Document:

Exhibit 10.3

Exhibit 10.3

EMPLOYMENT AGREEMEN

 

Between

Rentech, Inc.

and

Colin Morris

THIS AGREEMENT is made effective as of November 3, 2009 between Rentech, Inc. (the “Company”) and Colin
Morris (“Executive”).

In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Employment.  The Company shall employ Executive, and Executive hereby agrees to continue employment with the
Company, upon the terms and conditions set forth in this Agreement, for the period beginning on November 3, 2009 (the
“Effective Date”) and ending as provided in Section 4 hereof (the “Employment Period”). 

2. Position and Duties.

(a) During the Employment Period, Executive shall serve as Vice President and General Counsel of the Company.
During the Employment Period, Executive shall render such administrative, financial and other executive and managerial
services to the Company and its affiliates (the “Company Group”) as are consistent with Executive’s position
and the by-laws of the Company and as the Chief Executive Officer (“CEO”) may from time to time reasonably
direct.  Executive shall also serve for no additional compensation or remuneration as an officer or director of such
subsidiaries of the Company as may from time to time be designated by the CEO or the Board of Directors of the Company
(the “Board”).

(b) During the Employment Period, Executive shall report to the CEO and shall devote his best efforts and his full
business time and attention (except for permitted vacation periods and reasonable periods of illness or other
incapacity) to the business and affairs of the Company.  Executive shall perform his duties, responsibilities and
functions to the Company hereunder to the best of his abilities in a diligent, trustworthy, professional and efficient
manner and shall comply with the Company’s policies and procedures in all material respects.  In performing his duties
and exercising his authority under this Agreement, Executive shall support and implement the business and strategic
plans approved from time to time by the Board and shall support and cooperate with the Company’s efforts to operate in
conformity with the business and strategic plans approved by the Board.  During the Employment Period, Executive shall
not serve as an officer or director of, or otherwise perform services for compensation for, any other entity without
the prior written consent of the Board which shall not be unreasonably withheld. Executive may serve as an officer or
director of or otherwise participate in purely educational, welfare, social, religious and civic organizations so long
as such activities do not interfere with Executive’s regular performance of duties and responsibilities hereunder in
any material respect.  Nothing contained herein shall preclude Executive from (i) engaging in charitable and community
activities, (ii) participating in industry and trade organization activities, and (iii) managing his and his family’s
personal investments and affairs; provided, that Executive shall not have any ownership interest (of record or
beneficial) in any firm, corporation, partnership, proprietorship or other business that competes directly with the
Company’s Fischer-Tropsch business except for (x) an investment of not more than 1.0% of the outstanding securities of
a company traded on a public securities exchange or (y) investments made through public mutual funds.

1

 

1

 

3. Compensation and Benefits.

(a) Base Salary. The Company shall pay Executive an annual salary (the “Base Salary”) at the rate
of $229,500 in regular installments in accordance with the Company’s ordinary payroll practices (in effect from time to
time), but in any event no less frequently than monthly. Executive shall be eligible for an annual review of his Base
Salary based on performance as determined by the Board in its sole discretion.

(b) Bonuses and Incentive Compensation. For each fiscal year ending during the Employment Period,
Executive will be eligible to earn an annual bonus based on achievement of performance criteria established by the
Board as soon as administratively practicable following the beginning of each such fiscal year (the “Annual
Bonus”).  The target amount (the “Target Bonus”) of Executive’s Annual Bonus shall equal 50% of Executive’s
Base Salary (at the annual rate in effect at the start of the fiscal year), with a maximum Annual Bonus in an amount
equal to 100% of Executive’s Base Salary (at the annual rate in effect at the start of the fiscal year). For the
avoidance of doubt, the amount of any Annual Bonus may be less than the Target Bonus (and may equal zero), as
determined in the sole discretion of the Board or the Board’s Compensation Committee. The Company shall pay the Annual
Bonus for each fiscal year after the end of the Company’s fiscal year in accordance with procedures established by the
Board, but in no event later than the fifteenth day of the third month following the end of such fiscal year. To be
eligible for an Annual Bonus pursuant to this Section 3(b), Executive must be an employee of the Company on the last
day of the relevant fiscal year.

(c) Expenses. During the Employment Period, the Company shall, subject to Section 19 below, (i) reimburse
Executive for all reasonable business expenses incurred by him in the course of performing his duties and
responsibilities under this Agreement in accordance with the Company’s policies in effect from time to time with
respect to travel, entertainment and other business expenses for senior executives and (ii) pay to Executive a monthly
automobile allowance of $1,000.

(d) Other Benefits. Executive shall also be entitled to the following benefits during the Employment
Period:

(i) participation in the Company’s retirement plans, health and welfare plans, disability insurance plans and
other benefit plans of the Company as in effect from time to time, under the terms of such plans and to the same extent
and under the same conditions such participation and coverages are provided generally to other senior executives of the
Company;

(ii) coverage for services rendered to the Company, its subsidiaries and affiliates while Executive is a director
or officer of the Company, or of any of its subsidiaries or affiliates, under director and officer liability insurance
policy(ies) maintained by the Company from time to time; and

(iii) five weeks of vacation per year.

Nothing contained in this Section 3(d) shall, or shall be construed so as to, obligate the Company to adopt or maintain
any plan, program or policy at any time.

4. Termination.  The Employment Period shall end on the first anniversary of the Effective Date;
provided, however, that the Employment Period shall be automatically renewed for successive one-year
terms thereafter on the terms and conditions of this Agreement in effect at the time of such renewal unless either
party provides the other party with notice that it has elected not to renew the Employment Period at least 90 days
prior to the end of the initial Employment Period or any subsequent extension thereof.  Notwithstanding the foregoing,
(i) the Employment Period shall terminate immediately upon Executive’s resignation (with or without Good Reason, as
defined herein), death or Disability (as defined herein) and (ii) the Employment Period may be terminated by the
Company at any time prior to such date for Cause (as defined herein) or without Cause.  Except as otherwise provided
herein, any termination of the Employment Period by the Company shall be effective as specified in a written notice
from the Company to Executive, but in no event more than 90 days from the date of such notice.  The termination of the
Employment Period shall not affect the respective rights and obligations of the parties which, pursuant to the terms of
this Agreement, apply following the date of Executive’s termination of employment with the Company.

2

 

2

 

5. Severance.

(a) Termination Without Cause or for Good Reason.  In the event that Executive incurs a “separation from
service” from the Company (within the meaning of Section 409A(a)(2)(A)(i) of the Internal Revenue Code of 1986, as
amended (the “Code”), and Treasury Regulation Section 1.409A-1(h)) (“Separation from Service”) (1) by
the Company without Cause (as defined herein), or (2) by Executive for Good Reason (as defined herein), then, subject
to Executive’s execution and non-revocation of a Release substantially in the form attached as Exhibit A within
30 days after such Separation from Service, Executive shall be entitled to the benefits set forth below in this
Section 5(a). Each payment under this Section 5(a) shall be treated as a separate payment for purposes of Section 409A
(as defined below).

(i) The Company shall pay Executive an amount equal to one times Executive’s Base Salary plus one times
Executive’s Target Bonus (as in effect on the date of Executive’s termination).  The severance amount described in the
previous sentence shall be paid as follows, subject to Section 19 below: (A) the continuation of Base Salary shall be
paid in substantially equal installments over a period of one year from Executive’s Separation from Service in
accordance with the payroll practices of the Company in effect from time to time, beginning on the first payroll date
occurring on or after the thirtieth day following Executive’s Separation from Service (such payroll date, the
“First Payroll Date”) (with amounts otherwise payable prior to the First Payroll Date paid on the First Payroll
Date) and (B) the Target Bonus shall be paid on the date that executive bonuses are paid generally for the fiscal year
in which the date of termination took place, which shall, in any event, be no earlier than the First Payroll Date and
no later than two and one-half months after the end of such fiscal year;

(ii) Any outstanding equity awards held by Executive shall be governed by the terms of the applicable award
agreements.

(iii) Executive shall be entitled to benefits mandated under the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”), under Section 4980B of the Code, or any replacement or successor provision of
United States tax law, subject to Executive’s valid election to receive COBRA benefits, with the premium paid at the
Company’s expense until the first to occur of (A) eighteen months from the date of termination, (B) the expiration of
the period of time during which Executive is entitled to continuation coverage under the Company’s group health plan
under COBRA, or (C) such date that Executive becomes eligible for coverage under the group health plan of another
employer, provided, that if any plan pursuant to which such benefits are provided is not, or ceases prior to the
expiration of the period of continuation coverage to be, exempt from the application of Section 409A under Treasury
Regulation Section 1.409A-1(a)(5), then an amount equal to each remaining premium payment shall thereafter be paid to
Executive as currently taxable compensation in substantially equal monthly installments over the continuation coverage
period (or the remaining portion thereof).

In addition, if Executive’s employment terminates pursuant to this Section 5(a), the Company shall pay Executive
the amounts described in Section 5(d)(i), (ii) and (iii) within 30 days of the date of termination (or such earlier
date as may be mandated by applicable law) and shall pay or provide the other benefits described in Section 5(d) in
accordance therewith.

3

 

3

 

(b) Termination for Cause or Voluntary Resignation.  In the event that Executive’s employment with the
Company is terminated (i) by the Board for Cause or (ii) by Executive’s resignation from the Company for any reason
other than Good Reason or Disability (as defined herein), subject to applicable law, the parties agree to the
following:

(i) Any outstanding equity awards held by Executive shall be governed by the terms of the applicable award
agreements.

(ii) The Company shall pay Executive the amounts described in Section 5(d)(i), (ii) and (iii) within 30 days of
the date of termination (or such earlier date as may be mandated by applicable law) and shall pay or provide the other
benefits described in Section 5(d) in accordance therewith.

For purposes of this Agreement, Executive’s voluntary resignation or retirement shall be considered Executive’s
resignation from the Company without Good Reason.

(c) Death or Disability.  In the event that Executive’s employment with the Company is terminated as a
result of Executive’s death or Disability, the parties agree to the following:

(i) Any outstanding equity awards held by Executive shall be governed by the terms of the applicable award
agreements.

(ii) The Company shall pay Executive the amounts described in Section 5(d)(i), (ii) and (iii) within 30 days of
the date of termination (or such earlier date as may be mandated by applicable law) and shall pay or provide the other
benefits described in Section 5(d) in accordance therewith.

(d) Payments Upon Termination of Employment. In the case of any termination of Executive’s employment
with the Company, Executive or his estate or legal representative shall be entitled to receive, to the extent permitted
by applicable law, from the Company (i) Executive’s Base Salary through the date of termination to the extent not
previously paid, (ii) to the extent not previously paid, the amount of any Annual Bonus earned by Executive during any
fiscal year of the Company ended prior to the date on which Executive’s employment with the Company terminates, as
determined by the Board or the Board’s Compensation Committee and communicated to Executive prior to Executive’s
termination of employment, (iii) any vacation pay, expense reimbursements and other cash entitlements accrued by
Executive, in accordance with Company policy for senior executives, as of the date of termination to the extent not
previously paid, and (iv) all vested benefits accrued by Executive under all benefit plans and qualified and
nonqualified retirement, pension, 401(k) and similar plans and arrangements of the Company, in such manner and at such
times as are provided under the terms of such plans and arrangements. Any equity awards held by Executive that are
outstanding at the time of termination shall be governed by the terms of the plans or arrangements under which such
awards were created or maintained.

(e) Termination Without Cause, Non-Renewal or for Good Reason Following a Change in Control.  In the event
that Executive incurs a Separation from Service during the period beginning three months before and ending two-years
immediately following a Change in Control (as defined herein) of the Company (1) by the Company without Cause, (2) as a
result of the Company electing not to renew the Agreement in accordance with Section 4 above on terms and conditions
substantially similar to those contained herein, if, at the time of such non-renewal, (A) Executive is willing and able
to continue providing services on terms and conditions substantially similar to those contained in this Agreement and
(B) the Company has not, since the date of such Change in Control, already renewed this Agreement in accordance with
Section 4 above, or (3) by Executive for Good Reason, in any case, then, subject to Executive’s execution and
non-revocation of a Release substantially in the form attached as Exhibit A within 30 days after such
Separation from Service, Executive shall be entitled to the benefits set forth below in this Section 5(e).

4

 

4

 

(i) The Company shall pay Executive the payments set forth in Section 5(a)(i) in accordance with the terms and
conditions set forth in Section 5(a); provided, however, that in determining the amount of payment due
under Section 5(a)(i), Executive’s actual Annual Bonus for the year preceding the Change in Control shall be used, if
higher than his Target Bonus; and provided, further, that, subject to Section 19 below, payments
pursuant to Sections 5(a)(i) shall be made in a lump sum (A) if the Separation from Service occurs during the
three-month period preceding the Change in Control, on the 95th day following such Separation from Service
(to the extent not previously paid in accordance with Section 5(a)(i)), and (B) if the Separation from Service occurs
during the two-year period following the Change in Control, no later than 10 business days after Executive’s Separation
from Service.

(ii) Any outstanding equity awards held by Executive shall be governed by the terms of the applicable award
agreements.

In addition, if Executive’s employment terminates pursuant to this Section 5(e), the Company shall pay Executive
the amounts described in Section 5(d)(i), (ii) and (iii) within 30 days of the date of termination (or such earlier
date as may be mandated by applicable law) and shall pay or provide the other benefits described in Section 5(d) in
accordance therewith.

(f) Non-Renewal.  In the event that Executive incurs a Separation from Service as a result of the Company
electing not to renew the Agreement in accordance with Section 4 above on terms and conditions substantially similar to
those contained herein and, (A) at the time of such non-renewal, Executive is willing and able to continue providing
services on terms and conditions substantially similar to those contained in this Agreement and (B) Section 5(e) does
not apply to such non-renewal, then, subject to Executive’s execution and non-revocation of a Release substantially in
the form attached as Exhibit A within 30 days after such Separation from Service, Executive shall be entitled
to the benefits set forth below in this Section 5(f).

