Exhibit 10.2

UST INC.
AMENDED AND RESTATED STOCK INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT

        RESTRICTED STOCK AGREEMENT, made as of the date set forth on the Notice
of Grant of Restricted Stock, and hereby amended as of September 13, 2004, by
and between UST Inc., a Delaware corporation (the “Company”), pursuant to the
Amended and Restated Stock Incentive Plan (the “Plan”) and the employee of the
Company or a Subsidiary named on the Notice of Grant of Restricted Stock (the
“Employee”);

        WHEREAS, the Company desires, by affording the Employee the opportunity
to acquire or enlarge the Employee’s ownership of shares of the Company’s common
stock, $.50 par value (“Common Stock”), providing the Employee with a direct
proprietary interest in the Company’s success, to carry out the purpose of the
Plan; and

        WHEREAS, the Committee administering the Plan has granted (as of the
effective date of grant specified in the Notice of Grant of Restricted Stock) to
the Employee the shares of Restricted Stock as set forth in the Notice of Grant
of Restricted Stock.

        NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the parties hereto have
agreed and do hereby agree as follows:

        1. Grant of Award. Pursuant to Section 7 of the Plan, the Company grants
to the Employee, subject to the terms and conditions of the Plan and subject
further to the terms and conditions set forth herein, the number of shares of
Restricted Stock as shown on the Notice of Grant of Restricted Stock. The
Participant’s grant and record of Restricted Stock share ownership shall be kept
on the books of the Company until the restrictions on transfer have lapsed. At
the Employee’s request, vested shares may be evidenced by stock certificates.

        2. Vesting. The shares of Restricted Stock granted to the Employee shall
vest in accordance with the vesting conditions set forth in the Notice of Grant
of Restricted Stock. Such vesting conditions indicate the conditions under and
date upon which the Employee shall be entitled to receive shares of freely
transferable Common Stock equal to the number of vested shares of Restricted
Stock, provided that, as of the vesting date, the Employee has not incurred a
termination of service with the Company and all Subsidiaries (collectively, the
Company and its Subsidiaries shall be referred to herein as the “Company”).
There shall be no proportionate or partial vesting in the periods between the
vesting date(s), if any, specified in the Notice of Grant of Restricted Stock
and all vesting shall occur only on such vesting date(s), except as set forth in
Section 8 below.

 

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        Other than as set forth in Section 8 below and in the Plan, no vesting
shall occur after the termination of a Employee’s employment or service with the
Company for any reason.

        3. Rights as a Stockholder. The Employee shall have all of the rights of
a stockholder with respect to the Shares of Restricted Stock, including the
right to vote on all matters with respect to which the stockholders of the
Company have the right to vote and the right to receive dividends thereon.

        4. Restrictions on Transfer. Shares of Restricted Stock may not be
transferred or otherwise disposed of by the Employee, including by way of sale,
assignment, transfer, pledge, hypothecation or otherwise, except as permitted by
the Committee, or by will or the laws of descent and distribution.

        5. Approvals. The delivery of any shares of Common Stock hereunder is
subject to approval of any government agency which may, in the opinion of
counsel, be required in connection with the authorization, issuance or sale of
Common Stock. No Common Stock shall be issued upon the lapse of restrictions
relating to the shares of Restricted Stock prior to compliance with such
requirements and with the Company’s listing agreement with the New York Stock
Exchange (or other national exchange upon which the Company’s shares may then be
listed).

        6. Invalid Transfers. No purported sale, assignment, mortgage,
hypothecation, transfer, pledge, encumbrance, gift, transfer in trust (voting or
other) or other disposition of, or creation of a security interest in or lien
on, any of the shares of Restricted Stock by any holder thereof in violation of
the provisions of this Restricted Stock Agreement shall be valid, and the
Company will not transfer any of said shares of Restricted Stock on its books
nor will any of said shares of Restricted Stock be entitled to vote, nor will
any dividends be paid thereon, unless and until there has been full compliance
with said provisions to the satisfaction of the Company. The foregoing
restrictions are in addition to and not in lieu of any other remedies, legal or
equitable, available to enforce said provisions.

        7. Change in Control. Upon the occurrence of a Change in Control, the
restrictions that apply to any shares of Restricted Stock which have not yet
vested, or with respect to which the restrictions have not lapsed, shall
immediately lapse.

