Exhibit 10.2

 

CASELLA WASTE SYSTEMS, INC.

 

Casella Waste Systems, Inc.

2006 Stock Incentive Plan

 

Performance Share Unit Agreement

 

Cover Sheet

 

This Agreement evidences the grant by Casella Waste Systems, Inc., a Delaware
corporation (the “Company”), on the date set forth below (the “Grant Date”) to
the person named below (the “Participant”) of a Performance Share Unit Award
(the “Award”) of the target number of performance share units listed below
(“Target Performance Share Units”) up to the maximum number of performance share
units listed below (“Maximum Performance Share Units”) for the Performance
Period listed below (the “Performance Period”). Each unit ultimately earned (a
“Performance Share Unit”) represents the right to receive one share of the
Company’s Class A Common Stock, $0.01 par value per share (“Common Stock”), or
the value of such Share. This Award is subject to the terms and conditions
specified in the Casella Waste Systems, Inc. 2006 Stock Incentive Plan, as
amended, (the “Plan”), and in this Agreement, consisting of this Cover Sheet and
the attached Exhibit A.

 

Participant Name:

<PARTICIPANT NAME>

Grant Date:

<GRANT DATE>

Performance Period:

3 years, beginning on the first day of the current fiscal year

Number of Target

 

Performance Share Units:

<NUMBER OF SHARES>

Maximum

 

Performance Share Units:

<PERCENT> of Target Performance Share Units

 

 

CASELLA WASTE SYSTEMS, INC.

 

25 Greens Hill Lane

 

Rutland, Vermont 05701

 

 

 

By:

 

 

 

 

 

Name:

<PARTICIPANT NAME>

Title:

 

By accepting this Award, the Participant hereby (i) acknowledges that a copy of
the Plan and a copy of the Plan prospectus have been delivered to the
Participant and additional copies thereof are available upon request from the
Company’s Human Resources Department, (ii) acknowledges receipt of a copy of
this Cover Sheet and Exhibit A thereto (collectively, the “Agreement”) and
accepts the Award subject to all the terms and conditions of the Plan and the
Agreement; (iii) represents that the Participant has read and understands the
Plan, the Plan prospectus and the Agreement, and (iv) acknowledges that there
are tax consequences related to the Award and that the Participant should
consult a tax advisor to determine his or her actual tax consequences.  The
Participant must accept this Award by signing and returning it to the

 

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Company within 30 days following notification of the grant, whereupon the
Company will countersign the Award and return it to the Participant; otherwise,
the Company may, in its sole discretion, rescind the Award in its entirety.

 

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EXHIBIT A

 

CASELLA WASTE SYSTEMS, INC.

 

Casella Waste Systems, Inc. 2006 Stock Incentive Plan

 

Performance Share Unit Agreement

 

Terms and Conditions

 

1.             GRANT OF PERFORMANCE SHARE UNITS.

 

The Award is granted pursuant to and is subject to and governed by the Plan and
the terms of this Agreement. It is a form of “Restricted Stock Unit” as defined
in the Plan.  Unless otherwise defined in this Agreement, capitalized terms used
herein shall have the same meaning as in the Plan.  The shares of Common Stock
that are issuable after the Performance Share Units have been earned are
referred to in this Agreement as “Shares.”   The Performance Share Units shall
be granted to the Participant without payment of consideration (other than
continuing services).

 

2.             RANGE OF EARNED PERFORMANCE SHARE UNITS.

 

Depending on the Company’s financial performance as provided in Section 3, the
Participant may earn up to the Maximum Performance Share Units (between
<PERCENT> and <PERCENT> of the Target Performance Share Units).

 

3.             DETERMINATION OF EARNED PERFORMANCE SHARE UNITS

 

(A)                                  PERFORMANCE GOAL.  THE PERFORMANCE GOAL IS
BASED ON <MEASURE>, WITH THE TARGETS FOR THE INITIAL PERFORMANCE PERIOD (<DATE>
TO <DATE>), SET AS FOLLOWS:

 

 

 

<MEASURE>

 

Targeted Payout
Percentage

Threshold

 

<PERCENT>

 

<PERCENT>

Targeted

 

<PERCENT>

 

<PERCENT>

Maximum

 

<PERCENT>

 

<PERCENT>

 

(B)                                 NO SHARES WILL BE EARNED FOR A PERFORMANCE
PERIOD IF THE <MEASURE> FOR THE PERFORMANCE PERIOD IS BELOW THE THRESHOLD NUMBER
INDICATED ABOVE.  FOR PURPOSES OF THIS DETERMINATION, THE <MEASURE> SHALL BE
ROUNDED TO TWO DECIMAL POINTS, WITH THE THOUSANDTH DECIMAL POINT ROUNDED UPWARDS
IF AT 0.005 OR HIGHER. IF THE <MEASURE> IS BETWEEN TWO STATED PERCENTAGES ABOVE,
THE PAYOUT PERCENTAGE WILL BE PRORATED ACCORDINGLY.

 

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(C)           FOR PURPOSES OF THIS AGREEMENT:

 

<DEFINITION OF MEASURE>

 

The elements of each financial measure are as defined in the financial
statements, notes to the financial statements, management’s discussions and
analysis, or other Company filings with the Securities and Exchange Commission.

 

4.             CESSATION OF BUSINESS RELATIONSHIP.

 

(A)                                  CONTINUOUS SERVICE RELATIONSHIP.  IF THE
PARTICIPANT’S CONTINUOUS SERVICE TO THE COMPANY OR ONE OF ITS AFFILIATES AS AN
EMPLOYEE OR DIRECTOR (A “BUSINESS RELATIONSHIP”) CEASES FOR ANY REASON BEFORE
THE END OF THE PERFORMANCE PERIOD, THE PERFORMANCE SHARE UNITS WILL BE
FORFEITED, EXCEPT AS PROVIDED IN THIS SECTION.  THE PARTICIPANT’S BUSINESS
RELATIONSHIP SHALL BE DEEMED TO HAVE CEASED ON THE LAST DAY OF ACTIVE SERVICE TO
THE COMPANY OR AN AFFILIATE AND SHALL NOT BE EXTENDED BY ANY NOTICE OF
TERMINATION PERIOD.  FOR PURPOSES HEREOF, A BUSINESS RELATIONSHIP SHALL NOT BE
CONSIDERED AS HAVING CEASED DURING ANY LEAVE OF ABSENCE IF SUCH LEAVE OF ABSENCE
HAS BEEN APPROVED IN WRITING BY THE COMPANY.  ANY CHANGE IN THE TYPE OF BUSINESS
RELATIONSHIP THE PARTICIPANT HAS WITHIN OR AMONG THE COMPANY AND ITS AFFILIATES
SHALL NOT RESULT IN THE FORFEITURE OF THE PERFORMANCE SHARE UNITS SO LONG AS THE
PARTICIPANT CONTINUOUSLY MAINTAINS A BUSINESS RELATIONSHIP.