(i) The Company shall pay Executive an amount equal to twelve months of Executive’s Base Salary (as in effect on
the date of Executive’s termination), which amount shall, subject to Section 19 below, be paid in substantially equal
installments over a period of twelve months from Executive’s Separation from Service in accordance with the payroll
practices of the Company in effect from time to time, beginning on the First Payroll Date (with amounts otherwise
payable prior to the First Payroll Date paid on the First Payroll Date). Each payment under this Section 5(f) shall be
treated as a separate payment for purposes of Section 409A. In addition, upon a non-renewal described in this Section
5(f), if Executive has not already been awarded an Annual Bonus in respect of the fiscal year immediately preceding
such non-renewal, the Company may, in its sole discretion, award some portion of an Annual Bonus to Executive in
respect of such fiscal year based on Executive’s service and the attainment of applicable performance objectives during
such fiscal year.

(ii) Any outstanding equity awards held by Executive shall be governed by the terms of the applicable award
agreements.

In addition, if Executive’s employment terminates pursuant to this Section 5(f), the Company shall pay Executive
the amounts described in Section 5(d)(i), (ii) and (iii) within 30 days of the date of termination (or such earlier
date as may be mandated by applicable law) and shall pay or provide the other benefits described in Section 5(d) in
accordance therewith.

5

 

5

 

(g) Excess Parachute Payments.

(i) In the event any payment granted to Executive pursuant to the terms of this Agreement or otherwise (a
“Payment”) is determined to be subject to any excise tax (“Excise Tax”) imposed by Section 4999 of the
Code (or any successor to such Section), the Company shall pay to Executive, no later than the time any Excise Tax is
payable with respect to such Payment (through withholding or otherwise), an additional amount (a “Gross-Up
Payment”) which, after the imposition of all income, employment, excise and other taxes, penalties and interest
thereon, is equal to the sum of (A) the Excise Tax on such Payment plus (B) any penalty and interest assessments
associated with such Excise Tax.

(ii) The determinations to be made with respect to this Section 5(g) shall be made by a certified public
accounting firm designated by the Company and reasonably acceptable to Executive and Executive may rely on such
determination in making payments to the Internal Revenue Service.

(iii) Notwithstanding anything herein to the contrary, any Gross-Up Payment or any payment of any income or other
taxes to be paid by the Company under this Section 5(g) shall be made by the Company no later than the end of
Executive’s taxable year next following Executive’s taxable year in which Executive remits the related taxes. Any
costs and expenses incurred by the Company on behalf of Executive under this Section 5(g) due to any tax contest, audit
or litigation shall be paid by the Company as incurred and, in any event, no later than the end of Executive’s taxable
year following Executive’s taxable year in which the taxes that are the subject of the tax contest, audit or litigation
are remitted to the taxing authority, or where as a result of such tax contest, audit or litigation no taxes are
remitted, the end of Executive’s taxable year following Executive’s taxable year in which the audit is completed or
there is a final and non-appealable settlement or other resolution of the contest or litigation.

(h) No Other Payments.  Except as provided in Sections 5(a), (b), (c), (d), (e), (f) and (g) above, all of
Executive’s rights to salary, bonuses, employee benefits and other compensation hereunder which would have accrued or
become payable after the termination or expiration of the Employment Period shall cease upon such termination or
expiration, other than those expressly required under applicable law (such as COBRA).

(i) No Mitigation, No Offset.  In the event of Executive’s termination of employment for whatever reason,
Executive shall be under no obligation to seek other employment, and there shall be no offset against amounts due him
under this Agreement or otherwise on account of any remuneration attributable to any subsequent employment or claims
asserted by the Company or any affiliate, provided, that this provision shall not apply with respect to any
amounts that Executive owes to the Company or any member of the Company Group on account of any amount in respect of
which Executive is obligated to make repayment to the Company or any member of the Company Group.

(j) Definitions.  For purposes of this Agreement, the following terms shall have the following meanings:

(i) “Cause” shall mean one or more of the following:

(A) the conviction of, or an agreement to a plea of nolo contendere to, a crime involving moral turpitude or any
felony;

(B) Executive’s willful refusal substantially to perform duties as reasonably directed by the CEO under this or
any other agreement;

6

 

6

 

(C) in carrying out his duties, Executive engages in conduct that constitutes fraud, willful neglect or willful
misconduct which, in either case, would result in demonstrable material harm to the business, operations, prospects or
reputation of the Company;

(D) a material violation of the requirements of the Sarbanes-Oxley Act of 2002 (“SOX”) or other federal or
state securities law, rule or regulation; or

(E) any other material breach of this Agreement.

For purpose of this Agreement, the Company is not entitled to assert that Executive’s termination is for Cause
unless the Company, following a determination by the CEO, gives Executive written notice describing the facts which are
the basis for such termination and such grounds for termination (if susceptible to correction) are not corrected by
Executive within 30 days of Executive’s receipt of such notice to the reasonable, good faith satisfaction of the Board.

(ii) “Change in Control” shall mean the first to occur of any of the following events:

(A) A transaction or series of transactions (other than an offering of Common Stock to the general public through
a registration statement filed with the Securities and Exchange Commission) whereby any “person” or related “group” of
“persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”)) (other than the Company, any of its subsidiaries, an employee benefit plan maintained by
the Company or any of its subsidiaries or a “person” that, prior to such transaction, directly or indirectly controls,
is controlled by, or is under common control with, the Company) directly or indirectly acquires beneficial ownership
(within the meaning of Rule 13d-3 under the Exchange Act) of securities of the Company possessing more than 50% of the
total combined voting power of the Company’s securities outstanding immediately after such acquisition; or

(B) During any twelve-month period, individuals who, at the beginning of such period, constitute the Board
together with any new director(s) (other than a director designated by a person who shall have entered into an
agreement with the Company to effect a transaction described in Section 5(j)(ii)(A) or Section 5(j)(ii)(C)) whose
election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least a
majority of the directors then still in office who either were directors at the beginning of the twelve-month period or
whose election or nomination for election was previously so approved, cease for any reason to constitute a majority
thereof; or

(C) The consummation by the Company (whether directly involving the Company or indirectly involving the Company
through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination or (y) a
sale or other disposition of all or substantially all of the Company’s assets in any single transaction or series of
related transactions or (z) the acquisition of assets or stock of another entity, in each case other than a
transaction:

(1) Which results in the Company’s voting securities outstanding immediately before the transaction continuing to
represent (either by remaining outstanding or by being converted into voting securities of the Company or the person
that, as a result of the transaction, controls, directly or indirectly, the Company or owns, directly or indirectly,
all or substantially all of the Company’s assets or otherwise succeeds to the business of the Company (the Company or
such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power
of the Successor Entity’s outstanding voting securities immediately after the transaction, and

7

 

7

 

(2) After which no person or group beneficially owns voting securities representing 35% or more of the combined
voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this
Section 5(j)(ii)(C)(2) as beneficially owning 35% or more of combined voting power of the Successor Entity solely as a
result of the voting power held in the Company prior to the consummation of the transaction; or

(D) The Company’s stockholders approve a liquidation or dissolution of the Company.

(iii) “Disability” shall mean Executive’s  being unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months.

(iv) “Good Reason” shall mean Executive’s resignation from employment with the Company prior to the end of
the Employment Period as a result of one or more of the following reasons:

(A) the Company materially reduces the amount of Executive’s then current Base Salary;

(B) a material diminution in Executive’s authority, duties or responsibilities;

(C) a material breach of this Agreement by the Company; or

(D) a material change to the geographic location at which Executive must provide services (within the meaning of
Section 409A, provided, however, that in no event shall a relocation of less than 50 miles be deemed
material for purposes of this clause (D)).

For purposes of this Agreement, a termination of employment by Executive shall not be deemed to be for Good Reason
unless (i) Executive gives the Board written notice describing the event or events which are the basis for such
termination within 90 days after the event or events occur, (ii) such grounds for termination (if susceptible to
correction) are not corrected by the Company within 30 days of the Company’s receipt of such notice to the reasonable,
good faith satisfaction of Executive, and (iii) Executive terminates his employment no later than 30 days after
Executive provides notice to the Company in accordance with clause (i) of this paragraph.

6. Insurance; Indemnification and Advancement of Expenses.

(a) Insurance. The Company agrees to maintain director’s and officer’s liability insurance covering the
Executive for services rendered to the Company, its subsidiaries and affiliates while Executive is a director or
officer of the Company or any of its subsidiaries or affiliates.

(b) Indemnification and Advancement of Expenses. Executive shall be entitled to the benefits of Articles
Thirteen and Fourteen of the Company’s Amended and Restated Articles of Incorporation and the Company shall not amend
such provisions during the Employment Period without advance written notice to Executive. The Company shall not during
the Employment Period enter into any supplemental indemnification agreement with its directors or executive officers,
as such, unless Executive is offered an agreement containing terms pertaining to indemnification and advancement of
expenses that are substantially identical to the most favorable indemnification and advancement of expenses terms
provided to such directors or executive officers (excepting standard “Side A” and similar arrangements customarily
provided solely to non-employee directors), which agreement may not be amended without advance written notice to
Executive.

8

 

8

 

7. Confidential Information.  Executive has entered into, or will enter into simultaneously with this
agreement, a confidentiality and invention assignment agreement with the Company in the form attached as Exhibit
B.

8. Non-Solicitation.

(a) During the Employment Period and for one year thereafter (the “Restricted Period”), Executive shall
not directly or indirectly through another person or entity (i) induce, solicit, encourage or attempt to induce,
solicit or encourage any employee of the Company to leave the employ of the Company, or in any way interfere with the
relationship between the Company and any employee thereof; or (ii) use the Company’s confidential or proprietary
information to induce, solicit, encourage or attempt to induce, solicit or encourage any customer, supplier, licensee,
licensor, franchisee or other business relation of the Company to cease doing business with the Company, or in any way
interfere with the relationship between any such customer, supplier, licensee or business relation of the Company
(including, without limitation, making any negative or disparaging statements or communications regarding the Company).
The Company covenants that it will not, and it will direct members of senior management of the Company and the Board
not to, make any negative or disparaging statements or communications regarding Executive.

(b) If, at the time of enforcement of this Section 8, a court shall hold that the duration, scope or area
restrictions stated herein are unreasonable under circumstances then existing, the parties agree that the maximum
duration, scope or area reasonable under such circumstances shall be substituted for the stated duration, scope or area
and that the court shall be allowed to revise the restrictions contained herein to cover the maximum period, scope and
area permitted by law.  Executive acknowledges that the restrictions contained in this Section 8 are reasonable and
that he has reviewed the provisions of this Agreement with his legal counsel.

(c) Executive acknowledges that in the event of the breach or a threatened breach by Executive of any of the
provisions of this Section 8, the Company would suffer irreparable harm, and, in addition and supplementary to other
rights and remedies existing in its favor, the Company shall be entitled to specific performance and/or injunctive or
other equitable relief from a court of competent jurisdiction in order to enforce or prevent any violations of the
provisions hereof (without posting a bond or other security). In addition, in the event of a breach or violation by
Executive of Section 8(a), the Restricted Period shall be automatically extended by the amount of time between the
initial occurrence of the breach or violation and when such breach or violation has been duly cured.

9. Executive’s Representations.  Executive hereby represents and warrants to the Company that (i) the
execution, delivery and performance of this Agreement by Executive do not and shall not conflict with, breach, violate
or cause a default under, any contract, agreement, instrument, order, judgment or decree to which Executive is a party
or by which he is bound which has not been waived; (ii) Executive is not a party to or bound by any employment
agreement, noncompete agreement or confidentiality agreement with any other person or entity; and (iii) on the
Effective Date, this Agreement shall be the valid and binding obligation of Executive, enforceable in accordance with
its terms. Executive represents and agrees that he fully understands his right to discuss all aspects of this
Agreement with his private attorney, and that to the extent, if any, that he desired, he availed himself of such right.
Executive further represents that he has carefully read and fully understands all of the provisions of this Agreement,
that he is competent to execute this Agreement, that his agreement to execute this Agreement has not been obtained by
any duress and that he freely and voluntarily enters into it, and that he has read this document in its entirety and
fully understands the meaning, intent and consequences of this document.

9

 

9

 

10. Employment At-Will. Subject to the termination and severance obligations provided for in this Agreement,
notably in Sections 4 and 5 hereof, Executive hereby agrees that the Company may dismiss him and terminate his
employment with the Company, with or without advance notice and without regard to (i) any general or specific policies
(whether written or oral) of the Company relating to the employment or termination of its employees, or (ii) any
statements made to Executive, whether made orally or contained in any document, pertaining to Executive’s relationship
with the Company, or (iii) the existence or non-existence of Cause. Inclusion under any benefit plan or compensation
arrangement will not give Executive any right or claim to any benefit hereunder except to the extent such right has
become fixed under the express terms of this Agreement.

11. Notices.  All notices or communications hereunder shall be in writing, addressed as follows:

To the Company:

Chief Executive Officer

Rentech, Inc.

10877 Wilshire Blvd. Suite 710

Los Angeles, CA 90024

To Executive:

To the address on file in the permanent records of the Company at the time of the notice.

In the event the Company shall relocate its executive offices, the then-effective address shall be substituted for
that set forth above. All notices hereunder shall be conclusively deemed to be received and shall be effective (i) if
sent by hand delivery, upon receipt or (ii) if sent by electronic mail or facsimile, upon confirmation of receipt by
the sender of such transmission.

 

12. Severability.  In the event any provision or part of this Agreement is found to be invalid or
unenforceable, only that particular provision or part so found, and not the entire Agreement, will be inoperative.

