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.          )

REDDY ICE HOLDINGS, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 20, 2009

To Our Stockholders:

        You are cordially invited to attend the Annual Meeting of Stockholders of Reddy Ice Holdings, Inc. ("Reddy Ice"), to be held at 9:00 a.m., Central Daylight Time, on Wednesday, May 20, 2009 at the Northpark Central Office Tower at 8750 North Central Expressway, 3rd Floor, Dallas, Texas 75231, for the following purposes:

1.

to elect seven directors of Reddy Ice to hold office until the next annual meeting of stockholders and until their respective successors are duly elected and qualified;



2.

to ratify the appointment of PricewaterhouseCoopers LLP as Reddy Ice's independent registered public accounting firm for the fiscal year ending December 31, 2009;



3.

to consider and approve the amendment to the Reddy Ice Holdings, Inc. 2005 Long Term Equity Incentive and Share Award Plan, as amended (the "Plan"); and



4.

to transact such other business as may properly be brought before the meeting or any adjournment(s) thereof.

        Only holders of record of Reddy Ice's common stock at the close of business on April 7, 2009 will be entitled to notice of and to vote at the meeting or any adjournment thereof.

        Your vote is important. Whether or not you plan to attend the meeting, please vote your shares. In addition to voting in person or by mail, stockholders of record have the option of voting via the Internet or telephone. If your shares are held in the name of a bank, broker or other holder of record (i.e., in "street name"), please check your proxy card or other voting instructions to see which of these options are available to you. Even if you are attending the meeting in person, we encourage you to vote in advance by mail, Internet or telephone.

        If you are planning to attend the meeting in person, because of security procedures, you will need to register in advance to gain admission to the meeting. You can register by calling Investor Relations at (214) 526-6740 or via the Internet at InvestorRelations@reddyice.com by May 13, 2009. If you are a holder of record and plan to attend the meeting, you also can register by checking the appropriate box on your proxy card. In addition to registering in advance, you will be required to present government issued photo identification (e.g., driver's license or passport) to enter the meeting. Packages and bags will be inspected, and bags may have to be checked, among other measures that may be employed to enhance the security of those attending the meeting. These procedures may require additional time, so please plan accordingly.

        IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE MEETING OF STOCKHOLDERS TO BE HELD ON MAY 20, 2009: A complete set of proxy materials relating to our annual meeting is available on the Internet. These materials, consisting of the Notice of Annual Meeting and Proxy Statement, including Proxy Card and 2008 Annual Report to Stockholders, may be viewed at http://www.reddyiceproxy.com.

		By Order of the Board of Directors,
		WILLIAM P. BRICK Chairman of the Board of Directors and Executive Chairman

Dallas, Texas
April 16, 2009

REDDY ICE HOLDINGS, INC.

8750 NORTH CENTRAL EXPRESSWAY, SUITE 1800

DALLAS, TEXAS 75231

PROXY STATEMENT

2009 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 20, 2009

GENERAL INFORMATION ABOUT THE PROXY
MATERIALS AND THE ANNUAL MEETING

        The Board of Directors of Reddy Ice Holdings, Inc. (the "Company" or "Reddy Ice") is soliciting proxies for the 2009 Annual Meeting of Stockholders to be held at the Northpark Central Office Tower at 8750 North Central Expressway, 3rd Floor, Dallas, Texas 75231 on Wednesday, May 20, 2009 at 9:00 a.m., Central Daylight Time (the "Annual Meeting"). This proxy statement and the accompanying proxy card contain information about the items you will vote on at the Annual Meeting. We began mailing this proxy statement and the enclosed proxy card on or about April 16, 2009 to all stockholders entitled to vote. The Reddy Ice Annual Report, which includes financial statements, is being sent with this proxy statement.

Who is entitled to vote?

        If you are the holder of record of common stock, $0.01 par value per share, of the Company (the "common stock") at the close of business on April 7, 2009 (the "Record Date"), you are entitled to vote at the Annual Meeting and at any and all adjournments or postponements of the Annual Meeting. You are entitled to one vote for each share of common stock you own for each matter presented for vote at the Annual Meeting. As of the close of business on the Record Date, there were 22,114,116 shares of common stock outstanding. For ten days prior to the meeting, a complete list of stockholders entitled to vote at the meeting will be available for examination by any stockholder, for any purpose relating to the meeting, during ordinary business hours at our principal offices located at 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231.

How to vote?

        Stockholders of record may vote in person (i) by attending the Annual Meeting, (ii) by completing and returning the proxy by mail, (iii) by using the Internet or (iv) by telephone. To vote your proxy by mail, mark your vote on the enclosed proxy card, then return it by following the directions on the card. Your proxy, if not properly revoked, will be voted in accordance with your instructions. If you vote by using the Internet or telephone, you do NOT need to return your proxy card. If you do not mark a selection, your proxy will be voted as recommended by the Board of Directors. Your vote is very important, so whether you plan to attend the Annual Meeting or not, we encourage you to vote by proxy as soon as possible.

What is the difference between holding shares as a stockholder of record and as a beneficial owner?

        If your shares are registered directly in your name with the Company's transfer agent, American Stock Transfer & Trust Company, you are considered the stockholder of record with respect to those shares, and these proxy materials are being sent directly to you on behalf of the Company. As the stockholder of record, you have the right to grant your voting proxy to the Company or to vote in person at the meeting. The Company has enclosed a proxy card for you to use.

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        If your shares are held in a brokerage account or by another nominee, you are considered the beneficial owner of shares held in street name, and these proxy materials are being forwarded to you together with a voting instruction card. As the beneficial owner, you have the right to direct your broker, trustee or nominee how to vote and are also invited to attend the Annual Meeting. Since a beneficial owner is not the stockholder of record, you may not vote these shares in person at the Annual Meeting unless you obtain a "legal proxy" from the broker, trustee or nominee that holds your shares, giving you the right to vote the shares at the Annual Meeting. Your broker, trustee or nominee will send you separate instructions describing the procedure for voting your shares.

How can I change my vote?

        You may revoke your proxy or change your voting instructions before the time of voting at the Annual Meeting by (i) delivering a written revocation or a later-dated proxy to the Secretary of the Company at the address of the Company's principal executive offices, (ii) attending the Annual Meeting and voting in person or (iii) providing subsequent Internet or telephone voting instructions.

How many shares must be present or represented to constitute a quorum for the Annual Meeting?

        The presence of a majority of the outstanding shares, in person or represented by proxy, of the common stock entitled to vote at the Annual Meeting constitutes a quorum. A quorum is necessary in order to conduct business at the Annual Meeting. You are part of the quorum if you have voted by proxy. Shares held of record by your broker, trustee or nominee ("Broker Shares") that are voted on any matter and abstentions are included in determining the number of votes present. Broker Shares that are not voted on any matter at the Annual Meeting are not included in determining whether a quorum is present. If a quorum is not present, the Annual Meeting will be rescheduled for a later date.

How does the Board of Directors recommend that I vote?

        The Board of Directors recommends that you vote your shares "FOR" each of the nominees to the Board of Directors, "FOR" the ratification of the independent registered public accounting firm for the fiscal year ending December 31, 2009 and "FOR" the proposal to approve the amendment to the Reddy Ice Holdings, Inc. 2005 Long Term Equity Incentive and Share Award Plan, as amended (the "Plan").

What is the voting requirement to approve each of the proposals?

        Election of Directors.    Directors are elected by a plurality of the votes cast, in person or by proxy, at the Annual Meeting. The seven nominees receiving the highest number of affirmative votes at the Annual Meeting will be elected as directors for a one-year term. Abstentions and Broker Shares that are not voted in the election of directors will have no effect on the election of directors.

        Ratification of Appointment of Independent Registered Public Accounting Firm.    The appointment of the independent registered public accounting firm for the fiscal year ending December 31, 2009 will be ratified if the votes cast, in person or by proxy, at the Annual Meeting for ratification exceed the number of votes cast against ratification. If you "Abstain" from voting, it will have the same effect as an "Against" vote. Broker Shares that are not voted on the ratification of the appointment of the independent registered public accounting firm will have no effect on the proposal.

        Approval of the Amendment to the Reddy Ice Holdings, Inc. 2005 Long Term Equity Incentive and Share Award Plan, as amended.    The amendment to the Plan, in person or by proxy, at the Annual Meeting for approval exceed the number votes cast against approval. If you "Abstain" from voting, it will have the same effect as an "Against" vote. Broker Shares that are not voted on the proposal to increase the total shares authorized under the Plan will have no effect on the proposal.

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        Other Matters.    The affirmative vote of the majority of shares present, in person or by proxy, at the Annual Meeting is generally required for approval for all other matters that may properly come before the Annual Meeting. If any other matter not discussed in this proxy statement properly comes before the Annual Meeting upon which a vote may be taken, shares represented by all proxies received by the Company will be voted on that matter in accordance with the discretion of the persons named as proxy holders.

How are votes counted?

        Stockholders' proxies are received by the Company's independent proxy tabulating agent, and the vote is certified by an inspector of election. Proxies and ballots that identify the vote of individual stockholders will be kept confidential, except as necessary to meet legal requirements, in cases where stockholders write comments on their proxy cards, or in a contested proxy solicitation. During the proxy solicitation period, the Company will receive vote tallies from time to time from the inspector, but such tallies will provide aggregate figures rather than names of stockholders. The inspector will notify the Company if a stockholder has failed to vote.

Who will bear the cost of soliciting votes for the Annual Meeting?

        The Company will bear the entire cost of this proxy solicitation, including the preparation, printing and mailing of this proxy statement, the proxy card and any additional soliciting materials sent by the Company to stockholders. The Company may reimburse brokerage firms and other persons representing beneficial owners of shares for reasonable expenses incurred by them in forwarding proxy-soliciting materials to such beneficial owners. In addition to solicitations by mail, certain of the Company's directors, officers and regular employees, without additional remuneration, may solicit proxies by telephone, facsimile and personal interviews. Solicitation by officers and employees of the Company may also be made of some stockholders in person or by mail, telephone or facsimile following the original solicitation. In addition, the Company will retain Morrow & Co., Inc. to assist with the solicitation of votes using the means referred to above, and that firm will receive a fee of approximately $5,000, plus reimbursement of out of pocket expenses. The Company will bear all costs related to such engagement.

How can interested parties communicate with the Board of Directors?

        Interested parties who want to communicate with the Board of Directors or any individual director can write to them c/o Reddy Ice Holdings, Inc., 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231, Attention: Corporate Secretary, Steven J. Janusek. If applicable, your letter should indicate that you are a Company stockholder. Depending on the subject matter, our Corporate Secretary will: (i) forward the communication to the director or directors to whom it is addressed; or (ii) attempt to handle the inquiry directly, for example when the request is for information about the Company or is a stock-related matter; or (iii) not forward the communication if it is primarily commercial in nature or if it relates to an improper or irrelevant topic. At each Board of Directors meeting, a member of management will present a summary of all communications received since the last meeting that were not forwarded to the director or directors to whom they were addressed, and will make those communications available to the Board of Directors upon request.

        Any interested party who wishes to communicate directly via e-mail with the presiding non-management member of the Company's Board of Directors may use a form found on the Investor Relations section of the Company's website at www.reddyice.com.

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When do we anticipate mailing proxy materials to stockholders?

        It is anticipated that this proxy statement and the accompanying proxy card will be first mailed to stockholders on or about April 16, 2009.

Where can I find the voting results of the meeting?

        The preliminary voting results will be announced at the meeting. The final results will be published in our quarterly report on Form 10-Q for the second quarter of 2009.

May I propose actions for consideration at next year's annual meeting of stockholders or nominate individuals to serve as directors?

        You may submit proposals for consideration at future stockholder meetings, including director nominations.

        Under the Securities and Exchange Commission ("SEC") rules, stockholder proposals for our 2010 Annual Meeting of Stockholders must be received at our principal executive offices by December 17, 2009 to be considered for inclusion in our proxy materials relating to that meeting. Nominations for directors must be submitted as described on page 11 of this proxy statement.

        Any stockholder proposals must be in writing and addressed to the attention of our Corporate Secretary. We reserve the right to reject, rule out of order or take other appropriate actions with respect to any proposal or nomination that does not comply with these and other applicable requirements.

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ELECTION OF DIRECTORS
(ITEM 1)

        At the Annual Meeting, seven directors, constituting the entire Board of Directors, are to be elected to hold office until the next annual meeting of the stockholders and until their respective successors have been elected and qualified. Upon the recommendation of the Corporate Governance and Nominating Committee, the Board of Directors has nominated seven directors for election at the Annual Meeting. All of the director nominees are currently directors of Reddy Ice. Each nominee has indicated his willingness to serve as a director, if elected, and we have no reason to believe that any nominee will be unable to serve. The persons designated as proxies, however, reserve full discretion to cast votes for other persons in the event that any one or more of the nominees are unable to serve. Proxies cannot be voted for a greater number of persons than the number of nominees named on the enclosed form of proxy. A plurality of the votes cast in person or by proxy by the holders of common stock is required to elect a director. Under Delaware law and our Amended and Restated Certificate of Incorporation and Bylaws, shares as to which a stockholder withholds authority to vote on the election of directors ("Abstentions") and shares as to which a broker indicates that it does not have discretionary authority to vote ("Broker Non-Votes") will not be counted as voting on the election of directors and will not affect the election of the nominees receiving a plurality of the votes cast. Stockholders may not cumulate their votes in the election of directors. The Board of Directors recommends that you vote "FOR" each of the seven nominees described below.

