UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.    )

Filed by Registrantx

Filed by a Party other than the Registrant¨

Check the appropriate box:

¨ Preliminary Proxy Statement

¨Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

x Definitive Proxy Statement

¨ Definitive Additional Materials

¨ Soliciting Material Pursuant to §240.14a-12under Rule 14a-12

JARDEN CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of filing fee (Check the appropriate box):

x No fee required.

¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1) Title of each class of securities to which transaction applies:

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3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule

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¨ Fee paid previously with preliminary materials:

¨ Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the     offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the     date of its filing.

1) Amount Previously Paid:

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4) Date Filed:

Notice of Annual Meeting of Stockholders

To Be Held May 28, 200920, 2010

To Our Stockholders:

You are cordially invited to attend the Annual Meeting of Stockholders (the “Meeting”) of Jarden Corporation (the “Company”), which will be held on Thursday, May 28, 200920, 2010 at 10:00 a.m., local time, at 555 Theodore Fremd Avenue, Rye, New York 10580, for the following purposes:

Stockholders of record at the close of business on April 1, 2009March 30, 2010 shall be entitled to notice of and to vote at the Meeting and any adjournments or postponements thereof. A copy of the Annual Report of the Company for the year ended December 31, 2008 is being mailed to stockholders along with the attached Proxy Statement.

Stockholders are cordially invited to attend the Meeting.Your vote is important. Please submit a proxy as soon as possible so that your shares can be voted at the Meeting. Submitting the enclosed form of proxy will appoint Martin E. Franklin and Ian G.H. Ashken as your proxies. You may submit your proxy by mail.mail, Internet or telephone. You may revoke your proxy and vote in person if you decide to attend the Meeting. For instructions, please refer to page 2 of the Proxy Statement or the proxy card.

Important Notice Regarding the Availability of Proxy Materials for the Stockholder Meeting to Be Held on May 28, 2009:20, 2010:This proxy statement and form of proxy card,Proxy Statement, along with our 2009 Annual Report on Form 10-K for the fiscal year ended December 31, 2008,to Stockholders, are available at http://annualmeeting.jarden.com.www.envisionreports.com/jah.

April 9, 20092010

JARDEN CORPORATION

555 Theodore Fremd Avenue

Rye, NYNew York 10580

PROXY STATEMENT

ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON

May 28, 200920, 2010

INTRODUCTION

PROXY SOLICITATION AND GENERAL INFORMATION

This Proxy Statement and the accompanying Notice of Annual Meeting of Stockholders and the enclosed form of proxy (the “Proxy Card”) are being furnished to the holders (the “Stockholders”) of common stock, par value $0.01 per share (the “Common Stock”) of Jarden Corporation, a Delaware corporation (the “Company,” “we,” or “us”), in connection with the solicitation of proxies by the Board of Directors (the “Board” or “Board of Directors”) of the Company for use at the 20092010 Annual Meeting of Stockholders of the Company to be held on Thursday, May 28, 200920, 2010 at 555 Theodore Fremd Avenue, Rye, New York 10580 at 10:00 a.m., local time, and at any adjournment or postponement thereof (the “Meeting”). These proxy materials are first being sentdistributed and made available to Stockholders on or about April 13, 2009.9, 2010.

At the Meeting, Stockholders will be asked:

The Board of Directors has fixed the close of business on April 1, 2009March 30, 2010 as the record date for the determination of Stockholders entitled to notice of and to vote at the Meeting. As of the record date, each Stockholder will be entitled to one vote for each share of Common Stock held on all matters to come before the Meeting and may vote in person, Internet or telephone or by proxy authorized in writing.

Internet Availability of Proxy Materials

Pursuant to the “notice and access” rules adopted by the Securities and Exchange Commission (the “SEC”), the Company has elected to provide Stockholders access to its proxy materials over the Internet. Accordingly, the Company sent a Notice of Internet Availability of Proxy Materials (the “Notice”) to certain Stockholders. The Notice includes instructions on how to access the proxy materials over the Internet and how to request a printed copy of these materials. In addition, by following the instructions in the Notice, Stockholders may request to receive proxy materials in printed form by mail or electronically by e-mail on an ongoing basis.

Proxies and Voting

Common Stock represented by properly executed proxies received by the Company and not revoked will be voted at the Meeting in accordance with instructions contained therein. When voting to elect directors (Proposal 1), you may vote for all nominees, vote for only some of the nominees, or withhold authority to vote for all or some of the nominees. When voting on the proposalsproposal to (i) adopt and approve the Jarden Corporation 20092010 Employee Stock IncentivePurchase Plan (Proposal 2), or (ii) ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending December 31, 20092010 (Proposal 3), you may voteFOR the proposal,AGAINST the proposal, orABSTAIN from voting. If the Proxy Card is signed and returned without instructions, the shares will be votedFOR the election of each nominee for director named herein

(Proposal (Proposal 1);FORthe adoption and approval of the Jarden Corporation 20092010 Employee Stock IncentivePurchase Plan (Proposal 2); andFORthe ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending December 31, 20092010 (Proposal 3).

Voting

Stockholders are requested to complete, sign, date and promptly return the Proxy Card in the enclosed envelope.envelope (if you received these materials by mail) or to vote by Internet or telephone by following the instructions on the Proxy Card or the Notice.

Most beneficial owners whose stock is held in street name do not receive the Proxy Card. Instead, they receive voting instruction forms from their bank, broker or other agent. Beneficial owners may also be able to vote by telephone or the Internet.Internet to the extent permitted by their bank, broker or other agent. Beneficial owners should follow the instructions on the voter instruction form or proxy ballot they receive from their bank, broker or other agent.

The method of voting used will not limit a Stockholder’s right to attend the Meeting.

Revocation of Proxy

A Stockholder who so desires may revoke its proxy at any time before it is voted at the Meeting by: (i) delivering written notice to the Company (attention: Secretary); (ii) timely delivery of a valid, later-dated proxy;proxy by Internet, telephone or mail; or (iii) casting a ballot at the Meeting. Attendance at the Meeting will not in and of itself constitute a revocation of a proxy. Beneficial owners who hold their stock in street name cannot revoke their proxies in person at the Meeting because the Stockholders of record who have the right to cast the votes will not be present. If they wish to change their votes after returning voting instructions, beneficial owners should contact their bank, broker or other agent before the Meeting to determine whether they can do so.

Voting on Other Matters

If other matters are properly presented at the Meeting for consideration, the persons named in the proxy will have the discretion to vote on those matters for you. At the date of this Proxy Statement, we did not know of any other matters to be raised at the Meeting.

Record Date; Shares Outstanding and Entitled to Vote

Only Stockholders as of the close of business on April 1, 2009March 30, 2010 (the “Record Date”) are entitled to notice of and to vote at the Meeting and any adjournments or postponements thereof. As of the Record Date, there were 75,848,604were89,609,639 shares of Common Stock outstanding and entitled to vote, with each share entitled to one vote.

Quorum; Required Votes

The presence at the Meeting, in person or by duly authorized proxy, of the holders of a majority of the shares of Common Stock issued, outstanding and entitled to vote at the Meeting, shall constitute a quorum for this Meeting.

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Abstentions and “broker non-votes” are counted as present and entitled to vote for purposes of determining whether a quorum exists. A “broker non-vote” occurs when a nominee holding shares for a beneficial owner does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received voting instructions from the beneficial owner.

Under the New York Stock Exchange (“NYSE”) rule,rules, nominees have such discretion to vote absent instructions with respect to certain “routine” matters, such as the ratification of independent auditors, but not with respect to matters that are considered “non routine”.

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An uncontestedroutine,” such as, the election of directors and the ratification of accountants are currently considered to be “routine” matters.directors. Accordingly, if you are a beneficial stockholder and your broker holds your shares in its name, the broker is permitted to vote your shares on Proposals 1 andProposal 3 even if the broker does not receive voting instructions from you. However, without voting instructions from you, your broker will not be able to vote your shares on Proposals 1 and 2.

The affirmative vote of a plurality of the votes present in person or represented by proxy and entitled to vote is necessary for the election of directors (Proposal 1). The affirmative vote of a majority of the votes in person or represented by proxy entitled to vote is necessary for (i) the adoption and approval of the Jarden Corporation 20092010 Employee Stock IncentivePurchase Plan (Proposal 2);, and (ii) the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending December 31, 20092010 (Proposal 3).

Since the affirmative vote of a plurality of votes present in person or represented by proxy and entitled to vote is required for the election of directors (Proposal 1), abstentions and “broker non-votes” will have no effect on the outcome of such election. Since the affirmative vote of a majority of the votes present in person or represented by proxy and entitled to vote is necessary for (i) the adoption and approval of the Jarden Corporation 20092010 Employee Stock IncentivePurchase Plan (Proposal 2), and (ii) the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the year ending December 31, 20092010 (Proposal 3), abstentions will have the same effect as a negative vote, but “broker non-votes” will have no effect on the vote. However, for purposes of the NYSE requirements that at least a majority of the outstanding shares of our Common Stock cast votes on the proposal to adopt and approve the Jarden Corporation 2009 Stock Incentive Plan (Proposal 2), abstentions will count as a vote cast, but “broker non-votes” will not.

Votes at the Meeting will be tabulated by an inspector of elections appointed by the Company or the Company’s transfer agent.

Proxy Solicitation

This solicitation is being made by the Company. All expenses incurred by the Company in connection with this solicitation will be borne by the Company. Directors, officers and employees of the Company also may solicit proxies from Stockholders by mail, telephone, telegram, electronic transmission, personal interview or otherwise. Such directors, officers and employees will not receive additional compensation, but may be reimbursed for out-of-pocket expenses in connection with such solicitation. We have retained theThe Company may engage a proxy solicitation firm of MacKenzie Partners, Inc. to assist us in the distribution and solicitation of proxies, and we intend to pay a fee of approximately $12,500, plus reasonable expenses, for these services.proxies. In accordance with the regulations of the Securities and Exchange Commission (the “SEC”)SEC and the NYSE, we also will reimburse brokerage firms and other custodians, nominees and fiduciaries for their reasonable expenses incurred in sending proxies and proxy materials to beneficial owners of Common Stock as of the Record Date.

List of Stockholders

In accordance with Delaware General Corporation Law (the “DGCL”), a list of Stockholders entitled to vote at the Meeting will be available at the Meeting and for ten days prior to the Meeting, for any purpose germane to the Meeting, between the hours of 10:00 a.m. and 5:00 p.m., local time, at our offices at 555 Theodore Fremd Avenue, Rye, NYNew York 10580.

Voting Confidentiality

Proxies, ballots and voting tabulations are handled on a confidential basis to protect your voting privacy. This information will not be disclosed except as required by law.

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No Appraisal Rights

Stockholders will have no rights of appraisal under the DGCL in connection with the proposals to be considered at the Meeting.

IT IS DESIRABLE THAT AS LARGE A PROPORTION AS POSSIBLE OF THE STOCKHOLDERS’ INTERESTS BE REPRESENTED AT THE MEETING. THEREFORE, EVEN IF YOU INTEND TO BE PRESENT AT THE MEETING, PLEASE SIGN AND RETURN THE ENCLOSED PROXY CARD OR VOTE BY INTERNET OR TELEPHONE TO ENSURE THAT YOUR STOCK WILL BE REPRESENTED. IF YOU ARE PRESENT AT THE MEETING AND DESIRE TO DO SO, YOU MAY WITHDRAW YOUR PROXY AND VOTE IN PERSON BY GIVING WRITTEN NOTICE TO THE SECRETARY OF THE COMPANY. PLEASE RETURN YOUR EXECUTED PROXY CARD PROMPTLY.

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SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding beneficial ownership of our Common Stock as of April 1, 2009,March 30, 2010, by (i) each person or entity known to us owning beneficially 5% or more of our Common Stock (the holdings of certain unrelated entities listed below are generally based on shareholdings disclosed in their public filings), (ii) each of our current directors and nominees for the Board of Directors, (iii) each of our named executive officers set forth below in the Summary Compensation Table, and (iv) all current directors and executive officers as a group. Unless otherwise noted, shares are owned directly or indirectly with sole voting and investment power. Unless otherwise indicated, the address of each person named in the table below is c/o Jarden Corporation, 555 Theodore Fremd Avenue, Rye, NYNew York 10580.