13. Complete Agreement.  This Agreement and those documents expressly referred to herein (including without
limitation all equity award agreements entered into prior to the Effective Date between the Company and Executive)
embody the complete agreement and understanding among the parties and supersede and preempt any prior understandings,
agreements or representations by or among the parties, written or oral, which may have related to the subject matter
hereof in any way.

14. No Strict Construction.  The language used in this Agreement shall be deemed to be the language chosen by
the parties hereto to express their mutual intent, and no rule of strict construction shall be applied against any
party.

15. Counterparts.  This Agreement may be executed in separate counterparts, each of which is deemed to be an
original and all of which taken together constitute one and the same agreement.

16. Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the
beneficiaries, heirs and representatives of Executive and the successors and assigns of the Company (including without
limitation, any successor due to reincorporation of the Company or formation of a holding company).  The Company shall
require any successor (whether direct or indirect, by purchase, merger, reorganization, consolidation, acquisition of
property or stock, liquidation, or otherwise) to all or a majority of its assets, by agreement in form and substance
satisfactory to Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform this Agreement if no such succession had taken place.  Executive
may not assign his rights (except by will or the laws of descent and distribution or to a trust for the purpose of
estate or tax planning for the benefit of Executive’s spouse and/or children) or delegate his duties or obligations
hereunder.  Except as provided by this Section 16, this Agreement is not assignable by any party and no payment to be
made hereunder shall be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or other
charge.

10

 

10

 

17. Choice of Law.  All issues and questions concerning the construction, validity, enforcement and
interpretation of this Agreement and the exhibits and schedules hereto shall be governed by, and construed in
accordance with, the laws of the State of California regardless of the law that might be applied under principles of
conflicts of laws.

18. Amendment and Waiver.  The provisions of this Agreement may be amended, modified or waived only with the
prior written consent of the Company and Executive, and no course of conduct or course of dealing or failure or delay
by any party hereto in enforcing or exercising any of the provisions of this Agreement (including, without limitation,
the Company’s right to terminate the Employment Period for Cause) shall affect the validity, binding effect or
enforceability of this Agreement or be deemed to be an implied waiver of any provision of this Agreement.

19. Internal Revenue Code Section 409A.

(a) General. To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A of the
Code and Department of Treasury regulations and other interpretative guidance issued thereunder, including without
limitation any such regulations or other such guidance that may be issued after the Effective Date (“Section
409A”). Notwithstanding any provision of this Agreement to the contrary, in the event that following the Effective
Date, the Company determines in good faith that any compensation or benefits payable under this Agreement may not be
either exempt from or compliant with Section 409A, the Company shall consult with Executive and adopt such amendments
to this Agreement or adopt other policies or procedures (including amendments, policies and procedures with retroactive
effective), or take any other commercially reasonable actions necessary or appropriate to (i) preserve the intended tax
treatment of the compensation and benefits payable hereunder, to preserve the economic benefits of such compensation
and benefits, and/or to avoid less favorable accounting or tax consequences for the Company and/or (ii) to exempt the
compensation and benefits payable hereunder from Section 409A or to comply with the requirements of Section 409A and
thereby avoid the application of penalty taxes thereunder; provided, however, that this Section 19(a) does not, and
shall not be construed so as to, create any obligation on the part of the Company to adopt any such amendments,
policies or procedures or to take any other such actions or to indemnify the Executive for any failure to do so.

(b) Specified Employee. Notwithstanding anything to the contrary in this Agreement, no compensation or benefits,
including without limitation any severance payment under Section 5 above, shall be paid to Executive during the 6-month
period following his Separation from Service to the extent that the Company determines that Executive is a “specified
employee” at the time of such Separation from Service (within the meaning of Section 409A) and that that paying such
amounts at the time or times indicated in this Agreement would be a prohibited distribution under Section
409A(a)(2)(b)(i) of the Code. If the payment of any such amounts is delayed as a result of the previous sentence, then
on the first business day following the end of such 6-month period (or such earlier date upon which such amount can be
paid under Section 409A without being subject to such additional taxes, including as a result of Executive’s death),
the Company shall pay to Executive a lump-sum amount equal to the cumulative amount that would have otherwise been
payable to Executive during such 6-month period, along with interest at the prime rate (as reported in the Wall Street
Journal or such other source as the Company deems reliable) from the date such payments were otherwise due to the date
of payment. The Company’s determination as to whether such six-month delay is required by this sub-paragraph shall be
made in good faith by the Company after consultation between the Company and Executive.

11

 

11

 

(c) Reimbursements. To the extent that any reimbursements, including without limitation any reimbursements
pursuant to Section 3(c) above, are determined to constitute taxable compensation to Executive, then such
reimbursements shall be paid to Executive promptly following proper substantiation in accordance with applicable
Company policy, but in no event after December 31st of the year following the year in which the expense was
incurred (and such reimbursements shall be contingent upon Executive’s timely submission of proper substantiation).
The amount of any such expenses reimbursed in one year shall not affect the amount eligible for reimbursement in any
subsequent year and Executive’s right to reimbursement of any such expenses shall not be subject to liquidation or
exchange for any other benefit.

20. Insurance.  The Company may, at its discretion, apply for and procure in its own name and for its own
benefit life and/or disability insurance on Executive in any amount or amounts considered advisable.  Executive agrees
to cooperate in any medical or other examination, supply any information and execute and deliver any applications or
other instruments in writing as may be reasonably necessary to obtain and constitute such insurance.  Executive hereby
represents that he has no reason to believe that his life is not insurable at rates now prevailing for healthy men of
his age.

21. Withholding.  Any payments made or benefits provided to Executive under this Agreement shall be reduced by
any applicable withholding taxes or other amounts required to be withheld by law or contract.

22. Arbitration.  Any dispute or controversy arising under or in connection with this Agreement or otherwise in
connection with the Executive’s employment by the Company that cannot be mutually resolved by the parties to this
Agreement and their respective advisors and representatives shall be settled exclusively by arbitration in Los Angeles,
California in accordance with the rules of the American Arbitration Association before one arbitrator of exemplary
qualifications and stature, who shall be selected jointly by an individual to be designated by the Company and an
individual to be selected by Executive, or if such two individuals cannot agree on the selection of the arbitrator, who
shall be selected by the American Arbitration Association. The Company will pay the direct costs and expenses of any
such arbitration, including the fees and costs of the arbitrator; provided, however, that the
arbitrator may, at his or her election, award attorneys’ fees to the prevailing party, if permitted by applicable law.

23. Executive’s Cooperation.  During the Employment Period and thereafter, Executive shall cooperate with the
Company and its affiliates, upon the Company’s reasonable request, with respect to any internal investigation or
administrative, regulatory or judicial proceeding involving matters within the scope of Executive’s duties and
responsibilities to the Company Group during the Employment Period (including, without limitation, Executive being
available to the Company upon reasonable notice for interviews and factual investigations, appearing at the Company’s
reasonable request to give testimony without requiring service of a subpoena or other legal process, and turning over
to the Company all relevant Company documents which are or may come into Executive’s possession during the Employment
Period); provided, however, that any such request by the Company shall not be unduly burdensome or
interfere with Executive’s personal schedule or ability to engage in gainful employment.  In the event the Company
requires Executive’s cooperation in accordance with this Section 23, the Company shall reimburse Executive for
reasonable out-of-pocket expenses (including travel, lodging and meals) incurred by Executive in connection with such
cooperation, subject to reasonable documentation. In the event that the obligations under this Section 23 require more
than 20 hours of the Executive’s time after the termination of the Employment Period, the Company shall thereafter also
pay to Executive compensation at an hourly rate equal to the result of (a) the Base Salary applicable on the date of
the termination of Executive’s employment, divided by (b) 1,750.

12

 

12

 

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

COMPANY:

RENTECH, INC.

By: /s/ Richard Wesolowski                                  

Name: Richard Wesolowski

Title: Senior Vice President, Human Resources

EXECUTIVE:

/s/ Colin Morris                                               

Colin Morris

13

 

13

 

EXHIBIT A

 

FORM OF RELEASE

This General Release of all Claims (this “Agreement”) is entered into by Colin Morris (“Executive”) and
Rentech, Inc. (the “Company”), effective as of [ ].

In further consideration of the promises and mutual obligations set forth in the Employment Agreement between Executive
and the Company, dated November 3, 2009 (the “Employment Agreement”), Executive and the Company agree as
follows:

1. Return of Property. All Company files, access keys, desk keys, ID badges, computers, electronic
devices, telephones and credit cards, and such other property of the Company as the Company may reasonably request, in
Executive’s possession must be returned no later than the date of Executive’s termination from the Company.

2. General Release and Waiver of Claims.

(a) Release. In consideration of the payments and benefits provided to Executive under the
Employment Agreement and after consultation with counsel, Executive, personally and on behalf of each of Executive’s
respective heirs, executors, administrators, representatives, agents, successors and assigns (collectively, the
“Releasors”) hereby irrevocably and unconditionally releases and forever discharges the Company and its
subsidiaries and affiliates and each of their respective officers, employees, directors, and agents and all persons
acting in concert with them or any of them (“Releasees”) from any and all claims, actions, causes of action,
rights, judgments, obligations, damages, demands, accountings or liabilities of whatever kind or character
(collectively, “Claims”), including, without limitation, any Claims under any federal, state, local or foreign
law, including without limitation, the Age Discrimination in Employment Act, as amended, 29 U.S.C. § 621, et seq.;
Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991, 42 U.S.C. § 2000 et seq.; Equal
Pay Act, as amended, 29 U.S.C. § 206(d); the Civil Rights Act of 1866, 42 U.S.C. § 1981; the Family and Medical Leave
Act of 1993, 29 U.S.C. § 2601 et seq.; the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq.; the
False Claims Act , 31 U.S.C. § 3729 et seq.; the Employee Retirement Income Security Act, as amended, 29 U.S.C. § 1001
et seq.; the Worker Adjustment and Retraining Notification Act, as amended, 29 U.S.C. § 2101 et seq. the Fair Labor
Standards Act, 29 U.S.C. § 215 et seq., the Sarbanes-Oxley Act of 2002; the California Fair Employment and Housing Act,
as amended, Cal. Lab. Code § 12940 et seq.; the California Equal Pay Law, as amended, Cal. Lab. Code §§
1197.5(a),1199.5; the Moore-Brown-Roberti Family Rights Act of 1991, as amended, Cal. Gov’t Code §§12945.2, 19702.3;
California Labor Code §§ 1101, 1102, 69 Ops. Cal. Atty. Gen. 80 (1986); California Labor Code §§ 1102.5(a), (b); the
California WARN Act, Cal. Lab. Code § 1400 et seq.; the California False Claims Act, Cal. Gov’t Code § 12650 et seq.;
the California Corporate Criminal Liability Act, Cal. Penal Code § 387; and the California Labor Code, that the
Releasors had, have, may have, or in the future may possess, arising out of (i) Executive’s employment relationship
with and service as an employee, officer or director of the Company, and the termination of such relationship or
service, and (ii) any event, condition, circumstance or obligation that occurred, existed or arose on or prior to the
date hereof; provided, however, that Executive does not release, discharge or waive any rights to
payments and benefits provided under the Employment Agreement that are contingent upon the execution by Executive of
this Agreement, any vested benefits, any rights to indemnification, or any rights as a shareholder of the Company.

A-1

 

14

 

THE EXECUTIVE ACKNOWLEDGES THAT HE HAS BEEN ADVISED OF AND IS FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL
CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH, IF KNOWN BY HIM OR HER, MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR.”

BEING AWARE OF SAID CODE SECTION, THE EXECUTIVE HEREBY EXPRESSLY WAIVES ANY RIGHTS HE MAY HAVE THEREUNDER, AS WELL
AS UNDER ANY OTHER STATUTES OR COMMON LAW PRINCIPLES OF SIMILAR EFFECT.

(b) Specific Release of ADEA Claims. In further consideration of the payments and benefits
provided to Executive under the Employment Agreement, the Releasors hereby unconditionally release and forever
discharge the Releasees from any and all Claims that the Releasors may have as of the date Executive signs this
Agreement arising under the Federal Age Discrimination in Employment Act of 1967, as amended, and the applicable rules
and regulations promulgated thereunder (“ADEA”). By signing this Agreement, Executive hereby acknowledges and
confirms the following: (i) Executive was, and is hereby, advised by the Company in connection with his termination to
consult with an attorney of his choice prior to signing this Agreement and to have such attorney explain to Executive
the terms of this Agreement, including, without limitation, the terms relating to Executive’s release of claims arising
under ADEA, and Executive has in fact consulted with an attorney; (ii) Executive was given a period of not fewer than
21 days to consider the terms of this Agreement and to consult with an attorney of his choosing with respect thereto;
(iii) Executive knowingly and voluntarily accepts the terms of this Agreement; (iv) the payments and benefits provided
to Executive in consideration of this release are in addition to any amounts otherwise owed to Executive; and (v) this
Agreement is written in a manner designed to be understood by Executive and he understands it. Executive also
understands that he has seven days following the date on which he signs this Agreement within which to revoke the
release contained in this paragraph, by providing the Company a written notice of his revocation of the release and
waiver contained in this paragraph.

(c) No Assignment. Executive represents and warrants that he has not assigned any of the Claims
being released under this Agreement.

3. Proceedings. Executive has not filed, and agrees not to initiate or cause to be initiated on his
behalf, any complaint, charge, claim or proceeding against the Releasees before any local, state or federal agency,
court or other body relating to any Claims released under this Agreement, including without limitation, any Claims
relating to his employment or the termination of his employment, (each, individually, a “Proceeding”), and
agrees not to participate voluntarily in any Proceeding. Notwithstanding the foregoing, Executive may bring to the
attention of the United States Equal Employment Opportunity Commission (the “EEOC”) claims of discrimination.
Executive waives any right he may have to benefit in any manner from any relief (whether monetary or otherwise) arising
out of any Proceeding.