 

(B)                                 DEATH OR DISABILITY; TERMINATION WITHOUT
CAUSE; RESIGNATION FOR GOOD REASON.  IF THE PARTICIPANT’S BUSINESS RELATIONSHIP
CEASES DURING THE PERFORMANCE PERIOD AS A RESULT OF THE PARTICIPANT’S (I) DEATH,
(II) DISABILITY, (III) TERMINATION OF THE EMPLOYMENT WITHOUT CAUSE OR
(IV) RESIGNATION FOR GOOD REASON, THE PARTICIPANT (OR THE PARTICIPANT’S
BENEFICIARY IN THE EVENT OF THE PARTICIPANT’S DEATH) SHALL BE ENTITLED TO
PAYMENT OF A PRO RATA PORTION OF THE PERFORMANCE SHARE UNITS, BASED ON THE
NUMBER OF DAYS ELAPSED IN THE PERFORMANCE PERIOD PRIOR TO THE CESSATION OF THE
BUSINESS RELATIONSHIP.  THE NUMBER OF PERFORMANCE SHARE UNITS FOR THIS PURPOSE
SHALL BE DETERMINED AFTER THE PERFORMANCE PERIOD BASED ON <MEASURE> FOR THE
PERIOD.

 

(C)                                  DEFINITIONS.  FOR PURPOSES OF THIS SECTION:

 

(I)                                     “BENEFICIARY” SHALL MEAN THE LAST PERSON
OR PERSONS DESIGNATED AS SUCH BY THE PARTICIPANT IN WRITING PRIOR TO THE
PARTICIPANT’S DEATH.  IF NO SUCH PERSON SURVIVES THE PARTICIPANT, THE
BENEFICIARY SHALL BE THE PARTICIPANT’S ESTATE.

 

(II)                                  “CAUSE” SHALL MEAN ANY OF THE FOLLOWING
WITH RESPECT TO THE PARTICIPANT, HIS OR HER

 

A.                                   BEING CONVICTED OF A CRIME INVOLVING THE
COMPANY (OTHER THAN PURSUANT TO ACTIONS TAKEN AT THE DIRECTION OR WITH THE
APPROVAL OF THE BOARD),

 

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B.                                     BEING FOUND BY REASONABLE DETERMINATION
OF THE COMPANY, MADE IN GOOD FAITH, TO HAVE ENGAGED IN (1) WILLFUL MISCONDUCT
THAT HAS A MATERIAL ADVERSE EFFECT ON THE COMPANY, (2) WILLFUL OR GROSS NEGLECT
THAT HAS A MATERIAL ADVERSE EFFECT ON THE COMPANY, (3) FRAUD,
(4) MISAPPROPRIATION OR (5) EMBEZZLEMENT IN THE PERFORMANCE OF HIS DUTIES
HEREUNDER, OR

 

C.                                     HAVING BREACHED IN ANY MATERIAL RESPECT
THE MATERIAL TERMS AND PROVISIONS OF HIS OR HER EMPLOYMENT AGREEMENT OR ANY
OTHER MATERIAL CONTRACT BETWEEN THE PARTICIPANT AND THE COMPANY AND FAILED TO
CURE SUCH BREACH WITHIN 15 DAYS FOLLOWING WRITTEN NOTICE FROM THE COMPANY
SPECIFYING SUCH BREACH;

 

PROVIDED THAT THE TERMINATION FOR CAUSE REQUIRES A WRITTEN NOTICE GIVEN TO THE
PARTICIPANT AT ANY TIME FOLLOWING THE OCCURRENCE OF ANY OF THE EVENTS DESCRIBED
IN CLAUSES A AND B ABOVE AND ON WRITTEN NOTICE GIVEN TO THE PARTICIPANT AT ANY
TIME NOT LESS THAN 60 DAYS FOLLOWING THE OCCURRENCE OF ANY OF THE EVENTS
DESCRIBED IN CLAUSE C ABOVE.

 

(III)                               “DISABILITY” SHALL HAVE THE MEANING PROVIDED
UNDER TREASURY REGULATION SECTION 1.409A-3(I)(4)(I) AND (III).

 

(IV)                              “GOOD REASON” SHALL MEAN THE OCCURRENCE OF
(X) A CHANGE IN  CONTROL, ACCOMPANIED BY, OR FOLLOWED WITHIN THE TWELVE-MONTH
PERIOD AFTER A CHANGE IN CONTROL BY,: (Y) (I) A MATERIAL BREACH BY THE COMPANY
OF THIS AGREEMENT OR ANY APPLICABLE EMPLOYMENT AGREEMENT, (II) A MATERIAL
DIMINUTION IN THE DUTIES, TITLE OR RESPONSIBILITIES OF THE PARTICIPANT, OR
(III) A MATERIAL DIMINUTION IN THE PARTICIPANT’S BASE COMPENSATION.  HOWEVER, IN
NO EVENT SHALL THE PARTICIPANT BE CONSIDERED TO HAVE RESIGNED FOR “GOOD REASON”
UNLESS THE PARTICIPANT DELIVERS A WRITTEN NOTICE OF RESIGNATION TO THE BOARD
IDENTIFYING IN REASONABLE DETAIL THE ACTS OR OMISSIONS CONSTITUTING “GOOD
REASON” WITHIN 90 DAYS FOLLOWING THE ACTS OR OMISSIONS, AND SUCH ACTS OR
OMISSIONS ARE NOT CURED BY THE COMPANY WITHIN 30 DAYS OF THE RECEIPT OF SUCH
NOTICE AND THE PARTICIPANT ACTS ON HIS OR HER RESIGNATION WITHIN SIX MONTHS
FOLLOWING THE OCCURRENCE GIVING RISE TO A GOOD REASON.

