or policy of the Company.

12. Complete Agreement; TARP. This Agreement, together with the agreements referred
to herein sets forth the entire agreement between the parties, and fully supersedes any and all
prior agreements or understandings between the parties pertaining to actual or potential claims
arising from Klaeser’s employment with the Company or the termination of Klaeser’s employment with
the Company. Klaeser further acknowledges and agrees that the provisions of the CPP Senior Officer
Agreement and related waiver executed by Klaeser in connection with the Company’s participation in
the TARP program continue in full force and effect, it being understood that nothing in this
Agreement shall constitute an expansion of such waiver or agreement. In addition, Klaeser agrees
that in the event the payment or provision by the Company or receipt by Klaeser of any amounts or
benefits paid or provided hereunder or otherwise in connection with Klaeser’s departure from the
Company are determined to have violated or to violate the provisions of EESA, then such payments or
benefits will be subject to recovery or cancellation by the Company and Klaeser agrees to such
cancellation and/or repayment of such amounts upon written notice from the Company that the Company
has made a good faith determination (based upon a written opinion of counsel or determination by an
applicable regulatory agency) that such cancellation or the amount of such repayment is so
required.

13. Future Cooperation. In connection with any and all claims, disputes,
negotiations, governmental or internal investigations, lawsuits or administrative proceedings (the
“Legal Matters”) involving the Company, or any of its current or former officers, employees or
Board members (collectively, the “Disputing Parties” or, individually, a “Disputing Party”),
Klaeser agrees to make himself reasonably available, upon reasonable notice from the Company and
without the necessity of subpoena, to provide information or documents, provide declarations or
statements regarding a Disputing Party, meet with attorneys or other representatives of a Disputing
Party, prepare for and give depositions or testimony, and/or otherwise cooperate in the
investigation, defense or prosecution of any or all such Legal Matters, as may, in the good faith
of the Company, be reasonably requested.

 

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14. Amendment. This Agreement may not be altered, amended, or modified except in
writing signed by both Klaeser and the Company.

15. Joint Participation. The parties hereto participated jointly in the negotiation
and preparation of this Agreement, and each party has had the opportunity to obtain the advice of
legal counsel and to review and comment upon the Agreement. Accordingly, it is agreed that no rule
of construction shall apply against any party or in favor of any party. This Agreement shall be
construed as if the parties jointly prepared this Agreement, and any uncertainty or ambiguity shall
not be interpreted against one party and in favor of the other.

16. Notice. All notices, requests, demands, claims and other communications hereunder
shall be in writing. Any notice, request, demand, claim, or other communication hereunder shall be
deemed duly given (i) three (3) business days after it is sent by registered or certified mail,
return receipt requested, postage prepaid; (ii) when receipt is electronically confirmed, if sent
by fax (provided that a hard copy shall be promptly sent by first class mail); or (iii) one (1)
business day following deposit with a recognized national overnight courier service for next day
delivery, charges prepaid, and, in each case, addressed to the intended recipient, as set forth
below:

	 	 	 	 
	 	To the Company:
	 	Christopher J. Zinski 

General Counsel 

Private Bancorp, Inc.

120 South LaSalle Street

Suite 400

Chicago, IL 60602
	 
	 	To Klaeser:

	 	To the last recorded address 

on the books and records 

of the Company
	 
	 	With a copy to:

	 	Barack Ferrazzano Kirschbaum & Nagelberg LLP 

200 West Madison Street, Suite 3900

Chicago, IL 60606

Attention: Donald L. Norman, Jr.

17. Applicable Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Illinois, without reference to its conflict of law provisions.
Furthermore, Klaeser agrees and consents to submit to personal jurisdiction in the state of
Illinois in any state or federal court of competent subject matter jurisdiction situated in Cook
County, Illinois. Klaeser further agrees that the sole and exclusive venue for any suit arising
out of, or seeking to enforce this Agreement shall be in a state or federal court of competent
subject matter jurisdiction situated in Cook County, Illinois. In addition, Klaeser waives any
right to challenge in another court any judgment entered by such Cook County court or to assert
that any action instituted by the Company in any such court is in the improper venue or should be
transferred to a more convenient forum.

 

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18. Headings. The headings in this Agreement are inserted for convenience only and
are not to be considered a constriction of the provisions hereof.

19. Execution of Agreement. This Agreement may be executed in several counterparts,
each of which shall be considered an original, but which when taken together, shall constitute one
Agreement.

PLEASE READ THIS AGREEMENT AND CAREFULLY CONSIDER ALL OF ITS PROVISIONS BEFORE SIGNING IT.
THIS AGREEMENT CONTAINS A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS AND FEDERAL, STATE AND LOCAL LAWS
PROHIBITING DISCRIMINATION IN EMPLOYMENT.

 

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IN WITNESS WHEREOF, Klaeser and the Company have voluntarily signed this Separation Agreement
and General Release consisting of seven (7) pages and a one (1) page Exhibit A on the dates set
forth below.

PRIVATE BANCORP, INC.

	 	 	 	 	 
	By: 	/s/ Joan Schellhorn	 	/s/ Dennis Klaeser
	 	 	 	Dennis Klaeser
	 
	Its: 	Chief Human Resource Officer	 	Dated: 	7/7/2009
	 
	Dated:  	7/6/2009	 	 	 

 

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Clinical Data, Inc.

Amended and Restated 2005 Equity Incentive Plan

ARTICLE 1.

Background and Purpose of the Plan

     1.1. Background. This Amended and Restated 2005 Equity Incentive Plan (the “Plan”)
permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Stock Appreciation
Rights, Restricted Stock, Restricted Stock Units, and other equity-based awards.

     1.2. Purpose. The purposes of the Plan are (a) to attract and retain highly competent
persons as Employees, Directors, and Consultants of the Company; (b) to provide additional
incentives to such Employees, Directors, and Consultants; and (c) to promote the success of the
business of the Company.