A-2

 

15

 

4. Remedies. In the event Executive initiates or voluntarily participates in any Proceeding, or if
he fails to abide by any of the terms of this Agreement or his post-termination obligations contained in the Employment
Agreement, or if he revokes the ADEA release contained in Paragraph 2(b) of this Agreement within the seven-day period
provided under Paragraph 2(b), the Company may, in addition to any other remedies it may have, reclaim any amounts paid
to him under the severance provisions of the Employment Agreement or terminate any benefits or payments that are
subsequently due under the Employment Agreement, without waiving the release granted herein. The foregoing shall not
apply to Executive’s bringing to the attention of the EEOC any claims of discrimination. Executive acknowledges and
agrees that the remedy at law available to the Company for breach of any of his post-termination obligations under the
Employment Agreement or his obligations under Paragraphs 2 and 3 of this Agreement would be inadequate and that damages
flowing from such a breach may not readily be susceptible to being measured in monetary terms. Accordingly, Executive
acknowledges, consents and agrees that, in addition to any other rights or remedies that the Company may have at law or
in equity, the Company shall be entitled to seek a temporary restraining order or a preliminary or permanent
injunction, or both, without bond or other security, restraining Executive from breaching his post-termination
obligations under the Employment Agreement or his obligations under Paragraphs 2 and 3 of this Agreement. Such
injunctive relief in any court shall be available to the Company, in lieu of, or prior to or pending determination in,
any arbitration proceeding.

Executive understands that by entering into this Agreement he will be limiting the availability of certain
remedies that he may have against the Company and limiting also his ability to pursue certain claims against the
Company.

5. Severability Clause. In the event any provision or part of this Agreement is found to be invalid
or unenforceable, only that particular provision or part so found, and not the entire Agreement, will be inoperative.

6. Non-admission. Nothing contained in this Agreement will be deemed or construed as an admission of
wrongdoing or liability on the part of the Company.

7. Governing Law. All matters affecting this Agreement, including the validity thereof, are to be
governed by, and interpreted and construed in accordance with, the laws of the State of California regardless of the
law that might be applied under principles of conflicts of laws.

8. Arbitration. Any dispute or controversy arising under or in connection with this Agreement or
otherwise in connection with Executive’s employment by the Company that cannot be mutually resolved by the parties to
this Agreement and their respective advisors and representatives shall be settled exclusively by arbitration in Los
Angeles, California in accordance with the rules of the American Arbitration Association before one arbitrator of
exemplary qualifications and stature, who shall be selected jointly by an individual to be designated by the Company
and an individual to be selected by Executive or, if such two individuals cannot agree on the selection of the
arbitrator, who shall be selected by the American Arbitration Association. The Company will pay the direct costs and
expenses of any such arbitration, including the fees and costs of the arbitrator; provided, however,
that the arbitrator may, at his or her election, award attorneys’ fees to the prevailing party, if permitted by
applicable law.

9. Notices. All notices or communications hereunder shall be in writing, addressed as follows:

To the Company:

 

Chief Executive Officer

Rentech, Inc.

10877 Wilshire Blvd. Suite 710

Los Angeles, CA 90024

To Executive:

 

To the address on file in the permanent records of the Company at the time of the notice.

A-3

 

16

 

All such notices shall be conclusively deemed to be received and shall be effective (i) if sent by hand delivery,
upon receipt or (ii) if sent by electronic mail or facsimile, upon confirmation of receipt by the sender of such
transmission.

EXECUTIVE ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT AND THAT HE FULLY KNOWS, UNDERSTANDS AND APPRECIATES ITS
CONTENTS, AND THAT HE HEREBY EXECUTES THE SAME AND MAKES THIS AGREEMENT AND THE RELEASE AND AGREEMENTS PROVIDED FOR
HEREIN VOLUNTARILY AND OF HIS OWN FREE WILL.

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

COMPANY:

RENTECH, INC.

By:                                                                          

Name:

Title:

EXECUTIVE:

                                                                         

Colin Morris

A-4

 

17

 

EXHIBIT B

CONFIDENTIALITY AND INVENTION ASSIGNMENT AGREEMENT

 

18Exhibit 10.31

Exhibit 10.31

eResearchTechnology, Inc.

Amended and Restated 2003 Equity Incentive Plan

1. Purpose

The purpose of the Amended and Restated 2003 Equity Incentive Plan (referred to herein as the
“Plan”) of eResearchTechnology, Inc. (the “Company”) is to provide a means by which certain
employees and directors of, and others providing services to or having a relationship with, the
Company and its subsidiaries (as such term is defined in Section 424(f) of the Internal Revenue
Code of 1986, as amended (the “Code”)) may be given an opportunity to acquire shares of common
stock of the Company (“Common Stock”) or receive compensation based on the value of such shares.
The Plan is intended to promote the interests of the Company by encouraging stock ownership on the
part of such individuals, by enabling the Company and its subsidiaries to secure and retain the
services of highly qualified persons, and by providing such individuals with an additional
incentive to advance the success of the Company and its subsidiaries.

2. Administration

A. General. The Plan shall be administered by a Committee consisting of not less than two
directors (the “Committee”) to be appointed from time to time by the Board of Directors.
Membership on the Committee shall in any event be limited to those members of the Board who (i) are
“Non-Employee Directors” as defined in the regulations promulgated by the Securities and Exchange
Commission pursuant to Section 16(b) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) or any successor statute or regulation, and (ii) “outside directors” within the
meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). The
Committee shall have the power to: (a) determine the individuals to whom awards (“Grants”) may be
made under the Plan; (b) determine the type, size and terms of any such Grants, including options
to purchase common stock (“Stock Options”) and awards of shares of common stock subject to
restrictions established by the Committee (“Restricted Stock”); (c) determine the time when any
such Grants will be made and the duration of any applicable exercise or restriction period,
including the criteria for exercisability and/or forfeiture and acceleration of exercisability and
acceleration or waiver of forfeiture; (d) construe the provisions of the Plan and (e) adopt rules
and regulations governing the administration of the Plan. All decisions, determinations and
interpretations of the Committee shall be final and binding upon all persons to whom Grants may be
made under the Plan. All power and authority granted hereunder to the Committee may, at the
discretion of the Board of Directors, be exercised by the Board of Directors, and unless the
context clearly indicates otherwise, all references herein to the “Committee” shall be deemed to
refer to the Board of Directors in the absence of the appointment of the Committee or in the event
of the exercise by the Board of Directors of the Committee’s power and authority. The members of
the Board of Directors or the Committee shall not be liable for any action or determination made in
good faith with respect to the Plan or to any Grant awarded pursuant thereto.

 

 

 

Deferral Eligible Grantees and Outside Directors (as defined in Section 9N) may elect to defer
the receipt of Restricted Stock Units (as defined in Section 8A) as provided in Section 9. The
deferral provisions of Section 9 and the other provisions of the Plan relating to the deferral of
Restricted Stock Units are unfunded and maintained primarily for the purpose of providing directors
and a select group of management or highly compensated employees the opportunity to defer the
receipt of compensation otherwise payable to such directors and eligible employees in accordance
with the terms of the Plan.

B. Additional Powers. The Committee may: (i) modify or restrict exercise procedures and any
other Plan procedures; (ii) establish local country plans as subplans to this Plan, each of which
may be attached as an Appendix hereto and to the extent that the Committee determines that the
restrictions imposed by the Plan preclude the achievement of the material purposes of awarding
Grants in jurisdictions outside the United States under such a subplan, the Committee will have the
authority and discretion to modify those restrictions as the Committee determines to be necessary
or appropriate to conform to applicable requirements or practices of jurisdictions outside the
United States; (iii) take any action, before or after a Grant is awarded, which it deems advisable
to obtain or comply with any necessary local government regulatory exemptions or approvals;
provided that the Committee may not take any action hereunder which would violate any securities
law or any governing statute.

3. Eligibility

The persons who shall be eligible to participate in this Plan and receive Grants hereunder
shall be the Company’s directors and such employees and other individuals who provide services to
or otherwise have a relationship with the Company or its subsidiaries as the Committee shall from
time to time determine. An eligible individual may receive more than one Grant under the Plan and
Grants of more than one type under the Plan.

4. Allotment of Shares

Subject to Section 13 of the Plan, the shares of the Common Stock, $0.01 par value, of the
Company that may be issued under the Plan shall be 7,318,625 shares, all of which may be used for
Grants of Incentive Stock Options (as hereinafter defined). Such shares may be authorized and
unissued shares (that are not reserved for any other purpose) or shares issued and subsequently
reacquired by the Company. Without limiting the generality of the foregoing, whenever the Company
receives shares of Common Stock in connection with the exercise of or payment for any Stock Options
granted under the Plan, only the net number of shares actually issued shall be counted against the
foregoing limit. Shares that by reason of the expiration of a Stock Option or otherwise are no
longer subject to purchase pursuant to a Stock Option granted under the Plan and shares
representing Restricted Stock that is forfeited to the Company may be available for subsequent
Grants under the Plan. Notwithstanding anything to the contrary set forth in the Plan, the maximum
number of shares of Common Stock for which Grants may be granted to any employee in any calendar
year shall be 675,000 shares, all of which may be used for Grants of Incentive Stock Options (as
hereinafter defined).

 

2

 

5. Effective Date and Term of Plan

The effective date of the Plan was April 22, 2003. The Plan shall terminate on April 22,
2013, but the Board of Directors may terminate the Plan at any time prior thereto. Termination of
the Plan shall not alter or impair, without the consent of the recipient of a Grant hereunder, any
of the rights or obligations of any Grant theretofore awarded under the Plan, except as
specifically authorized herein.

6. Terms and Conditions

A. All Stock Options. Stock Options granted pursuant to this Plan shall be evidenced by Stock
Option award letters in such form not inconsistent with the Plan as the Committee shall from time
to time approve. Nothing in this Plan or any Stock Option granted hereunder shall govern the
employment rights and duties between the option holder and the Company or subsidiary. Neither this
Plan, nor any grant or exercise pursuant thereto, shall constitute an employment agreement among
such parties. The following shall also apply to all Stock Options granted under the Plan.

(i) Option Price

The option price per share of Common Stock for each Stock Option shall be determined by the
Committee, consistent with the provisions of this Plan.

(ii) Time of Exercise of Option

Except as otherwise set forth herein, the Committee shall establish the option period and time
or times within the option period when the Stock Option may be exercised in whole or in such parts
as may be specified from time to time by the Committee, provided that no Stock Option shall be
exercisable after ten years from the date of grant thereof. Unless otherwise determined by the
Committee in its sole discretion, no Stock Option shall be exercisable until after the expiration
of six months from the date of grant. The Committee may in its discretion accelerate the time or
times when any particular Stock Option held by said option holder may be so exercised so that such
time or times are earlier than those originally provided in the Stock Option agreement, upon such
circumstances and subject to such terms and conditions as the Committee deems appropriate. In all
cases, exercise of a Stock Option shall be subject to the provisions of Section 6A(vi).

(iii) Payment and Manner of Exercise

(a) Payment Upon Exercise of Shares. Full payment for shares purchased upon the
exercise of a Stock Option shall be made pursuant to one or more of the following methods as
determined by the Committee and set forth in the Grant document:

(A) In cash;

(B) By certified check payable to the order of the Company;

 

3

 

(C) By surrendering shares with an aggregate Fair Market Value equal to the aggregate option
price; provided, however, that the option price may not be paid in shares if the Committee
determines that such method of payment would result in liability under section 16(b) of the
Securities Exchange Act of 1934 to a participant. Except as otherwise provided by the Committee, if
payment is made in whole or in part by surrendering shares, the participant shall deliver to the
Company certificates registered in the name of such participant representing shares legally and
beneficially owned by such participant, free of all liens, claims and encumbrances of every kind
and having a Fair Market Value on the date of delivery that is equal to or greater than the
aggregate option price for the option shares subject to payment by the surrender of shares,
accompanied by stock powers duly endorsed in blank by the record holder of the shares represented
by such certificates. The Committee may impose such limitations and prohibitions on the use of
shares to exercise an Option as it deems appropriate; or

(D) Via cashless exercise, such that subject to the other terms and conditions of the Plan,
following the date of exercise, the Company shall deliver to the participant shares having a Fair
Market Value, as of the date of exercise, equal to the excess, if any, of (I) the Fair Market Value
of such shares on the date of exercise of the Option over (II) the sum of (1) the aggregate option
price for such shares, plus (2) the applicable tax withholding amounts (as determined pursuant to
Section 17) for such exercise; provided that in connection with such cashless exercise that would
not result in the issuance of a whole number of shares, the Company shall withhold cash that would
otherwise be payable to the participant from its regular payroll or the participant shall deliver
cash or a certified check payable to the order of the Company for the balance of the option price
for a whole share to the extent necessary to avoid the issuance of a fractional share or the
payment of cash by the Company.

(b) Upon exercise, the Company shall deliver to the Option holder (or other person entitled
to exercise the Stock Option), at the principal office of the Company, or such other place as shall
be mutually agreed upon, a certificate or certificates for such shares; provided, however, that the
time of delivery may be postponed by the Company for such periods as may be required for it with
reasonable diligence to comply with any requirements of law; and provided further that in the event
the Common Stock that is issuable upon exercise is not registered under the Securities Act of 1933,
then the Company may require that the registered owner deliver an investment representation in form
acceptable to the Company and its counsel, and the Company will place a legend on the certificate
for such Common Stock restricting the transfer of same. There shall be no obligation or duty for
the Company to register under the Securities Act of 1933 at any time the Common Stock issuable upon
exercise of the Stock Option. If the option holder (or other person entitled to exercise the Stock
Option) fails to accept delivery, the option holder’s payment shall be returned and the right to
exercise the Stock Option with respect to such undelivered shares shall be terminated.