        The following information regarding the director nominees of Reddy Ice, their principal occupations, employment history and directorships in certain companies is as reported by the respective individuals. All ages are reported as of April 14, 2009.

        Effective as of the Annual Meeting, Mr. Brick will retire as an employee of Reddy Ice. Following his retirement as an employee of Reddy Ice, Mr. Brick will serve as a consultant to Reddy Ice for the remainder of 2009 and will receive fees of $150,000 in the aggregate for his consulting services over that period. Mr. Brick has also served as Chairman of the Board of Directors. It is anticipated that the Board of Directors will elect Mr. Cassagne as Chairman of the Board of Directors following the Annual Meeting.

        On August 15, 2003, Packaged Ice, Inc., or Packaged Ice, merged with, and was renamed, Reddy Ice Group, Inc., or Reddy Group. On January 1, 2007, Reddy Group merged with and into its subsidiary Reddy Ice Corporation. References to "Reddy" refer to Packaged Ice for periods prior to August 15, 2003, Reddy Group for the period from August 15, 2003 to January 1, 2007, and Reddy Ice Corporation for periods after January 1, 2007. Reddy Ice Corporation was originally acquired by Packaged Ice in 1998, and references to Reddy Ice Corporation are to that entity prior to its acquisition by Packaged Ice.

DIRECTOR NOMINEES

        William P. Brick, 57, assumed the position of Executive Chairman on June 23, 2008. Mr. Brick had served as Chief Executive Officer and President on an interim basis since December 1, 2007 after having previously served as Executive Chairman since May 17, 2007. Prior to serving as Executive Chairman in 2007, Mr. Brick was named Chief Executive Officer of the Company and a member of the Company's Board of Directors on August 15, 2003, Chief Executive Officer of Reddy, in April 2001 and the Chairman of Reddy's Board of Directors in June 2001. Prior to joining Reddy, Mr. Brick was employed by Suiza Foods Corporation, now known as Dean Foods Company, where he served as Executive Vice President from July 1996 until October 1996 and as Chief Operating Officer of Dairy Operations from October 1996 until January 2000. Before joining Suiza, Mr. Brick was the Vice President—Sales and Marketing for the Metropoulos Management Group from February 1996 until

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June 1996. From 1995 until January 1996, he served as Vice President—Sales and Marketing for Ultra Products.

        Gilbert M. Cassagne, 52, became Chief Executive Officer and President of the Company, and a member of the Company's Board of Directors, on June 23, 2008. Prior to joining Reddy Ice, Mr. Cassagne was chief executive officer of Cadbury Schweppes Americas Beverages, a division of the multinational consumer products company Cadbury Schweppes, from February 2003 to October 2007, where he also served a part of the executive board. Mr. Cassagne has held numerous other positions within Cadbury including Regional President of Asia Pacific and President of Motts. Prior to Cadbury Schweppes, Mr. Cassagne also worked for consumer products and beverage companies such as Procter & Gamble and Dr Pepper/Seven Up, Inc., prior to its acquisition by Cadbury Schweppes in April 1995.

        Kevin J. Cameron, 40, became a member of the Company's Board of Directors on December 31, 2008. Mr. Cameron has more than ten years of corporate governance and strategy experience. In 2003, Mr. Cameron co-founded Glass Lewis & Company, a leading independent research firm focused on issues of corporate governance. From 2001 to 2002, Mr. Cameron handled corporate affairs for Moxi Digital, a technology venture focused on digital entertainment. From 1997 to 2001, he was employed by NorthPoint Communications, a publicly-traded broadband telecommunications company. Prior to 1997, Mr. Cameron was an attorney with the corporate law firm of Kellogg, Huber, Hansen, Todd & Evans in Washington D.C. and served as a law clerk to the Hon. James L. Buckley of the United States Court of Appeals for the District of Columbia Circuit. Mr. Cameron earned a law degree from the University of Chicago and an undergraduate degree from McGill University. Mr. Cameron also serves as a director of Keryx Biopharmaceuticals, Inc. and as a member of the Shamrock Activist Value Fund's Advisory Panel.

        Theodore J. Host, 63, became a member of the Company's Board of Directors on November 15, 2005. Mr. Host is a private investor. From October 2001 to April 2004, Mr. Host was the CEO and Director, and from November 1999 until October 2001 was President, CEO and a Director, of Prestige Brands International, a consumer products company. Mr. Host worked with McCown DeLeeuw & Co. to create a consumer products start-up company from March 1996 to November 1999. Prior thereto, Mr. Host served as the President and Chief Operating Officer, and later Chief Executive Officer, of The Scotts Company, a lawn care company. Mr. Host holds Bachelor of Arts and Master of Arts degrees in business from New York University.

        Michael S. McGrath, 62, became a member of the Company's Board of Directors on February 22, 2006. Mr. McGrath is the former President and Chief Operating Officer of Dr. Pepper/Seven Up, Inc., the North American business of Cadbury Schweppes plc. From August 1998 to March 2002, Mr. McGrath was President and Chief Operating Officer of Cadbury Beverages/Seven Up. In April 2002, Mr. McGrath's responsibilities as President and Chief Operating Officer were expanded to include Cadbury Schweppes' Dr. Pepper business. Mr. McGrath retired in January 2005 and is currently a private investor. He currently serves as a director for Eaux Vives Waters Inc., Polar Corp. and The Nutrasweet Company. Mr. McGrath holds a Bachelor of Education from Boston College.

        Michael H. Rauch, 70, became a member of the Company's Board of Directors on April 17, 2008. Mr. Rauch is Of Counsel to the law firm of Fried, Frank, Harris, Shriver & Jacobson LLP. Mr. Rauch joined Fried Frank in 1968, was a partner of the firm from 1972 to 2004 and served as co-managing partner of the firm from 1998 to 2003. Mr. Rauch holds a Bachelor of Arts degree from Princeton University and an LL.B. from Harvard Law School.

        Robert N. Verdecchio, 52, became a member of the Company's Board of Directors on September 7, 2005. Mr. Verdecchio is a private investor. From 1997 to 2004 he served as a member of the Board of Directors of Pegasus Communications Corporation when it operated as a provider of satellite, cable and broadcast television as well as of wireless internet access. Mr. Verdecchio also served as Pegasus'

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Chief Financial Officer from 1991 to 2000. Mr. Verdecchio holds a B.S. in Accounting from Temple University.

INFORMATION REGARDING THE BOARD OF DIRECTORS

Composition of the Board of Directors

        Our business is managed under the direction of our Board of Directors. Our Board of Directors currently consists of seven directors. The rules of the New York Stock Exchange ("NYSE") require a majority of the members of our Board of Directors to be "independent" directors. No director will be deemed to be independent unless the Board of Directors affirmatively determines that the director has no material relationship with the Company, either directly or as an officer, shareowner or partner of an organization that has a relationship with the Company. The Board of Directors observes all criteria established by the NYSE and other governing laws and regulations. In its review of director independence, the Board of Directors considers all relevant facts and circumstances, including without limitation, all commercial, banking, consulting, legal, accounting, charitable or other business relationships any director may have with the Company. After conducting its review of director independence in accordance with the foregoing, our Board of Directors has determined that we currently have five independent directors: Kevin J. Cameron, Theodore J. Host, Michael S. McGrath, Michael H. Rauch and Robert N. Verdecchio.

        The Board of Directors held 20 meetings during the year ended December 31, 2008 and acted eight times by written consent. Each incumbent director attended, in person or by telephone, at least 75% of the meetings of both the Board of Directors and committees on which he served during 2008.

Shamrock Agreement

        We entered into a letter agreement dated as of April 17, 2008 with Shamrock Activist Value Fund, L.P., or SAVF, and certain of SAVF's affiliates, which we refer to, together with SAVF, as the Shamrock Activist Value Fund, pursuant to which two Shamrock Activist Value Fund nominees, Christopher S. Kiper and Michael H. Rauch, were designated by the Shamrock Activist Value Fund and appointed to the Board of Directors. Effective December 31, 2008, Christopher S. Kiper resigned from the Company's Board of Directors and was replaced by Kevin J. Cameron as a designee of SAVF.

        The letter agreement provides that, for the period, referred to as the "Effective Period," from April 17, 2008 until the earlier of December 1, 2009 and the date on which the Shamrock Activist Value Fund owns less than 5% of our outstanding common stock, the Shamrock Activist Value Fund will have the right to designate two members of the Board of Directors. The Shamrock Activist Value Fund's designees will be included in the Board of Directors' proxy slates nominated for election to the Board of Directors during the Effective Period. The letter agreement also provides that during the Effective Period, the Shamrock Activist Value Fund (i) will support the Board of Directors' proxy slates and not support or participate in any "withhold the vote" or similar campaign and (ii) will not propose any proxy resolutions or conduct any proxy solicitations or propose nominees except to the Board of Directors and its committees.

        We have agreed that, during the Effective Period, we will not, without SAVF's consent, (i) change the size of the Board of Directors, other than as contemplated by the letter agreement, (ii) amend our certificate of incorporation or bylaws, (iii) select a date earlier than December 1, 2009 as the deadline for advance notice to us of stockholder proposals with respect to our 2010 annual stockholders meeting or (iv) enter into any agreement to do any of the foregoing.

        Pursuant to the letter agreement, the Board of Directors currently consists of seven members. Upon the subsequent departure of a member of the Board of Directors, the Board of Directors will then be reduced in size to six directors.

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        We have been informed by SAVF that, in connection with each of Mr. Cameron's and Mr. Rauch's service as a Shamrock Activist Value Fund nominee and member of the Board of Directors, SAVF has agreed to (i) pay each of them an annual retainer of $150,000 and (ii) provide each of them with limited indemnification for the duration of his service.

Committees of the Board of Directors

        Audit Committee.    Our audit committee currently consists of Kevin J. Cameron, Michael S. McGrath and Robert N. Verdecchio. Mr. Cameron was appointed to the audit committee effective December 31, 2008, replacing Christopher S. Kiper. Each member of the audit committee is financially literate, as such qualification is interpreted by the Board of Directors in its business judgment. In addition, our Board of Directors has determined that Mr. Verdecchio is an "audit committee financial expert" as such term is defined in Item 407(d)(5) of Regulation S-K. In accordance with the requirements of the NYSE, the audit committee is composed entirely of "independent" (as defined under Federal securities laws and the rules of the NYSE) directors. The nominating and governance committee recommends to our Board of Directors nominees for the audit committee.

        The audit committee held seven meetings during the year ended December 31, 2008 and acted three times by written consent. The audit committee will have at least four regular meetings each year. The results of each meeting are reported at the next regular meeting of our Board of Directors.

        The audit committee has the responsibility for overseeing:

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our accounting and financial reporting processes;



•

the reliability of our financial statements;



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the effective evaluation and management of our financial risks;



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our compliance with laws and regulations; and



•

the maintenance of an effective and efficient audit of our financial statements by a qualified independent registered public accounting firm.

        To fulfill these responsibilities, the audit committee will:

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be aware of the current areas of greatest financial risk to us and ensure that management is effectively assessing and managing risks;



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consider the effectiveness of our disclosure controls and procedures to promote timely, accurate, compliant and meaningful disclosure in our periodic reports filed with the SEC;



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periodically review with the independent registered public accounting firm their assessment as to the adequacy of our structure of internal controls over financial accounting and reporting, and their qualitative judgments as to the accounting principles employed and related disclosures by us and the conclusions expressed in our financial reports;



•

review our accounting policies and practices to ensure they meet the requirements with respect to the rules and pronouncements of the Financial Accounting Standards Board, the SEC and the Public Company Accounting Oversight Board;



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select, evaluate and, if necessary, replace our independent registered public accounting firm;



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actively engage in dialogue with the independent auditors with respect to any disclosed relationships or services that may impact the objectivity or independence of the independent registered public accounting firm;



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meet with the independent registered public accounting firm, the internal auditors and senior management to review the scope and methodology of the proposed audit;

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discuss with management policies and practices regarding earnings press releases, as well as financial information and earnings guidance provided to analysts and rating agencies;



•

set clear hiring policies with respect to any current or former employees of our independent registered public accounting firm;



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review periodically our code of conduct and obtain confirmation from management that the policies included in the code of conduct are understood and implemented;



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establish procedures for the receipt, retention and treatment of complaints we receive regarding our internal accounting controls or auditing matters and for the confidential, anonymous submission by employees of their concerns regarding our internal accounting controls and auditing matters; and



•

have the authority to engage independent counsel and other advisers, as necessary, to carry out any of the foregoing duties.

        Our Board of Directors adopted a written charter for the audit committee, which has been filed with the SEC and is also available on our website at http://www.reddyice.com. In addition, stockholders may request a free copy of the audit committee charter from: Reddy Ice Holdings, Inc., 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231, Attention: Corporate Secretary, Steven J. Janusek, or by calling (214) 526-6740.

        Compensation Committee.    Our compensation committee currently consists of Kevin J. Cameron, Theodore J. Host and Robert N. Verdecchio. Mr. Cameron was appointed to the compensation committee effective December 31, 2008, replacing Mr. Kiper. Our Board of Directors has determined that the members of our compensation committee are "independent" in accordance with the rules of the NYSE. The nominating and governance committee recommends to our Board of Directors nominees for the compensation committee.

        The compensation committee held three meetings during the year ended December 31, 2008 and acted three times by written consent. The compensation committee will have at least one regular meeting each year. The results of each meeting are reported at the next regular meeting of our Board of Directors.

