Exhibit 10.2

 

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Dear [                  ]:

 

On ___________, ______, pursuant to the Non-Employee Directors Deferred Stock
Plan (the “Plan”), the Board of Directors (the “Board”) approved a grant to you
of          Deferred Shares (the “Award” or the “Deferred Shares”).  Your Award
is subject to the terms and conditions of the Plan (which are incorporated
herein by reference) and this letter agreement (the “Agreement”).  In the event
of any contradiction, distinction or difference between this Agreement and the
terms of the Plan, the terms of the Plan will control.  Capitalized terms not
otherwise defined herein shall have the meaning ascribed to them by the Plan.

 

Unless you elected to defer your Award pursuant to Plan, the Award shall be
distributed to you on the anniversary of the date hereof.  Notwithstanding
anything contained herein to the contrary, distribution of your Award shall be
made in compliance with Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”), and the regulations issued thereunder.  On the applicable
settlement dates, the value of the applicable portion of your Award will be paid
to you in shares of Common Stock of Covance Inc. (the “Company”).

 

Prior to distribution of your Award, you will have no rights as a holder of
Common Stock.  However, if prior to distribution of your Award, the Company pays
a dividend with respect to Common Stock, your Account shall be credited with a
number of additional Deferred Shares, calculated by dividing (i) the product of
(a) the whole number of Deferred Shares held in your Account on the date the
dividend is paid times (b) the amount of such dividend with respect to one share
of Common Stock, by (ii) the Fair Market Value of one share of Common Stock on
the date such dividend is paid.  Such additional Deferred Shares shall be
credited to your Account on the date the applicable dividend is paid and shall
be paid to you in the same manner as the underlying Deferred Shares on which the
payment is based.  In addition, the Board or the Committee, as applicable, shall
adjust your Deferred Shares to the extent it deems appropriate to reflect any
stock dividend, stock split, combination of shares, merger, share exchange,
consolidation or other change in the corporate structure of the Company or the
Common Stock.

 

The Company may impose any conditions on the Award it deems necessary or
advisable to ensure compliance with the requirements of applicable securities
laws.  The Company shall not be obligated to issue or deliver any shares of
Common Stock pursuant to this Award if, in the opinion of the Company’s counsel,
the required compliance has not been completed with respect to all applicable
laws, regulations and national securities exchange rules.  The Board may amend
the terms of this Agreement to the extent it deems appropriate to comply with
applicable law.  The construction and interpretation of any provision of this
Agreement shall be final, conclusive and binding on all persons when made by the
Board.

 

Your Award constitutes an unfunded, unsecured promise by the Company to pay you
the value of your Award on the date set forth herein.  You will have no rights
to any funds set aside by the

 

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Company to pay your Award.  Any such amounts shall belong to the Company only
and shall at all times be subject to the claims of the Company’s general
creditors.

 

You may not assign or otherwise transfer any portion of your Award to any other
person and any attempt to accomplish the same shall be void.  Nothing in this
Agreement shall be construed as giving you any right to be retained in the
services of the Company.

 

In the event that any provision of this Agreement shall be held illegal or
invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Agreement and the Agreement shall be enforced as if the
illegal or invalid provision had not been included.  All obligations of the
Company under this Agreement shall be binding upon and inure to the benefit of
any successor to the Company.

 

Except to the extent superseded by applicable federal law, this Agreement shall
be construed according to the laws of the state of Delaware, without regard to
the principles of conflict of laws.

 

Please sign and and return a copy of this Agreement to me at your earliest
convenience.

 

Very truly yours,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACKNOWLEDGED AND ACCEPTED

 

 

 

 

 

By:

 

 

 

[Director Name]

 

 

 

Dated:

 

 

 

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