(c) The Committee may also, in its discretion and subject to prior notification to the
Company by an option holder, permit an option holder to enter into an agreement with the Company’s
transfer agent or a brokerage firm of national standing whereby the option holder will
simultaneously exercise the Stock Option and sell the shares acquired thereby through the Company’s
transfer agent or such brokerage firm and either the Company’s transfer agent or the brokerage firm
executing the sale will remit to the Company from the
proceeds of sale the exercise price of the shares as to which the Stock Option has been
exercised.

 

4

 

(d) The Company may, at any time, offer to buy out one or more Stock Options for payment in
cash, based on such terms and conditions as the Committee shall establish and communicate to the
option holder at the time that such offer is made; provided that no such purchase shall be made at
a price greater than the excess, if any, of the Fair Market Value of the Common Stock on the date
of purchase over the option price per share for any Stock Option so purchased.

(iv) Non-Transferability of Stock Option

A Stock Option by its terms shall not be assignable or transferable by the option holder
otherwise than by will or by the laws of descent and distribution.

(v) Rights after Termination of Employment

In the event of termination of employment due to any cause other than death or disability,
rights to exercise the Stock Option to the extent otherwise exercisable on the date of termination
of employment, or to any greater extent permitted by the Committee, shall terminate three months
following cessation of employment. In the event of termination of employment due to disability
(within the meaning of Section 22(e)(3) of the Code) or death, such option holder or executor,
administrator or devisee of an option holder, shall have the right to exercise such Stock Option
(to the extent otherwise exercisable on the date of death or disability) at any time within one
year after cessation of employment by reason of such disability or death. In the event of
termination of employment for any reason, including death or disability, any portion of the Stock
Option not exercisable on the date of such termination of employment shall expire unless otherwise
provided by this Plan or the Committee in its sole discretion.

(vi) Fair Market Value

“Fair Market Value” on any date means: (a) if the Common Stock is listed on a national
securities exchange, the closing price reported as having occurred on the primary exchange with
which the Common Stock is listed and traded; (b) if the Common Stock is not listed on any national
securities exchange but is quoted in the Nasdaq Stock Market on a last sale basis, the last sale
reported on such date, or, if there is no such sale on that date, then on the last preceding date
on which a sale was reported; or (c) if the Common Stock is not listed on a national securities
exchange nor quoted in the Nasdaq Stock Market on a last sale basis, the amount determined by the
Committee to be the fair market value based upon a good faith attempt to value the Common Stock in
accordance with the Code and regulations promulgated thereunder.

(vii) No Repricing Without Stockholder Approval.

Notwithstanding anything in the Plan to the contrary, without the prior approval of the
stockholders of the Company, the Committee may not: (a) reduce the option price of any Stock
Option after it is granted; (b) cancel any Stock Option at a time when the option price thereof
exceeds the Fair Market Value of the Common Stock in exchange for
another Stock Option or other Grant hereunder unless the cancellation and exchange occurs in
connection with a merger, acquisition, spin-off or other similar corporate transaction or (c) take
any other action that would be treated as a repricing under generally accepted accounting
principles as applied in the United States.

 

5

 

B. Non-Qualified Stock Options. The Committee may, in its discretion, grant Stock Options
under the Plan which, in whole or in part, do not qualify as incentive stock options under Section
422 of the Code (“Non-Qualified Options”). The terms and conditions of the Non-Qualified Options
shall be governed by Section 6A above. The option price per share for each Non-Qualified Option
shall not be less than 100% of the Fair Market Value of the Common Stock on the date the Stock
Option is granted. The Fair Market Value shall be determined as set forth in Section 6A(vi)
above.

C. Incentive Stock Options. The Committee may, in its discretion, grant Stock Options under
the Plan, which qualify, in whole or in part, as incentive stock options (“Incentive Stock Option”)
under Section 422 of the Code. In addition to the terms and conditions set forth in Section 6A
above, the following terms and conditions shall govern any Incentive Stock Option issued under the
Plan:

(i) Maximum Fair Market Value of Incentive Stock Options

No option holder may have Incentive Stock Options that become exercisable for the first time
in any calendar year (under all Incentive Stock Option plans of the Company and its subsidiary
corporations) with an aggregate Fair Market Value (determined as of the time such Incentive Stock
Option is granted) in excess of $100,000.

(ii) Option Price

The option price per share for each Incentive Stock Option shall be 100% of the Fair Market
Value of the Common Stock on the date the Stock Option is granted; provided, however, that in the
case of the grant to an option holder who owns Common Stock of the Company possessing more than 10%
of the total combined voting power of all classes of stock of the Company or its subsidiaries, the
option price of such Stock Option shall be at least 110% of the Fair Market Value of the Common
Stock on the date the Stock Option is granted. The Fair Market Value shall be determined as
prescribed in Section 6A(vi) above.

(iii) Period of Stock Option

Each Incentive Stock Option shall expire ten years from the date it is granted or at the end
of such shorter period as may be designated by the Committee on the date of grant; provided,
however, that in the case of the grant of an Incentive Stock Option to an option holder who owns
Common Stock of the Company possessing more than 10% of the total combined voting power of all
classes of stock of the Company or its subsidiaries, such Stock Option shall not be exercisable
after the expiration of five years from the date it is granted.

 

6

 

(iv) Eligible Participants

Incentive Stock Options may be issued only to employees of the Company or its parent or
subsidiary corporation or corporations.

(v) Interpretation

No term of the Plan relating to Incentive Stock Options shall be interpreted, amended, or
altered, nor shall any direct discretion or authority granted under the Plan be so exercised, so as
to disqualify the Plan under Section 422 of the Code.

D. Substitution of Options. Options may be granted under the Plan from time to time in
substitution for Stock Options held by employees of other corporations who are about to become,
and who do concurrently with the grant of such Stock Options become, employees of the Company or a
subsidiary of the Company as a result of a merger or consolidation of the employing corporation
with the Company or a subsidiary of the Company, or the acquisition by the Company or a subsidiary
of the Company of the assets of the employing corporation or the acquisition by the Company or a
subsidiary of the Company of stock of the employing corporation. The terms and conditions of the
substitute Options so granted may vary from the terms and conditions set forth in this Section 6 to
such extent as the Committee at the time of grant may deem appropriate to conform, in whole or in
part, to the provisions of the Stock Options in substitution for which they are granted.

7. Stock Appreciation Rights.

A. General Requirements. “Stock Appreciation Right” means the right, pursuant to an award
granted under Section 7 hereof, to cash and/or shares of stock in an amount equal to the difference
between (i) the Fair Market Value, as of the date such right (or such portion thereof) is
exercised, of the shares of Stock covered by such right (or such portion thereof) and (ii) the base
amount established by the Committee with respect to such right (or such portion thereof).

B. Grant and Exercise. Stock Appreciation Rights may be granted separate from or in
conjunction with all or part of any Stock Option granted under the Plan and shall be
nontransferable except that, subject to Section 6A(iv) hereof, a Stock Appreciation Right shall be
transferable upon transfer of the related Stock Option. In the case of a Non-Qualified Stock
Option, Stock Appreciation Rights may be granted either at or after the time of the grant of such
Stock Option. In the case of an Incentive Stock Option, Stock Appreciation Rights may be granted
only at the time of the grant of such Stock Option.

A Stock Appreciation Right or applicable portion thereof granted with respect to a given Stock
Option shall terminate and no longer be exercisable upon the termination or exercise of the related
Stock Option, except that, unless otherwise determined by the Committee, in its sole discretion at
the time of grant, a Stock Appreciation Right granted with respect to less than the full number of
shares covered by a related Stock Option shall not be reduced until the number of shares covered by
an exercise or termination of the related Stock Option exceeds the number of shares not covered by
the Stock Appreciation Right. A Stock Appreciation Right not granted in connection with a Stock
Option shall terminate at the time specified in the grant.

 

7

 

A Stock Appreciation Right granted in connection with a Stock Option may be exercised by an
optionee, in accordance with Section 6A(iii) of the Plan, by surrendering the applicable portion of
the related Stock Option. Upon such exercise and surrender, the optionee shall be entitled to
receive an amount determined in the manner prescribed in Section 6A(iii) of the Plan. Stock
Options which have been so surrendered, in whole or in part, shall no longer be exercisable to the
extent the related Stock Appreciation Rights have been exercised. A Stock Appreciation Right not
granted in connection with a Stock Option may be exercised by the grantee’s delivery to the
Committee of a notice of exercise, in the form prescribed by the Committee.

C. Terms and Conditions. Stock Appreciation Rights shall be subject to such terms and
conditions, not inconsistent with the provisions of the Plan, as shall be determined from time to
time by the Committee, in its sole discretion, including the following:

(i) Stock Appreciation Rights shall be exercisable only at such time or times established by
the Committee. Stock Appreciation Rights granted in connection with Stock Options shall be
exercisable only at such time or times and to the extent that the Stock Options to which they
relate shall be exercisable in accordance with the provisions of Section 6 and this Section 7 of
the Plan.

(ii) Upon the exercise of a Stock Appreciation Right, an optionee shall be entitled to receive
up to, but not more than, an amount in cash and/or shares of Stock equal in value to the excess of
the Fair Market Value of one share of Stock over the base amount established by the Committee,
multiplied by the number of shares in respect of which the Stock Appreciation Right shall have been
exercised, with the Committee having the right to determine the form of payment. In the case of a
Stock Appreciation Right granted in connection with a Stock Option the base amount shall be the
exercise price of the related Stock Option.

(iii) Upon the exercise of a Stock Appreciation Right, the Stock Option or part thereof to
which such Stock Appreciation Right is related, if any, shall be deemed to have been exercised for
the purpose of the limitation set forth in Section 4 of the Plan on the number of shares of Stock
to be issued under the Plan, but only to the extent of the number of shares issued under the Stock
Appreciation Right at the time of exercise, if any, based on the value of the Stock Appreciation
Right at such time.

(iv) A Stock Appreciation Right granted in connection with a Stock Option may be exercised
only if and when the market price of the Stock subject to the Stock Option exceeds the exercise
price of such Stock Option.

 

8

 

8. Restricted Stock and Restricted Stock Units

A. General Requirements. The Committee may issues shares of Restricted Stock and Restricted
Stock Units (as hereinafter defined) upon such terms and conditions as the Committee deem
appropriate under this Section 8. Restricted Stock and Restricted Stock Units shall be set forth in
writing as determined from time to time by the Committee, consistent with the following provisions
of this Section 8. Restricted Stock and Restricted Stock Units may be
issued for consideration or for no consideration (except as required by applicable law) and
subject to such restrictions as the Committee may determine. The Committee may establish conditions
under which restrictions on Restricted Stock and Restricted Stock Units lapse over a period of time
or according to such other criteria as the Committee deems appropriate, including restrictions
based upon the achievement of specific performance goals. “Restricted Stock Unit” shall mean a unit
that entitles the participant, upon the Vesting Date set forth in a Grant, to receive one share of
the Company’s Common Stock.

B. Number of Shares. Subject to Section 4 hereof, the Committee shall determine the number of
shares of Restricted Stock and the number of Restricted Stock Units to be awarded pursuant to any
Grant and the restrictions applicable to such shares.

C. Requirement of Employment or Service. If the participant ceases to be employed by, or
provide service to, the Company, or if any other specified conditions are not met, any Restricted
Stock or Restricted Stock Units as to which the restrictions have not then lapsed shall
automatically be forfeited to the Company, and those shares of Restricted Stock that may previously
have been issued shall be immediately returned to the Company. The Committee may provide for
complete or partial exceptions to this requirement as it deems appropriate.

D. Restrictions on Transfer. A participant may not sell, assign, transfer, pledge or
otherwise dispose of any Restricted Stock that remain subject to forfeiture in accordance with the
terms of the Grant thereof except by will or in accordance with the laws of descent and
distribution upon death. Each certificate representing Restricted Stock will contain a legend
giving appropriate notice of the restrictions in the Grant. The participant shall be entitled to
have the restrictive legend removed from a stock certificate covering Restricted Stock as to which
all restrictions have lapsed. The Committee may determine that the Company will not issue
certificates for Grants of Restricted Stock until all restrictions on such shares have lapsed, or
that the Company will retain possession of such certificates until all restrictions on such shares
have lapsed.

E. Right to Vote and To Receive Dividends. The Committee shall determine to what extent, and
under what conditions, the holder of Restricted Stock shall have the right to vote such shares and
the holder of Restricted Stock or Restricted Stock Units shall have the right to receive any
dividends or dividend equivalents or other distributions paid with respect to shares of Restricted
Stock or shares issuable with respect to Restricted Stock Units at any time that such shares remain
subject to forfeiture. The Committee may determine that a participant’s entitlement to dividends or
other distributions with respect to Restricted Stock or Restricted Stock Units may be subject to
achievement of performance goals or other conditions.

9. Deferral Elections

A participant may elect to defer the receipt of shares that would otherwise be issuable with
respect to Restricted Stock Units as to which a Vesting Date has not occurred, as provided by the
Committee in the Grant consistent, however, with the provisions of this Section 9. Capitalized
terms used in this Section 9 but not previously defined in the Plan shall have the meanings set
forth in Section 9N.

 

9

 

A. Initial Election.

(i) Election. Each participant who is an Outside Director or a Deferral Eligible
Employee shall have the right to defer the receipt of some or all of the shares issuable with
respect to Restricted Stock Units as to which a Vesting Date has not yet occurred, by filing an
Initial Election to defer the receipt of such shares on a form provided by the Committee for this
purpose.