        The primary responsibility of the compensation committee will be to develop and oversee the implementation of our philosophy with respect to the compensation of our officers. In that regard, the compensation committee will:

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develop and maintain a compensation policy and strategy that creates a direct relationship between pay levels and corporate performance and returns to stockholders;



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recommend compensation and benefit plans to our Board of Directors for approval;



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review and approve annual corporate and personal goals and objectives to serve as the basis for the chief executive officer's compensation, evaluate the chief executive officer's performance in light of the goals and, based on such evaluation, determine the chief executive officer's compensation;



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determine the annual total compensation for executives in the top four salary grades of our salary grade system;



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with respect to our equity-based compensation plans, approve the grants of stock options and other equity-based incentives as permitted under our compensation plans;

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•

review and recommend compensation for non-employee directors to our Board of Directors; and



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review and recommend employment agreements, severance arrangements and change of control plans that provide for benefits upon a change in control, or other provisions for our executive officers and directors, to our Board of Directors.

        Our Board of Directors adopted a written charter for the compensation committee, which is available on our website at http://www.reddyice.com. In addition, stockholders may request a free copy of the compensation committee charter from: Reddy Ice Holdings, Inc., 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231, Attention: Corporate Secretary, Steven J. Janusek, or by calling (214) 526-6740.

        Corporate Governance and Nominating Committee.    Our corporate governance and nominating committee (referred to herein as the "governance and nominating committee") currently consists of Theodore J. Host, Michael S. McGrath and Michael H. Rauch. Our Board of Directors has determined that the members of the governance and nominating committee are "independent" in accordance with the rules of the NYSE. The governance and nominating committee recommends to our Board of Directors nominees for the governance and nominating committee.

        The governance and nominating committee held five meetings during the year ended December 31, 2008. The governance and nominating committee will have at least one regular meeting each year. The results of each meeting are reported at the next regular meeting of our Board of Directors. The governance and nominating committee will:

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identify individuals qualified to serve as our directors;



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recommend a set of corporate governance guidelines to our Board of Directors;



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review periodically the composition of our Board of Directors;



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identify and recommend director candidates for our Board of Directors;



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recommend to our Board of Directors nominees for election as directors;



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recommend to our Board of Directors the composition of the committees of the Board of Directors;



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review and approve public disclosures;



•

review periodically our corporate governance guidelines and recommend governance issues that should be considered by our Board of Directors;



•

review periodically our committee structure and operations and the working relationship between each committee and the Board of Directors; and



•

consider, discuss and recommend ways to improve the effectiveness of our Board of Directors.

        Our Board of Directors adopted a written charter for the governance and nominating committee, which is available on our website at http://www.reddyice.com. In addition, stockholders may request a free copy of the governance and nominating committee charter from: Reddy Ice Holdings, Inc., 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231, Attention: Corporate Secretary, Steven J. Janusek, or by calling (214) 526-6740.

        Special Committee (Investigation).    On March 6, 2008, our Board of Directors formed a special committee to conduct an independent investigation of all matters relating to our involvement in the investigation by the Antitrust Division of the United States Department of Justice. The special committee currently consists of Kevin J. Cameron, Theodore J. Host, Michael S. McGrath, Michael H. Rauch and Robert N. Verdecchio. Mr. Cameron was appointed to the special committee effective December 31, 2008, replacing Mr. Kiper.

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        Director Nomination Process.    While there are no formal procedures for stockholder recommendations of nominees to our Board of Directors, the committee will consider nominees recommended by stockholders that meet the stated criteria. A stockholder who wishes to recommend a prospective nominee for the Board of Directors should notify the Company's Corporate Secretary or any member of the governance and nominating committee in writing with whatever supporting material the stockholder considers appropriate prior to the deadline set forth in response to the question "May I propose actions for consideration at next year's annual meeting of stockholders or nominate individuals to serve as directors?" on page 4.

        Generally, candidates for director positions should possess:

•

relevant business and financial expertise and experience, including an understanding of fundamental financial statements;



•

the highest character and integrity and a reputation for working constructively with others;



•

sufficient time to devote to meetings and consultation on Board of Directors matters; and



•

freedom from conflicts of interest that would interfere with performance as a director.

        The governance and nominating committee evaluates prospective nominees from time to time. Criteria used for such evaluations include, but are not limited to, business experience, skills, talents, and the prospective nominee's ability to contribute to the success of the Company. The governance and nominating committee also considers other relevant factors, including the balance of management and independent directors, the need for audit committee and other specialized expertise and relevant industry experience. A prospective candidate nominated by a stockholder is evaluated by the governance and nominating committee in the same manner as any other prospective candidate.

Compensation Committee Interlocks and Insider Participation

        None of our executive officers has served as a director or member of the compensation committee, or other committee serving an equivalent function, of any entity of which an executive officer is expected to serve as a member of our compensation committee.

Codes of Conduct and Ethics and Corporate Governance Guidelines

        Our Board of Directors adopted (1) a code of business conduct and ethics applicable to our directors, officers and employees and (2) corporate governance guidelines, each in accordance with applicable rules and regulations of the SEC and the New York Stock Exchange. Each of these codes of ethics and conduct and the corporate governance guidelines is available on our website at http://www.reddyice.com. In addition, stockholders may request a free copy of the code of ethics and the corporate governance guidelines from: Reddy Ice Holdings, Inc., 8750 North Central Expressway, Suite 1800, Dallas, Texas 75231, Attention: Corporate Secretary, Steven J. Janusek, or by calling (214) 526-6740.

Executive Sessions

        Our corporate governance guidelines require that the non-management directors meet in executive sessions periodically (and at least four times per year), with no members of management present. The Chairman of the Corporate Governance and Nominating Committee presides at such executive sessions. Non-management directors who are not independent under the NYSE rules may participate in these executive sessions, however the non-management independent directors also meet separately in executive session at least once per year. Currently, there are no non-management directors who are not independent under the NYSE rules. However, following Mr. Brick's retirement, Mr. Brick will be a non-management director but will not be independent under the NYSE rules. The Chairman of the Corporate Governance and Nominating Committee presides at such executive sessions.

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DIRECTOR COMPENSATION

        The below table sets forth the non-employee director compensation for 2008:

(1)

Amounts represent the total amount of quarterly retainers and fees for Committee service during 2008 (see Director Compensation below).

(2)

Represents the dollar amount recognized for financial statement reporting purposes with respect to the 2008 fiscal year for the fair value of outstanding restricted shares and restricted share units in accordance with Statement of Financial Accounting Standards No. 123(R), "Share Based Payment" ("SFAS 123R"). For additional information regarding the valuation and accounting for equity instruments, refer to note 12 to the Company's financial statements in the Form 10-K for the year ended December 31, 2008, as filed with the SEC. These amounts reflect the Company's accounting expense for these awards and do not correspond to the actual value that will be recognized by the directors.

(3)

Mr. Cameron was appointed to the Board of Directors effective December 31, 2008 and, as a result, did not receive any compensation in 2008. Mr. Kiper resigned from the Board of Directors effective December 31, 2008.

Director Compensation

        The management members of the Board of Directors do not receive any compensation for their services on the Board of Directors. Each non-management director receives $30,000 per annum as compensation for his service, payable quarterly in arrears. In addition, our non-management directors receive $5,000 per annum for service on the audit committee and $2,500 per annum for service on the compensation committee or the corporate governance and nominating committee, and the chairperson of each committee receives an additional $2,500 for service on the audit committee and $1,000 for service on the compensation committee or the corporate governance and nominating committee. Members of the special committee (investigation) began receiving $750 for each meeting of the committee attended in person and $375 for each meeting of the committee attended telephonically beginning June 23, 2008. Additionally we have granted restricted share units to our non-management directors from time to time, as determined by the full Board of Directors. Directors are also reimbursed for ordinary and necessary expenses incurred in attending meetings of the Board of Directors or committee meetings.

        On November 3, 2005, we granted 4,000 restricted share units ("RSUs") to each of our non-management directors at that time, including Mr. Verdecchio. Fifty percent of each award of RSUs (the "Time-vested RSUs") vest in four equal annual installments beginning on August 12, 2006 and continuing on August 12 of each of the following three years, provided the recipient remains a director of the Company through such vesting dates. The remaining fifty percent of each award of RSUs (the "Performance-vested RSUs") vest in four equal annual installments beginning on August 12, 2006 and

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continuing on August 12 of each of the following three years, provided the recipient remains a director of the Company through such vesting dates and the applicable performance condition for the applicable vesting period is met. The performance condition for each vesting period is based on the Company's earned distributable cash per share (as defined in the related restricted share unit agreement) for such vesting period. Each vesting period begins on July 1 and ends on June 30 of the subsequent year. All RSUs immediately vest in full, and shares will be distributed, at the time of a Change in Control (as defined in the Reddy Ice Holdings, Inc. 2005 Long Term Equity Incentive and Share Award Plan, as amended). At the time of their appointment to the Board of Directors, Mr. Host and Mr. McGrath were granted 4,000 and 3,500 RSUs, respectively, with substantially similar vesting provisions to the RSUs granted on November 3, 2005. If in any performance period the performance condition for a subsequent performance period is achieved, Performance-vested RSUs are entitled to dividend equivalent rights in the subsequent performance period equal to the dividends which would be payable on the shares of common stock represented by the RSUs subject to vesting in that period. Payments of such dividend equivalents will be made in cash to the holders of RSUs at the time of actual dividend payments and will not be subject to any vesting requirements. Time-vested RSUs are not entitled to dividend equivalent rights.

        Based on a compensation study performed in December 2006, we determined that an increase in non-management director compensation was warranted. On April 10, 2007, the Board of Directors approved the grant of 2,500 additional RSUs to each non-management director. The grants were composed of 1,250 Time-vested RSUs and 1,250 Performance-vested RSUs. Twenty percent of the Time-vested RSUs vested on August 12, 2007 and forty percent vest on each of August 12, 2008 and 2009, provided the recipient remains a director of the Company through such vesting dates. The Performance-based RSUs vest in the same proportions on August 12, 2007, 2008 and 2009, provided the recipient remains a director of the Company through such vesting date and the applicable performance condition for the applicable vesting period is met. Based on our financial results for the vesting period ended June 30, 2008, the performance condition for the Performance-based RSUs eligible for vesting on August 12, 2008 was not met as our actual earned distributable cash per share for the period was approximately $1.82 and the target for the period was approximately $2.48. As a result, the unvested Performance-based shares scheduled to vest on August 12, 2008 did not vest and instead remained unvested subject to the applicable performance test in the subsequent year. The performance target for the remaining vesting period also was not met as of June 30, 2008. As a result, the holders of unvested Performance-based RSUs are not entitled to dividend equivalent payments for the period from July 1, 2008 to June 30, 2009.

        In connection with his appointment to our Board of Directors on April 17, 2008, each of Mr. Rauch and Mr. Kiper was granted 2,000 RSUs effective August 12, 2008. The RSUs are subject to vesting on August 12, 2009 on terms consistent with the prior grants of RSUs to our non-management directors. Mr. Kiper forfeited his RSUs upon resigning from the Board of Directors, effective December 31, 2008.

        By August 12, 2009 all of the outstanding RSU grants to our non-employee directors will have either vested or been forfeited. As a result of the short time period remaining until this final vesting date, no RSUs were granted to Mr. Cameron following his appointment to our Board of Directors on December 31, 2008. Our Board of Directors is expected to review the equity-based compensation provided to our non-management directors over the next year.

        We currently do not have any guidelines or policies that require our non-management directors to maintain certain levels of ownership of the Company's stock. We expect our compensation committee to consider this issue in the future.

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SUMMARY OF BOARD OF DIRECTORS COMMITTEES

        The table below lists all of the committees of the Board of Directors and indicates who serves on those committees as of April 14, 2009.

*

Chairman

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RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
(ITEM 2)

        Pursuant to the audit committee's recommendation, the Board of Directors has appointed PricewaterhouseCoopers LLP ("PWC"), independent registered public accounting firm, to audit our consolidated financial statements for the year ending December 31, 2009.

        PWC has served as our independent auditor since November 12, 2008. On that date, we (x) dismissed Deloitte & Touche LLP ("Deloitte") as our independent registered public accounting firm and (y) appointed PWC to serve as our independent registered public accounting firm. The decision to dismiss Deloitte was recommended and approved by our Board of Directors.

        During the fiscal years ended December 31, 2006 and 2007 and subsequent period from January 1, 2008 through November 12, 2008, there were no reportable events as defined by Item 304(a)(1)(v) of Regulation S-K except as described below. On March 5, 2008, we and certain of our employees, including members of our management, received grand jury subpoenas issued from the U.S. District Court for the Eastern District of Michigan seeking information in connection with an investigation by Antitrust Division of the United States Department of Justice (the "DOJ") into possible antitrust violations in the packaged ice industry. On March 6, 2008, our Board of Directors formed a special committee of independent directors to conduct an internal investigation of these matters. As a result of the ongoing DOJ investigation and resulting Special Committee investigation, Deloitte had periodically requested, and the Special Committee provided, limited information regarding the scope and findings of the investigation from the Special Committee in connection with Deloitte's quarterly review procedures. At the time of Deloitte's dismissal, the Special Committee's investigation was ongoing and therefore Deloitte's dismissal occurred prior to Deloitte receiving a full report on the scope and results of the investigation. At the time of Deloitte's dismissal, Deloitte indicated that it was not in a position to determine whether any additional information with respect to the DOJ and Special Committee investigations would materially impact previously issued audit reports or underlying financial statements or cause Deloitte to be unwilling to rely on Management's representations or be associated with our financial statements. At the time of Deloitte's dismissal, we indicated to Deloitte that they would not be requested to issue a consent with respect to their prior audit reports in the future.