 

5.             PAYMENT.

 

(A)                                  WITHIN 60 DAYS FOLLOWING THE COMMITTEE’S
CERTIFICATION IN WRITING OF THE PERFORMANCE SHARE UNITS EARNED, THE COMPANY
SHALL DISTRIBUTE TO THE PARTICIPANT (OR TO THE PARTICIPANT’S BENEFICIARY IN THE
EVENT OF DEATH) THE SHARES REPRESENTED BY PERFORMANCE SHARE UNITS THAT WERE
EARNED, REDUCED BY THE NUMBER OF SHARES (IF ANY) THAT ARE WITHHELD FROM THE
AWARD FOR THE PAYMENT OF TAX-RELATED ITEMS (AS DEFINED IN SECTION 12 HEREOF) AND
UPON THE SATISFACTION OF ALL OTHER APPLICABLE CONDITIONS AS TO THE PERFORMANCE
SHARE UNITS; PROVIDED, HOWEVER, THAT THE SHARES SHALL BE DISTRIBUTED NO LATER
THAN THE 15TH DAY OF THE THIRD MONTH FOLLOWING THE

 

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LATER OF (X) THE END OF THE CALENDAR YEAR IN WHICH THE PERFORMANCE PERIOD ENDS
OR (Y) THE END OF THE COMPANY’S TAXABLE YEAR IN WHICH THE PERFORMANCE PERIOD
ENDS; PROVIDED FURTHER, HOWEVER, THAT THE SHARES MAY BE DISTRIBUTED FOLLOWING
THE DATE CONTEMPLATED IN THIS SECTION TO THE EXTENT PERMITTED UNDER SECTION 409A
(“SECTION 409A”) OF INTERNAL REVENUE CODE OF 1986, AND THE REGULATIONS,
INCLUDING THE PROPOSED REGULATIONS THEREUNDER (THE “CODE”) WITHOUT THE PAYMENT
BECOMING SUBJECT TO, AND BEING TREATED AS “NONQUALIFIED DEFERRED COMPENSATION”
WITHIN THE MEANING OF SECTION 409A (SUCH AS WHERE THE COMPANY REASONABLY
ANTICIPATES THAT THE PAYMENT WILL VIOLATE FEDERAL SECURITIES LAWS OR OTHER
APPLICABLE LAWS).  PAYMENT OF ANY EARNED PERFORMANCE SHARE UNITS SHALL BE MADE
IN WHOLE SHARES.  EARNED PERFORMANCE SHARE UNITS SHALL BE ROUNDED DOWN TO THE
NEAREST WHOLE SHARE, AND THE COMPANY SHALL PAY THE VALUE OF ANY FRACTIONAL
SHARES TO THE PARTICIPANT IN CASH ON THE BASIS OF THE FAIR MARKET VALUE PER
SHARE OF COMMON STOCK ON THE DATE OF DISTRIBUTION.

 

(B)                                 THE COMPANY SHALL NOT BE OBLIGATED TO ISSUE
SHARES TO THE PARTICIPANT  UPON THE EARNING OF ANY PERFORMANCE SHARE UNITS
UNLESS THE ISSUANCE AND DELIVERY OF SUCH SHARES SHALL COMPLY WITH ALL RELEVANT
PROVISIONS OF LAW AND OTHER LEGAL REQUIREMENTS INCLUDING, WITHOUT LIMITATION,
ANY APPLICABLE FEDERAL, STATE OR FOREIGN SECURITIES LAWS, ANY APPLICABLE
TAX-RELATED ITEMS AND THE REQUIREMENTS OF ANY STOCK EXCHANGE UPON WHICH SHARES
MAY BE LISTED.

 

(C)                                  ANYTHING IN THE FOREGOING TO THE CONTRARY
NOTWITHSTANDING, PERFORMANCE SHARE UNITS GRANTED UNDER THIS AGREEMENT MAY BE
SUSPENDED, DELAYED OR OTHERWISE DEFERRED FOR ANY OF THE REASONS CONTEMPLATED IN
SECTIONS 4 AND 5 ONLY TO THE EXTENT SUCH SUSPENSION, DELAY OR DEFERRAL IS
PERMITTED UNDER TREAS. REG. §§1.409A-2(B)(7), 1.409A-1(B)(4)(II) OR SUCCESSOR
PROVISIONS, OR AS OTHERWISE PERMITTED UNDER SECTION 409A.

 

6.             OPTION OF COMPANY TO DELIVER CASH.

 

Notwithstanding any of the other provisions of this Agreement, at the time when
any Performance Share Units are payable pursuant to Sections 5 or 11, the
Company may elect, in the sole discretion of the Committee, to deliver to the
Participant in lieu of the Shares represented by Performance Share Units that
are then payable an equivalent amount of cash (determined by reference to the
closing price of the Shares on the principal exchange on which the Shares trade
on the applicable payment date or if such date is not a trading date, on the
next preceding trading date).  Such payments shall be made no later than the
deadline set forth in Section 5(a) hereof.  If the Company elects to deliver
cash to the Participant, the Company is authorized to retain such amount as is
sufficient to satisfy the withholding of Tax-Related Items (as defined in
Section 12 hereof).

 

7.             RESTRICTIONS ON TRANSFER.

 

(A)                                  THE PARTICIPANT SHALL NOT SELL, ASSIGN,
TRANSFER, PLEDGE, HYPOTHECATE OR OTHERWISE ENCUMBER OR DISPOSE OF ANY
PERFORMANCE SHARE UNITS, EITHER VOLUNTARILY OR BY

 

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operation of law.  Any attempt to dispose of any Performance Share Units in
contravention of the above restriction shall be null and void and without
effect.