(ii) Deadline for Initial Election. No Initial Election to defer the receipt of shares
issuable with respect to Restricted Stock Units that are not Performance-Based Compensation shall
be effective unless it is filed with the Committee on or before the 30 th day following the date
of grant and 12 or more months in advance of the applicable Vesting Date. No Initial Election to
defer the receipt of shares issuable with respect to Restricted Stock Units that are
Performance-Based Compensation shall be effective unless it is filed with the Committee at least
six months before the end of the Performance Period during which such Performance-Based
Compensation may be earned.

B. Effect of Failure of Vesting Date to Occur. An Election shall be null and void if a Vesting
Date with respect to the Restricted Stock Units does not occur before the distribution date for
shares issuable with respect to such Restricted Stock Units identified in such Election.

C. Deferral Period. Except as otherwise provided in Section 9D, all shares issuable with
respect to Restricted Stock Units that are subject to an Election shall be delivered to the
participant (or the participant’s Successor-in-Interest) without any legend or restrictions (except
those that may be imposed by the Committee, in its sole judgment, under Section 25G), on the
distribution date for such shares designated by the participant on the most recently filed
Election. Subject to acceleration or deferral pursuant to Section 9D, no distribution may be made
earlier than January 2nd of the third calendar year beginning after the Vesting Date, nor later
than January 2nd of the eleventh calendar year beginning after the Vesting Date. The distribution
date may vary with each separate Election.

D. Additional Elections. Notwithstanding anything in this Section 9D to the contrary, no
Subsequent Election shall be effective until 12 months after the date on which such Subsequent
Election is made.

(i) Each active participant who has previously made an Initial Election to defer a
distribution of part or all of his or her Account, or who, pursuant to this Section 9D(i) has made
a Subsequent Election to defer the distribution date for shares issuable with respect to Restricted
Stock Units for an additional period from the originally-elected distribution date, may elect to
defer the distribution date for a minimum of five and a maximum of ten additional years from the
previously-elected distribution date, by filing a Subsequent Election with the Committee on or
before the close of business at least one year before the date on which the distribution would
otherwise be made.

 

10

 

(ii) A deceased participant’s Successor-in-Interest may elect to: (A) file a Subsequent
Election to defer the distribution date for the deceased participant’s shares issuable with respect
to Restricted Stock Units for five additional years from the date a distribution would otherwise be
made; or (B) file an Acceleration Election to accelerate the distribution date for the
deceased participant’s shares issuable with respect to Restricted Stock Units from the date a
distribution would otherwise be made to a date that is as soon as practicable following the
deceased participant’s death. A Subsequent Election must be filed with the Committee at least one
year before the date on which the distribution would otherwise be made, as reflected on the
deceased participant’s last Election. An Acceleration Election pursuant to this Section 9D(ii) must
be filed with the Committee as soon as practicable following the deceased participant’s death, as
determined by the Committee.

(iii) A Disabled participant may elect to accelerate the distribution date of the Disabled
participant’s shares issuable with respect to Restricted Stock Units from the date a distribution
would otherwise be made to a date that is as soon as practicable following the date the Disabled
participant became disabled. An Acceleration Election pursuant to this Section 9D(iii) must be
filed with the Committee as soon as practicable following the date the participant becomes
Disabled, as determined by the Committee.

(iv) A retired participant may elect to defer the distribution date of the retired
participant’s shares issuable with respect to Restricted Stock Units for five additional years from
the date a distribution would otherwise be made. A Subsequent Election must be filed with the
Committee at least one year before the date on which the distribution would otherwise be made, as
reflected on the retired participant’s last Election.

E. Discretion to Provide for Distribution in Full Upon or Following a Change of Control. To
the extent permitted by Section 409A, in connection with a Change of Control, and for the 12-month
period following a Change of Control, the Committee may exercise its discretion to terminate the
deferral provisions of the Plan and, notwithstanding any other provision of the Plan or the terms
of any Initial Election or Subsequent Election, distribute the Account of each participant in full
and thereby effect the revocation of any outstanding Initial Elections or Subsequent Elections.

F. Hardship. Notwithstanding the terms of an Initial Election or Subsequent Election, if, at
the participant’s request, the Committee determines that the participant has incurred a Hardship,
the Committee may, in its discretion, authorize the immediate distribution of all or any portion of
the participant’s Account and thereby effect the revocation of any outstanding Initial Elections or
Subsequent Elections with respect to the portion of the participant’s account so distributed.

G. Separation from Service. Notwithstanding the terms of an Initial Election or Subsequent
Election, if the Committee determines that the participant has incurred a separation from service,
as defined in Treasury Regulations section 1.409A-1(h), the Committee may, in its discretion
authorize the immediate distribution of all or any portion of the participant’s Account and thereby
effect the revocation of any outstanding Initial Elections or Subsequent Elections with respect to
the portion of the participant’s account so distributed.

 

11

 

H. Other Acceleration Events. To the extent permitted by Section 409A, notwithstanding the
terms of an Initial Election or Subsequent Election, distribution of all or part of a participant’s
Account may be made:

(i) To fulfill a domestic relations order (as defined in section 414(p)(1)(B) of the Code) to
the extent permitted by Treasury Regulations section 1.409A-3(j)(4)(ii) or any successor provision
of law).

(ii) To the extent necessary to comply with laws relating to avoidance of conflicts of
interest, as provided in Treasury Regulation section 1.409A-3(j)(4)(iii) (or any successor
provision of law).

(iii) To pay employment taxes to the extent permitted by Treasury Regulation section
1.409A-3(j)(4)(vi) (or any successor provision of law).

(iv) In connection with the recognition of income as the result of a failure to comply with
Section 409A, to the extent permitted by Treasury Regulation section 1.409A-3(j)(4)(vii) (or any
successor provision of law).

(v) To pay state, local or foreign taxes to the extent permitted by Treasury Regulation
section 1.409A-3(j)(4)(xi) (or any successor provision of law).

(vi) In satisfaction of a debt of a participant to the Company where such debt is incurred in
the ordinary course of the service relationship between the participant and the Company, to the
extent permitted by Treasury Regulation section 1.409A-3(j)(4)(xiii) (or any successor provision of
law).

(vii) In connection with a bona fide dispute as to a participant’s right to payment, to the
extent permitted by Treasury Regulation section 1.409A-3(j)(4)(xiv) (or any successor provision of
law).

I. Book Accounts. An Account shall be established for each participant who makes an Election.
Deferred Stock Units shall be credited to the Account as of the date of the Election, provided that
the Election satisfies the requirements of Section 9A(ii) or Section 9D, if applicable. Each
Deferred Stock Unit will represent a hypothetical share of Common Stock credited to the Account in
lieu of delivery of each share to which the Election applies.

J. Crediting of Income, Gains and Losses on Accounts. The value of a participant’s Account as
of any date shall be determined as if it were invested in the Company Stock Fund.

K. Participants’ Status as General Creditors. A participant’s right to delivery of shares
subject to an Election under this Section 9 shall at all times represent the general obligation of
the Company. The participant shall be a general creditor of the Company with respect to this
obligation, and shall not have a secured or preferred position with respect to such obligation.
Nothing contained in the Plan or a Grant shall be deemed to create an escrow, trust, custodial
account or fiduciary relationship of any kind. Nothing contained in the Plan or a Grant shall be
construed to eliminate any priority or preferred position of a participant in a bankruptcy matter
with respect to claims for wages.

L. Non-Assignability, Etc. The right of a participant to receive shares subject to an Election
under this Section 9 shall not be subject in any manner to attachment or other legal
process for the debts of such participant; and no right to receive shares or cash payments
hereunder shall be subject to anticipation, alienation, sale, transfer, assignment or encumbrance.

 

12

 

M. Required Suspension of Payment of Benefits. Notwithstanding any provision of the Plan or
any participant’s election as to the date or time of payment of any benefit payable under the Plan,
to the extent compliance with the requirements of Treas. Reg. § 1.409A-3(i)(2) (or any successor
provision) is necessary to avoid the application of an additional tax under Section 409A to
payments due to the participant upon or following his separation from service, then notwithstanding
any other provision of this Plan, any such payments that are otherwise due within six months
following the participant’s separation from service will be deferred and paid to the participant in
a lump sum immediately following that six month period.

N. Defined Terms.

(i) “Acceleration Election” means a written election on a form provided by the Committee,
pursuant to which a Deceased participant’s Successor-in-Interest or a Disabled participant elects
to accelerate the distribution date of shares issuable with respect to Restricted Stock Units.

(ii) “Account” means unfunded bookkeeping accounts established and maintained by the Committee
in the names of the respective participants to which Deferred Stock Units, dividend equivalents and
earnings on dividend equivalents shall be credited with respect to the portion of the Account
allocated to the Company Stock Fund.

(iii) “Change of Control” shall have the meaning provided in Treasury Regulations section
1.409A-3(i)(5).

(iv) “Company Stock Fund” means a hypothetical investment fund pursuant to which Deferred
Stock Units are credited with respect to a portion of a Grant subject to an Election.

(v) “Deferral Eligible Employee” means a participant who is awarded Restricted Stock Units by
the Committee.

(vi) “Deferred Stock Units” means the hypothetical shares of Common Stock credited to an
Account in lieu of delivery of each share to which an Election applies.

(vii) “Disability” shall have the meaning ascribed in Section 22(e)(3) of the Code .

(viii) “Election” means, as applicable, an Initial Election, a Subsequent Election, or an
Acceleration Election.

(ix) “Hardship” means an “unforeseeable emergency,” as defined in Section 409A. The Committee
shall determine whether the circumstances of the participant constitute an unforeseeable emergency
and thus a Hardship. Following a uniform procedure, the Committee’s determination shall consider
any facts or conditions deemed necessary or advisable by the Committee, and the participant shall
be required to submit any evidence of the participant’s
circumstances that the Committee requires. The determination as to whether the participant’s
circumstances are a case of Hardship shall be based on the facts of each case; provided however,
that all determinations as to Hardship shall be uniformly and consistently made for all
participants in similar circumstances.

 

13

 

(x) “Initial Election” means a written election on a form provided by the Committee, pursuant
to which a participant: (i) elects, within the time or times specified in Section 9A, to defer the
distribution date of shares issuable with respect to Restricted Stock Units; and (ii) designates
the distribution date of such shares.

(xi) “Outside Director” means any individual who serves as a member of the Board of Directors
of the Company and who is neither (i) an employee of the Company, (ii) the beneficial owner of 10%
or more of the outstanding Common Stock of the Company (a “Significant Holder”), or (iii) a
stockholder, member or partner of any entity which itself is a Significant Holder.

(xii) “Subsequent Election” means a written election on a form provided by the Committee,
filed with the Committee in accordance with Section 9D, pursuant to which a participant: (i)
elects, within the time or times specified in Section 9A, to further defer the distribution date of
shares issuable with respect to Restricted Stock Units; and (ii) designates the distribution date
of such shares.

(xiii) “Successor-in-Interest” means the estate or beneficiary to whom the right to payment
under the Plan shall have passed by will or the laws of descent and distribution.

(xiv) “Vesting Date” means the date on which the restrictions imposed on a share issuable with
respect to a Restricted Stock Unit lapse.

10. Long Term Performance Awards.

A. General Requirements. “Long-Term Performance Award” means an award made pursuant to
Section 10 hereof that is payable in cash and/or shares of Common Stock (including Restricted Stock
and Performance Shares) in accordance with the terms of the grant, based on Company, business unit
and/or individual performance over a period of at least two years, in each case as determined by
the Committee and as set forth in the grant letter.

B. Awards and Administration. Long Term Performance Awards may be awarded either alone or in
addition to other awards granted under the Plan. Prior to award of a Long Term Performance Award,
the Committee shall determine the nature, length and starting date of the performance period (the
“performance period”) for each Long Term Performance Award, which shall be at least two years
(subject to Section 12 below). Performance periods may overlap and participants may participate
simultaneously with respect to Long Term Performance Awards that are subject to different
performance periods and/or different performance factors and criteria. Prior to award of a Long
Term Performance Award, the Committee shall determine the performance objectives to be used in
valuing Long Term Performance Awards and determine the extent to which such Long Term Performance
Awards have been earned. Performance objectives may vary from participant to participant and
between groups of participants and shall be based upon such Company, business unit and/or
individual performance factors and criteria as
the Committee may deem appropriate, as approved by the stockholders of the Company. If the
Committee has determined to comply with the rules and regulations under Section 162(m) of the Code,
the Committee shall determine, in its sole discretion, the extent to which the performance
objectives for any Long Term Performance Award should be disclosed to and approved by the
stockholders of the Company and otherwise comply with such rules and regulations.

 

14

 

At the beginning of each performance period, the Committee shall determine for each Long Term
Performance Award subject to such performance period the range of dollar values or number of shares
of Common Stock to be awarded to the participant at the end of the performance period if and to the
extent that the relevant measure(s) of performance for such Long Term Performance Award is (are)
met; provided, however, that no participant shall be awarded a Long Term Performance Award with a
dollar value in excess of One Million Dollars ($1,000,000) (determined as of the time such Long
Term Performance Award is granted) for the performance period to which the Long Term Performance
Award relates. Such dollar values or number of shares of Common Stock may be fixed or may vary in
accordance with such performance and/or other criteria as may be specified by the Committee, in its
sole discretion.

C. Adjustment of Awards. In the event of special or unusual events or circumstances affecting
the application of one or more performance objectives to a Long Term Performance Award, the
Committee may revise the performance objectives and/or underlying factors and criteria applicable
to the Long Term Performance Awards affected, to the extent deemed appropriate by the Committee, in
its sole discretion, to avoid unintended windfalls or hardship.

D. Termination of Service. Unless otherwise provided in the applicable award agreement(s), if
a participant terminates service with the Corporation during a performance period because of death,
disability or retirement (as such terms may be defined in the grant letter with respect to such
Long Term Performance Award), such participant (or his estate) shall be entitled to a payment with
respect to each outstanding Long Term Performance Award at the end of the applicable performance
period:

(i) based, to the extent relevant under the terms of the award, upon the Company, business
unit and/or individual performance for the portion of such performance period ending on the date of
termination and the Company, business unit and/or individual performance for the entire performance
period, and

(ii) pro-rated, where deemed appropriate by the Committee, for the portion of the performance
period during which the participant was employed by the Company, all as determined by the
Committee, in its sole discretion.