        Although ratification by the stockholders is not required by law, the Board of Directors has determined that it is desirable to request approval of the selection of PWC by the stockholders. In the event the stockholders fail to ratify the appointment, the audit committee will consider this factor when making any future determination regarding PWC. Even if the selection is ratified, the audit committee in its discretion may direct the appointment of a different independent accounting firm at any time during the year if it determines that such a change would be in our best interests and the best interests of our stockholders.

        Passage of the proposal requires the affirmative vote of a majority of the votes cast. The Board of Directors unanimously recommends that you vote "FOR" the ratification of the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2009.

Fees Paid to PricewaterhouseCoopers LLP and Deloitte & Touche LLP

        PricewaterhouseCoopers LLP was appointed on November 12, 2008 to serve as our independent registered public accounting firm for the year ended December 31, 2008. Deloitte served as our independent registered public accounting firm for the year ended December 31, 2007. Aggregate fees

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billed to us by PWC and Deloitte for professional services rendered for fiscal 2008 and 2007 were as follows:

        Audit Fees.    Consists of fees billed for professional services rendered for the audit of the Company's consolidated financial statements, the review of the interim condensed consolidated financial statements included in quarterly reports, services that are normally provided by the Company's independent auditor in connection with statutory and regulatory filings or engagements and attest services, except those not required by statute or regulation. PWC's audit fees included the audits of the three years ended December 31, 2008. Deloitte's fees during the year ended December 31, 2008 were composed of billings for work performed in connection with the 2008 audit that was not completed. During the year ended December 31, 2007, audit fees related to capital markets transactions were $25,560.

        Audit-Related Fees.    Consists of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of the Company's consolidated financial statements and are not reported under "Audit Fees." These services include employee benefit plan audits, auditing work on proposed transactions, attest services that are not required by statute or regulation, and consultations concerning financial accounting and reporting standards. Deloitte's audit-related fees for 2008 included amounts related to PWC's review of its audit work papers.

        Tax Fees.    Consists of tax compliance/preparation and other tax services. Tax compliance/preparation consists of fees billed for professional services related to federal and state tax compliance, assistance with tax audits and appeals, and assistance related to the impact of mergers, acquisitions and divestitures on tax return preparation. Other tax services consist of fees billed for other miscellaneous tax consulting and planning. During the years ended December 31, 2008 and 2007, tax fees related to capital markets transactions and other special projects were $46,082 and $125,540, respectively.

        Audit Committee Pre-Approval Policies and Procedures.    All auditing services and non-audit services provided to us by our independent auditors must be pre-approved by the audit committee (other than the de minimus exceptions provided by the Exchange Act). All of the Audit, Audit-Related and Tax Fees shown above for 2008 met this standard.

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Pre-approval of Audit and Permissible Non-audit Services of Independent Auditors

        The audit committee pre-approves all audit and permissible non-audit services provided by PWC. These services may include audit services, audit-related services, tax services and other services. The audit committee has adopted a policy for the pre-approval of services provided by PWC. Under this policy, pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and includes an anticipated budget. In addition, the audit committee may also pre-approve particular services on a case-by-case basis. The audit committee has delegated pre-approval authority to the Chair of the audit committee. Pursuant to this delegation, the Chair must report any pre-approval decision by him to the audit committee at its first meeting after the pre-approval was obtained.

Other

        In connection with the audits for the period ending December 31, 2008, there were no disagreements with PWC on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure which, if not resolved to the satisfaction of PWC, would have caused them to refer to such disagreement in connection with their report.

        A representative of PWC is expected to be present at the Annual Meeting, will have an opportunity to make a statement if he or she desires to do so and is expected to be available to respond to appropriate questions.

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APPROVAL OF AMENDMENT TO THE REDDY ICE HOLDINGS, INC.
2005 LONG TERM INCENTIVE AND SHARE AWARD PLAN, AS AMENDED
(ITEM 3)

        We are asking our stockholders to approve the amendment of our 2005 Long Term Incentive and Share Award Plan, as amended (the "Plan") to increase the maximum number of shares authorized for issuance under the Plan by 1,500,000 shares, to a total of 2,750,000 shares. As of April 14, 2009 there were 40,111 shares remaining available for issuance under the Plan.

        The Plan, as previously amended, was approved by our stockholders at our Annual Meeting of Stockholders held on May 17, 2007. Currently, there are an aggregate of 1,250,000 shares of common stock authorized for issuance under the existing Plan, of which only 40,111 shares remain available for grant. Under the Plan, the number of shares authorized for grant would be increased by 1,500,000 to 2,750,000. As of April 14, 2009, 132,850 restricted shares, 251,554 restricted share units and stock options in respect of 370,350 shares were outstanding under the existing Plan. In addition, the Company has conditionally approved granting 124,275 restricted shares (to be issued upon the approval of this Plan amendment) and has conditionally issued stock options in respect of 555,525 shares. After giving effect to the Plan amendment and the issuance of the conditional awards, the 40,111 shares currently available for grant will increase to 860,311.

        The Plan is intended to provide incentives to attract, retain and motivate employees, consultants and directors and to provide for competitive compensation opportunities, to encourage long term service, to recognize individual contributions and reward achievement of performance goals, and to promote the creation of long-term value for stockholders by aligning the interests of such persons with those of stockholders. The grants under the Plan would be the principal method for long-term incentive compensation and are designed to promote the convergence of long-term interests between our key employees and our stockholders.

        Our Board of Directors believes that increasing the number of shares issuable under the Plan is necessary to allow us to continue to utilize equity-based compensation awards to retain and attract the services of key individuals essential to our growth and success. Our employees are our most valuable asset and such awards are crucial to our ability to motivate individuals in our service to achieve our goals. Our Board of Directors believes that such equity incentives are necessary for us to remain competitive with regard to retaining and attracting qualified individuals. Additionally, the Plan enables participants to share in our future success. In furtherance of these objectives, on April 14, 2009 the Board of Directors unanimously adopted the amendment described above increasing the number of shares available under the Plan, subject to approval by the stockholders at the annual meeting. In addition, on April 14, 2009 the Board of Directors approved certain modifications to the Plan as described below that do not require stockholder approval.

        The Company has registered with the SEC on Form S-8 Registration Statements the shares of common stock currently issuable under the Plan. If this proposal is approved by our stockholders, the Board of Directors intends to cause the additional shares of common stock that will become available for issuance under the Plan to be registered on a Form S-8 Registration Statement to be filed with the SEC at the Company's expense prior to the issuance of any such additional shares.

Summary of the Plan

        The following is a summary of the material terms of the Plan. This summary does not purport to be a complete description of the Plan and is qualified in its entirety by reference to the full text of the Plan, a copy of which is attached as Annex A to this proxy statement.

        General.    Prior to the initial public offering of Company's common stock, the Board of Directors adopted, and the stockholders of the Company approved, the 2005 Long Term Incentive and Share

18

Award Plan. As originally adopted, the Plan authorized the issuance of 750,000 shares of common stock. At our annual meeting of stockholders on May 17, 2007, our stockholders approved the 2005 Long Term Incentive and Share Award Plan, as amended. As amended, the Plan authorized the issuance of an additional 500,000 shares of common stock, resulting in a total authorization of 1,250,000 shares of common stock.

        The Plan provides for the grant to eligible employees, consultants and directors of stock options, share appreciation rights ("SARs"), restricted shares, restricted share units, performance shares, performance units, dividend equivalents, and other share-based awards (the "Awards"). An aggregate of 1,250,000 shares of common stock have been reserved for issuance under the Plan; an additional 1,500,000 shares of common stock will be reserved for issuance if the amendment is adopted. In addition, during a calendar year (i) the maximum number of shares with respect to which options and SARs may be granted to a participant under the Plan is 500,000 shares, and (ii) the maximum number of shares which may be granted to a participant under the Plan with respect to Awards intended to qualify as performance-based compensation for purposes of the Internal Revenue Code of 1986, as amended (the "Code") (other than options and SARs) is 500,000 shares. These share amounts are subject to anti-dilution adjustments in the event of certain changes in the Company's capital structure, as described below. Shares issued pursuant to the Plan will be either authorized but unissued shares or treasury shares.

        On April 14, 2009 the Board of Directors amended the Plan to clarify and amend as necessary that shares of stock surrendered or withheld as payment of either the exercise price of an award or for withholding taxes or shares repurchased by the Company using proceeds from the exercise of stock options will not be made available for future awards. Under the Plan prior to the April 14, 2009 amendment, the Plan could have been interpreted to permit shares surrendered or withheld as payment of the exercise price of an award or for withholding taxes or repurchased by the Company using proceeds from stock option exercises to again be made available for issuance as awards, although the Committee has not interpreted the Plan in this manner in the past. In addition, the amendment clarifies that all shares covered by a SAR issued on or after April 14, 2009, to the extent that the SAR is ultimately exercised and settled in shares of stock, shall be considered issued or transferred pursuant to the Plan.

        In addition, on April 14, 2009 the Board approved an amendment to the Plan that provides that of the 1,500,000 additional shares included in the amendment submitted for stockholder approval, no more than 1,000,000 shares may be issued in the form of an award other than options or SARs.

        Eligibility and Administration.    Officers and other employees of, and consultants to, the Company and its subsidiaries and affiliates and directors of the Company are eligible to be granted Awards under the Plan. The Plan is administered by the compensation committee or such other Board committee (or the entire Board) as may be designated by the Board (the "Committee"). Unless otherwise determined by the Board, the Committee will consist of two or more members of the Board who are nonemployee directors within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 (the "Exchange Act") and "outside directors" within the meaning of Section 162(m) of the Code. The Committee will determine which eligible employees, consultants and directors receive Awards, the types of Awards to be received and the terms and conditions thereof. The Committee has authority to waive conditions relating to an Award or accelerate vesting of Awards. Approximately 150 persons are currently eligible to participate in the Plan.

        Except for certain antidilution adjustments, unless the approval of stockholders of the Company is obtained, options and SARs issued under the Plan will not be amended to lower their exercise price and options and SARs issued under the Plan will not be exchanged for other Options or SARs with lower exercise prices.

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        Awards.    Incentive stock options ("ISOs") intended to qualify for special tax treatment in accordance with the Code and nonqualified stock options not intended to qualify for special tax treatment under the Code may be granted for such number of shares of common stock as the Committee determines. The Committee is authorized to set the terms relating to an option, including exercise price and the time and method of exercise. However, the exercise price of options will not be less than the fair market value of the shares on the date of grant, and the term will not be longer than ten years from the date of grant of the options.

        A SAR entitles the holder thereof to receive with respect to each share subject thereto, an amount equal to the excess of the fair market value of one share of common stock on the date of exercise over the exercise price of the SAR set by the Committee as of the date of grant. However, the exercise price of the SARs will not be less than the fair market value of the shares on the date of grant, and the term will not be longer than ten years from the date of grant of the SARs. Payment with respect to SARs may be made in cash or shares of common stock as determined by the Committee.

        Awards of restricted shares are subject to such restrictions on transferability and other restrictions, if any, as the Committee may impose. Such restrictions will lapse under circumstances as the Committee may determine, including based upon a specified period of continued employment or upon the achievement of performance criteria referred to below. Except as otherwise determined by the Committee, eligible employees granted restricted shares will have all of the rights of a stockholder, including the right to vote restricted shares and receive dividends thereon, and unvested restricted shares will be forfeited upon termination of employment during the applicable restriction period.

        A restricted share unit entitles the holder thereof to receive shares of common stock or cash at the end of a specified deferral period. Restricted share units are also subject to such restrictions as the Committee may impose. Such restrictions will lapse under circumstances as the Committee may determine, including based upon a specified period of continued employment or upon the achievement of performance criteria referred to below. Except as otherwise determined by the Committee, restricted share units subject to restriction will be forfeited upon termination of employment during any applicable restriction period.

        Performance shares and performance units provide for future issuance of shares or payment of cash, respectively, to the recipient upon the attainment of corporate performance goals established by the Committee over specified performance periods. Except as otherwise determined by the Committee, performance shares and performance units will be forfeited upon termination of employment during any applicable performance period. Performance objectives may vary from person to person and will be based upon such performance criteria as the Committee may deem appropriate. The Committee may revise performance objectives if significant events occur during the performance period which the Committee expects to have a substantial effect on such objectives.

        The Committee may also grant dividend equivalent rights and it is authorized, subject to limitations under applicable law, to grant such other Awards that may be denominated in, valued in, or otherwise based on, shares of common stock, as deemed by the Committee to be consistent with the purposes of the Plan.