* Less than 1%

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INFORMATION REGARDING

BOARD OF DIRECTORS AND COMMITTEES

Statement on Corporate Governance

The Company maintains formal corporate governance standards. The Company has reviewed internally and with the Board of Directors the provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), the rules of the SEC and the NYSE’s corporate governance listing standards regarding corporate governance policies and processes and is in compliance with such rules and listing standards. The Company has adopted charters for its Audit Committee, Compensation Committee and Nominating and Policies Committee and implemented a Governance Principles and Code of Conduct Policy, Business Conduct and Ethics Policy and Insider Trading Policy. You can access all of these documents on the “Governance” page of the Company’s website,www.jarden.com, or by writing to us at Jarden Corporation, 555 Theodore Fremd Avenue, Rye, NYNew York 10580, Attention: Corporate Governance.

In accordance with the NYSE corporate governance listing standards, our Governance Principles and Code of Conduct Policy requires the Board of Directors to designate a non-executive lead director (the “Lead Independent Director”) to preside over non-executive sessions and perform any duties more appropriately performed by an independent director which would otherwise be performed by the Chairman of the Board of Directors. Irwin D. Simon has been designated as the Lead Independent Director. The Company’s non-management directors meet at least once per year in a non-executive session without management at which Mr. Simon presides. Stockholders and other interested parties may communicate with the Company’s Lead Independent Director or the non-management directors as a group either by writing to Irwin D. Simon, c/o Jarden Corporation, 555 Theodore Fremd Avenue, Rye, NYNew York 10580 or sending an e-mail to BOD@jarden.com. Correspondence received will be forwarded to Mr. Simon promptly. The Board of Directors has directed that certain items that are unrelated to the duties and responsibilities of the Board of Directors should be excluded, such as:

In addition, material that is unduly hostile, threatening, illegal or similarly unsuitable will be excluded, with the provision that any communication that is filtered out must be made available to any outside director upon request.

Independence of Directors

Our Governance Principles and Code of Conduct Policy requires that a majority of the directors satisfy the independence requirements of the SEC and the NYSE. In general, “independent” means that the director shall have no material relationship with the Company or any member of the senior management of the Company. In performing their duties, directors must hold themselves free of any interest, influence or relationship with respect to any activity which could impair their judgment or objectivity in the course of their service to the Company. The policy establishes a mandatory retirement age of 70 for independent directors. It also urges independent directors with more than one year of service to own at least 1,000 shares of Common Stock of the Company. Based on the aforementioned standards, the Board of Directors has determined that each of the following

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non-employee directors is independent and has no relationship with the Company, except as a director and stockholder of the Company:

In addition, based on such standards, the Board of Directors determined that: (a) Martin E. Franklin is not independent because he is the Chairman and Chief Executive Officer of the Company; and (b) Ian G.H. Ashken is not independent because he is the Vice Chairman and Chief Financial Officer of the Company.

In addition to the foregoing, our Governance Principles and Code of Conduct Policy also provides for:

During 2008,2009, the Board of Directors held eleventen meetings. The Board of Directors has standing Compensation, Nominating and Policies, and Audit Committees. During 2008,2009, each current director attended 75% or more of the aggregate number of meetings of the Board of Directors and the Committees of the Board of Directors on which he or she served, which were held during his or her period of service. The Compensation and Nominating and Policies Committees do not meet on a regular basis, but only as circumstances require. The Company does not have a formal policy as to Board of Directors attendance at our annual meetings of Stockholders. Messrs. Franklin and Ashken were the only directors who attended our last annual meeting.

Board Leadership Structure

Martin E. Franklin currently serves as the Company’s Chairman of the Board and its Chief Executive Officer (“CEO”), and he has served in both capacities since September 24, 2001. Given the growth the Company has experienced since Mr. Franklin began serving in these roles, as well as the diversity of its business, both in terms of products and geographical scope, the Board believes that the most effective leadership structure for the Company at this time is for Mr. Franklin to continue to serve in both capacities. The Board believes that Mr. Franklin’s dual role as Chairman and CEO fosters effective decision-making and alignment on corporate strategy because it enables Mr. Franklin to have extensive and current knowledge of the Company’s operations and its strategies. The Board further believes that given Mr. Franklin’s leadership in helping to grow the Company, he is the best person to act as the Company’s principal executive officer as well as to set the agenda for and lead discussions of the Board.

At the same time, the Board believes that board independence is a critical aspect of corporate governance. As discussed above, our independent directors hold regularly scheduled meetings, at which only independent directors are present. As provided in our Governance Principles and Code of Conduct Policy, the Board is required to designate a non-executive Lead Independent Director to preside over non-executive sessions and perform any duties more appropriately performed by an independent director which would otherwise be performed by the Chairman of the Board. The Lead Independent Director position balances the need for effective and independent oversight of management with the need for strong, unified leadership. The Board has designated Irwin D. Simon as such Lead Independent Director.

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The Board believes that this leadership structure – a single Chairman and CEO coupled with a designated Lead Independent Director – is appropriate for our Company given the size and scope of our business, the experience and active involvement of our independent directors, and our corporate governance practices, which include regular communication with and interaction between and among Mr. Franklin and the independent directors.

Board Role in Risk Oversight

Management is responsible for the day-to-day management of risks the Company faces, while the Board of Directors, as a whole and through its committees, provides risk oversight. In its risk oversight role, the Board of Directors must satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed, including assessing major risk factors relating to the Company and its performance, and reviewing measures to address and mitigate risks. While the full Board of Directors is charged with overseeing risk management, various committees of the Board of Directors and members of management also have responsibilities with respect to our risk oversight. In particular, the Audit Committee plays a large role in monitoring and assessing our financial, legal, and operational risks, and receives regular reports from the management team’s senior risk officer regarding comprehensive organizational risk as well as particular areas of concern. Additionally, the Compensation Committee monitors and assesses the various risks associated with compensation policies, and oversees incentives that encourage a level of risk-taking consistent with our overall strategy.

Compensation Committee

The Compensation Committee reviews recommendations for executive compensation, including incentive compensation and stock incentive plans and makes recommendations to the Board of Directors concerning levels of executive compensation and adoption of incentive and stock plans. Pursuant to the Compensation Committee’sits charter, the Compensation Committee’s authority generally includes the authority to do each of the following:

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The Compensation Committee shall have authority to retain such compensation consultants, outside counsel and other advisors as the Compensation Committee may deem appropriate in its sole discretion.

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The Compensation Committee consists of Messrs. Wood (Chairman), Simon (Vice Chairman), Azria and Gross. All of the members of the Compensation Committee meet the independence standards contained in the NYSE corporate governance rules. The Compensation Committee met twicefour times during 2008.2009.

Nominating and Policies Committee

The purpose of the Nominating and Policies Committee is to identify, evaluate and nominate qualified candidates for election to the Board of Directors. The Nominating and Policies Committee considers all qualified candidates identified by members of the committee, by other members of the Board of Directors and by senior management. The Nominating and Policies Committee will also consider nominees recommended by Stockholders. The names, resume(s) and biographical information of such nominees should be forwarded to the Secretary, Jarden Corporation, 555 Theodore Fremd Avenue, Rye, New York 10580, who will submit them to the Nominating and Policies Committee for its consideration. See the section titled “Other Matters – Proposals by Stockholders” for more information on Stockholder nominations of candidates for election to the Board of Directors.

The Nominating and Policies Committee is also responsible for developing and recommending to the Board of Directors a set of corporate governance principles and periodically reviewing and reassessing the adequacy of those principles and recommending any proposed changes to the Board of Directors for approval, and advising the Board of Directors on corporate governance matters as they arise.

The Nominating and Policies Committee evaluates all candidates for director, regardless of the person or firm recommending such candidate, on the basis of the length and quality of their business experience, the applicability of such candidate’s experience to the Company and its business, the skills and perspectives such candidate would bring to the Board of Directors and the personality or “fit” of such candidate with existing members of the Board of Directors and management. The Nominating and Policies Committee does not have a formal policy with regard to the consideration of diversity in identifying candidates for director. Nevertheless, the Nominating and Policies Committee’s evaluation of director candidates takes into account their ability to contribute to the diversity of age, background, experience, viewpoints, and other individual qualities and attributes represented on the Board and the Nominating and Policies Committee reviews its effectiveness in balancing these considerations when assessing the composition of the Board.

All members of the Board of Directors should possess the following minimum qualifications as determined by the Nominating and Policies Committee: fundamental qualities of intelligence, honesty, perceptiveness, good judgment, maturity, high ethics and standards, integrity, fairness and responsibility; have a genuine interest in the Company; be committed to enhancing stockholder value; and have the ability and willingness to spend the time required to function effectively as a director of the Company.

The Nominating and PolicesPolicies Committee may engage third-party search firms from time to time to assist it in identifying and evaluating nominees for director.

Based on its assessment of each candidate’s independence, skills and qualifications and the criteria described above, the Nominating and Policies Committee will make recommendations regarding potential director candidates to the Board of Directors.

The Nominating and Policies Committee consists of Messrs. Molen (Chairman), Simon and Heckmann. All of the members of the Nominating and Policies Committee meet the independence standards contained in the NYSE corporate governance rules. The Nominating and Policies Committee met twiceonce during 2008.2009.

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Audit Committee

The Audit Committee consists of Messrs. AzriaGross (Chairman), Gross (Vice Chairman), Huemme and Wood. Each of the Audit Committee members satisfies the definition of independent director as established in the NYSE corporate governance listing standards.rules. In accordance with Section 407 of the Sarbanes-Oxley Act, the Board of Directors determined Messrs. Azria andMr. Gross to be a “Financial Experts,Expert,” as defined in Item 407(d)(5) of Regulation S-K promulgated by the SEC. The duties of the Audit Committee are to: (a) recommend the appointment by the Board of Directors of the registered public accounting firm who shall conduct the annual audit of the Company; (b) assist the Board of Directors in fulfilling its fiduciary responsibilities relating to corporate accounting and reporting practices through review of accounting principles, policies, and changes thereto, financial statements, and general financial disclosure procedures; (c) maintain, through periodic meetings, a direct line of communication with the independent accountants to provide for exchanges of views and information; and (d) review management’s evaluation of the adequacy of the Company’s internal control structure and the extent to which major recommendations made by the independent accountants have been implemented. The number of meetings held during the year is set forth in the “Report of the Audit Committee,” included in this Proxy Statement. The Audit Committee is governed by a written Audit Committee Charter previously approved by the Board of Directors, which may be amended from time to time. The Audit Committee Charter is reviewed and reassessed by the Audit Committee and approved by the Board of Directors as needed but at least annually.

Section 301 of the Sarbanes-Oxley Act requires the Audit Committee to establish procedures for the receipt, retention and treatment of complaints received by the Company from its employees regarding perceived questionable accounting or auditing matters. The Company uses an independent third party to provide an 800 number for the receipt, recording and transcription of any complaints received.

Report of the Audit Committee

The Audit Committee oversees the Company’s financial reporting process on behalf of the Board of Directors. Management has the primary responsibility for the financial statements and the reporting process, including the systems of internal accounting control. In fulfilling its oversight responsibilities, the Audit Committee reviewed the audited financial statements in the Annual Report with management, including a discussion of the quality, not just the acceptability, of the accounting principles, the reasonableness of significant judgments, and the clarity of disclosures in the financial statements.

The Audit Committee has met and reviewed with the independent registered public accounting firm, who is responsible for expressing an opinion on the conformity of the Company’s audited financial statements with generally accepted accounting principles, their judgments as to the quality, not just the acceptability, of the Company’s accounting principles and such other matters as are required to be discussed with the Audit Committee under generally accepted auditing standards, including Statement on Auditing Standards No. 61 (as amended by Statement on Auditing Standards No. 90 and further amended by Statement on Auditing Standards No. 114) and the assessment of the Company’s internal control over financial reporting. In addition, the Audit Committee has discussed with the independent registered accounting firm the auditors’ independence from management and the Company, including the matters in the written disclosures required by the Independence Standards Board No. 1 (Independent Discussions with Audit Committees) and Public Company Accounting Oversight Board (“PCAOB”) Rule 3526, Communications with Audit Committees Concerning Independence, which became effective on September 30, 2008 and supersedes Independence Standards Board No. 1. The Audit Committee also has considered whether the independent registered public accounting firm’s provisions of non-audit services to the Company is compatible with the auditors’ independence.

The Audit Committee discussed with the Company’s independent registered public accounting firm the overall scope and plans for their respective audits. The Audit Committee meets with the independent registered public accounting firm, with and without management present, to discuss the results of their examination, and the

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overall quality of the Company’s financial reporting processes, the evaluation of the Company’s internal accounting controls, and the overall quality of the Company’s financial reporting. The Audit Committee held fivefour meetings during 2008.2009.