 

(B)                                 THE COMPANY SHALL NOT BE REQUIRED (I) TO
TRANSFER ON ITS BOOKS ANY OF THE PERFORMANCE SHARE UNITS THAT HAVE BEEN
TRANSFERRED IN VIOLATION OF ANY OF THE PROVISIONS SET FORTH HEREIN OR (II) TO
TREAT AS THE OWNER OF SUCH PERFORMANCE SHARE UNITS ANY TRANSFEREE TO WHOM SUCH
PERFORMANCE SHARE UNITS HAVE BEEN TRANSFERRED IN VIOLATION OF ANY OF THE
PROVISIONS CONTAINED HEREIN.

 

8.                                       NO OBLIGATION TO CONTINUE BUSINESS
RELATIONSHIP.  NEITHER THE PLAN, THIS AGREEMENT, NOR THE GRANT OF THE
PERFORMANCE SHARE UNITS IMPOSES ANY OBLIGATION ON THE COMPANY OR ITS AFFILIATES
TO HAVE OR CONTINUE A BUSINESS RELATIONSHIP WITH THE PARTICIPANT.

 

9.                                       NO RIGHTS AS STOCKHOLDER.  THE
PERFORMANCE SHARE UNITS REPRESENT AN UNFUNDED, UNSECURED PROMISE BY THE COMPANY
TO DELIVER SHARES OR THE VALUE THEREOF IN ACCORDANCE WITH THE TERMS OF THIS
AGREEMENT.  THE PARTICIPANT SHALL HAVE NO RIGHTS AS A SHAREHOLDER WITH RESPECT
TO THE SHARES UNDERLYING THE PERFORMANCE SHARE UNITS.  THE PARTICIPANT SHALL
HAVE NO RIGHT TO VOTE OR RECEIVE DIVIDENDS WITH RESPECT TO ANY SHARES UNDERLYING
THE PERFORMANCE SHARE UNITS UNLESS AND UNTIL SUCH SHARES ARE DISTRIBUTED TO THE
PARTICIPANT.

 

10.                                 ADJUSTMENTS FOR CAPITAL CHANGES.

 

The Plan contains provisions covering the treatment of Restricted Stock Awards
in a number of contingencies such as stock splits and mergers.  Provisions in
the Plan for such adjustments are hereby made applicable hereunder and are
incorporated herein by reference.

 

11.           CHANGE IN CONTROL.

 

(A)                                  UPON A CHANGE IN CONTROL OF THE COMPANY
DURING THE PERFORMANCE PERIOD, PERFORMANCE SHARE UNITS SHALL BE VESTED AS THOUGH
THE MAXIMUM <MEASURE> HAD BEEN SATISFIED AS OF SUCH DATE, AND PAID WITHIN FIVE
BUSINESS DAYS OF A CHANGE IN CONTROL; PROVIDED THAT IF SUCH PAYMENT WOULD RESULT
IN THE IMPOSITION OF A TAX UNDER SECTION 409A THEN SUCH PAYMENT SHALL BE MADE IN
ACCORDANCE WITH SECTION 5(A) ABOVE, FOLLOWING THE END OF THE FISCAL YEAR IN
WHICH SUCH CHANGE IN CONTROL OCCURS.

 

(B)                                 FOR PURPOSES OF THIS AGREEMENT, A “CHANGE IN
CONTROL” MEANS ANY OF THE FOLLOWING EVENTS:

 

(I)                                     “CHANGE IN CONTROL” MEANS ANY OF THE
FOLLOWING EVENTS:

 

A.                                   ANY “PERSON,” AS SUCH TERM IS USED IN
SECTIONS 13(D) AND 14(D) OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE
“EXCHANGE ACT”) (A  “PERSON”) OR “GROUP” (WITHIN THE MEANING OF RULE 13D-5 OF
THE EXCHANGE ACT AND TREAS. REG. § 1.409A-3(I)(5)(B)), IS OR BECOMES THE
“BENEFICIAL OWNER,” AS DEFINED IN RULE 13D-3 UNDER THE EXCHANGE ACT (A
“BENEFICIAL OWNER”), DIRECTLY OR INDIRECTLY, OF

 

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SECURITIES OF THE COMPANY REPRESENTING 40% OR MORE OF THE COMBINED VOTING POWER
OF THE COMPANY’S THEN OUTSTANDING VOTING SECURITIES, BY ACQUISITION OR THROUGH
MERGER, CONSOLIDATION, OR REORGANIZATION;

 

B.                                     INDIVIDUALS WHO, AT THE BEGINNING OF ANY
12 MONTH PERIOD, CONSTITUTE THE BOARD OF DIRECTORS OF COMPANY (THE “INCUMBENT
BOARD”), CEASE FOR ANY REASON TO CONSTITUTE AT LEAST A MAJORITY OF THE BOARD OF
DIRECTORS, PROVIDED THAT ANY PERSON BECOMING A DIRECTOR SUBSEQUENT TO THE DATE
HEREOF WHOSE ELECTION, OR NOMINATION FOR ELECTION BY THE COMPANY’S STOCKHOLDERS,
IS APPROVED BY A VOTE OF AT LEAST A MAJORITY OF THE DIRECTORS SHALL, FOR THE
PURPOSES OF THIS AGREEMENT, BE CONSIDERED AS THOUGH SUCH PERSON WERE A MEMBER OF
THE INCUMBENT BOARD OF THE COMPANY (PROVIDED THAT THIS CLAUSE B DOES NOT APPLY
IF A MAJORITY SHAREHOLDER OF THE COMPANY IS ANOTHER CORPORATION); OR

 