     1.3. 2002 Plan. The Clinical Data, Inc. 2002 Incentive and Stock Plan (the “Prior
Plan”) shall remain in effect in accordance with its terms, and further option grants may be made
under the Prior Plan after the Effective Date. The adoption of this Plan as of the Effective Date
shall not affect the Prior Plan or the terms of any option granted under the Prior Plan either
before or after the Effective Date.

     1.4. Eligibility. Service Providers who are Employees, Consultants determined by the
Committee to be significantly responsible for the success and future growth and profitability of
the Company, or Directors are eligible to be granted Awards under the Plan. However, Incentive
Stock Options may be granted only to Employees.

     1.5. Definitions. Capitalized terms used in the Plan and not otherwise defined herein
shall have the meanings assigned to such terms in the attached Appendix.

ARTICLE 2.

Share Limits

     2.1. Shares Subject to the Plan.

          (a) Share Reserve. Subject to adjustment under Section 2.3 of the Plan, four million six
hundred thousand (4,600,000) Shares shall be initially reserved for issuance pursuant to Awards
made under the Plan. All of the available Shares may, but need not, be issued pursuant to the
exercise of Incentive Stock Options. At all times the Company will reserve and keep available a
sufficient number of Shares to satisfy the requirements of all outstanding Awards made under the
Plan and all other outstanding but unvested Awards made under the Plan that are to be settled in
Shares.

          (b) Shares Counted Against Limitation. If an Award is exercised, in whole or in part, by
delivery or attestation of Shares under Section 5.4(b), or if the tax withholding obligation is
satisfied by withholding Shares under Section 10.7(b), the number of Shares deemed to have been
issued under the Plan (for purposes of the limitation set forth in this Section

 

 

2.1) shall be the number of Shares that were subject to the Award or portion thereof so
exercised and not the net number of Shares actually issued upon such exercise.

          (c) Lapsed Awards. If an Award: (i) expires; (ii) is terminated, surrendered, or canceled
without having been exercised in full; or (iii) is otherwise forfeited in whole or in part, then
the unissued Shares that were subject to such Award and/or such surrendered, canceled, or forfeited
Shares (as the case may be) shall become available for future grant or sale under the Plan (unless
the Plan has terminated), subject however, in the case of Incentive Stock Options, to any
limitations under the Code.

          (d) Limitation on Full-Value Awards. Not more than seven hundred fifty thousand (750,000) of
the total number of Shares reserved for issuance under the Plan (as adjusted under Section 2.3) may
be granted or sold as Awards of Restricted Stock, Restricted Stock Units, unrestricted grants of
Shares, and other Awards (“full-value Awards”) whose intrinsic value is not solely dependent on
appreciation in the price of Shares after the date of grant. Options and Stock Appreciation Rights
shall not be subject to, and shall not count against, the limit described in the preceding
sentence. If a full-value Award expires, is forfeited, or otherwise lapses as described in Section
2.1(c), the Shares that were subject to the Award shall be restored to the total number of Shares
available for grant or sale as full-value Awards.

          (e) Substitute Awards. The Committee may grant Awards under the Plan in substitution for
stock and stock based awards held by employees, directors, consultants or advisors of another
company (an “Acquired Company”) in connection with a merger, consolidation or advisors of such
Acquired Company with the Company or an Affiliate or the acquisition by the Company or an Affiliate
of property or stock of the Acquired Company. The Committee may direct that the substitute Awards
be granted on such terms and conditions as the Committee considers appropriate in the
circumstances. Any substitute Awards granted under the Plan shall not count against the share
limitations set forth in Section 2.1(a) and 2.2.

     2.2. Individual Share Limit. In any Tax Year, no Service Provider shall be granted
Awards with respect to more than seven hundred fifty thousand (750,000) Shares. The limit
described in this Section 2.2 shall be construed and applied consistently with Section 162(m) of
the Code, except that the limit shall apply to all Service Providers.

          (a) Awards Not Settled in Shares. If an Award is to be settled in cash or any medium other
than Shares, the number of Shares on which the Award is based shall count toward the individual
share limit set forth in this Section 2.2.

          (b) Canceled Awards. Any Awards granted to a Participant that are canceled shall continue to
count toward the individual share limit applicable to that Participant set forth in this Section
2.2.

     2.3. Adjustments.

          (a) In the event that there is any dividend or distribution payable in Shares, or any stock
split, reverse stock split, combination or reclassification of Shares, or any other similar change
in the number of outstanding Shares, then the maximum aggregate number of Shares available for
Awards under Section 2.1 of the Plan, the maximum number of Shares issuable to a Service Provider
under Section 2.2 of the Plan, and any other limitation under this Plan on the maximum number of
Shares issuable to an individual or in the aggregate shall be proportionately

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adjusted (and rounded down to a whole number) by the Committee as it deems equitable in its
discretion to prevent dilution or enlargement of the rights of the Participants. The Committee’s
determination with respect to any such adjustments shall be conclusive.

          (b) In the event that there is any extraordinary dividend or other distribution in respect of
the Shares, recapitalization, reclassification, merger, reorganization, consolidation, combination,
sale of assets, split-up, exchange, spin-off or other extraordinary event, then the Committee shall
make provision for a cash payment, for the substitution or exchange of any or all outstanding
Awards or a combination of the foregoing, based upon the distribution or consideration payable to
holders of the Shares in respect of such event or on such other terms as the Committee otherwise
deems appropriate.

ARTICLE 3.