        If the Committee determines that an Award of restricted shares, restricted share units, performance shares, performance units or other share-based awards should qualify under the performance-based compensation exception to the $1 million cap on deductibility under Section 162(m) of the Code, the grant, vesting, exercise and/or settlement of such awards shall be contingent upon achievement of preestablished performance goals based on one or more of the following business criteria for the Company and/or for specified subsidiaries or affiliates or other business units or lines of business of the Company: (1) earnings per share (basic or fully diluted); (2) revenues; (3) earnings, before or after taxes, from operations (generally or specified operations), or before or after interest expense, depreciation, amortization, incentives, or extraordinary or special items; (4) cash flow, free

20

cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations, or cash flow in excess of cost of capital; (5) return on net assets, return on assets, return on investment, return on capital, return on equity; (6) economic value added; (7) operating margin or operating expense; (8) net income; (9) share price or total stockholder return; (10) earnings before income taxes, interest, depreciation and amortization expenses as further adjusted to give effect to unusual items, non-cash items and other adjustments, (11) earned distributable cash per share and (12) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration, geographic business expansion goals, cost targets, customer satisfaction, supervision of litigation and information technology, and goals relating to acquisitions or divestitures of subsidiaries, affiliates or joint ventures. The targeted level or levels of performance with respect to such business criteria may be established at such levels and in such terms as the Committee may determine, in its discretion, including in absolute terms, as a goal relative to performance in prior periods, or as a goal compared to the performance of one or more comparable companies or an index covering multiple companies. The maximum amount payable upon settlement of a cash-settled performance unit or other cash-settled award granted for a calendar year to any participant that is intended to satisfy the requirements for the performance-based compensation exception under Section 162(m) shall not exceed $2 million.

        Nontransferability.    Unless otherwise set forth by the Committee in an award agreement, Awards (except for vested shares) are generally not transferable by the participant other than by will or the laws of descent and distribution and are exercisable during the lifetime of the participant only by such participant or his or her guardian or legal representative.

        Change of Control.    In the event of a change of control (as defined below), all Awards granted under the Plan then outstanding but not then exercisable (or subject to restrictions) shall become immediately vested and/or exercisable, all restrictions shall lapse, and any performance criteria shall be deemed satisfied, unless otherwise provided in the applicable Award agreement.

        On April 14, 2009, the Board of Directors amended the Plan to provide that more than 50% of the Outstanding Company Common Stock or Outstanding Company Voting Securities must be acquired to constitute a Change of Control as described in paragraph (i) below. The higher 50% threshold to trigger a Change of Control will apply to all Awards under the Plan on and after April 14, 2009. For Awards made prior to April 14, 2009, the lower 30% threshold will apply.

        For purposes of the Plan, "Change of Control" means:

          (i)  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 30% 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 the following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company (other than by exercise of a conversion privilege); (ii) any acquisition by the Company or any of its Subsidiaries; (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its Subsidiaries; (iv) any acquisition by any Person who owns 10% or more of the Outstanding Company Common Stock or the Outstanding Company Voting Securities on the Effective Date; or (v) any acquisition by any corporation with respect to which, following such acquisition, more than 70% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the outstanding Company Common Stock and Outstanding Company Voting Securities immediately

21

prior to such acquisition in substantially the same proportions as their ownership, immediately prior to such acquisition, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be;

         (ii)  during any period of two consecutive years, individuals who, as of the beginning of such period, constitute the Board of Directors (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board of Directors; provided, however, that any individual becoming a director subsequent to the beginning of such period whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act);

        (iii)  consummation of a reorganization, merger or consolidation, in each case, with respect to which all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and outstanding Company Voting Securities immediately prior to such reorganization, merger or consolidation, do not, following such reorganization, merger or consolidation, beneficially own, directly or indirectly, more than 70% of, respectively, 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 corporation resulting from such reorganization, merger or consolidation;

        (iv)  consummation of a sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation with respect to which following such sale or other disposition, more than 70% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such sale or other disposition in substantially the same proportions as their ownership, immediately prior to such sale or other disposition; or

         (v)  approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

        Capital Structure Changes.    If the Committee determines that any dividend in shares, recapitalization, share split, reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, share exchange, or other similar corporate transaction or event affects the common stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of eligible participants under the Plan, then the Committee shall make such equitable changes or adjustments as it deems appropriate, including adjustments to (i) the number and kind of shares which may thereafter be issued under the Plan, (ii) the number and kind of shares, other securities or other consideration issued or issuable in respect of outstanding Awards, and (iii) the exercise price, grant price or purchase price relating to any Award.

        Amendment and Termination.    The Plan may be amended, suspended or terminated by the Board of Directors at any time, in whole or in part. However, any amendment for which stockholder approval is required under the rules of any stock exchange or automated quotation system on which the common stock may then be listed or quoted will not be effective until such stockholder approval has been obtained. In addition, no amendment, suspension, or termination of the Plan may materially and adversely affect the rights of a participant under any Award theretofore granted to him or her without the consent of the affected participant. The Committee may waive any conditions or rights, amend any terms, or amend, suspend or terminate, any Award granted, provided that, without participant consent,

22

such amendment, suspension or termination may not materially and adversely affect the rights of such participant under any Award previously granted to him or her.

        Effective Date and Term.    The Plan became effective as of August 8, 2005. Unless earlier terminated, the Plan will expire on August 8, 2015 and no further awards may be granted thereunder after such date.

        Market Value.    The per share closing price of the Company's common stock on April 14, 2009 was $1.53.

        Federal Income Tax Consequences.    The following is a summary of the federal income tax consequences of the Plan, based upon current provisions of the Code, the Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, and does not address the consequences under any state, local or foreign tax laws.

Stock Options

        In general, the grant of an option will not be a taxable event to the recipient and it will not result in a deduction to the Company. The tax consequences associated with the exercise of an option and the subsequent disposition of shares of common stock acquired on the exercise of such option depend on whether the option is a nonqualified stock option or an ISO.

        Upon the exercise of a nonqualified stock option, the participant will recognize ordinary taxable income equal to the excess of the fair market value of the shares of common stock received upon exercise over the exercise price. The Company will generally be able to claim a deduction in an equivalent amount. Any gain or loss upon a subsequent sale or exchange of the shares of common stock will be capital gain or loss, long-term or short-term, depending on the holding period for the shares of common stock. If the optionholder is an employee, ordinary income recognized on exercise generally is subject to withholding of income and employment taxes.

        Generally, a participant will not recognize ordinary taxable income at the time of exercise of an ISO and no deduction will be available to the Company. If shares of common stock acquired upon exercise of an ISO are sold or exchanged more than one year after the date of exercise and more than two years after the date of grant of the option, any gain or loss will be long-term capital gain or loss. However, if shares of common stock acquired upon exercise of an ISO are sold or exchanged within one year after the date of exercise or within than two years after the date of grant of the option this will be deemed to be a "Disqualifying Disposition." Upon a Disqualifying Disposition, the participant will generally recognize ordinary income at the time of disposition in an amount equal to the excess of the fair market value of the shares of common stock at the date of exercise over the exercise price on the date of grant. Any gain in excess of that amount will be a capital gain. If a loss is recognized, there will be no ordinary income, and such loss will be a capital loss. Any ordinary income recognized by the optionholder upon the Disqualifying Disposition generally will result in a deduction by the Company for federal income tax purposes.

        Although the exercise of an ISO as described above would not produce ordinary taxable income to the participant, it would result in an increase in the participant's alternative minimum taxable income and may result in an alternative minimum tax liability.

Restricted Shares

        A participant who receives restricted shares will generally recognize ordinary taxable income at the time that such shares "vest", i.e., when they are not subject to a substantial risk of forfeiture. The amount of ordinary taxable income so recognized will generally be the fair market value of the

23

common stock at the time the shares vest, less the amount, if any, paid for the shares. This amount is generally deductible for federal income tax purposes by the Company.

        In lieu of the treatment described above, a participant may elect immediate recognition of ordinary taxable income under Section 83(b) of the Code. In such event, the participant will recognize as ordinary income the fair market value of the restricted shares at the time of grant (determined without regard to any restrictions other than restrictions which by their terms will never lapse), and the Company will generally be entitled to a corresponding deduction. If a Section 83(b) election is made and the restricted shares are subsequently forfeited, the participant will not be entitled to any offsetting tax deduction.

        Any gain or loss upon a subsequent sale or exchange of the shares of common stock, measured by the difference between the sale price and the fair market value on the date the shares vest, will be capital gain or loss, long-term or short-term, depending on the holding period for the shares of common stock.

SARs and Other Awards

        With respect to SARs, restricted share units, performance shares, performance units, dividend equivalents and other Awards under the Plan not described above, generally, when a participant receives payment with respect to any such Award granted to him or her under the Plan, the amount of cash and the fair market value of any other property received will be ordinary taxable income to such participant and will be allowed as a deduction for federal income tax purposes to the Company.

Payment of Withholding Taxes

        The Company may withhold, or require a participant to remit to it, an amount sufficient to satisfy any federal, state, local or foreign withholding tax requirements associated with Awards under the Plan.

Deductibility Limit on Compensation in Excess of $1 Million

        Section 162(m) of the Code allows publicly-held corporations to deduct compensation in excess of $1 million paid to the corporation's principal executive officer, or any of the three highest compensated officers (other than the principal executive officer or principal financial officer) whose total compensation is required to be reported to the stockholders under the Securities Exchange Act of 1934, if the compensation is payable solely based on the attainment of one or more performance goals and certain statutory requirements are satisfied. We intend for compensation arising from grants of awards under the Plan which are based on performance goals, and stock options and stock appreciation rights granted at fair market value, to be deductible by the Company as performance-based compensation not subject to the $1 million limitation on deductibility.

        Passage of the proposal requires the affirmative vote of a majority of the votes cast. The Board of Directors unanimously recommends voting "FOR" the approval of the amendment to the Plan.

New Plan Benefits

        The grant of options and other awards under the Plan is discretionary, and we cannot determine now the specific number or type of options or awards to be granted in the future to any particular person or group, except for the grants set forth in the following New Plan Benefits table. Except as set forth below, any grants of options or other awards would be made in the sole discretion of the compensation committee in such amounts and to such persons as it deemed appropriate, subject to the limitations contained in the Plan. For more information regarding the conditional stock option grants and conditionally approved grants of restricted stock set forth in the table below, please refer to

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"Executive Compensation—Compensation Discussion & Analysis—Long Term Incentive Compensation—Long Term Incentive Compensation Awards in 2009."

*

The conditional restricted stock grants and the conditional stock option grants will vest in three equal amounts with the first vesting on January 1, 2010, the second vesting on January 1, 2011 and the third vesting on January 1, 2012. One-third of the conditional stock option grants will be granted at a strike price based on the greater of the fair market value on April 14, 2009 ($1.53 per share) or the fair market value on the day the additional shares are approved by our stockholders, one-third at a strike price based on the greater of the fair market value on the day the additional shares are approved by our stockholders or 150% of the fair market value on April 14, 2009 ($2.30 per share) and one-third at a strike price based on the greater of the fair market value on the day the additional shares are approved by our stockholders or 200% of the fair market value on April 14, 2009 ($3.06 per share). The fair market value of our stock on April 14, 2009 was $1.53 per share.

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EXECUTIVE OFFICERS

        The following table sets forth certain information as of April 14, 2009 regarding Reddy Ice's executive officers. Each of these officers has been elected to serve until his successor is duly appointed or elected or until his earlier removal or resignation from office. No arrangement or understanding exists between any of these officers and any other person pursuant to which they were or are to be selected as an officer.

        Effective as of the Annual Meeting, Mr. Brick will retire as an employee of Reddy Ice. Following his retirement as an employee of Reddy Ice, Mr. Brick will serve as a consultant to Reddy Ice for the remainder of 2009 and will receive fees of $150,000 in the aggregate for his consulting services over that period. Mr. Brick has also served as Chairman of the Board of Directors. It is anticipated that the Board of Directors will elect Mr. Cassagne as Chairman of the Board of Directors following the Annual Meeting.

        William P. Brick's background information is described in the "Director Nominees" section herein.

        Gilbert M. Cassagne's background information is described in the "Director Nominees" section herein.

        Steven J. Janusek became Chief Financial Officer in October 2000 and Secretary in June 2001. Mr. Janusek is a certified public accountant and served as Treasurer from February 2000 until March 2001 and as Corporate Controller from January 1998 until October 2000. Mr. Janusek joined Southwestern Ice, Inc. in July 1994 and from January 1996 served as the Corporate Controller of Southwestern Ice until its merger with Reddy in April 1997.

        Paul D. Smith became Executive Vice President and Chief Operating Officer on September 15, 2008. Prior to joining Reddy Ice, Mr. Smith was employed by Cadbury Schweppes PLC, a multinational consumer products company, from 2001 to 2007. Mr. Smith served Cadbury in various positions, including Senior Vice President—Sales Operations and Supply Chain, Regional Director—Supply Chain for Europe and the Middle East and Senior Vice President—Technical and Concentrate Operations for Dr. Pepper/Seven Up. Prior to joining Cadbury in 2001, Mr. Smith worked for 22 years in various operational roles for Pepsico, Inc. and Procter & Gamble.

        William A. Tolany was appointed Executive Vice President and Chief Customer Officer effective April 14, 2009. Mr. Tolany joined Reddy Ice in February 2002 as Vice President—Marketing. Mr. Tolany left Reddy Ice in August 2004 to become President and Chief Executive Officer of Stimulys Performance Marketing. He returned to Reddy Ice in August 2006 as Vice President—Business Development to manage the acquisition strategy for the company. He assumed responsibility for the functions of our Executive Vice President Sales & Marketing on an interim basis in September 2008.

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Mr. Tolany has extensive experience in consumer packaged goods, food products and beverages with companies such as General Foods Corporation, The Dr Pepper Company and Cadbury Schweppes.

        Mark A. Steffek became Vice President—Finance and Treasurer in April 2001. Mr. Steffek is a certified public accountant and from September 1991 until he joined Reddy in September 2000 as its Director of Financial Reporting and Assistant Treasurer, he served as an auditor with Deloitte & Touche LLP in various capacities, including senior manager.