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In reliance on the reviews and discussions referred to above, the Audit Committee reviewed and, together with the other members of the Board of Directors, approved for filing with the SEC the Annual Report on Form 10-K for the year ended December 31, 2008,2009, which included audited financial statements for such year. The Audit Committee approved and the Board of Directors has also ratified and recommended the appointment of the Company’s independent registered public accounting firm for 2009.the year ending December 31, 2010.

The Report of the Audit Committee does not constitute soliciting material, and shall not be deemed to be filed or incorporated by reference into any other Company filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates the Report of the Audit Committee by reference therein.

Compensation of Directors

The Company uses a combination of cash and stock-based incentive compensation to attract and retain qualified candidates to serve on the Board. In setting director compensation, the Company considers the significant amount of time that directors expend in fulfilling their duties on our Board and Board committees as well as the skill-level required by the Company of members of the Board and the need to continue to attract highly qualified candidates to serve on our Board. Director compensation arrangements are reviewed annually to maintain such standards.

Director Summary Compensation Table

The following table summarizes the compensation paid to our non-employee directors for the fiscal year ended December 31, 2008:2009:

Director Compensation (1)

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Discussion of Director Compensation

Directors who are also employees of the Company receive no additional compensation for their service on the Board or on any Board committee.

Cash Compensation

In 2008,2009, each non-employee directorsdirector received a flat retainer of $40,000 per year, payable quarterly. In 2008,2009, the chairman of each of the Audit, Compensation and Nominating and Policies Committees and the Lead Independent Director received an additional $5,000. In 2008, the chairman of the Audit Committee received an additional 500 restricted shares. In 2008,2009, each member of any Board committee, who is not also the chairman, received an additional $1,000 per year.

Stock Awards

Non-employee directors of the Company are also eligible to receive stock option grants and restricted stock awards under the Company’s Amended and Restated 2003 Stock Incentive Plan, as amended.amended, or its 2009 Stock Incentive Plan. On April 29, 2008,June 8, 2009, each of the then current non-employee directors of the Company was awarded 3,500 shares of restricted stock under the Amended and Restated 2003 Stock Incentive Plan, as amended, except Mr. Azria who was awarded an additional 500 of restricted stock under the Amended and Restated 2003 Stock Incentive Plan, as amended, as set forth above. The restrictions on these restricted stock awards lapse on April 29, 2009.June 8, 2010.

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In total, during the fiscal year ended December 31, 2008, 25,0002009, 24,500 shares of restricted stock were awarded to non-employee directors serving on the Board during 2008,2009, all of which were awarded pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended.

Stock Ownership Guidelines

All of our directors are expected to have a personal investment in the Company through their ownership of our shares. As a guideline, each director is urged to own at least 1,000 shares of our Common Stock. All of our directors currently meet our director stock ownership guidelines.

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Indemnification

We indemnify our directors and elected officers to the fullest extent permitted by law so that they will be free from undue concern about personal liability in connection with their service to the Company. Our Restated Certificate of Incorporation, as amended, and Amended and Restated Bylaws, as amended, also provide that we will indemnify any of our directors and officers against any and all costs, expenses or liabilities incurred by them by reason of having been a director or officer.

Involvement in Certain Legal Proceedings

To the knowledge of the Company, no director, executive officer, or person nominated to become a director or executive officer has within the last fiveten years: (i) had a bankruptcy petition filed by or against, or a receiver, fiscal agent or similar officer appointed by a court for, any business or property of such person or entity with respect to which such person was a general partner or executive officer either at the time of the bankruptcy filing or within two years prior to that time; (ii) been convicted in a criminal proceeding or is currently subject to a pending criminal proceeding (excluding traffic violations orand other minor offenses); (iii) been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining barring, suspending or otherwise limiting his or her involvement in the following activities: (a) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity; (b) engaging in any type of business practice; or (c) engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodities laws; (iv) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item,(iii)(a), above, or to be associated with persons engaged in any such activity; and (v) been found by a court of competent jurisdiction (in a civil action), the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.vacated; (vi) was the subject of, or party to, any federal or state judicial or administrative order, judgment, decree or finding, not subsequently reversed, suspended or vacated, relating to an alleged violation of: (a) any federal or state securities or commodities law or regulation; (b) any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, removal or prohibition order; or (c) any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or (vii) was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

The Company is not aware of any material proceedings to which any director, executive officer or affiliate of the Company, any owner of record or beneficial owner of more than 5% of any class of the Company’s voting securities, or any associate of any such director, executive officer or affiliate of the Company, or security holder is a party adverse to the Company or any of its subsidiaries or has a material interest adverse to the Company or any of its subsidiaries.

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PROPOSAL 1

ELECTION OF DIRECTORS

The Restated Certificate of Incorporation of the Company, (asas amended the(the “Certificate of Incorporation”), provides that the maximum number of directors shall be nine and the minimum number shall be two. The Board of Directors of the Company is divided into three classes of directors having staggered three-year terms of office. The Amended and Restated Bylaws, as amended (the “Bylaws”) of the Company provides that the number of members constituting the entire Board of Directors is nine. Currently, there are nine individuals serving as members of the Board of Directors. The proxies solicited hereby cannot be voted for a greater number of persons than the number of nominees named herein, of which there are three only. At each annual meeting of Stockholders, the successor of each director whose term expires at that annual meeting is elected to hold office for a term expiring at the annual meeting of Stockholders held in the third year following the year of his or her election, or until his or her successor has been elected and qualified in accordance with the Certificate of Incorporation and Bylaws. Pursuant to the Certificate of Incorporation, in general, any vacancies on our Board of Directors resulting from death, resignation, disqualification, removal or other cause may be filled by an affirmative vote of a majority of the remaining directors then in office.

The terms of office of the Class I Directors, including Martin E. Franklin, René-Pierre Azria and Michael S. Gross expire at this Meeting and each of Martin E. Franklin, René-Pierre Azria and Michael S. Gross is nominated for re-election. The terms of office of the Class II Directors, includingconsisting of Ian G.H. Ashken, Richard L. Molen and Robert L. Wood expire at the 2010 annual meeting.this Meeting and each of Ian G.H. Ashken, Richard L. Molen and Robert L. Wood is nominated for re-election. The terms of office of the Class III Directors, includingconsisting of Richard J. Heckmann, Douglas W. Huemme and Irwin D. Simon expire at the 2011 annual meeting. The terms of office of the Class I Directors, consisting of Martin E. Franklin, René-Pierre Azria and Michael S. Gross expire at the 2012 annual meeting. Mr. Heckmann was initially nominated to the Board of Directors pursuant to the terms of that certain Merger Agreement with K2 Inc. (See Section titled “Certain Relationships and Related Transitions” for a further description.) There are no family relationships among any of the directors or executive officers of the Company.

Unless otherwise specified, each proxy received will be voted for the election as directors of the three nominees named below to serve until the 20122013 annual meeting or until their successors shall have been duly elected and qualified. Each of the nominees has consented to be named a nominee in this Proxy Statement and to serve as a director if elected. Should any nominee become unable or unwilling to accept a nomination or election, the persons named in the enclosed proxy will vote for the election of a nominee designated by the Board of Directors or will vote for such lesser number of directors as may be prescribed by the Board of Directors in accordance with the Bylaws of the Company. At present, it is anticipated that each nominee will be a candidate.

When considering whether directors and nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the Board of Directors to satisfy its oversight responsibilities effectively in light of the Company’s business and structure, the Nominating and Policies Committee and the Board of Directors focused primarily on the information discussed in each of the directors’ individual biographies set forth below, which contains information regarding the person’s service as a director, business experience, and director positions held currently or at any time during the last five years. The Nominating and Policies Committee conducted performance evaluations on the members of our Board of Directors serving during fiscal 2009 and reported the results to the Board of Directors. The Nominating and Policies Committee and Board of Directors determined that each of those directors was an effective and committed member of the Board of Directors and, therefore, that such directors up for re-election should be proposed for re-election.

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The following persons have been nominated as Class III directors:

The Board of Directors unanimously recommends that Stockholders vote “FOR” each of the persons nominated by the Board of Directors to serve as Class III Directors.

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The terms of the following Class II directors expire at the 2010 annual meeting:

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The terms of the following Class III directors expire at the 2011 annual meeting:

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The terms of the following Class I directors expire at the 2012 annual meeting:

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EXECUTIVE OFFICERS OF THE COMPANY

The following table sets forth the name, age and position of each of our executive officers as of April 1, 2009.March 30, 2010. The executive officers of the Company are appointed by and serve at the discretion of the Board of Directors of the Company.

See the table of nominees for election as directors for biographical data with respect to Martin E. Franklin and Ian G.H. Ashken. See the narrative description of the employment agreements for Martin E. Franklin, Ian G.H. Ashken, James E. Lillie and Richard T. Sansone and John E. Capps for further terms with respect to the terms of their respective positions and employment.

James E. Lillie. Mr. Lillie is President and Chief Operating Officer of the Company. Mr. Lillie joined the Company in August 2003 as Chief Operating Officer and assumed the additional title and responsibilities of President effective January 2004. From 2000 to 2003, Mr. Lillie served as Executive Vice President of Operations at Moore Corporation, Limited, a diversified commercial printing and business communications company. From 1999 to 2000, Mr. Lillie served as Executive Vice President of Operations at Walter Industries, Inc., a Kohlberg, Kravis, Roberts & Company (“KKR”) portfolio company. From 1990 to 1999, Mr. Lillie held a succession of senior level management positions across a variety of disciplines including human resources, manufacturing, finance and operations positions at World Color, Inc., another KKR portfolio company.

John E. Capps. Mr. Capps is Senior Vice President, General Counsel and Secretary of the Company. Mr. Capps has been with the Company since January 2005. From 2003 to 2005, Mr. Capps was with American Household, Inc. which was acquired by the Company in January 2005, where he most recently served as Vice President-Legal. Prior to 2003, Mr. Capps was in private law practice with the firm Sullivan & Cromwell LLP.

Patricia J. Gaglione.Gaglione Mrs.. Ms. Gaglione is our Senior Vice President, Business Operations and Supply Chain. Mrs.Ms. Gaglione joined the Company in January 2005 as Vice President, Supply Chain and was promoted to her current position in January 2006.2009. Prior to joining the Company, Mrs.Ms. Gaglione most recently served as Vice President, Sourcing for RR Donnelley and Sons (formerly Moore Corporation, Limited), from May 2001 to May 2004. From 1996 to 2001, Mrs.Ms. Gaglione was General Manager, International Purchasing Office at Philips Electronics.

Patricia A. Mount. Ms. Mount is our Senior Vice President and Chief Transition Officer. Ms. Mount has been with the Company since January 2006.August 2003. From August 2003 through January 2006, Ms. Mount served as Chief Financial Officer of Tilia, Inc., a subsidiary of the Company. Prior to joining the Company, Ms. Mount served as the Chief Financial Officer of network equipment manufacturer LuxN from 2000 to 2002. From 1993 to 2000, Ms. Mount served in various senior financial and operating roles at Quantum Corporation.

Richard T. Sansone. Mr. Sansone is the Senior Vice President and Chief Accounting Officer of the Company. Mr. Sansone has been with the Company since December 2005. Prior to joining the Company, he most recently served as Senior Vice President, Controller and Chief Accounting Officer of RR Donnelley and Sons (formerly Moore Corporation, Limited), from April 2001 to December 2005. From 1992 to 2001, Mr. Sansone was with PricewaterhouseCoopers, LLP where he was an Audit Senior Manager.

J. David Tolbert. Mr. Tolbert is Senior Vice President, Human Resources and Corporate Risk of the Company. Mr. Tolbert has served in various management and executive roles in the areas of human resources, administration and corporate risk for the Company since 1993. From 1987 to 1993, Mr. Tolbert served in various human resource and operating positions at Ball Corporation.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Introduction

The Company’s Compensation Committee of the Board (the “Committee”) establishes the salaries and other compensation of the executive officers of the Company, including its Chairman and Chief Executive Officer (“CEO”) and other Named Executive Officers (as defined below). The Committee consists of three independent directors, all of whom have considerable experience in executive compensation issues and management development. No member of the Committee has ever been an officer or employee of the Company, nor is there a direct or indirect relationship between any of the members of the Committee and any of the Company’s executive officers. The Committee operates under a written charter adopted by the Board of Directors that is available at the Company’s web site atwww.jarden.com under the “Governance” tab.

The Committee has approved a compensation philosophy and objectives for the Company, which is described below.

Executive Compensation Philosophy and Objectives

The Committee continues to examine and refine our compensation philosophy, objectives and strategy throughout the fiscal year as part of our ongoing efforts to maintain “best practice” in this area and corporate governance in general. The Committee’s guiding principle is to assure that the Company’s compensation and benefits policies attract and retain the key employees necessary to support the Company’s growth and success, both operationally and strategically and to motivate their executives to achieve short-short and long-term goals with the ultimate objective of creating sustainable improvements in stockholder value. This principle guides the design and administration of compensation and benefits programs for the Company’s officers, other executives and the general workforce.