Administration of the Plan

     3.1. Administrator. The Plan shall be administered by the Committee.

     3.2. Powers of the Committee. Subject to the provisions of the Plan, Applicable Law,
and the specific duties delegated by the Board to the Committee, the Committee shall have the
authority in its discretion: (a) to determine the Fair Market Value; (b) to select the Service
Providers to whom Awards may be granted hereunder and the types of Awards to be granted to each;
(c) to determine the number of Shares to be covered by each Award granted hereunder; (d) to
determine whether, to what extent, and under what circumstances an Award may be settled in cash,
Shares, other securities, other Awards, or other property; (e) to approve forms of Award
Agreements; (f) to determine, in a manner consistent with the terms of the Plan, the terms and
conditions of any Award granted hereunder, based on such factors as the Committee, in its sole
discretion, shall determine; (g) to construe and interpret the terms of the Plan and Award
Agreements; (h) to correct any defect, supply any omission, or reconcile any inconsistency in the
Plan or any Award Agreement in the manner and to the extent it shall deem desirable to carry out
the purposes of the Plan; (i) to prescribe, amend, and rescind rules and regulations relating to
the Plan, including rules and regulations relating to sub-plans established pursuant to Section
12.1 of the Plan; (j) to authorize withholding arrangements pursuant to Section 10.7(b) of the
Plan; (k) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Award previously granted by the Committee; and (l) to make all other
determinations and take all other action described in the Plan or as the Committee otherwise deems
necessary or advisable for administering the Plan and effectuating its purposes.

     3.3. Compliance with Applicable Law. The Committee shall administer, construe,
interpret, and exercise discretion under the Plan and each Award Agreement in a manner that is
consistent and in compliance with a reasonable, good faith interpretation of all Applicable Laws.

     3.4. Effect of Committee’s Decision and Committee’s Liability. The Committee’s
decisions, determinations and interpretations shall be final and binding on all Participants and
any other holders of Awards. Neither the Committee nor any of its members shall be liable for any
act, omission, interpretation, construction, or determination made in good faith in connection with
the Plan or any Award Agreement.

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     3.5. Delegation to Executive Officers. To the extent permitted by Applicable Law, the
Board may delegate to one or more Executive Officers the powers: (a) to designate Service Providers
who are not Executive Officers as eligible to participate in the Plan; and (b) to determine the
amount and type of Awards that may be granted to Service Providers who are not Executive Officers.

     3.6. Awards may be Granted Separately or Together. In the Committee’s discretion,
Awards may be granted alone, in addition to, or in tandem with any other Award or any award granted
under another plan of the Company or an Affiliate. Awards granted in addition to or in tandem with
other awards may be granted either at the same time or at different times.

ARTICLE 4.

Vesting and Performance Objectives

     4.1. General. The vesting schedule or Period of Restriction for any Award shall be
specified in the Award Agreement. The criteria for vesting and for removing restrictions on any
Award may include (i) performance of substantial services for the Company for a specified period;
(ii) achievement of one or more Performance Objectives; or (iii) a combination of (i) and (ii), as
determined by the Committee.

     4.2. Period of Absence from Providing Substantial Services. To the extent that
vesting or removal of restrictions is contingent on performance of substantial services for a
specified period, a leave of absence (whether paid or unpaid) shall not count toward the required
period of service unless the Award Agreement provides otherwise.

     4.3. Performance Objectives.

          (a) Possible Performance Objectives. Any Performance Objective shall relate to the Service
Provider’s performance for the Company (or an Affiliate) or the Company’s (or Affiliate’s) business
activities or organizational goals, and shall be sufficiently specific that a third party having
knowledge of the relevant facts could determine whether the Performance Objective is achieved. The
Performance Objectives with respect to any Award may be one or more of the following General
Financial and/or Operational Objectives, as established by the Committee in its sole discretion:

               (i) General Financial Objectives:

	 	•	 	Increasing the Company’s net sales
	 
	 	•	 	Achieving a target level of earnings (including gross earnings; earnings before certain
deductions, such as interest, taxes, depreciation, or amortization; or earnings per Share)
	 
	 	•	 	Achieving a target level of income (including net income or income before consideration
of certain factors, such as overhead) or a target level of gross profits for the Company,
an Affiliate, or a business unit
	 
	 	•	 	Achieving a target return on the Company’s (or an Affiliate’s) capital, assets, or
stockholders’ equity
	 
	 	•	 	Maintaining or achieving a target level of appreciation in the price of the Shares
	 
	 	•	 	Increasing the Company’s (or an Affiliate’s) market share to a specified target level

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	 	•	 	Achieving or maintaining a Share price that meets or exceeds the performance of
specified stock market indices or other benchmarks over a specified period
	 
	 	•	 	Achieving a level of Share price, earnings, or income performance that meets or exceeds
performance in comparable areas of peer companies over a specified period
	 
	 	•	 	Achieving specified reductions in costs
	 
	 	•	 	Achieving specified improvements in collection of outstanding accounts or specified
reductions in non-performing debts

               (ii) Operational Objectives:

	 	•	 	Expanding one or more products into one or more new markets
	 
	 	•	 	Acquiring a prescribed number of new customers in a line of business
	 
	 	•	 	Achieving a prescribed level of productivity within a business unit
	 
	 	•	 	Completing specified projects within or below the applicable budget

          (b) Stockholder Approval of Performance Objectives. The list of possible Performance
Objectives set forth in Section 4.3(a), above, and the other material terms of Awards of Restricted
Stock or Restricted Stock Units that are intended to qualify as “performance-based compensation”
under Section 162(m) of the Code, shall be subject to reapproval by the Company’s stockholders at
the first stockholder meeting that occurs in 2010. No Award of Restricted Stock or Restricted
Stock Units that is intended to qualify as “performance-based compensation” under Section 162(m) of
the Code shall be made after that meeting unless stockholders have reapproved the list of
Performance Objectives and other material terms of such Awards, or unless the vesting of the Award
is made contingent on stockholder approval of the Performance Objectives and other material terms
of such Awards.

          (c) Documentation of Performance Objectives. With respect to any Award, the Performance
Objectives shall be set forth in writing no later than 90 days after commencement of the period to
which the Performance Objective(s) relate(s) (or, if sooner, before 25% of such period has elapsed)
and at a time when achievement of the Performance Objectives is substantially uncertain. Such
writing shall also include the period for measuring achievement of the Performance Objectives,
which shall be no greater than five consecutive years, as established by the Committee. Once
established by the Committee, the Performance Objective(s) may not be changed to accelerate the
settlement of an Award or to accelerate the lapse or removal of restrictions on Restricted Stock
that otherwise would be due upon the attainment of the Performance Objective(s).