EXECUTIVE COMPENSATION
COMPENSATION DISCUSSION AND ANALYSIS

Compensation Philosophy and Objectives

        Our philosophy in establishing compensation policies for our executive officers is to align compensation with our strategic objectives, while concurrently providing competitive compensation that enables us to attract and retain top-quality executive talent. The primary objectives of our compensation policies for executive officers are to:

•

Attract and retain executive officers by offering total compensation that is competitive with that offered by similarly situated companies and rewarding outstanding performance;



•

Promote and reward the achievement of short-term objectives that our Board of Directors and management believe will lead to long-term growth in stockholder value; and



•

Closely align the interests of executive officers with those of our stockholders by making the value of long-term incentive compensation dependent upon financial performance and total stockholder return.

Principal Components of Executive Compensation

        The principal components of our executive compensation program are:

•

Base salary;



•

Cash annual incentive awards; and



•

Long-term, equity-based incentives.

Mix of Compensation Components

        Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both short-term performance objectives and long-term stockholder value. To this end, a substantial portion of our executive officers' annual and long-term compensation is at-risk. The portion of compensation at-risk increases with the executive's position within the Company. This provides more upside potential and downside risk for more senior positions as these roles have greater influence on the performance of the Company as a whole.

Annual Compensation Programs

        Our executive officers receive two forms of annual cash-based compensation—base salary and annual incentive awards, which together constitute an executive's total annual compensation. Please note that "total annual compensation", as discussed in this Compensation Discussion and Analysis, differs from the "Total Compensation" column of the Summary Compensation Table on page 39, which includes long term incentive compensation and other forms of compensation valued on a basis consistent with financial statement reporting requirements. The levels of base salary and annual incentive awards for our executive officers are established annually under a program intended to

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maintain parity with the competitive market for executives in comparable positions. Total annual compensation for each position is targeted at the "market value" for that position. To determine market value, the compensation committee considers compensation data compiled by outside consultants based on a comparative peer group, as well as data from nationally-recognized independent executive compensation surveys.

        An initial compensation study was completed in February 2005 in anticipation of the initial public offering of our common stock that was completed in August 2005. A comparative peer group was developed that was intended to be representative of the market in which we compete most directly for executive talent. The peer group included 19 companies within the food products and durable goods industries with similar market caps and profit margins. Additional compensation data from the consultant's own surveys and other published surveys were also considered. Each executive position was reviewed and compared to the survey data based on the position's primary responsibilities and scope. The results of this study were used, in part, to determine executive compensation levels for 2005 and 2006.

        The compensation committee engaged Towers Perrin, a compensation consultant, in December 2006 to conduct a new competitive assessment of compensation for our executives and top management positions. The consultant provided benchmark data for each position. The survey data used for the study included non-durable goods manufacturing companies and general industry information that covered a wide range of companies across all industries and revenue sizes. The consultant performed a regression analysis of the survey data to recognize differences in company revenue. With the consultant's assistance, a new comparative peer group of 15 companies was developed based on similarities in such measures as revenues, gross profit and dividend policies.

        The compensation committee again engaged Towers Perrin in September 2008 to conduct a new competitive assessment of compensation for our executives and top management positions. Towers Perrin concluded its assessment in February 2009. This review was conducted in parallel with a comprehensive strategic business review by the Company's management. Reflecting the conclusions of the Company's strategic business review and as a result of changes in the overall business environment and changes within the existing peer group, a new comparative peer group was developed. The peer group was selected based upon an analysis of public companies with reference to their industry affiliation, size and financial performance. The new peer group contained 15 companies from the packaged food, beverage and consumer goods industry sectors and was based on similarities in such measures as revenue, market capitalization, assets, return on equity, net profit margins, EBITDA, return on invested capital and the total number of Company employees. The peer group created in connection with this assessment was comprised of the 15 companies listed below (three companies overlapped from the peer group utilized in Towers Perrin's prior analysis and are indicated by a *):

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Role of Executive Officers in Compensation Decisions

        The compensation committee makes all compensation decisions for executives in the top four salary grades of our salary grade system—a total of four employees as of April 14, 2009. In addition, the committee oversees and approves both the annual incentive program and long term incentive program for all of the Company's employees. Decisions regarding base salaries of other executive officers are made by the Chief Executive Officer.

        The Chief Executive Officer or another supervising officer annually reviews the performance of all executive officers. The conclusions reached and recommendations based on these reviews, including with respect to salary adjustments and annual award amounts, are presented first to the Chief Executive Officer (if the Chief Executive Officer is not the immediate supervisor) and after approval to the compensation committee. The compensation committee can exercise its discretion in modifying any recommended adjustments or awards to executives.

Annual Compensation Policies

        Our annual compensation policies further our pay-for-performance philosophy. We set total annual compensation for our executive officers to approximate the market value for comparable positions and intend to have a meaningful percentage at risk. Annual incentive awards are targeted at a level that, when combined with base salaries, are intended to yield total annual compensation that approximates market value. As a result, total annual compensation for a position generally should exceed its market value when our financial performance exceeds our applicable annual targets. Total annual compensation generally should be below market value when our financial performance does not meet targets.

        In order to streamline our compensation system, on April 14, 2009 the compensation committee approved the establishment of a salary grade system for all senior management positions. The relative importance of a particular management position in comparison to other Company management positions was a key factor in determining the appropriate grade for each position. In addition, the position's scope, nature of responsibilities, size of business unit and complexity of duties and responsibilities were also reviewed in establishing the grade for each position.

        Base Salary.    Based on base salary market data from the most recent competitive compensation analysis, on April 14, 2009 the compensation committee approved salary ranges for each grade level. The Company's philosophy for base salary and the ranges for each grade are intended to utilize the 50^th percentile for companies of comparable size from industry sectors comparable to that to the Company as the midpoint for each grade level. Currently, base salaries for our executive officers fall below the midpoints of their salary grade ranges, and are between the 25^th and 50^th percentile of the comparable company sample. The compensation committee's long term objective is for base salaries of our executive officers to approximate the 50^th percentile of market value for comparable positions.

        In 2008 and through April 14, 2009, the base salaries of our named executive officers were adjusted to the following levels:

(1)

Increase approved on April 14, 2009, effective May 1, 2009.

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        The compensation studies commissioned in December 2006 and 2009 were used by the compensation committee in determining the 2009 salaries noted above.

        Annual Incentive Awards.    Annual incentive awards have been historically targeted at levels slightly higher than market value for comparable positions, which reflects our view that larger amounts of an executive's annual compensation should be at-risk. In February 2008, the compensation committee approved our annual incentive program for 2008. Historically, including 2008, annual incentive awards have been awarded entirely based on achieving Adjusted EBITDA targets. Adjusted EBITDA is computed on the same basis as required under our senior credit facility. More specifically, EBITDA represents net income (loss) before income taxes, interest, depreciation and amortization expenses. Adjusted EBITDA represents EBITDA as further adjusted to give effect to unusual items, non-cash items and other adjustments, such additional adjustments being required to calculate covenant ratios and compliance under the Company's senior credit facility. For example, income related to the termination of the merger agreement with affiliates of GSO Capital Partners in early 2008 or costs associated with the ongoing DOJ investigation were not included in the computation of Adjusted EBITDA. Although EBITDA and Adjusted EBITDA are not presentations made in accordance with generally accepted accounting principles ("GAAP") and are not measures of financial condition or profitability, we believe they are important measures of the operational strength of our business and a key metric investors use in evaluating the value of the Company. Furthermore, the additional adjustments included in the calculation of Adjusted EBITDA are required to calculate covenant ratios and compliance under our senior credit facility, including our ability to pay dividends.

        During our annual budgeting process for 2007 and 2008, Adjusted EBITDA budgets were established for our corporate cost center and each individual plant location. The consolidated Adjusted EBITDA budgets were approved by our full Board of Directors. In conjunction with our annual budgeting process, our compensation committee set the annual incentive targets for each plant location and the consolidated Company. In establishing the annual Adjusted EBITDA budget, management and the Board of Directors have strived to meet published growth objectives that they believed were consistent with the goal of increasing stockholder value. The consolidated annual incentive target was generally set, including in 2007 and 2008, at an amount approximately equal to the midpoint of our initial published guidance range for annual Adjusted EBITDA in any given year. Both the Adjusted EBITDA budget and annual incentive target were adjusted periodically throughout the year for acquisitions, dispositions and unusual items as described above. All adjustments were approved by our full Board of Directors.

        Our executive officers and other members of our management have historically participated in the annual incentive program. At 100% of target, payments have been made based on a percentage of annual salary ranging, for the named executive officers, from 50% to 75%. Generally, the more senior employees and executives are compensated at higher percentages of annual salary. Beginning at 95% of the annual target, our executives have been able to earn a prorated portion of the target annual incentive compensation with a full payout at 100% of target. In the event that actual consolidated Adjusted EBITDA for the year exceeds the annual target, an additional pool of incentives is created equal to 40% of the excess. All plant level participants who achieve 100% of their individual target along with all corporate participants, including our executive officers, share in the additional pool pro rata based on their percentage of the base annual incentive. The maximum payout under the plan is 200% of the base annual incentive amount. The compensation committee has the discretion to grant bonuses if not otherwise earned according to plan terms if the facts and circumstances warrant such a grant.

        For 2007, we did not meet our consolidated corporate annual incentive target. However, certain of our facilities achieved their annual incentive targets. Payments made for our annual incentive plan totaled approximately $0.6 million for 2007. None of our executive officers received annual incentive

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payments for 2007. For 2007, the target percentage of annual base salary for Messrs. Brick, Janusek, Dann and Key were 75%, 50%, 50% and 50%, respectively.

        For 2008, we did not meet our consolidated corporate annual incentive target. However, certain of our facilities achieved their annual incentive targets. Payments made for our annual incentive plan totaled approximately $0.3 million for 2008. None of our executive officers received annual incentive payments for 2008. For 2008, the target percentage of annual base salary for Messrs. Brick, Cassagne, Janusek, Smith, Dann and Key were 75%, 75%, 50%, 65%, 50% and 50%, respectively.

        On April 14, 2009, the compensation committee approved the 2009 annual incentive program, which reflects changes from prior year programs based on the most recent competitive compensation analysis. The new program, while similar to the prior years' programs, contained several changes made to more closely align our management's incentives with the strategic objectives of the business, put more of our executive's pay at-risk and compensate for changes in our Long Term Incentive Program. The compensation committee's long term objective is for annual incentive award targets to approximate the 50^th percentile of market value for comparable positions. However, as noted above, our executives' base salaries are currently below the 50th percentile of market value for comparable positions. In order to achieve the compensation committee's goal of total annual cash compensation that approximates the 50th percentile for comparable positions, and reflecting the time needed to move base salary levels to the 50th percentile, annual incentive award targets for 2009 approximate the 75th percentile of market value for comparable positions. This results in total annual cash compensation for 2009 that approximates the 50th percentile. For 2009, the target percentage of annual base salary for Messrs. Cassagne, Janusek, Smith and Dann are set at 100%, 65%, 65% and 50%, respectively. Mr. Brick will not participate in the 2009 annual incentive program due to his anticipated retirement. Mr. Key is currently not eligible for participation in the 2009 annual incentive program due to his employment status. Effective September 13, 2008, Mr. Key was placed on a paid leave of absence and relieved of his duties at the direction of the special committee of our Board of Directors. The special committee has found that Mr. Key violated company policies and is associated with matters that are under investigation.

        During our annual budgeting process for 2009, revenues and Adjusted EBITDA budgets were established for our corporate cost centers and each individual plant location. The consolidated revenue and Adjusted EBITDA budgets have been approved by our full Board of Directors. For 2009, 50% of the annual incentive award will be based on revenue and 50% on annual Adjusted EBITDA. While our annual incentive plan has historically been based entirely on Adjusted EBITDA, our compensation committee believes that revenue growth will be important to future stockholder returns. As a result, the shift of the targets for half of the annual incentive compensation to revenue was determined to be appropriate. In conjunction with our annual budgeting process, our compensation committee has set the annual incentive targets for each plant location and the consolidated Company. In establishing the revenue and annual Adjusted EBITDA budgets, management and the Board of Directors have strived to meet growth objectives that they believe are consistent with the goal of increasing stockholder value. The revenue and Adjusted EBITDA annual incentive targets have been set at levels which the compensation committee believes to be achievable, but which will require management to execute effectively throughout the year to achieve. Both the revenue and Adjusted EBITDA budgets and annual incentive targets will be adjusted periodically throughout the year for acquisitions, dispositions and unusual items, consistent with our prior practice. All adjustments will be approved by our full Board of Directors.

        Our executive officers and other members of our management will participate in the 2009 annual incentive program. At 100% of target, payments are made based on a percentage of annual salary ranging, for the named executive officers, from 50% to 100% (excluding Mr. Key). Generally, the more senior employees and executives are compensated at higher percentages of annual salary, consistent with market value for comparable positions.

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        In order to receive the annual incentive payment for the revenue portion of the award, we must make 100% of the revenue target. No award will be paid for the revenue portion of the program if the revenue target is not achieved. With respect to the Adjusted EBITDA portion of the award, our executives will be able to receive a prorated payment beginning at 90% of the annual Adjusted EBITDA target, with a full payout of the Adjusted EBITDA portion of the award at 100% of target. This design, which sets an absolute floor for revenue, is consistent with the compensation committee's current view that revenue growth will be important to future stockholder returns.