        8. Effect of Termination of Employment. If the employment of the
Employee is terminated by reason of his death or Disability, or upon his
Retirement, or for any other reason if the Committee so determines, the number
of shares of Restricted Stock which have not theretofore become vested in
accordance with Section 2 of this Agreement shall become fully vested as of the
date of such termination of employment. If the employment of the Employee is
terminated by the Company other than for Cause, or by the Employee for Good
Reason (as defined in the Severance Agreement by and between UST Inc., U.S.
Smokeless Tobacco Company and the Employee, dated as of September 13, 2004), the
Employee shall become vested as of the date of termination

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with respect to a pro rata portion of the shares of Restricted Stock granted
pursuant to the Notice of Grant of Restricted Stock. For this purpose, the pro
rata portion shall be the number of shares granted thereby multiplied by a
fraction, the numerator of which is the number of full months which have elapsed
from the Grant Date specified in the Notice of Grant of Restricted Stock until
the date of termination, and the denominator of which is 60. If the employment
of the Employee is terminated for any other reason and if the Committee does not
determine otherwise, the number of shares of Restricted Stock that have not
theretofore become vested shall be forfeited. For purposes of this Agreement,
the term “Disability” shall mean a “disability,” as defined in the Company’s
Long-Term Disability Plan or, if such plan is not applicable to the Employee, as
defined by the State or federal disability program which applies to the Employee
and (ii) the term “Retirement” shall mean the retirement of the Employee from
the Company, as defined in any employee retirement plan of the Company in which
the Employee participates.

        9. Finding of Cause. If (a) the employment of the Employee is terminated
for Cause or (b) after the Employee’s termination of employment with the Company
other than for Cause, the Company discovers the occurrence of an act or failure
to act by the Employee, while in the employ of the Company, that would have
enabled the Company to terminate the Employee’s employment for Cause had the
Company known of such act or failure to act at the time of its occurrence, or
(c) subsequent to his termination of employment, the Employee commits a
Competitive Act and, in each case, if the act constituting Cause is a
Competitive Act or Willful Misconduct, such act is discovered by the Company
within three (3) years of its occurrence, then, unless otherwise determined by
the Committee,

(i)   any shares of Restricted Stock granted pursuant to the Notice of Grant of
Restricted Stock which have not yet become vested shall thereupon be forfeited
and shall be returned to the Company; and   (ii)   if the act constituting Cause
is a Competitive Act or Willful Misconduct, the Employee (or, in the event of
the Employee’s death following the commission of such act, his beneficiaries or
estate) shall (A) return to the Company all shares of Restricted Stock that
became vested during the 180 day period prior to and including the date of the
termination of the Employee’s employment (the “Acquired Shares”) and (B) to the
extent such Acquired Shares granted pursuant to the Notice of Grant of
Restricted Stock have previously been sold or otherwise disposed of by the
Employee, other than by reason of death (or if applicable, by his beneficiaries
or estate), repay to the Company the Fair Market Value of such shares on the
date of such sale or other disposition.   (iii)   for purpose of clause (ii)(B)
above, (A) the amount of repayment described therein shall not be affected by
whether the Employee (or, if applicable, his beneficiaries or estate) actually
received such Fair Market Value with respect to such sale or other disposition,

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    and (B) repayment may, without limitation, be affected, at the discretion of
the Company, by means of offset against any amount owed by the Company to the
Employee (or, if applicable, his beneficiaries or estate).

        10. Taxes. The Employee shall pay to the Company promptly upon request,
and in any event at the time the Employee recognizes taxable income in respect
to the shares of Restricted Stock (or, if the Employee makes an election under
Section 83(b) of the Code in connection with such grant, on or about the date of
grant), an amount equal to the federal, state and/or local taxes the Company
determines it is required to withhold under applicable tax laws with respect to
the shares of Restricted Stock. The Employee may satisfy the foregoing
requirement by making a payment to the Company in cash or, with the consent of
the Company, by authorizing the Company to withhold cash otherwise due to the
Employee (e.g., by filing a revised form W-4 to increase payroll tax
withholdings). The Employee shall promptly notify the Company of any election
made pursuant to Section 83(b) of the Code. The Employee understands that he/she
(and not the Company) shall be responsible for any tax liability that may arise
as a result of the transactions contemplated by this Restricted Stock Agreement.

THE EMPLOYEE ACKNOWLEDGES THAT IT IS THE EMPLOYEE’S SOLE RESPONSIBILITY AND NOT
THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b) OF THE CODE, IN
THE EVENT THAT THE EMPLOYEE DESIRES TO MAKE THE ELECTION.

        11. Compliance with Law and Regulations; Legend. The award and any
obligation of the Company hereunder shall be subject to all applicable federal,
state and local laws, rules and regulations and to such approvals by any
government or regulatory agency as may be required. The Company may require, as
a condition of the issuance and delivery of certificates evidencing Restricted
Stock pursuant to the terms hereof, that the certificates bear such legends as
set forth immediately below, in addition to any other legends required under
federal and state securities laws or as otherwise determined by the Committee.