          (d) Committee Certification. Prior to settlement of any Award that is contingent on
achievement of one or more Performance Objectives, the Committee shall certify in writing that the
applicable Performance Objective(s) and any other material terms of the Award were in fact
satisfied. For purposes of this Section 4.3(d), approved minutes of the Committee shall be
adequate written certification.

          (e) Negative Discretion. The Committee may reduce, but may not increase, the number of Shares
deliverable or the amount payable under any Award after the applicable Performance Objectives are
satisfied.

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ARTICLE 5.

Stock Options

     5.1. Terms of Option. Subject to the provisions of the Plan, the type of Option, term,
exercise price, vesting schedule, and other conditions and limitations applicable to each Option
shall be as determined by the Committee and shall be stated in the Award Agreement.

     5.2. Type of Option.

          (a) Each Option shall be designated in the Award Agreement as either an Incentive Stock Option
or a Nonstatutory Stock Option.

          (b) Neither the Company nor the Committee shall have liability to a Participant or any other
party if an Option (or any part thereof) which is intended to be an Incentive Stock Option does not
qualify as an Incentive Stock Option. In addition, the Committee may make an adjustment or
substitution described in Section 2.3 of the Plan that causes the Option to cease to qualify as an
Incentive Stock Option without the consent of the affected Participant or any other party.

     5.3. Limitations.

          (a) Maximum Term. No Option shall have a term in excess of 10 years measured from the date
the Option is granted. In the case of any Incentive Stock Option granted to a 10% Stockholder (as
defined in Section 5.3(e), below), the term of such Incentive Stock Option shall not exceed five
years measured from the date the Option is granted.

          (b) Minimum Exercise Price. Subject to Section 2.3(b) of the Plan, the exercise price per
share of an Option shall not be less than 100% of the Fair Market Value per Share on the date the
Option is granted. In the case of any Incentive Stock Option granted to a 10% Stockholder (as
defined in Section 5.3(e), below), subject to Section 2.3(b) of the Plan, the exercise price per
share of such Incentive Stock Option shall not be less than 110% of the Fair Market Value per Share
on the date the Option is granted.

          (c) Repricing Prohibited. Except as provided in Section 2.3, the Committee shall not amend
any outstanding Option to reduce its exercise price, and shall not grant an Option with a lower
exercise price within six months before or after an Option with a higher exercise price is
canceled.

          (d) $100,000 Limit for Incentive Stock Options. Notwithstanding an Option’s designation, to
the extent that Incentive Stock Options are exercisable for the first time by the Participant
during any calendar year with respect to Shares whose aggregate Fair Market Value exceeds $100,000
(regardless of whether such Incentive Stock Options were granted under this Plan, the 2002 Plan, or
any other plan of the Company or any Affiliate), such Options shall be treated as Nonstatutory
Stock Options. For purposes of this Section 5.3(d), Fair Market Value shall be measured as of the
date the Option was granted and Incentive Stock Options shall be taken into account in the order in
which they were granted.

          (e) 10% Stockholder. For purposes of this Section 5.3, a “10% Stockholder” is an individual
who, immediately before the date an Award is granted, owns (or is treated as owning) stock
possessing more than 10% of the total combined voting power of all classes of stock of the Company
(or an Affiliate), determined under Section 424(d) of the Code.

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     5.4. Form of Consideration. The Committee shall determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the case of an
Incentive Stock Option, the Committee shall determine the acceptable form of consideration at the
time of grant. To the extent approved by the Committee, the consideration for exercise of an
Option may be paid in any one, or any combination, of the forms of consideration set forth in
subsections (a), (b), and (c), below.

          (a) Cash Equivalent. Consideration may be paid by cash, check, or other cash equivalent
approved by the Committee.

          (b) Tender or Attestation of Shares. Consideration may be paid by the tendering of other
Shares to the Company or the attestation to the ownership of the Shares that otherwise would be
tendered to the Company in exchange for the Company’s reducing the number of Shares issuable upon
the exercise of the Option. Shares tendered or attested to in exchange for Shares issued under the
plan must be held by the Service Provider for at least six months prior to their tender or their
attestation to the Company and may not be shares of Restricted Stock at the time they are tendered
or attested to. The Committee shall determine acceptable methods for tendering or attesting to
Shares to exercise an Option under the Plan and may impose such limitations and prohibitions on the
use of Shares to exercise Options as it deems appropriate. For purposes of determining the amount
of the Option price satisfied by tendering or attesting to Shares, such Shares shall be valued at
their Fair Market Value on the date of tender or attestation, as applicable.

          (c) Other Methods. Consideration may be paid using such other methods of payment as the
Committee, at its discretion, deems appropriate from time to time.

     5.5. Exercise of Option.

          (a) Procedure for Exercise. Any Option granted hereunder shall be exercisable according to
the terms of the Plan and at such times and under such conditions as set forth in the Award
Agreement. An Option shall be deemed exercised when the Committee receives: (i) written or
electronic notice of exercise (in accordance with the Award Agreement) from the person entitled to
exercise the Option and (ii) full payment for the Shares (in a form permitted under Section 5.4 of
the Plan) with respect to which the Option is exercised.