The total compensation package, which includes base salary, incentive compensation and other incentive opportunities in the form of grants under the Company’s stock incentive plans, is designed to allow the Company to attract, motivate, and retain top-quality executives. Such principles are accomplished by linking management’s compensation to the Company’s success in creating value for its stockholders. The levels of compensation at competitive companies, derived from compensation surveys provided by outside consultants, as well as other factors such as the Company’s performance, growth and relative stockholder return, achievement of specific financial goals, a subjective determination of the executive’s past performance and expected future contributions to the Company and the awards given to the executive in the past, are used for comparison in establishing the Company’s overall compensation plan for certain executive officers.

Use of Outside Consultants

The Committee retains an outside compensation and benefits consulting firm from time to time to respond directly to the Committee and its inquiries regarding management pay, compensation design and other related matters. The Committee may ask that management participate in these engagements. In connection with the engagement of Towers Perrin, a nationally recognized compensation consulting firm, in 2009 as discussed below, the Committee has directed Towers Perrin to work with our Senior Vice President of Human Resources and other members of management, including the Company’s Chief Financial Officer, to obtain information necessary for it to form its recommendations and evaluate management’s recommendations. Towers Perrin also met with the Committee during the Committee’s regular meetings and in executive session, where no members of management were present, and with the Committee chair and other members of the Committee outside of the regular meetings. Towers Perrin did not meet with the Company’s CEO in the course of such engagement. Use of a particular consulting firm by the Committee does not preclude management from hiring the same consulting firm. The Company participates in compensation surveys of Towers Perrin a nationally recognized compensation consulting firm, to conduct a competitive

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compensation analysis including marketplace base salary, target annual incentive opportunity, target total annual compensation, actual total annual compensation, long-term incentive award level, target total direct compensation, and actual total direct compensation rates. The Company compares itself to general industry companies of comparable revenues for positions below the senior management level. For senior management positions, the Company lookedlooks at the general industry as well as high-growth and high-performing companies reflective of the Company’s strategic objectiveobjectives, including:

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The Committee does not believe, however, believe that it is appropriate to make any compensation decisions, whether regarding base salaries or incentive pay, primarily based upon benchmarking to a peer or other representative group of companies. The information from the outside consultant regarding pay practices at other companies has been provided to the Committee as a resource for their deliberations for executive compensation decisions and is useful in at least two respects. First, the Committee recognizes compensation practices must be competitive in the marketplace. Second, this marketplace information is one of the many factors that management and the Committee consider in assessing the reasonableness and appropriateness of our compensation programs. Although we do not target executive compensation to any peer group median, we strive to provide a compensation package that is competitive in the market and rewards each executive’s performance.

In 2007,2009, the Committee engaged Towers Perrin to provide recommendations on future(i) meet with the Committee and the Chief Financial Officer of the Company to discuss the Company’s business strategy, competitive challenges, management processes and pay philosophy, (ii) review and evaluate the executive compensation to provideprograms and policies for alignment with the Company’s strategic business objectives, (iii) develop comparative market data upon which the Company can evaluate the competitiveness and structure of its current executive compensation program, (iv) provide information on industry best practices on compensation practices and programs, (v) participate in the design of executive compensation programs to ensure the linkage between pay and performance, and (vi) make recommendations to the Committee and management on competitive pay practices for executives and assist in designingas to possible changes to the Company’s compensation and benefits programs, including long-term equity incentive compensation programs.practices. Based on the data and input from Towers Perrin, the Committee structured and approved amendments to the employment agreements for the Named Executive Officers in May 2007, which agreements generally provide for a two year term. The compensation structure set forth in these employment agreements has not changed, except that during fiscal year 2009each of Messrs. Franklin, Ashken and Lillie have voluntarily agreed to be paid 7.5% less than their contractual base salary, and the Company’s other executive officers, including Messrs. Sansone and Capps, have voluntarily agreed to accept a 5% pay decrease during fiscal year 2009 from the base rate of pay in effect for each of them as ofwhich were expiring on December 31, 2008.2009. See “Employment Agreements,” below. The Committee believes that the terms of these employment agreements are still reasonable and appropriate.appropriate, based upon the Committee’s review of factors such as the levels of compensation at a broad range of representative companies, including companies reflective of the Company’s strategic objectives, size and/or growth profile, the Company’s performance, growth and relative stockholder return, the achievement of specific financial goals, such as achieving earnings per share targets, increasing cash flow, improving operating margins and reducing leverage, a subjective determination of the executive’s past performance and expected future contributions to the Company and the awards given to the executive in the past.

The Elements of the Company’s Compensation Program

For the fiscal year ended December 31, 2008,2009, the components of compensation for Named Executive Officers were:

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Additional details on each element of our compensation program are outlined below.

Cash Compensation

For 2008,2009, base salaries and target performance incentive compensation participation rates (percentage of base salary) for the Company’s Chairman and CEO, Vice Chairman and Chief Financial Officer (“CFO”), President and Chief Operating Officer (“COO”), Senior Vice President, General Counsel and Secretary, and Senior Vice President and Chief Accounting Officer were established pursuant to their respective employment agreements (described below under the heading “Employment Agreements”), while target performance incentive compensation participation rates (percentage of base salary) for the Company’s other executive officers were fixed by their respective employment agreement or by the Committee. Target incentive participation rates are established and reviewed based upon factors such as the Company’s performance and growth, achievement of specific financial goals and creation of stockholder value, a subjective determination of the executive’s past performance and expected future contributions to the Company, and aggregate compensation of persons holding similar positions with comparable companies.

During 2009, Messrs. Franklin, Ashken and Lillie voluntarily agreed to be paid approximately 7.5% less than the contractual base salary set forth in their respective employment agreements, in recognition of the recessionary macro economic environment and its impact on the Company. In addition, each of the Company’s other executive officers voluntarily agreed to accept a 5% pay decrease during the first half of 2009 from the base rate of pay in effect for each of them as of December 31, 2008.

For 2008,2009, target incentive participation rates were 50% for the Chairman and CEO, the Vice Chairman and CFO, the President and COO, the Senior Vice President, General Counsel and Secretary and the Senior Vice President and Chief Accounting Officer.Officer, and 40% for the Senior Vice President, Business Operations and Supply Chain. Payments of incentive compensation for 20082009 could have ranged from 0zero to 200% ofdouble the target bonus opportunity and were based on a goal for corporate performance as measured by

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as-adjusted earnings per share (“EPS”). EPS serves as a balanced indicator of sustained stockholder value. Therefore, the evaluation of executive performance based on this measure provides an incentive for individual executives to perform in the best interests of stockholders. The Committee establishes in advance any general types of adjustments it would make to EPS to determine such incentive compensation rates, and are set forth below. Reported earnings per share as disclosed in the Company’s Annual Report on Form 10-K would not take into account the adjustments as set forth below.

The table below sets forth the performance goals established by the Committee for the Named Executive Officers under the Amended and Restated 2003 Stock Incentive Plan, as amended.

In addition, after the Company issued twelve million new shares of common stock in connection with a public offering in April 2009, the Company established a one-time, supplemental incentive program to drive performance in the second half of 2009. The purpose of this special program was to provide incentives to corporate management to attain an appropriate level of EPS in light of the stock offering and its associated dilutive effect on earnings per share. Under this supplemental program, each participant was eligible to receive a payment ranging from 0% to 58.3% of the target incentive participation rate if the Company achieved EPS in the period from July 1, 2009 through December 31, 2009 of between $1.54/share and $1.76/share (inclusive). The maximum payout under this program could be achieved if EPS in the second half of 2009 was $1.63, in which case each participant would receive a payout equal to 58.3% of his or her target incentive compensation payout percentage.

For 2009, the Committee approved the payment of incentive compensation under the above referenced programs at double the targeted payout for each Named Executive Officer, including 183.3% of targeted payout

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based on the Company’s achievement of EPS of $2.60 for the full year and an additional 16.7% of targeted payout based on the Company’s achievement of EPS of $1.69 for the second half of 2009. In determining the 20082009 results for incentive compensation purposes, the Committee included in EPS adjustments for:

For 2008, the Company did not meet the performance goals set forth above and the Named Executive Officers did not receive this annual incentive bonus.

In addition to the payment of an annual incentive bonus, the Committee, in its sole discretion, may approve an additional discretionary bonus for certain Named Executive Officers for exceptional performance related to other corporate activity undertaken by the Company in any year. With regard to Messrs. Franklin, Ashken and Lillie the discretionary compensation is based on the express terms of their employment agreements. For 2008,2009, the Committee approved discretionary performance-based bonuses for each of Messrs. Franklin, Ashken, Lillie, and Sansone and CappsMs. Gaglione to recognize their contributions totowards the Company achieving extraordinary performance during the year in light of the extraordinary macro-economic conditions.year. In approving these bonuses, the Committee considered Messrs. Franklin, Ashken, Lillie Sansone and Capps’Sansone’s and Ms. Gaglione’s outstanding leadership of the Company during fiscal year 2008 during a period of unprecedented volatility and uncertainty,2009 as evidenced by the successful integration of the K2 Inc. and Pure Fishing, Inc. acquisitions, successfully reaching a business resolution and agreement in principle to settle all issues relating to the bankruptcy of the Company’s lender and administrative agent, an affiliate of Lehman Brothers Inc. and taking strategic actions designed to position the Companytaken to outperform its competitors during this recessionary macroeconomic environment.and excellent performance achieved in an extraordinary economic environment, combined with timely and successful completion of capital market activities.

Base salary, incentive compensation and the amount of discretionary bonus (total cash compensation) earned in 20082009 by the Named Executive Officers are reflected in the “Salary”,“Salary,” “Bonus” and “Non-Equity Incentive Plan Compensation” columns in the Summary Compensation Table set forth below.

Equity-Based Compensation

We believe that equity compensation is the most effective means of creating a long-term link between the compensation provided to officers and other key management personnel with returns realized by the stockholders. In 2008,2009, the Company maintained the Amended and Restated 2003 Stock Incentive Plan, as amended and the 2009 Stock Incentive Plan, to incentivize executive officers and other key employees.

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TheEach of the Amended and Restated 2003 Stock Incentive Plan, as amended, and the 2009 Stock Incentive Plan, is designed to give the Board of Directors discretion and flexibility in designing incentive compensation packages to align the goals of management with those of our stockholders and to motivate executive officers and key employees to improve the operations of the Company, thereby maximizing stockholder value. Pursuant to this plan,each of these plans, the Board of Directors may issue to employees, officers, directors, consultants, independent contractors and advisors of the Company and its subsidiaries incentive stock options, nonqualified stock options, restricted stock and cash bonuses. The specific types and size of awards to be granted (other than options granted to non-employee directors) and the terms and conditions of such awards are determined by the Committee subject to the provisions of the Amended and Restated 2003 Stock Incentive Plan, as amended.amended, or the 2009 Stock Incentive Plan, as applicable.

The Committee generally makes awards based upon the employee’s position within the Company, scope of responsibility, ability to affect profits and stockholder value and a subjective review of the employee’s historic and recent performance. All awards to executive officers are within the discretion of the Committee subject to the terms of the Amended and Restated 2003 Stock Incentive Plan, as amended.amended, or the 2009 Stock Incentive Plan, as applicable.

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Since 2005, our equity-based compensation program for executive officers has primarily focused on grants of performance-based restricted stock awards, although stock options were utilized for a portion of the awards within the program during 2008.2008 and 2009. This strategy was implemented to balance the Committee’s interest in (i) focusing executive officers on long-term metrics that create sustained shareholder value, (ii) more efficiently aligning long-term incentive costs with perceived value, (iii) attracting and retaining talent, and (iv) remaining competitive with market changes and compensation practices.

Vesting of restricted stock awards is typically based on our results during a given performance period as measured by EPS, Segment Earnings and/or the increase in the price of our Common Stock. These metrics were chosen because of their relevance to our corporate strategy and objectives for the respective performance periods at the time of grant, the ability of executive officers to impact achievement of the performance goals, and our belief that achieving or exceeding these goals should result in sustained increases to shareholder value over the longer-term.

We may from time to time grant supplemental time or performance vesting restricted stock grants to executive officers. These grants are typically made to attract new executives or as a retention device for current executives. Such awards typically vest over three or four years.