The transferability of this certificate and the shares of stock represented
hereby are subject to the restrictions, terms and conditions (including
forfeiture provisions and restrictions against transfer) contained in the UST
Inc. Amended and Restated Stock Incentive Plan and an Agreement entered into
between the registered owner of such shares and the Company. A copy of the Plan
and Agreement is on file in the office of the Secretary of the Company, 100
Putnam Avenue, Greenwich, Connecticut 06830.

Such legend shall not be removed until such shares vest pursuant to the terms
hereof.

        12. Incorporation of Plan. This Agreement is made under the provisions
of the Plan (which is incorporated herein by reference) and shall be interpreted
in a manner consistent with it. To the extent that this Agreement is silent with
respect to, or in any way inconsistent with, the terms of the Plan, the
provisions of the Plan shall

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govern and this Restricted Stock Agreement shall be deemed to be modified
accordingly. Unless otherwise defined herein or otherwise required by the
context, all terms used herein shall have the meaning ascribed to them in the
Plan.

        13. Notices. Any notices required or permitted hereunder shall be
addressed to the Company, at 100 West Putnam Avenue, Greenwich, Connecticut
06830, or to the Employee at the address then on record with the Company, as the
case may be, and deposited, postage prepaid, in the United States mail. Either
party may, by notice to the other given in the manner aforesaid, change his or
its address for future notices.

        14. Successor. This Agreement shall bind and inure to the benefit of the
Company, its successors and assigns, and the Employee and his personal
representatives and beneficiaries.

        15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware. The Committee shall have
final authority to interpret and construe the Plan and this Agreement and to
make any and all determinations under them, and its decision shall be binding
and conclusive upon the Employee and his legal representative in respect of any
questions arising under the Plan or this Agreement.

        16. Amendment. This Agreement may be amended or modified by the Company
at any time; provided that notice is provided to the Employee in accordance with
Section 13; and provided further that no amendment or modification that is
adverse to the rights of the Employee as provided by this Agreement shall be
effective unless set forth in a writing signed by the parties hereto.

        17. Binding Agreement. This Agreement shall be binding upon the Employee
and his or her personal representatives and beneficiaries without any need for
additional action by the Employee, and any attempt by the Employee and his or
her personal representatives and beneficiaries to exercise any rights under this
Agreement shall be conclusive evidence of such person’s acceptance thereof. This
Agreement amends and supercedes in its entirety the Restricted Stock Agreement
between the parties dated as of July 28, 2004 and executed by the Employee on
August 7, 2004.

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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by
its officer thereunder duly authorized and the Employee has hereunto set his
hand, all as of the day and year set forth below.

UST INC.

      /s/ VINCENT A. GIERER, JR.

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Name:
  Vincent A. Gierer, Jr.
Title:
  Chairman of the Board

  and Chief Executive

  Officer

The undersigned hereby acknowledges having read this Restricted Stock Agreement
and the Plan and hereby agrees to be bound by all provisions set forth herein
and in the Plan.

     
/s/ MURRAY S. KESSLER
  9/14/04

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Employee
  Date
 
   
Murray S. Kessler
   

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PLEASE PRINT NAME
   

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UST INC.
AMENDED AND RESTATED STOCK INCENTIVE PLAN
NOTICE OF GRANT OF RESTRICTED STOCK

     This Notice is to certify that the Participant named below has been granted
the number of shares of Restricted Common Stock set forth below under the terms
and conditions set forth in this Notice. This Notice is subject to and
incorporates by reference the terms and conditions of the Restricted Stock
Agreement ((the “Agreement”), a copy of which is enclosed). Please refer to the
Restricted Stock Agreement and the UST Inc. Amended and Restated Stock Incentive
Plan (the “Plan”) document for an explanation of the terms and conditions of
this grant and a full description of your rights and obligations. You must sign
the Agreement in order for this Notice and grant to be effective. Please sign
and date the Agreement on the last page and return it promptly in the enclosed
envelope. Regardless of whether we receive your signed Agreement, any attempt by
you to exercise your rights under the Agreement will signify your acceptance of
the terms and conditions of the Agreement and of the Plan.

     
Name of Participant:
  Murray S. Kessler
 
   
Number of Restricted Shares:
  50,000
 
   
Per Share Value on Grant Date:
  $37.66
 
   
Grant Date:
  July 28, 2004
 
   
Vesting Conditions:
  50,000 shares shall vest on July 28, 2009 provided and solely to the extent
that the Company has achieved, in any three (3) of the five (5) year calendar
year periods ending on 12/31/04, 12/31/05, 12/31/06, 12/31/07 and 12/31/08
respectively, both: (A) positive annual Earnings Per Share (EPS) from continuing
operations; and (B) a dividend payout ratio of at least 50% of EPS from
continuing operations.
 
   
Additional Terms:
  See the Restricted Stock Agreement.