C.                                     THE CONSUMMATION OF A SALE OR OTHER
DISPOSITION BY THE COMPANY OF ALL OR SUBSTANTIALLY ALL (I.E., AT LEAST 85%) OF
THE COMPANY’S ASSETS TO A PERSON OR GROUP (EACH AS DEFINED IN CLAUSE A WITHIN A
12 MONTH PERIOD ENDING ON THE THEN MOST RECENT DISPOSITION OF ASSETS. THERE IS
NO CHANGE IN CONTROL EVENT UNDER THIS CLAUSE C WHEN THE TRANSFER IS TO (I) A
SHAREHOLDER OF THE COMPANY (IMMEDIATELY BEFORE THE ASSET TRANSFER) IN EXCHANGE
FOR OR WITH RESPECT TO SUCH SHAREHOLDER’S STOCK; (II) AN ENTITY, 50% OR MORE OF
THE TOTAL VALUE OR VOTING POWER OF WHICH IS OWNED, DIRECTLY OR INDIRECTLY, BY
THE COMPANY; (III) A PERSON, OR MORE THAN ONE PERSON ACTING AS A GROUP, THAT
OWNS, DIRECTLY OR INDIRECTLY, 50% OR MORE OF THE TOTAL VALUE OR VOTING POWER OF
ALL THE OUTSTANDING STOCK OF THE COMPANY; OR (IV) AN ENTITY, AT LEAST 50% OF THE
TOTAL VALUE OR VOTING POWER OF WHICH IS OWNED, DIRECTLY OR INDIRECTLY, BY A
PERSON DESCRIBED IN SUBCLAUSE (III).

 

NOTWITHSTANDING THE PRECEDING PROVISIONS OF THIS DEFINITION, A CHANGE IN CONTROL
SHALL NOT BE DEEMED TO HAVE OCCURRED IF THE PERSON DESCRIBED IN THE PRECEDING
PROVISIONS OF THIS DEFINITION IS (1) AN UNDERWRITER OR UNDERWRITING SYNDICATE
THAT HAS ACQUIRED THE OWNERSHIP OF ANY OF THE COMPANY’S THEN OUTSTANDING VOTING
SECURITIES SOLELY IN CONNECTION WITH A PUBLIC OFFERING OF THE COMPANY’S
SECURITIES, (2) ANY SUBSIDIARY OF THE COMPANY OR (3) TO THE EXTENT PERMITTED BY
SECTION 409A, AN EMPLOYEE STOCK OWNERSHIP PLAN OR OTHER EMPLOYEE BENEFIT PLAN
MAINTAINED BY THE COMPANY (OR ANY OF ITS SUBSIDIARIES) THAT IS QUALIFIED UNDER
THE PROVISIONS OF THE CODE.  IN ADDITION, NO CHANGE IN CONTROL SHALL HAVE
OCCURRED UNLESS THE TRANSACTION OR SERIES OF TRANSACTIONS RESULTS IN A CHANGE IN
CONTROL WITHIN THE MEANING OF CODE SECTION 409A AND THE REGULATIONS THEREUNDER.
THIS CHANGE IN CONTROL DEFINITION SHALL BE INTERPRETED IN A MANNER THAT IS
CONSISTENT WITH CODE SECTION 409A AND THE REGULATIONS THEREUNDER,

 

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INCLUDING WITH RESPECT TO ANY APPLICABLE LIMITATIONS ON THE KINDS OF EVENTS THAT
WOULD CONSTITUTE A CHANGE IN CONTROL.

 

12.           WITHHOLDING TAXES.

 

(A)                                  REGARDLESS OF ANY ACTION THE COMPANY AND/OR
THE AFFILIATE EMPLOYING THE PARTICIPANT (THE “EMPLOYER”) TAKE WITH RESPECT TO
ANY OR ALL INCOME TAX (INCLUDING U.S. FEDERAL, STATE AND LOCAL TAX AND/OR
NON-U.S. TAX), SOCIAL INSURANCE, PAYROLL TAX OR OTHER TAX-RELATED ITEMS
(“TAX-RELATED ITEMS”), THE PARTICIPANT HEREBY ACKNOWLEDGES THAT THE ULTIMATE
LIABILITY FOR ALL TAX-RELATED ITEMS LEGALLY DUE BY THE PARTICIPANT WITH RESPECT
TO THE PARTICIPANT’S AWARD OF PERFORMANCE SHARE UNITS, EARNING OF THE
PERFORMANCE SHARE UNITS, OR THE ISSUANCE OF SHARES (OR PAYMENT OF CASH) IN
SETTLEMENT OF EARNED PERFORMANCE SHARE UNITS IS AND REMAINS THE PARTICIPANT’S
RESPONSIBILITY AND THAT THE COMPANY AND/OR THE EMPLOYER (I) MAKE NO
REPRESENTATIONS OR UNDERTAKINGS REGARDING THE TREATMENT OF ANY TAX-RELATED ITEMS
IN CONNECTION WITH ANY ASPECT OF THE PERFORMANCE SHARE UNITS, INCLUDING THE
AWARD OF THE PERFORMANCE SHARE UNITS, THE EARNING OF THE PERFORMANCE SHARE
UNITS, THE ISSUANCE OF SHARES (OR PAYMENT OF CASH) IN SETTLEMENT OF THE
PERFORMANCE SHARE UNITS, THE SUBSEQUENT SALE OF SHARES ACQUIRED AT EARNING AND
THE RECEIPT OF ANY DIVIDENDS AND OR DIVIDEND EQUIVALENTS; AND (II) DO NOT COMMIT
TO STRUCTURE THE TERMS OF THE AWARD OR ANY ASPECT OF THE PERFORMANCE SHARE UNITS
TO REDUCE OR ELIMINATE THE PARTICIPANT’S LIABILITY FOR TAX-RELATED ITEMS.

 