In 2008, based on the limited number of shares of restricted stock available for grant under the Amended and Restated 2003 Stock Incentive Plan, as amended, we granted certain executive officers stock options vesting over three years in lieu of restricted stock awards. Messrs. Franklin, Ashken and Lillie did not receive equity grants in 2008.

We consider several factors when establishing the size of equity-based compensation grants to executive officers, including long-term incentive compensation awarded within comparator groups, the number of unvested stock-based awards held by the executive, the executive’s performance during the prior year and the executive’s expected contribution to our long-term performance. We also consider the expected shareholder dilution and accounting cost attributable to our long-term incentive programs in establishing the total number of shares of Common Stock we make available through stock-based awards.

It has been our practice, but not a firm policy, to grant stock-based awards to management, including executive officers, on an annual basis. Award levels and grant dates are approved by the Committee, and grants are made on or following the date of the Committee’s approval. The Committee will also approve any equity- basedequity-based grants in connection with the hiring or promotion of an executive officer. The Committee has broad authority and discretion to grant such awards and there are no formalized procedures regarding the timing of such grants and whether such grants will continue to be granted on an annual basis or otherwise.

Perquisites and Other Personal and Additional Benefits

Executive officers participate in other employee benefit plans generally available to all employees on the same terms as similarly situated employees.

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The Company’s 401(k) plan provides for a Company matching contribution equal to employee contribution up to 4% of the value of the individual employee’s base salary and further limited by Internal Revenue Services guidelines. For fiscal year 2009, the Company has changed the 4% matching contribution to a discretionary, rather than mandatory, match. For fiscal year 2009, the Company gave a 1% discretionary contribution.

The Company provides Named Executive Officers with perquisites and other personal benefits that the Company and the Committee believe are reasonable and consistent with its overall compensation program to better enable the Company to attract and retain employees for key positions. The Committee at least annually reviews the levels of perquisites and other personal benefits provided to Named Executive Officers.

Certain Named Executive Officers are provided use of company financial or tax planning assistance, while all receive payment of life insurance and long-term disability premiums, and company matching contributions to the executive’s 401(k) plan. In addition, the Chairman and CEO of the Company, for security purposes, is required to use private corporate aircraft for all personal and business-related air travel unless a private aircraft is not reasonably available. If a private aircraft is not reasonably available, he shall be entitled to first class air travel for

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business related travel. The costs to the Company associated with providing these benefits for executive officers named in the Summary Compensation Table are reflected in the “All Other Compensation” column of the Summary Compensation Table.

The Company does not have a formal policy or formula for (i) determining the precise allocation of each compensation element to pay, (ii) allocating between long-term and currently paid out compensation, (iii) allocating between cash and non-cash compensation, or (iv) allocating among different forms of non-cash compensation. As discussed in this “Compensation Discussion and Analysis” section, during the process of setting and allocating the various elements of compensation and when setting the individual components of compensation of our executive officers, the Compensation Committee considers the following:

As discussed above under the subheading “The Elements of the Company’s Compensation Program,” the components of the Company’s compensation program consist of: (i) cash consideration, which includes base salary and target performance incentive compensation, (ii) equity-based consideration, which includes incentive stock options, nonqualified stock options, restricted stock and cash bonuses issued under the Company’s Amended and Restated 2003 Stock Incentive Plan, as amended, and/or the Company’s 2009 Stock Incentive Plan, as applicable, and (iii) perquisites and other personal and additional benefits. Base salary, which is paid in cash, is fixed compensation in that it does not vary based on performance. Target performance incentive compensation is variable compensation in that it varies based upon performance against prescribed goals. Equity-based consideration, other than cash bonuses, issued under the Company’s Amended and Restated 2003 Stock Incentive Plan, as amended, and/or the Company’s 2009 Stock Incentive Plan, as applicable, are long-term incentives. The Company believes that a significant portion of executive compensation should be in target performance incentive compensation and equity-based consideration when compared to base salary. In addition, the Company believes that, in order to link management’s compensation to the Company’s success in creating value for its stockholders and to reward appropriately for superior performance, our Named Executive Officers should have a greater percentage of their total compensation in incentive or variable compensation and that for other executives, a significant, but lower, portion of their total compensation should be in incentive or variable compensation. This belief is illustrated by the component elements of compensation for our Named Executive Officers as set forth in the Summary Compensation Table below.

Accounting and Tax Considerations

The Committee generally seeks to comply with the requirements of Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), to the extent deemed practicable, with respect to options and annual and long-term incentive programs in order to avoid losing the deduction for non-performance based compensation in excess of $1 million paid to one or more of the Named Executive Officers. The Committee has generally structured the Company’s compensation plans to include performance metrics with the objective that amounts paid under those plans and arrangements are tax deductible, including by having those plans approved by the Company’s Stockholders. However, in renewing the expiring employment agreements for Messrs. Franklin and Lillie in 2009, the Committee determined it to be in the best interest of the Company to make minimal changes to the existing agreements and did not attempt to make more extensive changes in order to structure the

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compensation in accordance with Section 162(m) of the Code in light of the Company’s large net operating loss carry-forwards and the fact that the Company does not pay a material amount of cash taxes in the United States for U.S. federal income tax purposes. The Company has and may in the future determine to award compensation or modify compensation for any of the Named Executive Officers in a manner that does not meet the requirements of Section 162(m) of the Code when it deems it appropriate to achieve its compensation and other objectives or in the best interest of the Company.

We provide Messrs. Franklin, Ashken and Lillie with change of control provisions pursuant to their amended and restated employment agreements. Such agreements provide for tax protection in the form of a gross up payment to reimburse the executive for any excise tax under Section 4999 of the Code as well as any additional income and employment taxes resulting from such reimbursement. Section 4999 of the Code imposes a 20% non-deductible excise tax on the recipient of an “excess parachute payment” and Section 280G of the Code disallows the tax deduction to the payor of any amount of an excess parachute payment that is contingent on a change of control. A payment as a result of a change of control must exceed 3 times the executive’s base amount in order to be considered an excess parachute payment, and then the excise tax is imposed on the parachute payments that exceed the executive’s base amount. The intent of the tax gross-up is to provide a benefit without a tax penalty to our executives who are displaced in the event of a change of control. We believe the provision of tax protection for excess parachute payments for Messrs. Franklin, Ashken and Lillie is consistent with market practice, is a valuable executive talent retention incentive, and is consistent with the objectives of our overall executive compensation program.

Policy on Stock Trading and Hedging

Executives and other employees may not engage in any transaction in which they may profit from short-term speculative swings in the value of the company’s securities. This prohibition includes “short sales” (selling borrowed securities which the seller hopes can be purchased at a lower price in the future) or “short sales against the box” (selling owned, but not delivered securities), “put” and “call” options (publicly available rights to sell or buy securities within a certain period of time at a specified price or the like) and other hedging transactions

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designed to minimize an executive’s risk inherent in owning our stock, such as zero-cost collars and forward sale contracts. In addition, this policy is designed to ensure compliance with all insider trading rules.

Post-Employment and Other Events

Retirement, death, disability and change-in-control events trigger the payment of certain compensation to thecertain Named Executive Officers that is not available to all salaried members. Such compensation is payable pursuant to separately negotiated employment arrangements between such Named Executive Officers and the Company. Such compensation is discussed under the headings “Employment Agreements” and “Potential Payments Upon Termination or Change of Control.”

Role of Executive Officers in Compensation Decisions

The Committee determines the total compensation of our CEO and oversees the design and administration of compensation and benefit plans for all of the Company’s employees. Generally, our CEO makes recommendations to the Committee as it relates to the compensation of the other executive officers. In addition, our executive officers, including our CEO, CFO and Senior Vice President of Human Resources and Corporate Risk, provide input and make proposals regarding the design, operation, objectives and values of the various components of compensation in order to provide appropriate performance and retention incentives for other key employees. These proposals may be made on the initiative of the executive officers or upon the request of the Committee.InCommittee.In addition, our internal human resources personnel have met with the Committee to present topical issues for discussion and education as well as specific recommendations for review. Certain executive officers, including the Chairman and CEO and the Vice Chairman and CFO, attend a portion of most regularly scheduled Committee meetings, excluding executive sessions. The Committee may also obtain input from our legal, finance

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and tax functions, as appropriate, as well as one or more executive compensation-consulting firms regarding matters under consideration. The Committee has delegated to management certain responsibilities related to employee benefit matters. The Committee has formed two management committees that (i) oversee the investment of retirement plan assets and savings plan investment funds and (ii) administer benefit plans for employees. These committees are made up of the Company’s employees and report to the Committee periodically.

Summary

The Committee believes that the total compensation package has been designed to motivate key management to improve the operations and financial performance of the Company, thereby increasing the long-term market value of our Common Stock. The tables in this Executive Compensation section reflect the compensation structure established by the Committee.

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Summary Compensation Table

The following summary compensation table sets forth information concerning the annual and long-term compensation earned by the Company’s chief executive officer, chief financial officer and fourthree other executive officers of the Company whose annual salary and bonus during fiscal 20082009 exceeded $100,000 (collectively, the “Named Executive Officers”).

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Mr. Franklin—Company-provided life insurance and long-term disability premiums, $2,979; imputed taxable income on individual life and disability policies, $117,442; the Company’s discretionary contribution on the employee’s 401(k), $2,450; personal use of the Company aircraft to which Mr. Franklin is entitled under his employment agreement, valued at the incremental cost of such use to the Company, $151,568; financial consulting fees paid by the Company, $50,000; and health costs not covered under a Company provided health insurance policy, $23,135. We valued the incremental cost of the aircraft using a method that takes into account aircraft fuel expenses per flight hour and engine maintenance expenses per flight hour attributable to personal use; and to the extent attributable to personal use, any landing, parking and handling fees; flight planning expenses; crew travel expenses; supplies and catering; excise taxes; and customs, foreign permit and similar fees.

Mr. Ashken—Company-provided life insurance and long-term disability premiums, $2,979; personal use of the Company aircraft, valued at the incremental cost of such use to the Company in excess of amounts pre-paid by Mr. Ashken for such use pursuant to the terms of his employment agreement, $79,346; imputed taxable income on individual life and disability policies, $93,956; the Company’s discretionary contribution on the employee’s 401(k), $2,450; and financial consulting fees paid by the Company, $7,000. We valued the incremental cost of the aircraft using a method that takes into account aircraft fuel expenses per flight hour and engine maintenance expenses per flight hour attributable to personal use; and to the extent attributable to personal use, any landing, parking and handling fees; flight planning expenses; crew travel expenses; supplies and catering; excise taxes; and customs, foreign permit and similar fees.

Mr. Lillie—Company-provided life insurance and long-term disability premiums, $2,979; personal use of the Company aircraft, valued at the incremental cost of such use to the Company in excess of amounts pre-paid by Mr. Lillie for such use, $22,096; imputed taxable income on individual life and disability policies, $21,118; and the Company’s discretionary contribution on the employee’s 401(k), $2,450.

Mr. Sansone—Company-provided life insurance and long-term disability premiums, $2,421.

Ms. Gaglione—Company-provided life insurance and long-term disability premiums, $1,815; and the Company’s discretionary contribution on the employee’s 401(k), $2,450.

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Grants of Plan-Based Awards

The following table contains certain information regarding grants of plan-based awards in fiscal year 20082009 to each of the Named Executive Officers.

In 2009, the Company granted stock option awards to Mr. Sansone and Ms. Gaglione, but not to other Named Executive Officers. Mr. Sansone does not have equity-based compensation provisions in his employment agreement, and, therefore he, along with Ms. Gaglione, were considered by the Compensation Committee for grants of stock-based awards, including stock options, in 2009 in connection with the Company’s annual routine equity grant to employees of the Company which is consistent with the Company’s equity compensation philosophy. The Compensation Committee awarded Mr. Sansone and Ms. Gaglione stock options that were granted at fair market value and vest and become exercisable in equal installments over a three year period, commencing on the date of grant.

The other Named Executive Officers, Messrs. Franklin, Ashken and Lillie, received restricted stock awards in accordance with the terms of their employment agreements. Messrs. Franklin, Ashken and Lillie received additional restricted stock awards in 2009 to reflect their outstanding leadership of the Company during fiscal year 2009 as evidenced by their strategic actions taken to outperform its competitors and excellent performance

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achieved in an extraordinary economic environment, combined with timely and successful completion of capital market activities. Mr. Sansone and Ms. Gaglione received additional restricted stock awards in 2009 to reflect certain increased roles and responsibilities that each of Mr. Sansone and Ms. Gaglione had in the Company’s Outdoor Solutions segment in connection with the restructuring of the management of such segment in fiscal year 2009.

