Amended And Restated Resolution Performance Products, Inc. Restricted Unit Plan

Exhibit 10.34


RESOLUTION PERFORMANCE PRODUCTS, INC.


RESTRICTED UNIT PLAN

(As Amended and Restated May 31, 2005)

TABLE OF CONTENTS

Page


ARTICLE I

DEFINITIONS 1

ARTICLE II

SHARES SUBJECT TO THE PLAN 4

ARTICLE III

RESTRICTED UNIT ACCOUNT 4

3.1 Restricted Unit Account 4

3.2 Account Credits And Debits 4

3.3 Dividend Equivalents 4

ARTICLE IV

VESTING 4

ARTICLE V

ADJUSTMENTS 5

ARTICLE VI

DISTRIBUTIONS 5

6.1 Distribution of Shares 5

6.2 Special Rule for Key Employees 5

6.3 Distribution for Unforeseeable Emergencies 5

ARTICLE VII

ADMINISTRATION 6

7.1 Committee 6

7.2 Rules For Administration 6

7.3 Committee Action 6

7.4 Delegation 6

7.5 Services 6

ARTICLE VIII

AMENDMENT AND TERMINATION 6

ARTICLE IX

GENERAL PROVISIONS 7

9.1 Limitation Of Rights 7

9.2 Employment Rights 7

9.3 Assignment, Pledge Or Encumbrance 7

9.4 Investor Rights Agreement 7

9.5 Binding Provisions 7

9.6 Governing Law 7

9.7 Pronouns 7

9.8 Withholding 8

9.9 Construction 8


-i-

WHEREAS , Resolution Performance Products, Inc., a Delaware corporation (the " Company" ), maintains this Restricted Unit Plan (the " Plan" ) in which Marvin O. Schlanger (the " Participant" ) is the sole participant;

WHEREAS , in light of certain changes to the tax laws applicable to nonqualified deferred compensation arrangements such as the Plan as set forth in Section 409A of the Internal Revenue Code and any regulations or other guidance promulgated thereunder (" Section 409A" ), the Company and the Participant desire to amend the Plan so that it complies with the requirements of Section 409A;


WHEREAS , this amended and restated version of the Plan is intended by the Company and the Participant to so comply with Section 409A; and

WHEREAS , the Company is authorized under Article VIII of the Plan to amend the Plan, provided that the Company may not amend Article VI of the Plan to adversely affect the Participant' s rights under such Article VI without the Participant' s consent;

NOW, THEREFORE , the Company and the Participant hereby agree that the Plan be, and it hereby is, amended and restated as set forth herein, effective as of May 31, 2005 (the " Effective Date" ).


ARTICLE I


DEFINITIONS

" Board" means the Board of Directors of the Company.


" Change in Control Event" shall mean any of the following:


(a) Approval by stockholders of the Company (or, if no stockholder approval is required, by the Board alone) of the complete dissolution or liquidation of the Company, other than in the context of a Business Combination that does not constitute a Change in Control Event under paragraph (c) below;


(b) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a " Person" )) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of either (1) the then-outstanding shares of common stock of the Company (the " Outstanding Company Common Stock" ) or (2) the combined voting power of the then-outstanding voting securities of the Company entitled to vote generally in the election of directors (the " Outstanding Company Voting Securities" ); provided , however , that, for purposes of this paragraph (b), the following acquisitions shall not constitute a Change in Control Event; (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any affiliate or a successor, (D) any acquisition by any entity pursuant to a Business Combination, (E) any acquisition by a Person described in and satisfying the conditions of Rule 13d-1(b) promulgated under the

Exchange Act, or (F) any acquisition by a Person who is the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of the Outstanding Company Common Stock and/or the Outstanding Company Voting Securities on the Effective Date (or an affiliate, heir, descendant, or related party of or to such Person); or

(c) Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company or any corporation or other entity a majority of whose outstanding voting stock or voting power is beneficially owned directly or indirectly by the Company (a " Subsidiary" ), a sale or other disposition of all or substantially all of the assets of the Company, or the acquisition of assets or stock of another entity by the Company or any of its Subsidiaries (each, a " Business Combination" ), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company' s assets directly or through one or more subsidiaries (a " Parent" )), and (2) no Person (excluding any individual or entity described in clauses (C), (E) or (F) of paragraph (b) above) beneficially owns (within the meaning of Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, more than 50% of, respectively, the then-outstanding shares of common stock of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that the ownership in excess of 50% existed prior to the Business Combination.


Notwithstanding the foregoing definition, in no event will (i) a Public Offering, (ii) any transaction or series of transactions that occurs prior to a Public Offering, or (iii) ...