(B)                                 PRIOR TO THE RELEVANT TAX WITHHOLDING EVENT,
AS APPLICABLE, THE PARTICIPANT SHALL PAY OR MAKE ADEQUATE ARRANGEMENTS
SATISFACTORY TO THE COMPANY AND/OR THE EMPLOYER TO SATISFY ALL WITHHOLDING
OBLIGATIONS OF THE COMPANY AND/OR THE EMPLOYER WITH RESPECT TO TAX-RELATED
ITEMS.  IN THIS REGARD, THE PARTICIPANT HEREBY AUTHORIZES THE COMPANY AND/OR THE
EMPLOYER, IN THEIR SOLE DISCRETION AND WITHOUT ANY NOTICE TO OR AUTHORIZATION BY
THE PARTICIPANT, TO WITHHOLD FROM THE SHARES BEING DISTRIBUTED UNDER THIS AWARD
UPON THE DETERMINATION OF EARNED PERFORMANCE SHARE UNITS THAT NUMBER OF WHOLE
SHARES THE FAIR MARKET VALUE OF WHICH (DETERMINED BY REFERENCE TO THE CLOSING
PRICE OF THE COMMON STOCK ON THE PRINCIPAL EXCHANGE ON WHICH THE COMMON STOCK
TRADES ON THE DATE THE WITHHOLDING OBLIGATION ARISES, OR IF SUCH DATE IS NOT A
TRADING DATE, ON THE NEXT PRECEDING TRADING DATE) IS EQUAL TO THE AGGREGATE
WITHHOLDING OBLIGATION AS DETERMINED BY THE COMPANY AND/OR EMPLOYER WITH RESPECT
TO SUCH AWARD, PROVIDED THAT THE COMPANY ONLY WITHHOLDS THE NUMBER OF SHARES
NECESSARY TO SATISFY THE MINIMUM WITHHOLDING OBLIGATION AMOUNT.  IF THE COMPANY
SATISFIES THE WITHHOLDING OBLIGATION FOR TAX-RELATED ITEMS BY WITHHOLDING A
NUMBER OF SHARES BEING DISTRIBUTED UNDER THE AWARD AS DESCRIBED ABOVE, THE
PARTICIPANT HEREBY ACKNOWLEDGES THAT THE PARTICIPANT IS DEEMED TO HAVE BEEN
ISSUED THE FULL NUMBER OF SHARES SUBJECT TO THE AWARD OF PERFORMANCE SHARE
UNITS, NOTWITHSTANDING THAT A NUMBER OF THE SHARES IS HELD BACK SOLELY FOR THE
PURPOSE OF PAYING THE TAX-RELATED ITEMS DUE AS A RESULT OF THE AWARD, EARNING
AND/OR SETTLEMENT OF THE PERFORMANCE SHARE UNITS.  IN THE EVENT THE TAX-RELATED
ITEMS WITHHOLDING OBLIGATION WOULD RESULT IN A FRACTIONAL NUMBER OF SHARES TO BE
WITHHELD BY THE COMPANY, SUCH NUMBER OF SHARES TO BE WITHHELD

 

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SHALL BE ROUNDED UP TO THE NEXT NEAREST NUMBER OF WHOLE SHARES.  IF, SOLELY DUE
TO ROUNDING OF SHARES, THE VALUE OF THE NUMBER OF SHARES RETAINED BY THE COMPANY
PURSUANT TO THIS PROVISION IS MORE THAN THE AMOUNT REQUIRED TO BE WITHHELD, THEN
THE COMPANY MAY PAY SUCH EXCESS AMOUNT TO THE RELEVANT TAX AUTHORITY AS
ADDITIONAL WITHHOLDING WITH RESPECT TO THE PARTICIPANT.

 

(C)                                  ALTERNATIVELY, OR IN ADDITION, THE COMPANY
MAY (A) ONLY TO THE EXTENT AND IN THE MANNER PERMITTED BY ALL APPLICABLE
SECURITIES LAWS, INCLUDING MAKING ANY NECESSARY SECURITIES REGISTRATION OR
TAKING ANY OTHER NECESSARY ACTIONS, INSTRUCT THE BROKER WHOM IT HAS SELECTED FOR
THIS PURPOSE TO SELL ON THE PARTICIPANT’S BEHALF, THE SHARES TO BE ISSUED UPON
THE EARNING OR SETTLEMENT, AS APPLICABLE, OF THE PARTICIPANT’S PERFORMANCE SHARE
UNITS TO MEET THE WITHHOLDING OBLIGATION FOR TAX-RELATED ITEMS, AND/OR
(B) WITHHOLD ALL APPLICABLE TAX-RELATED ITEMS LEGALLY PAYABLE BY PARTICIPANT
FROM PARTICIPANT’S WAGES OR OTHER CASH COMPENSATION PAID TO PARTICIPANT BY THE
COMPANY AND/OR THE EMPLOYER.

 

(D)                                 FINALLY, THE PARTICIPANT HEREBY ACKNOWLEDGES
THAT THE PARTICIPANT IS REQUIRED TO PAY TO THE EMPLOYER ANY AMOUNT OF
TAX-RELATED ITEMS THAT THE EMPLOYER MAY BE REQUIRED TO WITHHOLD AS A RESULT OF
THE PARTICIPANT’S AWARD OF PERFORMANCE SHARE UNITS, EARNING OF THE PERFORMANCE
SHARE UNITS, OR THE ISSUANCE OF SHARES (OF PAYMENT OF CASH) IN SETTLEMENT OF
EARNED PERFORMANCE SHARE UNITS THAT CANNOT BE SATISFIED BY THE MEANS PREVIOUSLY
DESCRIBED.  THE PARTICIPANT HEREBY ACKNOWLEDGES THAT THE COMPANY MAY REFUSE TO
DELIVER THE SHARES IN SETTLEMENT OF THE EARNED PERFORMANCE SHARE UNITS TO THE
PARTICIPANT IF THE PARTICIPANT FAILS TO COMPLY WITH THE PARTICIPANT’S
OBLIGATIONS IN CONNECTION WITH THE TAX-RELATED ITEMS AS DESCRIBED IN THIS
SECTION.  THE PARTICIPANT SHALL HAVE NO FURTHER RIGHTS WITH RESPECT TO ANY
SHARES THAT ARE RETAINED BY THE COMPANY PURSUANT TO THIS PROVISION, AND UNDER NO
CIRCUMSTANCES WILL THE COMPANY BE REQUIRED TO ISSUE ANY FRACTIONAL SHARES.