Outstanding Equity Awards at Fiscal Year End

The following table sets forth information concerning stock options and stock awards held by the Named Executive Officers at December 31, 2008:2009:

Ms. Gaglione: The restricted share awards vest ratably over a three year period on each anniversary date beginning on October 28, 2010 now that the EBITDA performance target has been achieved.

Mr. Ashken: The restrictions lapse on Mr. Ashken’s restricted shares on the date that the average closing price on the NYSE (or such other national securities exchange on which the common stock may then be traded) for any period of five consecutive trading days equals or exceeds $48.70 per share.

Mr. Lillie: The restrictions lapse on Mr. Lillie’s restricted shares on the date that the average closing price on the NYSE (or such other national securities exchange on which the common stock may then be traded) for any period of five consecutive trading days equals or exceeds $48.70 per share.

Mr. Sansone: The restrictions lapse on 21,300 shares if the Company’s As Adjusted EBITDA equals or exceeds $1.8 billion for the January 2, 2009 through January 1, 2012 period. Ms. Gaglione: The restrictions lapse on 16,000 of Ms. Gaglione’s restricted shares if the Company’s As Adjusted EBITDA equals or exceeds $1.8 billion for the January 2, 2009 through January 1, 2012 period.

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Option Exercises and Stock Vested During Fiscal 20082009

Pension Benefits – Fiscal 20082009

Our Named Executive Officers received no benefits in fiscal 20082009 from the Company under defined pension or defined contribution plans other than our tax-qualified 401(K)401(k) plan.

Non-Qualified Deferred Compensation

Our Named Executive Officers received no benefits in fiscal 20082009 from the Company under non-qualified deferred compensation plans other than our tax-qualified 401(K)401(k) Plan.

Compensation Committee Report

The Company’s Compensation Committee of the Board (the “Compensation Committee”) has submitted the following report for inclusion in this Proxy Statement:

Our Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis contained in this Proxy Statement with management. Based on our Compensation Committee’s review of and the discussions with management with respect to the Compensation Discussion and Analysis, our Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 20082009 for filing with the SEC.

The Report of the Compensation Committee does not constitute soliciting material, and shall not be deemed to be filed or incorporated by reference in to any other Company filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Company specifically incorporates the Report of the Compensation Committee by reference therein.

Compensation Committee Interlocks and Insider Participation

During fiscal 2008,2009, the Compensation Committee was comprised of Messrs. MolenWood (Chairman), Simon (Vice Chairman), Azria and Gross.

No member of the Compensation Committee during 20082009 was an officer, employee or former officer of the Company or any of its subsidiaries or had any relationship requiring disclosure herein pursuant to SEC

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regulations. No executive officer of the Company served as a member of a compensation committee or a director of another entity under circumstances requiring disclosure under SEC regulations.

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Employment Agreements

Martin E. Franklin, Ian G.H. Ashken and James E. Lillie

The Company’s amended and restated employment agreement with Martin E. Franklin, dated as of May 24, 2007, as amended, provides for his employment as Chairman and Chief Executive Officer of the Company through December 31, 2009,2012, subject to certain termination rights and renewal provisions. Mr. Franklin’s employment agreement provides that he will receive an annual base salary of at least $1,950,000, subject to an annual increase at least equal to the change in Consumer Price Index, although for fiscal year 2009, Mr. Franklin volunteered to be paid approximately 7.5% less than his contractual base salary.salary in recognition of the then recessionary macroeconomic environment and its impact on the Company. In addition, Mr. Franklin is entitled to receive an operating bonus of up to 50% of base compensation each year for achieving the Company’s earnings per share budget or up to 100% of base compensation each year for achieving 110%earnings per share equal to the performance target set by the Committee for payment of maximum bonus of the Company’s earnings per share budgetemployees generally, in each case based on the annual budget approved by the Board of Directors. For a description of the performance targets established by the Board of Directors for 2008,2009, see the “Compensation Discussion and Analysis” section above. In addition, Mr. Franklin is eligible for a performance-based discretionary bonus related to other corporate activity undertaken by the Company of up to 100% of base compensation each year, at the discretion of the Board or Compensation Committee. For a description of the performance-based discretionary bonus for 2009, see the “Compensation Discussion and Analysis” section above. Pursuant to Mr. Franklin’s employment agreement, Mr. Franklin shall be entitled to receive an annual grant of 230,000 shares of restricted stock in 2009, 2010 and 2011 and 300,000 shares of restricted stock in 2012 pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended,Company’s stock incentive plan, with the vesting restrictions and terms set forth below. The grant for 2008 was accelerated and vested early pursuant to the equity vesting lock-up and amendment agreement, dated November 7, 2007, discussed below. On January 13, 2009, the grant for 2009 was awarded and Mr. Franklin received 160,000 shares of restricted stock because the Company did not have sufficient shares pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended, to grant the number of shares of restricted stock required to be granted to Mr. Franklin in 2009.2009 (the “Franklin 2009 Grant”), subject to the vesting restrictions set forth below. In lieu of the additional 70,000 shares of restricted stock to be granted to Mr. Franklin, the Company has agreed to award to Mr. Franklin a cash payment in an amount equal to the value of the shares of restricted stock not issued to him, as further set forth in the restricted stock and amendment agreement dated January 13, 2009, and amended on March 27, 2009. On January 5, 2010, the grant for 2010 was awarded and Mr. Franklin received 230,000 shares of restricted stock subject to the vesting restrictions set forth below (the “Franklin 2010 Grant”).Mr. Franklin’s employment agreement also entitles him to participate in the medical, insurance and other fringe benefit plans or policies the Company may make available to, or have in effect for, its personnel with commensurate duties from time to time. Mr. Franklin’s employment agreement also provides for certain other ancillary benefits, including the reimbursement of all reasonable business expenses and, for security purposes, use of private aircraft transportation for all travel, at the Company’s expense. The Company shall also bear expenses for Mr. Franklin’s personal use of private aircraft transportation that does not exceed 75 hours in any calendar year. In addition, the agreement requires the Company to provide Mr. Franklin with $10 million of life insurance. Mr. Franklin shall also be entitled to, if for any reason Mr. Franklin shall not be covered by a health insurance policy of the Company, an annual medical, dental, vision care and other health care allowance of up to $30,000 for unreimbursed expense incurred by Mr. Franklin or any of his immediate family members.

The Company’s amended and restated employment agreement with Ian G.H. Ashken, dated as of May 24, 2007, as amended, provides for his employment as Vice Chairman and Chief Financial Officer of the Company through December 31, 2009,2012, subject to certain termination rights and renewal provisions. Mr. Ashken’s employment agreement provides that he will receive an annual base salary of $900,000, subject to an annual increase at least equal to the change in Consumer Price Index, although for fiscal year 2009, Mr. Ashken volunteered to be paid approximately 7.5% less than his contractual base salary.salary in recognition of the then recessionary macroeconomic environment and its impact on the Company. In addition, Mr. Ashken is entitled to receive an operating bonus of up to 50% of base compensation each year for achieving the Company’s earnings per share budget or up to 100% of base compensation each year for achieving 110%earnings per share equal to the performance target set by the Committee for payment of maximum bonus of the Company’s earnings per share budgetemployees

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generally, in each case based on the annual budget approved by the Board of Directors. For a description of the performance targets established by the Board of Directors for 2008,2009, see the “Compensation Discussion and Analysis” section above. In addition, Mr. Ashken is eligible for a performance-based discretionary bonus related

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to other corporate activity undertaken by the Company of up to 100% of base compensation each year, at the discretion of the Board or Compensation Committee. For a description of the performance-based discretionary bonus for 2009, see the “Compensation Discussion and Analysis” section above. Pursuant to Mr. Ashken’s employment agreement, Mr. Ashken shall be entitled to receive an annual grant of 95,000 shares of restricted stock in 2009, 2010 and 2011 and 135,000 shares of restricted stock in 2012 pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended,Company’s stock incentive plan, with the vesting restrictions and terms set forth below. The grant for 2008 was accelerated and vested early pursuant to the equity vesting lock-up and amendment agreement, dated November 7, 2007, discussed below. On January 13, 2009, the grant for 2009 was awarded and Mr. Ashken received 95,000 shares of restricted stock.stock (the “Ashken 2009 Grant”), subject to the vesting restrictions set forth below. On January 5, 2010, the grant for 2010 was awarded and Mr. Ashken received 95,000 shares of restricted stock subject to the vesting restrictions’ set forth below (the “Ashken 2010 Grant”). Mr. Ashken’s employment agreement also entitles him to participate in the medical, insurance and other fringe benefit plans or policies the Company may make available to, or have in effect for, its personnel with commensurate duties from time to time. Mr. Ashken’s employment agreement also provides for certain other ancillary benefits, including the reimbursement of all reasonable business expenses and use of any airplanes that the Company owns or is entitled to use at the actual (if determinable) or estimated direct cost of such use. In addition, the agreement requires the Company to provide Mr. Ashken with $6 million of life insurance.

Each of Messrs. Franklin’s and Ashken’s employment agreement contains a non-competition covenant and non-solicitation provisions (relating to the Company’s employees and customers) effective during the term of his employment and during the greater of (i) a period of three years after any termination of Mr. Franklin’s or Mr. Ashken’s employment or (ii) any period thereafter during which Mr. Franklin or Mr. Ashken continues to receive benefits under the employment agreement, other than in cases of a termination by the Company without cause, by Mr. Franklin or Mr. Ashken with good reason, or if Mr. Franklin’s or Mr. Ashken’s employment is not renewed. For a description of any amount to be received by Messrs. Franklin and Ashken in the event their employment is terminated or due to a change of control of the Company, see the Section titled “Potential Payments on Termination or Change of Control.”

The Company’s amended and restated employment agreement with James E. Lillie, dated as of May 24, 2007, as amended, provides for his employment as President and Chief Operating Officer of the Company through December 31, 2009,2012, subject to certain termination rights and renewal provisions. Mr. Lillie’s employment agreement provides that he will receive an annual base salary of $635,000$750,000 per year, subject to an annual increase at least equal to the change in the Consumer Price Index, although for fiscal year 2009, Mr. Lillie volunteered to be paid approximately 7.5% less than his contractual base salary.salary in recognition of the then recessionary macroeconomic environment and its impact on the Company. In addition, Mr. Lillie is entitled to receive an operating bonus of up to 50% of base compensation in each year if the Company achieves certain specified performance objectivesthe Company’s budgeted earnings per share target for such year as approved by the Board of Directors and up to 100% of base compensation in each year if the Company achieves suchearnings per share equal to the performance objectives 10% higher than approvedtarget set by the BoardCommittee for payment of Directors.maximum bonus to the Company’s employees generally. For a description of the performance targets established by the Board of Directors for 2008,2009, see the “Compensation Discussion and Analysis” section above. In addition, Mr. Lillie is eligible for a performance-based discretionary bonus related to other corporate activity undertaken by the Company of up to 50% of base compensation each year, at the discretion of the Board or Compensation Committee. For a description of the performance-based discretionary bonus for 2009, see the “Compensation Discussion and Analysis” section above. Pursuant to Mr. Lillie’s employment agreement, Mr. Lillie shall be entitled to receive an annual grant of 40,000 shares of restricted stock in 2009, 2010 and 2011 and 65,000 shares of restricted stock in 2012 pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended,Company’s stock incentive plan, with the vesting restrictions and terms set forth below. The grant for 2008 was accelerated and vested early pursuant to the equity vesting lock-up and amendment agreement, dated November 7, 2007, discussed below. On January 13, 2009, the grant for 2009 was awarded and Mr. Lillie received 30,000 shares of restricted stock because the Company did not have sufficient shares pursuant to the Amended and Restated 2003 Stock Incentive Plan, as amended to grant the number of shares of restricted stock required to be granted to Mr. Lillie in 2009.2009 (the “Lillie 2009 Grant”), subject to the vesting restrictions set forth below. In lieu of the additional 10,000 shares of restricted stock to be granted

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to Mr. Lillie, the Company has agreed to award to Mr. Lillie a cash payment in an amount equal to the value of the shares of restricted stock not issued to him, as further set forth in the restricted stock and amendment agreement dated January 13, 2009, and amended on March 27, 2009. On January 5, 2010, the grant for 2010 was awarded and Mr. Lillie received 40,000 shares of restricted stock subject to the vesting restrictions set forth below (the “Lillie 2010 Grant”). Mr. Lillie will receive a prescribed severance pay amount if he is terminated without cause or suffers a specified disability. Mr. Lillie’s employment agreement also entitles him to participate in the medical, insurance and other fringe benefit plans or policies the Company may make available to, or have in effect for, its personnel with commensurate duties from time to time. In addition, the employment agreement requires the Company to providereimburse Mr. Lillie with $1 millionup to $25,000 per year for the cost of premiums for life insurance.insurance for the benefit of Mr. Lillie. Mr. Lillie’s employment agreement contains a non-competition covenant and non-solicitation provisions (relating to the Company’s employees and customers)

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effective during the term of his employment and continuing for a period of 12 months after the expiration or termination of Mr. Lillie’s employment. For a description of any amount to be received by Mr. Lillie in the event his employment is terminated or due to a change of control of the Company, see the Section titled “Potential Payments on Termination or Change of Control.”