However, the Committee may provide for an earlier payment in settlement of such award in such
amount and under such terms and conditions as the Committee deems appropriate, in its sole
discretion.

Except as otherwise determined by the Committee, if a participant terminates service with the
Company during a performance period for any other reason, then such participant shall not be
entitled to any payment with respect to the Long Term Performance
Awards subject to such performance period, unless the Committee shall otherwise determine, in its
sole discretion.

 

15

 

In the event of a Change of Control (as such term is defined in the grant letter with respect
to such Long Term Performance Award), the Committee may, in its sole discretion, cause all
conditions applicable to a Long Term Performance Award to immediately terminate and a stock
certificate or stock certificates representing shares of Common Stock subject to such award, or
cash, as the case may be, to be issued and/or delivered to the participant.

E. Form of Payment. The earned portion of a Long Term Performance Award may be paid currently
or on a deferred basis, together with such interest or earnings equivalent, if any, as may be
determined by the Committee, in its sole discretion. Payment shall be made in the form of cash or
whole shares of Common Stock, including Restricted Stock, either in a lump sum payment or in annual
installments commencing as soon as practicable after the end of the relevant performance period,
all as the Committee shall determine at or after grant. If and to the extent a Long Term
Performance Award is payable in Common Stock and the full amount of such value is not paid in
Common Stock, then the shares of Common Stock representing the portion of the value of the Long
Term Performance Award not paid in Common Stock shall again become available for award under the
Plan, subject to Section 4. Prior to any payment, the Committee shall certify that all of the
performance goals or other material terms of the award have been met.

11. Performance Shares.

A. General Requirements. “Performance Share” means an award made pursuant to Section 11
hereof of the right to receive shares of Common Stock at the end of a specified performance period.

B. Awards and Administration. The Committee shall determine the persons to whom and the time
or times at which Performance Shares shall be awarded, the number of Performance Shares to be
awarded to any such person, the duration of the period (the “performance period”) during which, and
the conditions under which, receipt of the shares of Common Stock will be deferred, and the other
terms and conditions of the award in addition to those set forth below.

The Committee may condition the receipt of shares of Common Stock pursuant to a Performance
Share award upon the attainment of specified performance goals or such other factors or criteria as
the Committee shall determine, in its sole discretion.

The provisions of Performance Share awards need not be the same with respect to each
participant, and such awards to individual participants need not be the same in subsequent years.

 

16

 

C. Terms and Conditions. Performance Shares awarded pursuant to this Section 11 shall be
subject to the following terms and conditions and such other terms and conditions, not inconsistent
with the terms of this Plan, as the Committee shall deem desirable:

(i) Conditions. The Committee, in its sole discretion, shall specify the performance period
during which, and the conditions under which, the receipt of shares of Common Stock covered by the
Performance Share award will be deferred.

(ii) Stock Certificate. At the expiration of the performance period, if the Committee, in its
sole discretion, determines that the conditions specified in the Performance Share agreement have
been satisfied, a stock certificate or stock certificates representing the number of shares of
Common Stock covered by the Performance Share award shall be issued and delivered to the
participant. A participant shall not be deemed to be the holder of Common Stock, or to have the
rights of a holder of Common Stock, with respect to the Performance Shares unless and until a stock
certificate or stock certificates representing such shares of Common Stock are issued to such
Participant.

(iii) Death, Disability or Retirement. Subject to the provisions of the Plan, if a
participant terminates service with the Corporation during a performance period because of death,
disability or retirement (as such terms may be defined in the grant letter with respect to such
Performance Share award), such participant (or his estate) shall be entitled to a payment with
respect to each outstanding Performance Share award at the end of the applicable performance
period:

(a) based, to the extent relevant under the terms of the award, upon the the attainment of
specified performance goals or such other factors or criteria as the Committee set forth in the
Performance Share award for the portion of such performance period ending on the date of
termination and the attainment of such goals or other factors or criteria for the entire
performance period, and

(b) pro-rated, where deemed appropriate by the Committee, for the portion of the performance
period during which the participant was employed by the Company, all as determined by the
Committee, in its sole discretion.

However, the Committee may provide for an earlier payment in settlement of such award in such
amount and under such terms and conditions as the Committee deems appropriate, in its sole
discretion.

(iv) Termination of Service. Unless otherwise determined by the Committee at the time of
grant, the Performance Shares will be forfeited upon a termination of service during the
performance period for any reason other than death, disability or retirement.

(v) Change of Control. In the event of a Change of Control (as such term is defined in the
grant letter with respect to such Performance Share award), the Committee may, in its sole
discretion, cause all conditions applicable to the Performance Shares to immediately terminate and
a stock certificate or stock certificates representing shares of Common Stock subject to the
Performance Share award to be issued and delivered to the participant.

 

17

 

12. Qualified Performance-Based Compensation.

A. Designation as Qualified Performance-Based Compensation. The Committee may determine that
Stock Appreciation Rights, Restricted Stock, Long Term Performance
Awards or Performance Shares granted to an employee shall be considered “qualified
performance-based compensation” under Code section 162(m). The provisions of this Section 12 shall
apply to any such grants that are to be considered “qualified performance-based compensation” under
Code section 162(m). To the extent that grants of Stock Appreciation Rights, Restricted Stock,
Long Term Performance Awards or Performance Shares are designated as “qualified performance-based
compensation” under Code section 162(m) are made, no such grant may be made as an alternative to
another grant that is not designated as “qualified performance based compensation” but instead must
be separate and apart from all other grants made.

B. Performance Goals. When Stock Appreciation Rights, Restricted Stock, Long Term Performance
Awards or Performance Shares that are to be considered “qualified performance-based compensation”
are granted, the Committee shall establish in writing (i) the objective performance goals that must
be met, (ii) the period during which performance will be measured, (iii) the maximum amounts that
may be paid if the performance goals are met, and (iv) any other conditions that the Committee
deems appropriate and consistent with the Plan and the requirements of Code section 162(m) for
“qualified performance-based compensation.” The performance goals shall satisfy the requirements
for “qualified performance-based compensation,” including the requirement that the achievement of
the goals be substantially uncertain at the time they are established and that the performance
goals be established in such a way that a third party with knowledge of the relevant facts could
determine whether and to what extent the performance goals have been met. The Committee shall not
have discretion to increase the amount of compensation that is payable upon achievement of the
designated performance goals, but the Committee may reduce the amount of compensation that is
payable upon achievement of the designated performance goals.

C. Criteria Used for Objective Performance Goals. In setting the performance goals for grants
designated as “qualified performance-based compensation” pursuant to this Section 12, the Committee
shall use objectively determinable performance goals based on one or more of the following
criteria: pre- or after-tax net earnings, sales or revenue, operating earnings, operating cash
flow, return on net assets, return on stockholders’ equity, return on assets, return on capital,
stock price growth, gross or net profit margin, earnings per share, price per share, market share
or strategic business criteria consisting of one or more Company objectives based on meeting
specified revenue goals, market penetration goals, geographic business expansion goals, cost
targets, product development goals, goals relating to acquisitions or divestitures or any other
objective measure derived from any of the foregoing criteria. The performance goals may relate to
the participant’s business unit or the performance of the Company as a whole, or any combination of
the foregoing. Performance goals need not be uniform as among participants.

D. Timing of Establishment of Goals. The Committee shall establish the performance goals in
writing either before the beginning of the performance period or during a period ending no later
than the earlier of (i) 90 days after the beginning of the performance period or (ii) the date on
which 25% of the performance period has been completed, or such other date as may be required or
permitted under applicable regulations under Code section 162(m).

 

18

 

E. Announcement of Results. The Committee shall certify and announce the results for the
performance period to all participants after the Company announces the Company’s financial results
for the performance period. If and to the extent that the Committee does not certify that the
performance goals have been met, the applicable grants for the performance period shall be
forfeited or shall not be paid, as applicable.

F. Death, Disability or Other Circumstances. The Committee may provide that grants shall be
payable or restrictions shall lapse, in whole or in part, in the event of the Participant’s death
or disability during the performance period, a Change of Control or under other circumstances
consistent with the Treasury regulations and rulings under Code section 162(m).

13. Adjustment in Event of Recapitalization of the Company

A. Changes in Capitalization. Subject to any required action by the stockholders of the
Company, the number of shares of Common Stock covered by each outstanding Grant and the number of
shares of Common Stock that have been authorized for issuance under the Plan but as to which no
Grants have yet been granted or which have been returned to the Plan upon cancellation or
expiration of a Stock Option, forfeiture of Restricted Stock or issuance of fewer shares of Common
Stock upon payment of a Long Term Performance Award or Performance Share award than were the
original subject of such awards, including the maximum number of shares of Common Stock for which
Grants may be granted to any employee in any calendar year, as well as the price per share of
Common Stock covered by any outstanding Stock Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting from a stock split,
reverse stock split, stock dividend, combination or reclassification of the Common Stock, any other
increase or decrease in the number of issued shares of Common Stock effected without receipt of
consideration by the Company, or other similar event that affects the Common Stock such that an
adjustment is required to preserve or prevent enlargement of the benefits or potential benefits
made available under the Plan. Such adjustment shall be made by the Committee, whose determination
in that respect shall be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities convertible into shares of
stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect
to, the number or price of shares of Common Stock subject to a Grant.

B. Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the
Company, all outstanding Awards will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Committee. The Committee may, in the exercise of
its discretion in such instances, declare that any Award shall terminate as of a date fixed by the
Committee and (i) give each holder of a Stock Option the right to exercise the holder’s Stock
Option as to all or any part of the shares of Common Stock covered by the Stock Option, including
shares as to which the Stock Option would not otherwise be exercisable, (ii) subject to the
provisions of Code section 162(m), determine that the restrictions with respect to any Restricted
Stock shall lapse, in whole or in part, or (iii) subject to the provisions of Code section 162(m),
determine to pay all or any portion of a Long Term Performance Award or Performance Share award
notwithstanding that the performance criteria set forth therein have not been satisfied in full or
that the performance period has not expired.

 

19

 

C. Sale or Merger. In the event of a proposed sale of all or substantially all of the assets
of the Company, or the merger of the Company with or into another corporation, the Committee, in
the exercise of its sole discretion, may take such action as it deems desirable, including, but not
limited to: (i) causing an Award to be assumed or an equivalent Award to be substituted by the
successor corporation or a parent or subsidiary of such successor corporation, (ii) providing that
each option holder shall have the right to exercise the option holder’s Stock Option as to all of
the shares of Common Stock covered by the Stock Option, including shares as to which the Stock
Option would not otherwise be exercisable, (iii) declaring that a Stock Option shall terminate at a
date fixed by the Committee provided that the option holder is given notice and opportunity to
exercise the then exercisable portion of the option holder’s Stock Option prior to such date, (iv)
subject to the provisions of Code section 162(m), determine that the restrictions with respect to
any Restricted Stock shall lapse, in whole or in part, or (v) subject to the provisions of Code
section 162(m), determine to pay all or any portion of a Long Term Performance Award or Performance
Share award notwithstanding that the performance criteria set forth therein have not been satisfied
in full or that the performance period has not expired.

14. Amendment of Plan

The Committee, within its discretion, shall have authority to amend the Plan and the terms of
any Grant issued hereunder at any time, subject to any required stockholder approval or any
stockholder approval that the Committee may deem advisable for any reason, such as for the purpose
of obtaining or retaining the statutory or regulatory benefits under tax, securities or other laws
as satisfying any applicable stock exchange or Nasdaq listing requirement. The Committee may not,
without the consent of the recipient of any Grant previously made hereunder alter or impair any
right or obligation under such Grant, except as specifically authorized herein.

15. Rights of a Stockholder

The recipient of any Grant under the Plan, unless otherwise provided by the Plan or the award
letter evidencing such Grant, shall have no rights as a stockholder unless and until certificates
for shares of Common Stock are issued and delivered to him without the restrictive legend
contemplated by Section 8 hereof.

16. No Guaranty of Employment or Participation

Nothing contained in the Plan or in any award letter with respect to a Grant shall confer upon
any participant the right to continue in the employment of the Company or any subsidiary of the
Company or affect any right that the Company or any subsidiary of the Company may have to terminate
the employment of such participant. No person shall have a right to be selected to participate in
the Plan or, having been so selected, to receive any future Grants.

17. Withholding

A. Taxes. Subject to the rules of Section 17B, the Company shall be entitled, if necessary or
desirable, to withhold the amount of any tax, charge or assessment attributable to any Vesting
Date, issuance of or lapse of restrictions with respect to other shares pursuant to Grants under
the Plan, making of any other payments pursuant to Grants under the Plan or distribution of all or
any part of a participant’s Account. The Company shall not be required to
deliver shares or other amounts payable with respect to any Grants or distribute a
participant’s Account until it has been indemnified to its satisfaction for any such tax, charge or
assessment.

 

20

 

B. Payment of Tax Liabilities; Election to Withhold Shares or Pay Cash to Satisfy Tax
Liability.

(i) In connection with the occurrence of a Vesting Date, issuance of other shares or making of
other payments pursuant to Grants under the Plan, the lapse of any restrictions with respect to
Restricted Stock issued under the Plan or the distribution of a participant’s Account, the Company
shall have the right to (A) require the participant to remit to the Company an amount sufficient to
satisfy any federal, state and/or local withholding tax requirements prior to the delivery or
transfer of any certificate or certificates for shares or the making of any such payment or
distribution, or (B) take any action whatever that it deems necessary to protect its interests with
respect to tax liabilities. The Company’s obligation to make any delivery or transfer of shares or
other payment or distribution with respect to Grants under the Plan shall be conditioned on the
participant’s compliance, to the Company’s satisfaction, with any withholding requirement.