 

(E)                                  THE PARTICIPANT HAS REVIEWED AND
UNDERSTANDS THE TAX WITHHOLDING AND PAYMENT OBLIGATIONS AS SET FORTH IN THIS
AGREEMENT AND UNDERSTANDS THAT THE COMPANY IS NOT PROVIDING ANY TAX ADVICE AND
THAT THE PARTICIPANT SHOULD CONSULT WITH PARTICIPANT’S OWN TAX ADVISORS ON THE
U.S. FEDERAL, STATE, FOREIGN AND LOCAL TAX AND NON-U.S. TAX CONSEQUENCES OF THIS
INVESTMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

 

13.           NATURE OF GRANT.

 

In accepting the Performance Share Units, Participant acknowledges that: (a) the
grant of the Performance Share Units is voluntary and occasional and does not
create any contractual or other right to receive future grants of Performance
Share Units, or benefits in lieu of Performance Share Units even if Performance
Share Units have been granted repeatedly in the past; (b) all decisions with
respect to future awards of Performance Share Units, if any, will be at the sole
discretion of the Company; (c) the future value of the underlying Shares is
unknown and cannot be predicted with certainty; (d) in consideration of the
award of Performance Share Units, no claim or entitlement to

 

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compensation or damages shall arise from termination of the Performance Share
Units or any diminution in value of the Performance Share Units or Shares
received when the Performance Share Units are earned resulting from the
Participant’s termination of employment by the Company or any Affiliate (for any
reason whatsoever and whether or not in breach of local employment laws), and
Participant irrevocably releases the Company and/or the Affiliate from any such
claim that may arise; (e) in the event of involuntary termination of
Participant’s employment (whether or not in breach of local employment laws),
Participant’s right to receive Performance Share Units and vesting under the
Plan, if any, will terminate effective as of the date that Participant is no
longer actively employed and will not be extended by any notice period mandated
under local law or contract, and the Company shall have the exclusive discretion
to determine when Participant is no longer actively employed for purposes of the
Performance Share Units; (f) the Company is not providing any tax, legal or
financial advice, nor is the Company making any recommendations regarding
Participant’s participation in the Plan, or Participant’s acquisition or sale of
the underlying Shares; and (g) Participant is hereby advised to consult with his
or her own personal tax, legal and financial advisors regarding Participant’s
participation in the Plan before taking any action related to the Plan.

 

14.           MISCELLANEOUS.

 

(A)                                  NOTICES.  ALL NOTICES HEREUNDER SHALL BE IN
WRITING AND SHALL BE DEEMED GIVEN WHEN SENT BY CERTIFIED OR REGISTERED MAIL,
POSTAGE PREPAID, RETURN RECEIPT REQUESTED, IF TO THE PARTICIPANT, TO THE ADDRESS
SET FORTH ON THE COVER SHEET OR AT THE MOST RECENT ADDRESS SHOWN ON THE RECORDS
OF THE COMPANY, AND IF TO THE COMPANY, TO THE COMPANY’S PRINCIPAL OFFICE,
ATTENTION OF THE CORPORATE SECRETARY.

 

(B)                                 ENTIRE AGREEMENT; MODIFICATION.  THIS
AGREEMENT (INCLUDING THE COVER SHEET) AND THE PLAN CONSTITUTES THE ENTIRE
AGREEMENT BETWEEN THE PARTIES RELATIVE TO THE SUBJECT MATTER HEREOF, AND
SUPERSEDES ALL OTHER COMMUNICATIONS BETWEEN THE PARTIES RELATING TO THE SUBJECT
MATTER OF THIS AGREEMENT.  THIS AGREEMENT MAY BE MODIFIED, AMENDED OR RESCINDED
BY THE COMMITTEE AS IT SHALL DEEM ADVISABLE, SUBJECT TO ANY REQUIREMENT FOR
SHAREHOLDER APPROVAL IMPOSED BY APPLICABLE LAW OR OTHER APPLICABLE RULES,
INCLUDING, WITHOUT LIMITATION, THE RULES OF THE STOCK EXCHANGE ON WHICH THE
SHARES ARE LISTED.  IF THE COMMITTEE DETERMINES THAT THE AWARD TERMS COULD
RESULT IN ADVERSE TAX CONSEQUENCES TO THE PARTICIPANT, THE COMMITTEE MAY AMEND
THIS AGREEMENT WITHOUT THE CONSENT OF THE PARTICIPANT IN ORDER TO MINIMIZE OR
ELIMINATE SUCH TAX TREATMENT.

 

(C)                                  PLAN GOVERNS. THIS AGREEMENT IS SUBJECT TO
ALL TERMS AND PROVISIONS OF THE PLAN.  IN THE EVENT OF A CONFLICT BETWEEN ONE OR
MORE PROVISIONS OF THIS AGREEMENT AND ONE OR MORE PROVISIONS OF THE PLAN, THE
PROVISIONS OF THE PLAN WILL GOVERN.

 

(D)                                 SEVERABILITY.  THE INVALIDITY, ILLEGALITY OR
UNENFORCEABILITY OF ANY PROVISION OF THIS AGREEMENT SHALL IN NO WAY AFFECT THE
VALIDITY, LEGALITY OR ENFORCEABILITY OF ANY OTHER PROVISION.

 

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(E)                                  SUCCESSORS AND ASSIGNS.  THIS AGREEMENT
SHALL INURE TO THE BENEFIT OF AND BE BINDING UPON THE HEIRS, LEGATEES,
DISTRIBUTEES, EXECUTORS AND ADMINISTRATORS OF THE PARTICIPANT AND THE SUCCESSORS
AND ASSIGNS OF THE COMPANY.

 

(F)                                    PARTICIPANT’S ACCEPTANCE.  THE
PARTICIPANT IS URGED TO READ THIS AGREEMENT CAREFULLY AND TO CONSULT WITH HIS OR
HER OWN LEGAL COUNSEL REGARDING THE TERMS AND CONSEQUENCES OF THIS AGREEMENT AND
THE LEGAL AND BINDING EFFECT OF THIS AGREEMENT.  BY VIRTUE OF HIS OR HER
ACCEPTANCE OF THIS AGREEMENT, THE PARTICIPANT IS DEEMED TO HAVE ACCEPTED AND
AGREED TO ALL OF THE TERMS AND CONDITIONS OF THIS AWARD AND THE PROVISIONS OF
THE PLAN, INCLUDING AS BINDING, CONCLUSIVE AND FINAL ALL DECISIONS OR
INTERPRETATIONS OF THE COMMITTEE UPON ANY QUESTIONS ARISING UNDER THE PLAN OR
THIS AWARD.