On November 7, 2007, the Company entered into an equity vesting lock-up and amendment agreement with each of Messrs. Franklin, Ashken and Lillie amending their respective employment agreements, in which the Company agreed to: (i) grant and accelerate the vesting of 230,000 shares of restricted stock that would have been granted to Mr. Franklin on May 1, 2008 pursuant to his employment agreement; (ii) grant and accelerate the vesting of 95,000 shares of restricted stock that would have been granted to Mr. Ashken on May 1, 2008 pursuant to his employment agreement; and (iii) (a) accelerate the vesting of 9,375 options previously granted to Mr. Lillie, and (b) grant and accelerate the vesting of 40,000 shares of restricted stock that would have been granted to Mr. Lillie on May 1, 2008 pursuant to his employment agreement. Pursuant to such equity vesting lock-up and amendment agreements, each ofrestrict until November 7, 2012, Messrs. Franklin, Ashken and Lillie is prohibited until November 7, 2012, from offering, selling, transferring, contracting to sell, or otherwise disposing of, directly or indirectly, any of the restricted stock granted to Messrs. Franklin, Ashken and Lillie granted under such stockagreements, without prior written consent of the Company, except as set forth below. Notwithstanding the foregoing, each of Messrs. Franklin, Ashken and Lillie shall generally be entitled to sell up to but no more than 20% of such shares of such stock in any calendar year during the period from January 1, 2008 through December 31, 2012 and as fully set forth in the equity vesting lock-up and amendmentsuch agreements. Each of Messrs. Franklin, Ashken and Lillie shall be entitled to sell all of such stock at any time on or after January 1, 2013, subject to applicable law, regulation or stock exchange rule. The foregoing restrictions on transfer shall lapse upon the first to occur of (i) a termination of employment with the Company, (ii) a change of control of the Company and/or (iii) a tender for all of the Company’s issued and outstanding shares of common stock. As an inducement for the Company to accelerate the granting and/or vesting of any of such stock, and notwithstanding anything to the contrary contained in any employment agreement or any policy of the Company or any subsidiary or affiliate thereof that would otherwise be applicable, in the event that the employment of any of Messrs. Franklin, Ashken or Lillie is terminated prior to November 7, 2009 other than (i) by reason of his death or disability or (ii) after a change of control of the Company, (a) in the case of either of Messrs. Franklin or Ashken, each of them will be entitled to receive only one third (1/3) of the amount of any Severance Benefits (as defined in his employment agreement with the Company) to which he would otherwise be entitled pursuant to his employment agreement with the Company, and he shall not receive or be eligible to receive, and will not seek, any additional payment of Severance Benefits, or any other payment in lieu of the foregoing, from the Company or any subsidiary or affiliate to which he would otherwise be entitled pursuant to his employment agreement or otherwise; and (b) in the case of Mr. Lillie, he will not receive or be eligible to receive, and will not seek, any payment of severance pay (including any post-termination payment(s) based on salary or bonus), or any other payment in lieu of the foregoing, from the Company or any subsidiary or affiliate to which any of them would otherwise be entitled pursuant to his employment agreement or otherwise, except 401(k) balances, if any, to which any of them would be entitled pursuant to the applicable 401(k) plan.

Each of Messrs. Franklin’s, Ashken’s and Lillie’s employment agreements provides that the restrictions on any remaining awards of restricted stock granted to Messrs. Franklin, Ashken and Lillie will lapse based on achievement of a target appreciation in the stock price of the common stock of the Company set by the Compensation Committee at the time of the grant as follows: (i) the vesting target shall be achieved on the date that the average closing price of the Company’s Common Stock for any five consecutive trading days equals or exceeds a price representing an increase over the closing price on the last trading day of the prior calendar year at least equal to the target stock price appreciation percentage set by the Compensation Committee of the Company’s Board of Directors (up to certain maximums set forth in the respective employment agreements), or (ii) the date there is a change of control (as defined in the respective employment agreements) of the Company prior to achievement of the vesting targets for each annual grant. Upon satisfaction of the conditions and the lapsing of the restrictions on each grant of restricted stock, the executive shall be entitled to sell only 20% (but not more than 20%) of such vested shares in any calendar year ending prior to January 1, 2012, provided that executive shall be entitled to sell all such vested shares at any time on or after January 2012. The foregoing 20% limitation shall lapse upon a change of control of the Company.

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Each of Messrs. Franklin’s, Ashken’s and Lillie’s employment agreements provides that if it shall be determined that any payment, distribution or benefit provided (including, without limitation, the acceleration of any payment, distribution or benefit and the acceleration of exercisability of any stock option) to Messrs. Franklin, Ashken or Lillie or for any of their respective benefits (whether paid or payable or distributed or distributable) pursuant to the terms of their respective employment agreements or otherwise (a “Payment”) would be subject, in whole or in part, to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then Messrs. Franklin, Ashken or Lillie shall be entitled to receive from the Company an additional payment (the “Gross-Up Payment”) in an amount such that the net amount of the Payment and the Gross-Up Payment retained

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by Mr. Franklin, Mr. Ashken or Mr. Lillie after the calculation and deduction of all Excise Taxes (including any interest or penalties imposed with respect to such taxes) on the Payment and all federal, state and local income tax, employment tax and Excise Tax (including any interest or penalties imposed with respect to such taxes) on the Gross-Up Payment and taking into account any lost or reduced tax deductions on account of the Gross-Up Payment, shall be equal to the Payment.

In accordance with the terms of the Franklin 2009 Grant, the Ashken 2009 Grant and the Lillie 2009 Grant, the restrictions on the shares will lapse on the earlier to occur of: (i) the last day of any five consecutive trading day period during which the average closing price of the Company’s common stock on the New York Stock Exchange (or such other securities exchange on which the Company’s common stock may then be traded) equals or exceeds twelve dollars and eighty eight cents ($12.88), or 12% above the closing stock price on December 31, 2008, the maximum percentage allowed under Messrs. Franklin’s, Ashken’s and Lillie’s respective employment agreements, or (ii) the date there is a Change in Control of the Company (as defined in their respective employment agreements). The vesting requirement on the Franklin 2009 Grant, the Ashken 2009 Grant and the Lillie 2009 Grant have been satisfied pursuant to their terms.

In accordance with the terms of the Franklin 2010 Grant, the Ashken 2010 Grant and the Lillie 2010 Grant, the restrictions on the shares will lapse on the earlier to occur of: (i) the last day of any five consecutive trading day period during which the average closing price of the Company’s common stock on the New York Stock Exchange (or such other securities exchange on which the Company’s common stock may then be traded) equals or exceeds thirty four dollars ($34.00), which is 10% above the closing stock price on December 31, 2009, or (ii) the date there is a Change in Control of the Company (as defined in their respective employment agreements).

John E. Capps and Richard T. Sansone

The Company’s employment agreement with John E. Capps, dated as of May 24, 2007, as amended, provides for an initial two-year term subject to successive one-year renewal terms, such renewal terms to be automatic unless either party gives prior written notice of non-renewal. Under the employment agreement, Mr. Capps currently receives an annual base salary of $358,750, as well as a bonus package based on the Company’s performance. Mr. Capps voluntarily agreed to accept a 5% pay decrease during fiscal year 2009 from the base rate of pay in effect for Mr. Capps as of December 31, 2008. Mr. Capps’ employment agreement also entitles him to participate in the medical, insurance and other fringe benefit plans or policies the Company may make available to, or have in effect for, its personnel with commensurate duties from time to time.

The Company’s employment agreement with Richard T. Sansone, dated as of May 24, 2007, as amended, provides for an initial two-year term subject to successive one-year renewal terms, such renewal terms to be automatic unless either party gives prior written notice of non-renewal. Under the employment agreement, Mr. Sansone currently receives an annual base salary of $360,000,$369,000, as well as a bonus package based on the Company’s performance. Mr. Sansone voluntarily agreed to accept a 5% pay decrease duringfor the first six months of the 2009 fiscal year 2009 from the base rate of pay in effect for Mr. Sansone as of December 31, 2008.2008 in recognition of the then recessionary macroeconomic environment and its impact on the Company. Mr. Sansone’s employment agreement also entitles him to participate in the medical, insurance and other fringe benefit plans or policies the Company may make available to, or have in effect for, its personnel with commensurate duties from time to time.

Each of Messrs. Capps’ andMr. Sansone’s employment agreement contains a non-competition covenant and non-solicitation provisions (relating to the Company’s employees and customers) effective during the term of his employment and continuing for a period of 12 months after the expiration or termination of Messrs. Capps’ orMr. Sansone’s employment, respectively.employment. For a description of any amount to be received by each of Messrs. Capps andMr. Sansone in the event their respectivehis employment is terminated or due to a change of control of the Company, see the Section titled “Potential Payments on Termination or Change of Control.”

On November 7, 2007, the Company entered into an equity vesting lock-up and amendment agreement with each of Messrs. Capps andMr. Sansone amending their respectivehis employment agreementsagreement in which the Company agreed to: (i) (a) accelerate the vesting of 5,624 options previously granted to Mr. Capps, and (b) accelerate the vesting of 25,875 shares of restricted stock previously granted to Mr. Capps; and (ii) accelerate the vesting of 29,000 shares of restricted stock previously granted to Mr. Sansone. Pursuant to such equity vesting lock-up and amendment agreements, each of Messrs. Capps andagreement, Mr. Sansone is prohibited until November 7, 2012, from offering, selling, transferring, contracting to sell, or otherwise disposing of, directly or indirectly, any of such stock without prior written consent of the Company, except as set forth below. Notwithstanding the foregoing, each of Messrs. Capps andMr. Sansone shall generally be entitled to sell up to but no more than 20% of such shares of such stock in any calendar year during the period

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from January 1, 2008 through December 31, 2012 and as fully set forth in the equity vesting lock-up and amendment agreements. Each of Messrs. Capps andagreement. Mr. Sansone

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shall be entitled to sell all of such stock at any time on or after January 1, 2013, subject to applicable law, regulation or stock exchange rule. The foregoing restrictions on transfer shall lapse upon the first to occur of (i) a termination of employment with the Company, (ii) a change of control of the Company and/or (iii) a tender for all of the Company’s issued and outstanding shares of Common Stock. As an inducement for the Company to accelerate the granting and/or vesting of any of such stock, and notwithstanding anything to the contrary contained in any employment agreement or any policy of the Company or any subsidiary or affiliate thereof that would otherwise be applicable, in the event that the employment of any of Messrs. Capps and Sansone is terminated prior to November 7, 2009 other than (i) by reason of his death or disability or (ii) after a change of control of the Company, Messrs. Capps and Sansone will not receive or be eligible to receive, and will not seek, any payment of severance pay (including any post-termination payment(s) based on salary or bonus), or any other payment in lieu of the foregoing, from the Company or any subsidiary or affiliate to which any of them would otherwise be entitled pursuant to his employment agreement or otherwise, except for 401(k) balances, if any, to which any of them would be entitled pursuant to the applicable 401(k) plan.

Potential Payments Upon Termination or Change of Control

The following table summarizes the estimated payments to be made under each contract, agreement, plan or arrangement which provides for payments to a Named Executive Officer at, following, or in connection with any termination of employment including by resignation, retirement, disability or a constructive termination of a Named Executive Officer, or our change of control or a change in the Named Executive Officer’s responsibilities. However, in accordance with SEC regulations, we do not report any amount to be provided to a Named Executive Officer under any arrangement which does not discriminate in scope, terms, or operation in favor of our executive officers and which are available generally to all salaried employees. These benefits are in addition to the benefits to which the executives would be entitled upon a termination of employment generally (i.e., vested retirement benefits accrued as of the date of termination, stock awards that are vested as of the date of termination and the right to elect continued health coverage pursuant to COBRA).

For the purpose of the quantitative disclosure in the following table, and in accordance with SEC regulations, we have assumed that the termination took place on the last business day of our most recently completed fiscal year, and that the price per share of our Common Stock is the closing market price as of that date is $11.50.$30.91. The description set forth below provides estimates of the compensation and benefits that would be provided to the Named Executive Officers upon their termination of employment; however, in the event of an executive’s separation from the Company, any actual amounts will be determined based on the facts and circumstances in existence at that time.