(ii) Except as otherwise provided in this Section 17B(ii), any tax liabilities incurred in
connection with the occurrence of a Vesting Date, issuance of other shares or making of any payment
pursuant to Grants under the Plan, the lapse of any restrictions with respect to Restricted Stock
or the distribution of a participant’s Account shall, to the extent such liabilities cannot be
satisfied in full by withholding cash payable in connection with such event, be satisfied by the
Company’s withholding a portion of any shares to be so distributed or issued having a Fair Market
Value approximately equal to the minimum amount of taxes required to be withheld by the Company
under applicable law, unless otherwise determined by the Committee with respect to any participant.
Notwithstanding the foregoing, the Committee may permit a participant to elect one or both of the
following: (A) to have taxes withheld in excess of the minimum amount required to be withheld by
the Company under applicable law; provided that the participant certifies in writing to the Company
at the time of such election that the participant owns Other Available Shares (as defined below)
having a Fair Market Value that is at least equal to the amount to be withheld by the Company in
payment of withholding taxes in excess of such minimum amount; and (B) to pay to the Company in
cash all or a portion of the taxes to be withheld in connection with such Vesting Date, issuance of
other shares or making of any payment pursuant to Grants under the Plan, lapse of restrictions on
Restricted Stock or Account distribution. In all cases, any shares so withheld by the Company shall
have a Fair Market Value that does not exceed the amount of taxes to be withheld minus the cash
payment, if any, made by the participant or withheld from an Account distribution or other payment.
Any election pursuant to this Section 17B(ii) must be in a writing made prior to the date specified
by the Committee, and in any event prior to the date the amount of tax to be withheld or paid is
determined. An election pursuant to this Section 17B(ii) may be made only by a participant or, in
the event of the participant’s death, by the participant’s legal representative. Shares withheld
pursuant to this Section 17B(ii) shall be available for subsequent grants under the Plan. The
Committee may add such other requirements and limitations regarding elections pursuant to this
Section 17B(ii) as it deems appropriate.

 

21

 

(iii) “Other Available Shares” shall mean, as of any date, the sum of:

(a) the total number of shares owned by a participant or such participant’s Family Member (as
defined below) that were not acquired by such participant or such participant’s Family Member
pursuant to the Plan or otherwise in connection with the performance of services to the Company;
plus

(b) the excess, if any of:

(A) the total number of shares owned by a participant or such participant’s Family Member
other than the shares described in Section 17B(iii)(a); over

(B) the sum of:

(I) the number of such shares owned by such participant or such participant’s Family Member
for less than six months; plus

(II) the number of such shares owned by such participant or such participant’s Family Member
that has, within the preceding six months, been the subject of a withholding certification pursuant
to Section 17; plus

(III) the number of such shares owned by such participant or such participant’s Family Member
that has, within the preceding six months, been received in exchange for shares surrendered as
payment, in full or in part, but only to the extent of the number of shares surrendered; plus

(IV) the number of such shares owned by such participant or such participant’s Family Member
as to which evidence of ownership has, within the preceding six months, been provided to the
Committee in connection with the crediting of “Deferred Stock Units” (as defined in Section 9N) to
such participant’s Account.

For purposes of this Section 17B(iii), a share that is subject to a deferral election shall not be
treated as owned by a participant until all conditions to the delivery of such share have lapsed.

(iv) “Family Member” shall mean any child, grandchild, parent, grandparent, including in each
case adoptive relationships, stepchild, spouse, a trust in which these persons and the participant
collectively have more than fifty percent of the beneficial interest and any other entity in which
these persons and the participant collectively own more than fifty percent of the voting interests.

18. Non-Uniform Determinations

The Committee’s determinations under the Plan (including without limitation determinations of
the persons to receive Grants, the form, amount and timing of such Grants and the terms and
provisions of Grants and the award letters evidencing same) need not be uniform and may be made
selectively among persons who receive, or are eligible to receive, Grants under the Plan whether or
not such persons are similarly situated.

 

22

 

19. Reservation of Shares

The Company, during the term of the Plan, will at all times reserve and keep available such
number of shares as shall be sufficient to satisfy the requirements of the Plan. 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 for the failure to issue or sell such shares as to which
such requisite authority shall not have been obtained.

20. Effect on Other Plans

Participation in the Plan shall not affect an employee’s eligibility to participate in any
other benefit or incentive plan of the Company or any subsidiary of the Company. Any Grants made
pursuant to the Plan shall not be used in determining the benefits provided under any other plan of
the Company or any subsidiary of the Company unless specifically provided.

21. Forfeiture

Notwithstanding anything to the contrary in the Plan, if the Committee finds, by a majority
vote, after full consideration of the facts presented on behalf of both the Company and any option
holder, that a participant has been engaged in fraud, embezzlement, theft or commission of a felony
or retention by the Company or any subsidiary of the Company or that a participant has willfully
disclosed confidential information of the Company or any subsidiary of the Company and that such
disclosure damaged the Company or any subsidiary of the Company, the participant shall forfeit all
unexercised Stock Options, all exercised Stock Options under which the Company has not yet
delivered the certificates, and all Restricted Stock, Stock Appreciation Rights, Long Term
Performance Awards and Performance Shares. The decision of the Committee in interpreting and
applying the provisions of this Section 21 shall be final. No decision of the Committee, however,
shall affect the finality of the discharge or termination of such participant by the Company or any
subsidiary of the Company in any manner.

22. No Prohibition on Corporate Action

No provision of the Plan shall be construed to prevent the Company or any officer or director
thereof from taking any action deemed by the Company or such officer or director to be appropriate
or in the Company’s best interest, whether or not such action could have an adverse effect on the
Plan or any Grants made hereunder, and no participant or participant’s estate, personal
representative or beneficiary shall have any claim against the Company or any officer or director
thereof as a result of the taking of such action.

 

23

 

23. Indemnification

With respect to the administration of the Plan, the Company shall indemnify each present and
future member of the Committee and the Board against, and each member of the Committee and the
Board shall be entitled without further action on his or her part to indemnity from the Company
for, all expenses (including the amount of judgments and the amount of approved settlements made
with a view to the curtailment of costs of litigation, other than amounts paid to the Company
itself) reasonably incurred by him in connection with or arising out of, any action,
suit or proceeding in which he may be involved by reason of his or her being or having been a
member of the Committee or the Board, whether or not he continues to be such member at the time of
incurring such expenses; provided, however, that such indemnity shall not include any expenses
incurred by any such member of the Committee or the Board (i) in respect of matters as to which he
shall be finally adjudged in any such action, suit or proceeding to have been guilty of gross
negligence or willful misconduct in the performance of his or her duty as such member of the
Committee or the Board; or (ii) in respect of any matter in which any settlement is effected for an
amount in excess of the amount approved by the Company on the advice of its legal counsel; and
provided further that no right of indemnification under the provisions set forth herein shall be
available to or enforceable by any such member of the Committee or the Board unless, within 60 days
after institution of any such action, suit or proceeding, he shall have offered the Company in
writing the opportunity to handle and defend same at its own expense. The foregoing right of
indemnification shall inure to the benefit of the heirs, executors or administrators of each such
member of the Committee or the Board and shall be in addition to all other rights to which such
member may be entitled as a matter of law, contract or otherwise.

24. Miscellaneous Provisions

A. Compliance with Plan Provisions. No participant or other person shall have any right with
respect to the Plan, the Common Stock reserved for issuance under the Plan or in any Stock Option
or Restricted Stock until a written award letter shall have been executed by the Company and all
the terms, conditions and provisions of the Plan and the Grant applicable to such participant (and
each person claiming under or through him) have been met.

B. Approval by Company. In the discretion of the Committee, no shares of Common Stock, other
securities or property of the Company or other forms of payment shall be issued hereunder with
respect to any Stock Option or Restricted Stock award unless the Company’s General Counsel or Chief
Financial Officer shall be satisfied that such issuance will be in compliance with applicable
federal, state, local and foreign legal, securities exchange and other applicable requirements.

C. Compliance with Rule 16b-3. To the extent that Rule 16b-3 under the Exchange Act applies
to Grants made under the Plan, it is the intention of the Company that the Plan comply in all
respects with the requirements of Rule 16b-3, that any ambiguities or inconsistencies in
construction of the Plan be interpreted to give effect to such intention and that, if the Plan
shall not so comply, whether on the date of adoption or by reason of any later amendment to or
interpretation of Rule 16b-3, the provisions of the Plan shall be deemed to be automatically
amended so as to bring them into full compliance with such rule.

D. Unfunded Plan. The Plan shall be unfunded. The Company shall not be required to establish
any special or separate fund or to make any other segregations of assets under the Plan.

 

24

 

E. Effects of Acceptance of Grant. By accepting any Stock Option, Restricted Stock or other
benefit under the Plan, each participant and each person claiming under or through him shall be
conclusively deemed to have indicated his or her acceptance and ratification of, and
consent to, any action taken under the Plan by the Company, the Board and/or the Committee or its
delegates.

F. Construction. The masculine pronoun shall include the feminine and neuter, and the
singular shall include the plural, where the context so indicates.

G. Compliance with Legal and Exchange Requirements. The Plan, the granting and exercising of
Stock Options hereunder, the issuance of Restricted Stock hereunder and the other obligations of
the Company hereunder, including Stock Appreciation Rights, Long Term Performance Awards and
Performance Shares, shall be subject to all applicable federal and state laws, rules and
regulations, and to such approval by all regulatory or governmental agencies as may be required.
The Company, in its discretion, may postpone the granting and exercising of Stock Options, the
issuance or delivery of Common Stock under any Stock Option or any award of Restricted Stock, or
any other action sanctioned under the Plan to permit the Company, with reasonable diligence, to
complete such stock exchange listing or registration or qualification of such Common Stock or other
required action under any federal or state law, rule or regulation and may require any option
holder to make such representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of Common Stock in compliance with applicable laws, rules,
and regulations. The Company shall not be obligated by virtue of any provision of the Plan to
recognize the exercise of any Stock Option or to otherwise sell or issue Common Stock in violation
of any such laws, rules, or regulations; and any postponement of the exercise or settlement of any
Stock Option, issuance of Restricted Stock, Stock Appreciation Rights, Long Term Performance Awards
and Performance Shares under this provision shall not extend the term of such Stock Option or
modify the forfeiture provisions of such Restricted Stock, Stock Appreciation Rights, Long Term
Performance Awards or Performance Shares. The Company, the Committee and the other directors or
officers of the Company shall not have any obligation or liability to an option holder with respect
to any Stock Option (or Common Stock issuable thereunder), Restricted Stock, Stock Appreciation
Rights, Long Term Performance Awards or Performance Shares that shall lapse or be forfeited because
of such postponement. Likewise, the Committee may postpone the exercise of Stock Options, the
issuance or delivery of Common Stock under any Stock Option, Restricted Stock, Stock Appreciation
Rights, Long Term Performance Awards and Performance Shares and any action sanctioned under the
Plan to prevent the Company or any affiliate from being denied a federal income deduction with
respect to any Stock Option other than an Incentive Stock Option, the issuance of any Restricted
Stock, Stock Appreciation Rights, Long Term Performance Awards and Performance Shares.

H. Governing Law. The Plan and all award letters hereunder shall be construed in accordance
with and governed by the laws of the State of Delaware.

I. No Impact on Benefits. Except as may otherwise be specifically stated under any employee
benefit plan, policy or program, no amount payable in connection with any Grant shall be treated as
compensation for purposes of calculating an option holder’s rights and benefits under such plan,
policy or program.

 

25

 

J. No Constraint on Corporation Action. Nothing in this Plan shall be construed to limit,
impair or otherwise affect the Company’s right or power to make adjustments,
reclassifications, reorganizations or changes of its capital or business structure, or to merge or
consolidate, or dissolve, liquidate, sell or transfer all or any part of its business or assets or,
except as provided in Section 13, to limit the power or right of the Company or any affiliate to
take any action which such entity deems to be necessary or appropriate.

K. Beneficiary Designation. Each participant under the Plan may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit
under the Plan is to be paid or by whom any right under the Plan is to be exercised in the event of
the participant’s death. Each designation will revoke all prior designations by the same
participant, must be in a form prescribed by the Committee, and will be effective only when filed
by the participant in writing with the Committee during the option holder’s lifetime. In the
absence of any such designation, benefits remaining unpaid at a participant’s death shall be paid
to or exercised by the participant’s surviving spouse, if any, or otherwise to or by his or her
estate.

L. Code Section 409A Compliance. It is intended that this amended and restated Plan be
drafted and administered in compliance with Code section 409A including, but not limited to, any
future amendments to Code section 409A, and any other Internal Revenue Service or other
governmental rulings or interpretations (“IRS Guidance”) issued pursuant to Section 409A so as not
to subject the Participant to payment of interest or any additional tax under Code section 409A.
In furtherance thereof, if payment or provision of any amount or benefit hereunder that is subject
to Code section 409A at the time specified herein would subject such amount or benefit to any
additional tax under Code section 409A, the payment or provision of such amount or benefit shall be
postponed to the earliest commencement date on which the payment or provision of such amount or
benefit could be made without incurring such additional tax. In addition, to the extent that any
IRS Guidance issued under Code section 409A would result in the Participant being subject to the
payment of interest or any additional tax under Code section 409A, the parties agree, to the extent
reasonably possible, to amend this Plan in order to avoid the imposition of any such interest or
additional tax under Code section 409A, which amendment shall have the minimum economic effect
necessary and be reasonably determined in good faith by the Company and the Participant.

As amended through October 27, 2009.

 

26

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00164-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00164-of-00352.parquet"}]]