        If our actual consolidated Adjusted EBITDA for the year exceeds the annual target, 40% of the excess Adjusted EBITDA is allocated to an incentive pool which is split into two equal halves, a revenue pool and an Adjusted EBITDA pool. By allocating only 40% of above-target Adjusted EBITDA to the creation of the pools, management must significantly exceed the target levels for revenue and Adjusted EBITDA to achieve the maximum payouts under the plan. The revenue pool may be awarded based on revenue exceeding the target revenue, with none of the revenue pool being distributed if actual revenue equals target revenue and the entire revenue pool, up to the maximum payout amount for each participant, being distributed if actual revenue exceeds the target revenue by 10%. All plant level participants who achieve 100% of their individual targets for both revenue and Adjusted EBITDA along with all corporate participants, including our executive officers, share in the revenue pool. Distributions from the revenue pool are distributed based on each participant's percentage of the total base annual incentive for all employees eligible to share in the revenue pool. The maximum payout for any participant under the revenue portion of the plan is 200% of the revenue portion of the participant's base annual incentive amount. This structure is intended to create incentives for our employees to focus on both revenue and Adjusted EBITDA growth, as both metrics must exceed their targets for incentive payouts from the revenue pool above target levels to be made.

        All plant level participants who achieve 100% of their individual targets for both revenue and Adjusted EBITDA along with all corporate participants, including our executive officers, share in the Adjusted EBITDA pool. Distributions from the Adjusted EBITDA pool are distributed based on each participant's percentage of the total base annual incentive for all employees eligible to share in the Adjusted EBITDA pool. The maximum payout for any participant under the Adjusted EBITDA portion of the plan is 200% of the Adjusted EBITDA portion of the participant's base annual incentive amount.

        The compensation committee also has the discretion to grant bonuses if not otherwise earned according to plan terms if the facts and circumstances warrant such a grant.

        Our compensation committee, as part of its review of the design of the annual incentive program, is considering additional metrics for use in future years including a measure of Return on Invested Capital ("ROIC").

Long Term Incentive Compensation

        Our compensation committee believes that long term equity-based incentive compensation is an important component of our overall compensation program because it has the effect of retaining executives, aligning executives' financial interests with the interests of stockholders, and rewarding the achievement of our long-term strategic goals. Vesting of long term incentive awards is targeted at levels that approximate market value for comparable positions, utilizing the same compensation data used for setting total annual compensation.

        Long Term Incentive Compensation Following our IPO.    In connection with our IPO in August 2005, our compensation committee recommended the creation of a new long term incentive program for our executives for the purpose of retaining executives, aligning executives' financial interests with the interests of our new public stockholders, and rewarding the achievement of our long-term strategic goals as a public company. The Long Term Incentive and Share Award Plan (the "Plan") was approved

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by our stockholders in August 2005 prior to the IPO with an initial 750,000 shares in the plan. On May 17, 2007, our stockholders approved amendments to the Plan that, among other things, increased the maximum number of shares of common stock available for issuance to 1,250,000.

        Shortly after the completion of the IPO, our compensation committee granted the majority of the original 750,000 shares in the form of restricted stock units ("RSUs") to approximately 130 of our employees, including our executive officers at that time. Due to the dividend policy adopted in connection with our IPO, which was designed to distribute a substantial portion of our free cash flow to our stockholders on a quarterly basis, our compensation committee chose RSUs as the best instrument to properly align our executive's financial interest with the interests of our new public stockholders. This substantial upfront grant was made in lieu of annual grants as the compensation committee and the Board of Directors desired to create a level of certainty regarding the amount of dilution that would be experienced by our new stockholders in the first two to three years after the IPO. From our IPO through August 2008, our compensation committee granted additional RSUs in minor amounts to newly hired and promoted employees (other than Messrs. Cassagne and Smith, who received more significant grants when hired, as described below), typically either in February and August of each year, but has generally not made additional grants to employees whose positions within the Company have not changed since 2005.

        In these grants, fifty percent of the RSUs granted were time-based and 50% were performance-based. Our compensation committee believed that a mix of both time- and performance-based long-term incentives was appropriate in order to balance the goals of executive retention and rewarding the achievement of our long-term strategic goals. Generally, the Time-based RSUs vested in four equal annual installments beginning on August 12, 2006 and continuing on August 12 of each of the following three years. The Performance-based RSUs vested in four equal annual installments beginning on August 12, 2006 and continuing on August 12 of each of the following three years, provided the applicable performance condition for the applicable vesting period is met. The performance condition for each vesting period was based on our earned distributable cash per share for each vesting period. Earned distributable cash is defined as the excess of Adjusted EBITDA minus an amount equal to the sum of our net capital expenditures and cash interest payments, all of which are calculated on a pro forma basis to give effect to acquisitions, dispositions and other unusual items. Our compensation committee believed that earned distributable cash per share was a very important measure in determining the success of our strategic objectives as our ability to pay dividends was a key measure to our investors.

        Each vesting period begins on July 1 and ends on June 30 of the subsequent year. If in any performance period the performance condition for a subsequent performance period is achieved, Performance-based RSUs are entitled to dividend equivalent rights payments in the subsequent performance period equal to the dividends which would be payable on the shares of common stock represented by the RSUs subject to vesting in that period.

        Based on our financial results for the vesting period ended June 30, 2006, the performance condition for the Performance-based RSUs eligible for vesting on August 12, 2006 was met as our actual earned distributable cash per share for the period was approximately $2.77 and the target for the period was approximately $2.38. As a result of the performance targets for the remaining three vesting periods also being met as of June 30, 2006, the holders of unvested Performance-based RSUs were entitled to dividend equivalent payments for the period from July 1, 2006 to June 30, 2007.

        Based on our financial results for the vesting period ended June 30, 2007, the performance condition for the Performance-based RSUs eligible for vesting on August 12, 2007 was met as our actual earned distributable cash per share for the period was approximately $2.47 and the target for the period was approximately $2.43. However, the performance targets for the remaining two vesting periods were not met as of June 30, 2007. As a result, the holders of unvested Performance-based

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RSUs were not entitled to dividend equivalent payments for the period from July 1, 2007 to June 30, 2008. As a result of the contemplated merger with affiliates of GSO Capital Partners, certain "Designated Insiders" (as defined in our insider trading policy) were permitted by the compensation committee to, and agreed to, defer the vesting of their RSUs which had been scheduled to vest on August 12, 2007. The deferred RSUs subsequently vested on December 17, 2007.

        Based on our financial results for the vesting period ended June 30, 2008, the performance condition for the Performance-based RSUs eligible for vesting on August 12, 2008 was not met as our actual earned distributable cash per share for the period was approximately $1.82 and the target for the period was approximately $2.48. In addition, the performance target for the remaining vesting period was not met as of June 30, 2008. As a result, the unvested Performance-based shares scheduled to vest on August 12, 2008 did not vest and instead remained unvested subject to the applicable performance test in the subsequent year. In addition, the holders of unvested Performance-based RSUs were not entitled to dividend equivalent payments for the period from July 1, 2008 to June 30, 2009.

        As of the end of 2008, based on our projected results for the period of July 1, 2008 through June 30, 2009, we did not believe it was probable that the applicable performance test for both the unvested Performance-based RSUs scheduled to vest on August 12, 2008 or those scheduled to vest on August 12, 2009 would be met. The applicable performance test for the Performance-based RSUs scheduled to vest on August 12, 2008 and August 12, 2009 is the attainment of earned distributable cash per share of $2.48 and $2.53, respectively, for the period of July 1, 2008 through June 30, 2009. On April 14, 2009, 57,000 performance-based RSU were forfeited by certain executives including 12,000 by Mr. Janusek and 6,000 by Mr. Dann. As of April 14, 2009, 122,516 Performance-based RSUs remain outstanding of which 77,516 are expected to be forfeited no later than August 12, 2009.

        Long Term Incentive Compensation at the time Messrs. Cassagne and Smith were Hired.    Upon the hiring of Mr. Cassagne as Chief Executive Officer and President on June 23, 2008, he was granted 30,000 shares of restricted stock as an initial incentive. The provisions of the restricted stock agreement provided for the vesting of those shares on the first anniversary of their issuance if Mr. Cassagne remained employed with the Company. Mr. Cassagne received a payment of $250,160 as a tax reimbursement in connection with his recognition of income related to the restricted stock grant. Additionally, Mr. Cassagne was granted 90,000 RSUs. Fifty percent of the RSUs granted were time-based and 50% were performance-based. Twenty-thousand of the RSUs are scheduled to vest on August 12, 2009, 30,000 on August 12, 2010 and 40,000 on August 12, 2011. The compensation committee deferred to a later date the setting of performance targets for the Performance-based RSUs. On April 14, 2009, the compensation committee established performance targets associated with the RSUs. The Performance-based RSUs scheduled to vest on August 12, 2009 will vest if the committee determines, in its sole discretion, that Mr. Cassagne had achieved certain qualitative measures related to the establishment of the company's strategic plan and structure. The Performance-based RSUs scheduled to vest on August 12, 2010 and August 12, 2011 will vest on the attainment of our annual Adjusted EBITDA target for 2009 and 2010, respectively.

        Upon the hiring of Mr. Smith as Executive Vice President and Chief Operating Officer on September 15, 2008, 20,000 shares of restricted stock were granted as an initial incentive. The provisions of the restricted stock agreement provided for the vesting of those shares on the first anniversary of their issuance. Mr. Smith received a payment of $86,947 as a tax reimbursement in connection with his recognition of income related to the restricted stock grant.

        Restricted stock was used as long-term incentive compensation at the time each of Messrs. Cassagne and Smith were hired as an incentive for each of them to join the Company. In addition, the compensation committee granted RSUs to Mr. Cassagne to align his interests with the Board of Directors' objectives at the time. At the same time, the compensation committee was mindful of the need for a more comprehensive redesign of the Company's long-term incentive compensation

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structure, as discussed below, and wanted to ensure that most of Mr. Cassagne's and Mr. Smith's long-term incentive compensation would be reflective of that structure. As a result, the total grants to Messrs. Cassagne and Smith at the time they were hired were smaller than they would have been if the new compensation structure had been in place.

        Long Term Incentive Compensation Awards in 2009.    In connection with the new competitive assessment of compensation for our executives and top management positions, our compensation committee determined a new long-term incentive program was needed to attract and retain executives and to more closely align our management's incentives with the strategic objectives of our business and the financial interests of our stockholders. The compensation committee noted that, with 129,038 Time-based RSUs currently outstanding and 94,038 of those RSUs scheduled to vest on August 12, 2009, no significant long-term equity incentives are in place for management.

        The Company's philosophy for long-term incentives and the ranges for each grade are intended to utilize the 50^th percentile for companies of comparable size from industry sectors comparable to that of the Company. In order to maximize the retention of executives, the compensation committee also felt that annual grants of long-term incentives were more appropriate currently as compared to larger grants on a multi-year cycle. This structure is consistent with the practices of many of the Company's peers and avoids the possibility, under a multi-year grant cycle, of a period when the Company's management has only a small unvested incentive compensation stake in the Company's future.

        Additionally, our compensation committee determined that the granting of long-term incentives should be limited to a smaller group of management as compared to previous practice. This determination was due to the generally shorter equity "hold" time of lower level employees, the perceived value placed on equity compensation and changes in the annual incentive program. Applying this approach to the newly adopted salary grade structure, the compensation determined that employees in the top six salary grades would be automatically eligible for annual grants. In addition, the committee approved the creation of a discretionary fund for the Chief Executive Officer to grant, subject to the compensation committee's approval, long term incentive awards to high performance employees at lower salary grades than those automatically eligible for annual long term incentive awards.

        Based on the comparable data, our compensation committee adopted annualized long-term incentive grant guidelines by salary grade and adjusted those downward by one-third to reflect the major decline experienced recently in the US stock market. The annualized expected values at the 50^th percentile following the one-third adjustment was 105% of base salary for Mr. Cassagne, 53% for Messrs. Janusek and Smith and 27% for Mr. Dann. Mr. Brick is not expected to participate in the new long-term incentive program as a result of his anticipated retirement and, as discussed above, Mr. Key is not eligible due to his employment status.

        In continuation of our pay-for-performance compensation philosophy, our compensation committee has determined that a combination of restricted stock and stock option grants is appropriate. The compensation committee believes that options closely align management with stockholders, as management is only rewarded if the Company's stock price increases. As a result of the elimination of the Company's quarterly dividend in September 2008, stock price growth, rather than maintenance of quarterly dividend payments, is a key driver of stockholder value and, as a result, a focus of the Company's compensation system. In contrast to the Company's prior practice of splitting RSU grants equally between time-based and performance-based grants, and order to increase the amount of compensation "at risk", our compensation committee has determined that 60% of the value of the long-term incentive grants will be in the form of stock option grants while 40% of the value of the long-term incentive grants will be in the form of restricted stock grants. These values were computed based on a stock price of $2.76 per share which was our average stock price in the month of October 2008, the first full month following engagement of the competitive compensation consultant.

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        In connection with the new long-term incentive program, on April 14, 2009 our compensation committee granted 82,850 shares of restricted stock and 370,350 stock options to 35 of our executives and consultants, including grants from the Chief Executive Officer's discretionary pool. In addition, these same executives and consultants were conditionally approved for grants of 124,275 shares of restricted stock (to be issued upon the approval of the Plan amendment contemplated by this proxy statement) and 555,525 conditional stock options, subject to the same stockholder approval. Of those grants, Messrs. Cassagne, Janusek, Smith and Dann were granted 26,000, 9,200, 8,400 and 1,600 shares of restricted stock, respectively and 114,000, 40,800, 39,600 and 8,400 stock options, respectively; and were conditionally approved for grants of 39,000, 13,800, 12,600 and 2,400 shares of restricted stock, respectively; and 171,000, 61,200, 59,400 and 12,600 conditional stock options, respectively.