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Martin E. Franklin and Ian G.H. Ashken: Benefits Payable Upon Early Termination; Change of Control.

If (1) an early termination of the employment period of Mr. Franklin or Mr. Ashken occurs pursuant to (a) a termination on account of executive’s death, (b) a termination due to executive’s Disability (as defined below), (c) a Termination for Cause (as defined below), (d) a Termination Without Cause (as defined below), (e) a Termination for Good Reason (as defined below) or (f) a Termination Not for a Good Reason (as defined below), or (2) following a Change of Control (as defined below) of the Company after which the executive remains employed by the Company or its successor under the terms of his current employment agreement, Mr. Franklin or Mr. Ashken (or, in the event of his death, his respective surviving spouse, if any, or his respective estate) shall be paid the following:

Martin E. Franklin

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The aforementioned calculation assumes that all of Mr. Franklin’s restricted shares (230,000(990,000 shares) will automatically vest at a closing market price on December 31, 20082009 of $11.50$30.91 for a value of $2,645,000.$30,600,900. Annual medical and dental insurance premiums are assumed to be $15,151.$15,951.

Mr. Franklin is entitled to tax gross-up payments following a Change of Control if his payments trigger an excise tax under Section 280G of the Code. However, based on an assumed Change of Control and termination on December 31, 2008,2009, the payments that Mr. Franklin would receive would not trigger a tax gross-up payment.

Ian G.H. Ashken

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The aforementioned calculation assumes that all of Mr. Ashken’s restricted shares (95,000(420,000 shares) will automatically vest at a closing market price on December 31, 20082009 of $11.50$30.91 for a value of $1,092,500.$12,982,200. Annual medical and dental insurance premiums are assumed to be $15,151.$15,951.

Mr. Ashken is entitled to tax gross-up payments following a change of control if his payments trigger an excise tax under Section 280G of the Code. However, based on an assumed change of control and termination on December 31, 2008,2009, the payments that Mr. Ashken would receive would not trigger a tax gross-up payment.

In connection with the payments set forth above for Messrs. Franklin and Ashken, Earned Salary shall be paid in cash in a single lump sum as soon as practicable following the end of the employment period, but in no event more than 10 days thereafter;provided, that if executive’s termination is in conjunction with a Change of

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Control, executive shall be paid his Earned Salary on the earlier to occur of (a) five (5) days after the effective date of executive’s termination and (b) on the date of such Change of Control. Vested Benefits shall be payable in accordance with the terms of the plan, policy, practice, program, contract or agreement under which such benefits have been awarded or accrued. Additional Termination Benefits shall be provided or made available at the times specified above as to each such Additional Termination Benefit. Unless otherwise specified, Severance

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Benefits shall be paid in a single lump sum cash payment as soon as practicable, but in no event later than 10 days after the executive’s termination;provided, that (i) if executive’s termination is in conjunction with a Change of Control, executive shall be paid his Severance Benefits on the earlier to occur of (a) five (5) days after the effective date of executive’s termination and (b) on the date of such Change of Control, and (ii) if executive is a “specified employee” within the meaning of Section 409A of the Code, at the time of his termination of employment, then (1) on the earlier to occur of (x) five (5) days after the effective date of executive’s termination and (y) on the date of such Change of Control, executive shall be paid Severance Benefits in an amount equal to no more than two times the lesser of (A) the sum of the executive’s annualized compensation based upon the annual rate of pay for services provided to the Company for the year preceding the year in which the executive’s employment terminates or (B) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which the executive’s employment terminates, and (2) any remaining Severance Benefits shall be paid six (6) months and one (1) day following his termination of employment.

For purposes of the foregoing description of the benefits payable to Messrs. Franklin and Ashken upon early termination or a change of control, the following terms shall have the following meanings:

“Change of Control of the Company” generally means and shall be deemed to have occurred if (i) any person, other than the Company, is or becomes the “beneficial owner” directly or indirectly, of voting securities representing 50 percent or more of the total voting power of all the then-outstanding voting securities; or (ii) the current members of the Board cease to constitute a majority of the Board; or (iii) the stockholders of the Company approve a merger, consolidation, recapitalization or reorganization of the Company,provided, that any such transaction in which the holders of outstanding voting securities immediately prior to the transaction receive, with respect to such voting securities, voting securities of the surviving or transferee entity representing more than 60 percent of the total voting power outstanding immediately after such transaction shall not be deemed a Change of Control if the voting power of each such continuing holder relative to other such continuing holders not substantially altered in such transaction; or (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

“Disability” means long-term disability within the meaning of the Company’s long-term disability plan under which executive is covered at the time of determination.

“Termination for Cause” means a termination of executive’s employment by the Company within 30 days after the occurrence of (i) executive’s conviction of a felony or a crime involving moral turpitude, or (ii) executive’s willful and continued failure to perform the material duties of his position (other than as a result of Disability) if such failure continues for a period of 30 days after executive’s receipt of written notice from the Company specifying the exact details of such alleged failure and such alleged failure has had (or is expected to have) a material adverse effect on the business of the Company or its subsidiaries.

“Termination for Good Reason” generally means a termination of executive’s employment by executive following (i) a material diminution in executive’s positions, duties and responsibilities, (ii) the removal of executive from his current position, unless mutually agreed upon, (iii) a material reduction in executive’s Base Salary, (iv) a material breach by the Company of any other provision of the employment agreement or (v) a Change in Control of the Company (but in no event later than six months after such Change of Control).

“Termination Not For Good Reason” means any termination of executive’s employment by executive other than Termination for Good Reason or a termination due to executives Disability or death.

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“Termination Without Cause” means any termination of executive’s employment by the Company other than a Termination for Cause or a termination due to executive’s Disability.

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Messrs. Franklin and Ashken are subject to certain non-competition covenants and non-solicitation provisions as further set forth above under the caption titled “Employment Agreements.” Messrs. Franklin and Ashken are also subject to confidentiality provisions under the terms of their respective employment agreements.

James E. Lillie and Richard T. Sansone and John E. Capps:Sansone: Benefits Payable Upon Early Termination; Change of Control.

James E. Lillie

If Mr. Lillie’s employment were to be terminated by the Company without Cause, or upon Disability, he would be provided a lump sum payment equal to (i) twenty-four months’ base salary at the time of termination and (ii) the greater of (x) twenty-four months’ target bonus which Mr. Lillie would have been entitled to receive for achieving budget for the year in which Mr. Lillie’s employment was terminated and (y) the sum of the actual performance bonuses (excluding discretionary bonuses), if any, paid to Mr. Lillie with respect to the two fiscal years immediately preceding the year in which Mr. Lillie’s employment was terminated;provided,however, pursuant to that certain equity vesting lock-up and amendment agreement as described in the section entitled “Employment Agreements,” Mr. Lillie will not be entitled to severance payments due to a termination without cause.terminated. Mr. Lillie is also entitled to the continuation of health insurance and other benefits for the period for which Mr. Lillie could elect COBRA continuation coverage under the Company’s health insurance plans as a result of his termination of employment; plus, the full vesting of any outstanding stock options and the lapsing of any restrictions over any restricted shares owned by Mr. Lillie. In addition, if Mr. Lillie’s employment is terminated by the Company without Cause, each of the annual restricted stock awards set forth in his employment agreement shall be granted, notwithstanding whether the scheduled grant date has been achieved. Mr. Lillie will also be entitled to receive a cash payment in a lump sum within 10 days after termination of employment, or, if, on the date of such termination of employment, Mr. Lillie is a “specified employee” within the meaning of Section 409A of the Code, on the day after the expiration of 6 months following such termination of employment.

The cash portion of the Severance Amount shall be paid to Mr. Lillie as promptly as practicable after the date of termination and in no event later than 10 days after termination, provided that, if Mr. Lillie is a “specified employee” within the meaning of Section 409A of Code, at the time of his termination of employment, then (1) no later than 10 days after the date of termination, Mr. Lillie shall be paid the cash portion of the severance amount in an amount equal to no more than two times the lesser of (A) the sum of Mr. Lillie’s annualized compensation based upon the annual rate of pay for services provided to the Company for the year preceding the year in which Mr. Lillie’s employment terminates or (B) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which Mr. Lillie’s employment terminates, and (2) any remaining severance amount shall be paid 6 months and 1 day following his termination of employment.

Richard T. Sansone

If Mr. Sansone’s employment were to be terminated by the Company without Cause or upon Disability, he would be provided a lump sum payment equal to (i) his annual base salary at the time of termination, plus (ii) one year’s target bonus which Mr. Sansone would be entitled to receive for achieving budget for the year in which his employment was terminated, plus (iii) continuation of medical and dental insurance for one year at the expense of the Company, plus (iv) the full vesting of any outstanding stock options and the lapsing of any restrictions over any restricted shares owned by Mr. Sansone;provided,however, pursuant to that certain equity vesting lock-up and amendment agreement as described in the section entitled “Employment Agreements,” Mr. Sansone will not be entitled to severance payments due to a termination without Cause.Sansone. The cash portion of the severance amount shall be paid to Mr. Sansone as promptly as practicable after the date of termination and in no event later than 10 days after termination.

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John E. Capps

If Mr. Capps’ employment were to be terminated by the Company without Cause or upon Disability, he would be provided a lump sum payment equal to (i) his annual base salary at the time of termination, plus (ii) one year’s target bonus which Mr. Capps would be entitled to receive for achieving budget for the year in which his employment was terminated, plus (iii) continuation of medical and dental insurance for one year at the expense of the Company, plus (iv) the full vesting of any outstanding stock options and the lapsing of any restrictions over any restricted shares owned by Mr. Capps;provided,however, pursuant to that certain equity vesting lock-up and amendment agreement as described in the section entitled “Employment Agreements,” Mr. Capps will not be entitled to severance payments due to a termination without Cause. The cash portion of the severance amount shall be paid to Mr. Capps as promptly as practicable after the date of termination and in no event later than 10 days after termination.

The following tables show the potential payments upon termination of Messrs. Lillie Sansone and Capps,Sansone, upon the specified events:

James E. Lillie

In connection with the receipt of the payments above, Mr. Lillie is required to enter into a mutual release of claims with the Company following the termination of his employment. Mr. Lillie is also subject to certain non-competition covenants and non-solicitation provisions as further set forth above under the caption titled “Employment Agreements.” Mr. Lillie is also subject to confidentiality provisions under the terms of his employment agreement.

Severance payments assume 24 months of annual base salary of $650,875$619,537 and an average bonus of $610,800. Benefits assume 24 months of benefits at an annual rate of $15,151$15,951 for medical and dental premiums. All of Mr. Lillie’s restricted shares (40,000 shares) would vest at the market closing price on December 31, 20082009 of $11.50$30.91 for a value of $460,000.$1,236,400.

Mr. Lillie is entitled to tax gross-up payments following a change of control if his payments trigger an excise tax under Section 280G of the Code. However, based on an assumed change of control and termination on December 31, 2008,2009, the payments that Mr. Lillie would receive would not trigger a tax gross-up payment.

Mr. Lillie has a change of control provision in his employment agreement solely related to his unvested restricted stock awards. Upon change of control, the restrictions on Mr. Lillie’s restricted shares shall lapse and become fully vested.

For purposes of Mr. Lillie’s employment agreement, “Change of Control of the Company” generally means and shall be deemed to have occurred if (i) any person, other than the Company, is or becomes the “beneficial owner,” directly or indirectly, of voting securities representing 50 percent or more of the total voting power of all the then-outstanding voting securities; or (ii) the current members of the Board cease to constitute a majority of

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the Board; or (iii) the stockholders of the Company approve a merger, consolidation, recapitalization or reorganization of the Company,provided, that any such transaction in which the holders of outstanding voting securities immediately prior to the transaction receive, with respect to such voting securities, voting securities of the surviving or transferee entity representing more than 60 percent of the total voting power outstanding immediately after such transaction shall not be deemed a Change of Control if the voting power of each such continuing holder relative to other such continuing holders not substantially altered in such transaction; or (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company of all or substantially all of the Company’s assets.

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Richard T. Sansone

Mr. Sansone is subject to certain non-competition covenants and non-solicitation provisions as further set forth above under the caption titled “Employment Agreements.” Mr. Sansone is also subject to confidentiality provisions under the terms of his employment agreement.

Severance payments assume annual base salary of $360,000$351,333 and an annual target bonus of $180,000.$175,667. Benefits assume one year of benefits at an annual rate of $15,151$15,951 for medical and dental premiums.

Mr. Sansone’s employment agreement does not contain any payments to him upon a change of control of the Company.

John E. Capps