          (b) Termination of Relationship as a Service Provider. Following a Participant’s Termination
of Service, the Participant (or the Participant’s Beneficiary, in the case of Termination of
Service due to death) may exercise his or her Option within such period of time as is specified in
the Award Agreement, subject to the following conditions:

               (i) An Option may be exercised after the Participant’s Termination of Service only to the
extent that the Option was vested as of the Termination of Service;

               (ii) An Option may not be exercised after the expiration of the term of such Option as set
forth in the Award Agreement;

               (iii) Unless a Participant’s Termination of Service is the result of the Participant’s
Disability, the Participant may not exercise an Incentive Stock Option more than three months after
such Termination of Service;

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               (iv) If a Participant’s Termination of Service is the result of the Participant’s Disability,
the Participant may exercise an Incentive Stock Option up to 12 months after Termination of
Service; and

               (v) After the Participant’s death, his Beneficiary may exercise an Incentive Stock Option only
to the extent that that the deceased Participant was entitled to exercise such Incentive Stock
Option as of the date of his death.

In the absence of a specified time in the Award Agreement, the Option shall remain exercisable for
three months after the Participant’s Termination of Service for any reason other than Disability or
death, and for 12 months after the Participant’s Termination of Service on account of Disability or
death.

          (c) Rights as a Stockholder. Shares subject to an Option shall be deemed issued, and the
Participant shall be deemed the record holder of such Shares, on the Option exercise date. Until
such Option exercise date, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Shares subject to the Option. In the event that the
Company effects a split of the Shares by means of a stock dividend and the exercise price of, and
number of shares subject to, an Option are adjusted as of the date of distribution of the dividend
(rather than as of the record date for such dividend), then a Participant who exercises such Option
between the record date and the distribution date for such stock dividend shall be entitled to
receive, on the distribution date, the stock dividend with respect to the Shares subject to the
Option. No other adjustment shall be made for a dividend or other right for which the record date
is prior to the date the Shares are issued.

     5.6. Repurchase Rights. The Committee shall have the discretion to grant Options
which are exercisable for unvested Shares. If the Participant ceases to be a Service Provider
while holding such unvested Shares, the Company shall have the right to repurchase any or all of
those unvested Shares at a price per share equal to the lower of (i) the exercise price paid per
Share, or (ii) the Fair Market Value per Share at the time of repurchase. The terms upon which
such repurchase right shall be exercisable by the Committee (including the period and procedure for
exercise and the appropriate vesting schedule for the purchased Shares) shall be established by the
Committee and set forth in the document evidencing such repurchase right.

ARTICLE 6.

Stock Appreciation Rights

     6.1. Terms of Stock Appreciation Right. The term, base amount, vesting schedule, and
other conditions and limitations applicable to each Stock Appreciation Right, except the medium of
settlement, shall be as determined by the Committee and shall be stated in the Award Agreement.
All Awards of Stock Appreciation Rights shall be settled in Shares issuable upon the exercise of
the Stock Appreciation Right.

     6.2. Exercise of Stock Appreciation Right.

          (a) Procedure for Exercise. Any Stock Appreciation Right granted hereunder shall be
exercisable according to the terms of the Plan and at such times and under such conditions as set
forth in the Award Agreement. A Stock Appreciation Right shall be deemed

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exercised when the Committee receives written or electronic notice of exercise (in accordance
with the Award Agreement) from the person entitled to exercise the Stock Appreciation Right.

          (b) Termination of Relationship as a Service Provider. Following a Participant’s Termination
of Service, the Participant (or the Participant’s Beneficiary, in the case of Termination of
Service due to death) may exercise his or her Stock Appreciation Right within such period of time
as is specified in the Award Agreement to the extent that the Stock Appreciation right is vested as
of the Termination of Service. In the absence of a specified time in the Award Agreement, the
Stock Appreciation Right shall remain exercisable for three months following the Participant’s
Termination of Service for any reason other than Disability or death, and for 12 months after the
Participant’s Termination of Service on account of Disability or death.

          (c) Rights as a Stockholder. Shares subject to a Stock Appreciation Right shall be deemed
issued, and the Participant shall be deemed the record holder of such Shares, on the date the Stock
Appreciation Right is exercised. Until such date, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Shares subject to the Stock
Appreciation Right. If the Company effects a split of the Shares by means of a stock dividend and
the exercise price of, and number of shares subject to, a Stock Appreciation Right are adjusted as
of the date of distribution of the dividend (rather than as of the record date for such dividend),
then a Participant who exercises such Stock Appreciation Right between the record date and the
distribution date for such stock dividend shall be entitled to receive, on the distribution date,
the stock dividend with respect to the Shares subject to the Stock Appreciation Right. No other
adjustment shall be made for a dividend or other right for which the record date is prior to the
date the Shares are issued.

ARTICLE 7.

Restricted Stock

     7.1. Terms of Restricted Stock. Subject to the provisions of the Plan, the Period of
Restriction, the number of Shares granted, and other conditions and limitations applicable to each
Award of Restricted Stock shall be as determined by the Committee and shall be stated in the Award
Agreement. Unless the Committee determines otherwise, Shares of Restricted Stock shall be held by
the Company as escrow agent until the restrictions on such Shares have lapsed.

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

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

     7.4. Removal of Restrictions. Except as otherwise provided in this Article 7, and
subject to Section 10.5 of the Plan, Shares of Restricted Stock covered by an Award of Restricted
Stock made under the Plan shall be released from escrow, and shall become fully transferable, as
soon as practicable after the Period of Restriction ends, and in any event no later than 21/2 months
after the end of the Tax Year in which the Period of Restriction ends.

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     7.5. Voting Rights. During the Period of Restriction, Service Providers holding
Shares of Restricted Stock granted hereunder may exercise full voting rights with respect to those
Shares, unless otherwise provided in the Award Agreement.

     7.6. Dividends and Other Distributions. During the Period of Restriction, Service
Providers holding Shares of Restricted Stock shall be entitled to receive all dividends and other
distributions paid with respect to such Shares unless otherwise provided in the Award Agreement.

          (a) If any such dividends or distributions are paid in Shares, the Shares shall be subject to
the same restrictions (and shall therefore be forfeitable to the same extent) as the Shares of
Restricted Stock with respect to which they were paid.