        The restricted stock grants have been, and conditional restricted stock grants will be, granted in the form of time-lapse restricted stock. The stock option grants and conditional stock option grants have been made in the form of 7-year stock options with the options granted in three tranches. As a result of the decline in the Company's stock price during 2008, the compensation committee granted two thirds of the stock options with strike prices above fair market value. One-third of the stock option grants have been granted at a strike price equal to the fair market value on April 14, 2009, one-third at a strike price equal to 150% of the fair market value on April 14, 2009 and one-third equal to 200% of the fair market value on April 14, 2009. One-third of the conditional stock option grants will be granted at a strike price based on the greater of the fair market value on April 14, 2009 or the fair market value on the day the additional shares are approved by our stockholders, one-third at a strike price based on the greater of the fair market value on the day the additional shares are approved by our stockholders or 150% of the fair market value on April 14, 2009 and one-third at a strike price based on the greater of the fair market value on the day the additional shares are approved by our stockholders or 200% of the fair market value on April 14, 2009. The utilization of strike prices on the stock options significantly higher than the current fair market value was due to the significant decline in our stock price as compared to other peer companies. The fair market value of our stock on April 14, 2009 was $1.53 per share.

        The restricted stock grants, conditional restricted stock grants, stock option grants and conditional stock option grants will all vest in three equal amounts with the first vesting on January 1, 2010, the second vesting on January 1, 2011 and the third vesting on January 1, 2012. The compensation believes a three year vesting structure is consistent with the practices of comparable companies.

        In the event our stockholders do not approve the requested 1,500,000 additional shares for the Plan, the restricted shares in respect of the conditional restricted stock grants will not be issued and the conditional stock option grants will not be effective and those grants will be cancelled.

        Effective with the grants on April 14, 2009, the current number of shares available for issuance under the Plan is 40,111 shares. Assuming the addition of 1,500,000 shares to the Plan is approved by our stockholders and taking into account the provisional restricted stock and stock option grants, 860,311 shares will be available for issuance under the Plan. These available shares in combination with the 77,516 RSUs expected to be forfeited no later than August 12, 2009 will potentially be utilized for grants to new employees, promotions, our Board of Directors and future grants to our management.

Perquisites and Other Benefits

        In addition to the annual and long-term compensation described above, our executive officers also receive certain perquisites and other benefits. Such perquisites include Company matching contributions under our 401(k) plan, life insurance benefits, physicals and spousal travel.

        All participants in our 401(k) plan are eligible to receive matching Company contributions equal to 50% of employee contributions, up to a maximum amount equal to the lesser of 4% of annual salary and $4,500.

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        The Company provides term life insurance to all salaried employees in an amount equal to two times base salary, with a limit of $400,000. Internal Revenue Service regulations limit the amount of life insurance that an employer can provide to employees tax free. The coverage provided to many of our employees, including the executive officers, for 2008 exceeded such limits. Therefore, compensation expense has been calculated and attributed to each executive officer in accordance with IRS requirements. We also have had an agreement with Mr. Brick whereby we have agreed to pay him $7,500 per year as reimbursement for life insurance that he personally purchases. Upon Mr. Brick's retirement, this benefit will be terminated.

        Beginning in 2009, we have adopted a policy requiring our Chief Executive Officer and each of our Executive Vice Presidents to complete an annual physical exam paid for by the Company. To ensure consistency and control expenses, we have authorized one specific provider based in Dallas, TX for purposes of this policy.

        We customarily have national meetings during the year for certain members of management, including our executive officers. Spouses have historically been invited to attend certain of these meetings and their travel expenses are paid by the Company.

        We also provide other benefits, such as medical, dental and basic life insurance and disability coverage to most of our employees, including our executive officers. We also provide customary amounts of vacation time and paid holidays to all employees, including our executive officers.

Deferred Compensation and Defined Benefit Plans

        We do not offer any deferred compensation, defined benefit plans or pensions to any of our employees at this time. We are currently reviewing our options and may add a deferred compensation program at a future date.

Change In Control and Severance Agreements

        We do not have any agreements in place with the executive officers that provide compensation for a change in control of the Company. Each of our executive officers has an employment agreement or severance agreement that provides for severance payments in the event the executive officer's employment is terminated under certain conditions. We believe that these agreements serve to maintain the focus of our executive officers and insure that their attention, efforts and commitment are aligned with maximizing the success of the Company and stockholder value by minimizing distractions involving executive management that arise when strategic transactions involving a change in control and other significant changes to the Company are considered. For additional information concerning these severance provisions, see "Employment Agreements" below.

Regulatory Considerations

        The tax and accounting consequences of utilizing various forms of compensation are considered when adopting new or modifying existing compensation. Under Section 162(m) of the Internal Revenue Code, publicly held corporations may not take a tax deduction for compensation in excess of $1 million paid to any of the executive officers named in the Summary Compensation Table during any fiscal year. There are exceptions to the $1 million limitation for performance-based compensation meeting certain requirements and for certain compensation paid pursuant to plans or agreements in existence prior to the Company's initial public offering. To maintain flexibility in compensating executives in a manner designed to promote varying corporate goals, our compensation committee has not adopted a policy requiring all compensation to be deductible under 162(m). However, our compensation committee considers deductibility under Section 162(m) with respect to compensation arrangements for executives. We believe our current annual and long term incentive compensation for executives is not subject to any material deductibility limitations under Section 162(m).

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Stock Ownership Guidelines

        We historically have not had any guidelines or policies that require our executive officers to maintain certain levels of ownership of the Company's stock. On April 14, 2009, our compensation committee adopted stock ownership guidelines applicable to our Chief Executive Officer and each of our Executive Vice Presidents. The stock ownership guidelines are voluntary, and provide that the executive should, within five years of the later of the adoption of the guidelines or the executive being named to a position covered by the guidelines, maintain stock ownership equal in value to a multiple of base salary—three times base salary, in the case of the Chief Executive Officer, and two times base salary, in the case of each Executive Vice President. Prior to the completion of the five year phase in period, our compensation committee will monitor each executive's progress relative to the guidelines. All shares owned by the executive, including any unvested restricted shares, will be counted toward the executive's attainment of the stock ownership guidelines.

Securities Trading Policy

        We have a written insider trading policy that governs the trading of our stock by our executive officers and certain other employees. The listing of employees covered under the policy is updated from time to time based on changes in responsibility and access to internal information. This policy is designed to ensure compliance with all insider trading rules. It also prohibits "short sales" (selling borrowed securities which the seller hopes can be purchased at a lower price in the future) and "short sales against the box" (selling owned, but not delivered securities). It also prohibits trading derivative securities such as "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) related to our stock.

COMPENSATION COMMITTEE REPORT

        The following report is not deemed to be "soliciting material" or to be "filed" with the SEC or subject to Regulation 14A, other than as provided below, or to the liabilities of Section 18 of the Securities Exchange Act of 1934, and the report shall not be deemed to be incorporated by reference into any prior or subsequent filing by the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934 except to the extent the Company specifically requests that such information be incorporated by reference or treated as soliciting material.

        The compensation committee has reviewed and discussed the Compensation Disclosure and Analysis ("CD&A") with management and, based on such review and discussion, recommended to the Board of Directors the inclusion of the CD&A in the Company's Proxy Statement.

Compensation Committee of the Board of Directors


Theodore J. Host
Kevin J. Cameron
Robert N. Verdecchio

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SUMMARY COMPENSATION TABLE

        The following table sets forth certain compensation information for each individual who served as our Chief Executive Officer or Chief Financial Officer during the year ended December 31, 2008 and three additional highly compensated executive officers (the "Named Executive Officers") for the three years ended December 31, 2008:

(1)

Represents the dollar amount recognized for financial statement reporting purposes with respect to the 2008, 2007 or 2006 fiscal year, as applicable, for the fair value of outstanding restricted shares and RSUs, in accordance with SFAS 123R. For additional information regarding the valuation and accounting for equity instruments, refer to note 12 to the Company's financial statements in the Form 10-K for the year ended December 31, 2008 and 2007 and note 11 to the Company's financial statements in the Form 10-K for the year ended December 31, 2006, in each case as filed with the SEC. These amounts reflect the Company's accounting expense for these awards, and do not correspond to the actual value that will be recognized by the named executives.

(2)

Represents amounts (i) paid to the employee in connection with the dividend equivalent rights associated with unvested performance-based restricted share units and dividends paid to the employee on unvested shares of restricted stock, (ii) with respect to 2006, the reimbursement of sales commissions incurred by the employee in connection with the sale of common stock in the Company's secondary stock offering in May 2006 (the Company was reimbursed for such amounts by the underwriters of the secondary stock offering), (iii) bonuses to reimburse the employee for income taxes payable on the grant of restricted stock received in 2008, (iv) contributions made to the Company's 401(k) plan by the Company, (v) the cost of travel and lodging expenses paid by the Company for the benefit of the employee's spouse and (vi) the cost of life insurance benefits paid by the Company; for Mr. Brick, such amount also

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includes $7,500 of reimbursements for a life insurance policy and (vii) and other miscellaneous benefits. The amounts by employee and category are as follows:

(3)

Effective September 13, 2008, Ben D. Key, our Executive Vice President—Sales & Marketing, was placed on a paid leave of absence and relieved of his duties at the direction of the special committee of our Board of Directors. The special committee has found that Mr. Key violated company policies and is associated with matters that are under investigation.

GRANTS OF PLAN-BASED AWARDS

(1)

Represents 45,000 performance-based RSUs which are scheduled to vest on August 12, 2009, 2010 and 2011 in the following proportions: 22%, 33% and 45%, respectively. On April 14, 2009, the compensation committee established performance targets associated with the RSUs. The Performance-based RSUs scheduled to vest on August 12, 2009 will vest if the compensation committee determines, in its sole discretion, that Mr. Cassagne has achieved certain qualitative measures related to the establishment of the company's strategic plan and structure. The Performance-based RSUs scheduled to vest on August 12, 2010 and August 12, 2011 will vest on the attainment of the Company's annual Adjusted EBITDA target for 2009 and 2010, respectively.

(2)

Represents the grant of time-based RSUs which are scheduled to vest on August 12, 2009, 2010 and 2011 in the following proportions: 22%, 33% and 45%, respectively.

(3)

Represents the grant of restricted stock that vests on the one-year anniversary date of grant provided that the recipient remains an employee of the Company through the vesting date.

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NARRATIVE DISCLOSURE TO SUMMARY COMPENSATION TABLE

Employment Agreements

        On August 14, 2003, we entered into executive employment agreements (each, an "employment agreement") with each of our executive officers, including William P. Brick, our Executive Chairman and former Chief Executive Officer, Steven J. Janusek, our Executive Vice President, Chief Financial Officer and Secretary, Ben D. Key, our Executive Vice President—Sales and Marketing and Thomas L. Dann, our Senior Vice President—Western Operations. On June 23, 2008, at the time Gilbert M. Cassagne became our Chief Executive Officer and President, and September 15, 2008, at the time Paul D. Smith became our Executive Vice President and Chief Operating officer, we entered into employment agreements with each of Mr. Cassagne and Mr. Smith. The employment agreements for each of Messrs. Cassagne, Janusek, Smith, Key and Dann are of indefinite duration. On March 10, 2009, we and Mr. Brick amended Mr. Brick's employment agreement to provide that the term of his employment would end on the earlier of (i) the completion of the annual meeting of our stockholders with respect to which this proxy statement has been distributed and (ii) May 31, 2009.

        Under the terms of each employment agreement, in addition to his annual salary, each executive officer is entitled to participate in incentive compensation plans on the same basis as other comparable level employees. Each executive officer is also entitled to participate in various benefit plans. Each employment agreement provides for a minimum base salary. In addition, each employment agreement provides that the executive is entitled to receive an annual bonus upon achieving certain performance and operating targets. Prior to April 14, 2009, the employment agreements with Messrs. Brick, Cassagne, Janusek, Smith, Dann and Key provided for minimum base salaries of $360,000, $450,000, $180,000, $290,000, $140,000 and $150,000, respectively.

        On April 14, 2009, we entered into severance agreements with certain executive officers, including Messrs. Cassagne, Janusek and Smith. These severance agreements replaced the pre-existing employment agreements with each of these executives. The severance agreements do not contain provisions providing for the employee's minimum base salary or entitlement to participation in incentive compensation or benefit plans. The employment agreements of Messrs. Brick, Dann and Key have not been replaced with severance agreements and their minimum base salaries have not been further adjusted.

        Each of these severance or employment agreements provides for severance payments in the event the executive officer's employment is terminated under certain conditions. The severance or employment agreements do not provide for payments upon a change in control of the Company or increased severance payments if terminations are in connection with or following a change in control of the Company. In addition, we do not have any separate agreements in place with the executive officers that provide compensation in the event of a change in control of the Company. For additional information concerning the severance provisions of these severance or employment agreements, see "Potential Payments Upon Termination and Change of Control" below.

2005 Long Term Incentive and Share Award Plan

        Please see the discussion under "Approval of Amendment to the Reddy Ice Holdings, Inc. 2005 Long Term Incentive and Share Award Plan, as amended" and "Compensation Discussion and Analysis-Long Term Incentive Compensation" for a description of the Company's stock incentive plan and outstanding awards.

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OUTSTANDING EQUITY AWARDS AS OF DECEMBER 31, 2008