 

(G)                                 SECTION 409A.  THIS AGREEMENT, THE
PERFORMANCE SHARE UNITS AND PAYMENTS MADE PURSUANT TO THIS AGREEMENT ARE
INTENDED TO COMPLY WITH OR QUALIFY FOR AN EXEMPTION FROM THE REQUIREMENTS OF
SECTION 409A AND SHALL BE CONSTRUED CONSISTENTLY THEREWITH AND SHALL BE
INTERPRETED IN A MANNER CONSISTENT WITH THAT INTENTION.  TERMS DEFINED IN THE
AGREEMENT SHALL HAVE THE MEANINGS GIVEN SUCH TERMS UNDER SECTION 409A IF AND TO
THE EXTENT REQUIRED TO COMPLY WITH SECTION 409A.  NOTWITHSTANDING ANY OTHER
PROVISION OF THIS AGREEMENT, THE COMPANY RESERVES THE RIGHT, TO THE EXTENT THE
COMPANY DEEMS NECESSARY OR ADVISABLE, IN ITS SOLE DISCRETION, TO UNILATERALLY
AMEND THE PLAN AND/OR THIS AGREEMENT TO ENSURE THAT ALL PERFORMANCE SHARE UNITS
ARE AWARDED IN A MANNER THAT QUALIFIES FOR EXEMPTION FROM OR COMPLIES WITH
SECTION 409A, PROVIDED, HOWEVER, THAT THE COMPANY MAKES NO UNDERTAKING TO
PRECLUDE SECTION 409A FROM APPLYING TO THIS AWARD OF PERFORMANCE SHARE UNITS. 
ANY PAYMENTS DESCRIBED IN THIS SECTION 13(G) THAT ARE DUE WITHIN THE “SHORT TERM
DEFERRAL PERIOD” AS DEFINED IN SECTION 409A SHALL NOT BE TREATED AS DEFERRED
COMPENSATION UNLESS APPLICABLE LAW REQUIRES OTHERWISE.  IF AND TO THE EXTENT ANY
PORTION OF ANY PAYMENT, COMPENSATION OR OTHER BENEFIT PROVIDED TO THE
PARTICIPANT IN CONNECTION WITH HIS EMPLOYMENT TERMINATION IS DETERMINED TO
CONSTITUTE “NONQUALIFIED DEFERRED COMPENSATION” WITHIN THE MEANING OF
SECTION 409A AND THE PARTICIPANT IS A SPECIFIED EMPLOYEE AS DEFINED IN
SECTION 409A(2)(B)(I) OF THE CODE, AS DETERMINED BY THE COMPANY IN ACCORDANCE
WITH ITS PROCEDURES, BY WHICH DETERMINATION THE PARTICIPANT HEREBY AGREES THAT
HE IS BOUND, SUCH PORTION OF THE PAYMENT, COMPENSATION OR OTHER BENEFIT SHALL
NOT BE PAID BEFORE THE DAY THAT IS SIX MONTHS PLUS ONE DAY AFTER THE DATE OF
SEPARATION FROM SERVICE (AS DETERMINED UNDER SECTION 409A (THE “NEW PAYMENT
DATE”)), EXCEPT AS SECTION 409A MAY THEN PERMIT.  THE AGGREGATE OF ANY PAYMENTS
THAT OTHERWISE WOULD HAVE BEEN PAID TO THE PARTICIPANT DURING THE PERIOD BETWEEN
THE DATE OF SEPARATION FROM SERVICE AND THE NEW PAYMENT DATE SHALL BE PAID TO
THE PARTICIPANT IN A LUMP SUM ON SUCH NEW PAYMENT DATE, AND ANY REMAINING
PAYMENTS WILL BE PAID ON THEIR ORIGINAL SCHEDULE. NOTWITHSTANDING THE FOREGOING,
THE COMPANY, ITS AFFILIATES, DIRECTORS, OFFICERS AND AGENTS SHALL HAVE NO
LIABILITY TO A PARTICIPANT, OR ANY OTHER PARTY, IF AN AWARD THAT IS INTENDED TO
BE EXEMPT FROM, OR COMPLIANT WITH, SECTION 409A IS NOT SO EXEMPT OR COMPLIANT,
OR FOR ANY ACTION TAKEN BY THE COMMITTEE.

 

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(H)                                 GOVERNING LAW/CHOICE OF VENUE.  THIS
AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO THE PRINCIPLES OF THE CONFLICTS
OF LAWS THEREOF.  FOR PURPOSES OF LITIGATING ANY DISPUTE THAT ARISES DIRECTLY OR
INDIRECTLY FROM THE RELATIONSHIP OF THE PARTIES, EVIDENCED BY THIS AWARD OR THE
AGREEMENT, THE PARTIES HEREBY SUBMIT TO AND CONSENT TO THE EXCLUSIVE
JURISDICTION OF THE STATE OF VERMONT AND AGREE THAT SUCH LITIGATION SHALL BE
CONDUCTED ONLY IN THE COURTS OF RUTLAND COUNTY, VERMONT, OR THE FEDERAL COURTS
FOR THE UNITED STATES FOR THE DISTRICT OF VERMONT, AND NO OTHER COURTS, WHERE
THIS AWARD IS MADE AND/OR TO BE PERFORMED.

 

(I)                                     ADMINISTRATOR AUTHORITY.  THE COMMITTEE
WILL HAVE THE POWER TO INTERPRET THE PLAN AND THIS AGREEMENT AND TO ADOPT SUCH
RULES FOR THE ADMINISTRATION, INTERPRETATION AND APPLICATION OF THE PLAN AS ARE
CONSISTENT THEREWITH AND TO INTERPRET OR REVOKE ANY SUCH RULES (INCLUDING, BUT
NOT LIMITED TO, THE DETERMINATION OF WHETHER OR NOT ANY PERFORMANCE SHARE UNITS
HAVE BEEN EARNED).  ALL ACTIONS TAKEN AND ALL INTERPRETATIONS AND DETERMINATIONS
MADE BY THE COMMITTEE IN GOOD FAITH WILL BE FINAL AND BINDING UPON PARTICIPANT,
THE COMPANY AND ALL OTHER INTERESTED PERSONS.

 

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