          (b) If any such dividends or distributions are paid in cash, the Award Agreement may specify
that the cash payments shall be subject to the same restrictions as the related Restricted Stock,
in which case they shall be accumulated during the Period of Restriction and paid or forfeited when
the related Shares of Restricted Stock vest or are forfeited. Alternatively, the Award Agreement
may specify that the dividend equivalents or other payments shall be unrestricted, in which case
they shall be paid as soon as practicable after the dividend or distribution date. In no event
shall any cash dividend or distribution be paid later than 21/2 months after the Tax Year in which
the dividend or distribution becomes nonforfeitable.

     7.7. Right of Repurchase of Restricted Stock. If, with respect to any Award, (a) a
Participant’s Termination of Service occurs before the end of the Period of Restriction or (b) any
Performance Objectives are not achieved by the end of the period for measuring such Performance
Objectives, then the Company shall have the right to repurchase forfeitable Shares of Restricted
Stock from the Participant at their original issuance price or other stated or formula price (or to
require forfeiture of such Shares if issued at no cost).

ARTICLE 8.

Restricted Stock Units

     8.1. Terms of Restricted Stock Units. Subject to the provisions of the Plan, the
Period of Restriction, number of underlying Shares, and other conditions and limitations applicable
to each Award of Restricted Stock Units shall be as determined by the Committee and shall be stated
in the Award Agreement.

     8.2. Settlement of Restricted Stock Units. Subject to Section 10.5 of the Plan, the
number of Shares specified in the Award Agreement, or cash equal to the Fair Market Value of the
underlying Shares specified in the Award Agreement, shall be delivered to the Participant as soon
as practicable after the end of the applicable Period of Restriction, and in any event no later
than 21/2 months after the end of the Tax Year in which the Period of Restriction ends, unless
otherwise elected to be issued on a later date in accordance with the requirements of Section 409A
of the Code.

     8.3. Dividend and Other Distribution Equivalents. The Committee is authorized to
grant to holders of Restricted Stock Units the right to receive payments equivalent to dividends or
other distributions with respect to Shares underlying Awards of Restricted Stock Units. The

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Award Agreement may specify that the dividend equivalents or other distributions shall be
subject to the same restrictions as the related Restricted Stock Units, in which case they shall be
accumulated during the Period of Restriction and paid or forfeited when the related Restricted
Stock Units are paid or forfeited. Alternatively, the Award Agreement may specify that the
dividend equivalents or other distributions shall be unrestricted, in which case they shall be paid
on the dividend or distribution payment date for the underlying Shares, or as soon as practicable
thereafter. In no event shall any unrestricted dividend equivalent or other distribution be paid
later than 21/2 months after the Tax Year in which the record date for the dividend or distribution
occurs.

     8.4. Forfeiture. If, with respect to any Award, (a) a Participant’s Termination of
Service occurs before the end of the Period of Restriction, or (b) any Performance Objectives are
not achieved by the end of the period for measuring such Performance Objectives, then the
Restricted Stock Units granted pursuant to such Award shall be forfeited and the Company (and any
Affiliate) shall have no further obligation thereunder.

ARTICLE 9.

Other Equity-Based Awards

     9.1. Other Equity-Based Awards. The Committee shall have the right to grant other
Awards based upon or payable in Shares having such terms and conditions as the Committee may
determine, including the grant of Shares upon the achievement of a Performance Objective and the
grant of securities convertible into Shares.

ARTICLE 10.

Additional Terms of Awards

     10.1. No Rights to Awards. No Service Provider shall have any claim to be granted any
Award under the Plan, and the Company is not obligated to extend uniform treatment to Participants
or Beneficiaries under the Plan. The terms and conditions of Awards need not be the same with
respect to each Participant.

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

     10.3. 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.

     10.4. Transferability of Awards. Unless otherwise determined by the Committee, an
Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be exercised, during

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the lifetime of the Participant, only by the Participant. Subject to the approval of the
Committee in its sole discretion, Nonstatutory Stock Options may be transferable to members of the
immediate family of the Participant and to one or more trusts for the benefit of such family
members, partnerships in which such family members are the only partners, or corporations in which
such family members are the only stockholders. “Members of the immediate family” means the
Participant’s spouse, children, stepchildren, grandchildren, parents, grandparents, siblings
(including half brothers and sisters), and individuals who are family members by adoption. To the
extent that any Award is transferable, such Award shall contain such additional terms and
conditions as the Committee deems appropriate.

     10.5. Conditions On Delivery of Shares and Lapsing of Restrictions. The Company shall
not be obligated to deliver any Shares pursuant to the Plan or to remove restrictions from Shares
previously delivered under the Plan until (a) all conditions of the Award have been met or removed
to the satisfaction of the Committee, (b) subject to approval of the Company’s counsel, all other
legal matters (including any Applicable Laws) in connection with the issuance and delivery of such
Shares have been satisfied, and (c) the Participant has executed and delivered to the Company such
representations or agreements as the Committee may consider appropriate to satisfy the requirements
of Applicable Laws.

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

     10.7. Withholding.

          (a) Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to the
grant, exercise, vesting, or settlement of an Award, the Company shall have the power and the right
to deduct or withhold, or to require a Participant or Beneficiary to remit to the Company, an
amount sufficient to satisfy any federal, state, and local taxes (including the Participant’s FICA
obligation) that the Company determines is required to be withheld to comply with Applicable Laws.
The Participant or Beneficiary shall remain responsible at all times for paying any federal, state,
and local income or employment tax due with respect to any Award, and the Company shall not be
liable for any interest or penalty that a Participant or Beneficiary incurs by failing to make
timely payments of tax.

          (b) Withholding Arrangements. The Committee, in its sole discretion and pursuant to such
procedures as it may specify from time to time, may permit a Participant or Beneficiary to satisfy
such tax withholding obligation, in whole or in part, by (i) electing to have the Company withhold
otherwise deliverable Shares, or (ii) delivering to the Company already-owned Shares having a Fair
Market Value equal to the amount required by Applicable Law to be withheld. The Fair Market Value
of the Shares to be withheld or delivered, or with respect to which restrictions are removed, shall
be determined as of the date that the taxes are required to be withheld.

     10.8. Other Provisions in Award Agreements. In addition to the provisions described
in the Plan, any Award Agreement may include such other provisions (whether or not applicable to

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the Award of any other Participant) as the Committee determines appropriate, including
restrictions on resale or other disposition, provisions for the acceleration of exercisability of
Options and Stock Appreciation Rights in the event of a change in control of the Company,
provisions for the cancellation of Awards in the event of a change in control of the Company, and
provisions to comply with Applicable Laws.

     10.9. Section 16 of the Exchange Act. It is the intent of the Company that Awards and
transactions permitted by Awards be interpreted in a manner that, in the case of Participants who
are or may be subject to Section 16 of the Exchange Act, qualify, to the maximum extent compatible
with the express terms of the Awards, for exemption from matching liability under Rule 16b-3
promulgated under the Exchange Act. The Company shall have no liability to any Participant or
other person for Section 16 consequences of Awards or events in connection with Awards if an Award
or related event does not so qualify.

     10.10. Not Benefit Plan Compensation. Payments and other benefits received by a
Participant under an Award made pursuant to the Plan shall not be deemed a part of a Participant’s
compensation for purposes of determining the Participant’s benefits under any other employee
benefit plans or arrangements provided by the Company or an Affiliate, except where the Committee
expressly provides otherwise in writing.

ARTICLE 11.

Term, Amendment, and Termination of Plan

     11.1. Term of Plan. The Plan shall become effective on the Effective Date.

     11.2. Termination of the Plan. The Plan shall terminate upon the earliest to occur of
(i) July 27, 2015; (ii) the date that is 10 years after the Plan is approved by the Company’s
stockholders; (iii) the date on which all Shares available for issuance under the Plan have been
issued as fully vested Shares; or (iv) the date determined by the Board pursuant to its authority
under Section 11.3 of the Plan.

     11.3. Amendment of the Plan. The Board or the Committee may at any time amend, alter,
suspend, or terminate the Plan, without the consent of the Participants or Beneficiaries. The
Company shall obtain stockholder approval of any Plan amendment to the extent necessary to comply
with Applicable Laws.

     11.4. Effect of Amendment or Termination. Except as provided in Section 11.5 of the
Plan, no amendment, alteration, suspension, or termination of the Plan shall impair the rights of
any Participant or Beneficiary under an outstanding Award, unless required to comply with an
Applicable Law or mutually agreed otherwise between the Participant and the Committee; any such
agreement must be in writing and signed by the Participant and the Company. Termination of the
Plan shall not affect the Committee’s ability to exercise the powers granted to it hereunder with
respect to Awards granted under the Plan prior to the date of such termination.

     11.5. Adjustments of Awards Upon the Occurrence of Unusual or Nonrecurring Events.
The Committee may, in its sole discretion (but subject to the limitations and conditions expressly
stated in the Plan, such as the limitations on adjustment of Performance Objectives), adjust the

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terms and conditions of Awards during the pendency or in recognition of (a) unusual or
nonrecurring events affecting the Company or an Affiliate (such as a capital adjustment,
reorganization, or merger) or the financial statements of the Company or an Affiliate, or (b) any
changes in Applicable Laws or accounting principles. By way of example, the power to adjust Awards
shall include the power to suspend the exercise of any Option or Stock Appreciation Right.

ARTICLE 12.

Miscellaneous

     12.1. Authorization of Sub-Plans. The Committee may from time to time establish one
or more sub-plans under the Plan for purposes of satisfying applicable blue sky, securities, and/or
tax laws of various jurisdictions. The Committee shall establish such sub-plans by adopting
supplements to this Plan containing (i) such limitations as the Committee deems necessary or
desirable, and (ii) such additional terms and conditions not otherwise inconsistent with the Plan
as the Committee shall deem necessary or desirable. All sub-plans adopted by the Committee shall
be deemed to be part of the Plan, but each sub-plan shall apply only to Participants within the
affected jurisdiction and the Company shall not be required to provide copies of any sub-plans to
Participants in any jurisdiction which is not the subject of such sub-plan.

     12.2. Governing Law. The provisions of the Plan and all Awards made hereunder shall
be governed by and interpreted in accordance with the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflicts of laws thereof.

     12.3. Committee Manner of Action. Unless otherwise provided in the bylaws of the
Company or the charter of the Committee: (a) a majority of the members of a Committee shall
constitute a quorum, and (b) the vote of a majority of the members present who are qualified to act
on a question assuming the presence of a quorum or the unanimous written consent of the members of
the Committee shall constitute action by the Committee. The Committee may delegate the performance
of ministerial functions in connection with the Plan to such person or persons as the Committee may
select.

     12.4. Expenses. The costs of administering the Plan shall be paid by the Company.

     12.5. Severability. If any provision of the Plan or any Award Agreement is determined
by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any jurisdiction,
or as to any person or Award, such provision shall be construed or deemed to be amended to resolve
the applicable infirmity, unless the Committee determines that it cannot be so construed or deemed
amended without materially altering the Plan or the Award, in which case such provision shall be
stricken as to such jurisdiction, person, or Award, and the remainder of the Plan and any such
Award shall remain in full force and effect.

     12.6. Construction. Unless the contrary is clearly indicated by the context, (1) the
use of the masculine gender shall also include within its meaning the feminine and vice versa; (2)
the use of the singular shall also include within its meaning the plural and vice versa; and (3)
the word “include” shall mean to include, but not to be limited to.

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     12.7. No Trust or Fund Created. Neither the Plan nor any Award Agreement shall create
or be construed to create a trust or separate fund of any kind or a fiduciary relationship between
the Company (or an Affiliate) and a Participant or any other person. To the extent that any person
acquires a right to receive payments from the Company (or an Affiliate) pursuant to an Award, such
right shall be no more secure than the right of any unsecured general creditor of the Company (or
the Affiliate, as applicable).

     12.8. Headings. Headings are given to the sections and subsections of the Plan solely
as a convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.

     12.9. Complete Statement of Plan. This document is a complete statement of the Plan.

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APPENDIX

As used in the Plan, the following terms shall have the following meanings:

          (a) “Affiliate” means an entity in which the Company has a direct or indirect equity interest,
whether now or hereafter existing; provided however, that with respect to an Incentive Stock
Option, an Affiliate means a “parent corporation” (as defined in Section 424(e) of the Code) or a
“subsidiary corporation” (as defined in Section 424(f) of the Code) with respect to the Company,
whether now or hereafter existing.

          (b) “Applicable Laws” means the requirements relating to, connected with, or otherwise
implicated by the administration of long-term incentive plans under applicable state corporation
laws, United States federal and state securities laws, the Code, any stock exchange or quotation
system on which the Shares are listed or quoted, and the applicable laws of any foreign country or
jurisdiction where Awards are, or will be, granted under the Plan.

          (c) “Award” means, individually or collectively, a grant under the Plan of Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, or other equity-based awards.

          (d) “Award Agreement” means a written agreement setting forth the terms and provisions
applicable to an Award granted under the Plan. Each Award Agreement shall be subject to the terms
and conditions of the Plan.

          (e) “Beneficiary” means the personal representative of the Participant’s estate or the
person(s) to whom an Award is transferred pursuant to the Participant’s will or in accordance with
the laws of descent or distribution.

          (f) “Board” means the board of directors of the Company.

          (g) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a section of
the Code herein shall be a reference to any regulations or other guidance of general applicability
promulgated under such section, and shall further be a reference to any successor or amended
section of such section of the Code that is so referred to and any regulations thereunder.

          (h) “Committee” means the Compensation Committee of the Board, which has been constituted by
the Board to comply with the requirements of Rule 16b-3 promulgated under the Exchange Act, Section
162(m) of the Code, and/or other Applicable Laws.

          (i) “Company” means Clinical Data, Inc., a Delaware corporation, or any successor thereto.

          (j) “Consultant” means any natural person, including an advisor, engaged by the Company or an
Affiliate to render services to such entity.

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

 

 

          (l) “Disability” means total and permanent disability as defined in Section 22(e)(3) of the
Code.

          (m) “Effective Date” means July 27, 2005; provided that the Plan and any Awards granted
hereunder shall be null and void if the Plan is not approved by the Company’s stockholders before
any compensation under the Plan is paid.

          (n) “Employee” means any person who is an employee, as defined in Section 3401(c) of the Code,
of the Company or any Affiliate or any other entity the employees of which are permitted to receive
Incentive Stock Options under the Code. Neither service as a Director nor payment of a director’s
fee by the Company shall be sufficient to constitute “employment” by the Company.

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

          (p) “Executive Officer” means an individual who is an “executive officer” of the Company (as
defined by Rule 3b-7 under the Exchange Act) or a “covered employee” under Section 162(m) of the
Code.

          (q) “Fair Market Value” means, with respect to Shares as of any date the closing sale price
per share of such Shares (or the closing bid, if no sales were reported) as reported in The Wall
Street Journal (Northeast edition) or, if not reported therein, such other source as the Committee
deems reliable.

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

          (s) “Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock
Option.

          (t) “Option” means an option to purchase Shares that is granted pursuant to Article 5 of the
Plan. An Option may be an Incentive Stock Option or a Nonstatutory Stock Option.

          (u) “Participant” means the holder of an outstanding Award granted under the Plan.

          (v) “Performance Objective” means a performance objective or goal that must be achieved before
an Award, or a feature of an Award, becomes nonforfeitable, as described in Section 4.3 of the
Plan.

          (w) “Period of Restriction” means the period during which Restricted Stock, the remuneration
underlying Restricted Stock Units, or any other feature of an Award is subject to a substantial
risk of forfeiture. A Period of Restriction shall be deemed to end when the applicable Award
ceases to be subject to a substantial risk of forfeiture.

          (x) “Restricted Stock” means Shares that, during a Period of Restriction, are subject to
restrictions as described in Article 7 of the Plan.

          (y) “Restricted Stock Unit” means an Award that entitles the recipient to receive Shares or
cash after a Period of Restriction, as described in Article 8 of the Plan.

 

 

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

          (aa) “Share” means a share of the Company’s common stock.

          (bb) “Stock Appreciation Right” means an Award that entitles the recipient to receive, upon
exercise, the excess of (i) the Fair Market Value of a Share on the date the Award is exercised,
over (ii) a base amount specified by the Committee which shall not be less than the Fair Market
Value of a Share on the date the Award is granted, as described in Article 6 of the Plan

          (cc) “Tax Year” means the Company’s taxable year. If an Award is granted by an Affiliate,
such Affiliate’s taxable year shall apply instead of the Company’s taxable year.

          (dd) “Termination of Service” means the date an individual ceases to be a Service Provider.
Unless the Committee or a Company policy provides otherwise, a leave of absence authorized by the
Company or the Committee (including sick leave or military leave) from which return to service is
not guaranteed by statute or contract shall be characterized as a Termination of Service if the
individual does not return to service within three months; such Termination of Service shall be
effective as of the first day that is more than three months after the beginning of the period of
leave. If the ability to return to service upon the expiration of such leave is guaranteed by
statute or contract, but the individual does not return, the leave shall be characterized as a
Termination of Service as of a date established by the Committee or Company policy. For purposes
of the Plan and any Award hereunder, if an entity ceases to be an Affiliate, Termination of Service
shall be deemed to have occurred with respect to each Participant in respect of such Affiliate who
does not continue as a Service Provider in respect of the Company or another Affiliate after such
giving effect to such Affiliate’s change in status.

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