Exhibit 10.2


 


Appendix A


 


RSU Performance Objectives


 


The number of RSUs that become vested and payable pursuant to the Award
shall be determined as the product of multiplying items (1), (2) and (3) below,
where:


 


(1) is the number of RSUs subject to the Award as provided in Section 1
of this Agreement;


 


(2) is the “Contingent Percentage” (as set forth in Table A) that
corresponds to the “Adjusted EBITDA Margin” (as defined below) achieved for the
six-month period ending June 30, 2013; and


 


(3) is the “Revenue Growth Multiplier” (as set forth in Table B)
that corresponds to the percentage change in “Company Revenue” (as defined
below) achieved over the Performance Period.


 


Table A


 


	
  Adjusted EBITDA Margin

  (for the six-month period ending

  June 30, 2013)

  	
   

  	
  Contingent Percentage of

  Award Earned

  	
   

  
	
  > 19.00%

  	
   

  	
  170%

  	
   

  
	
  > 18.50%

  	
   

  	
  140%

  	
   

  
	
  > 18.00%

  	
   

  	
  110%

  	
   

  
	
  > 17.75%

  	
   

  	
  100%

  	
   

  
	
  > 17.50%

  	
   

  	
  75%

  	
   

  
	
  > 17.00%

  	
   

  	
  50%

  	
   

  
	
  < 17.00%

  	
   

  	
  0%

  	
   

  



 


Table B


 


	
  Fiscal year 2013 Company

  Revenue as a percentage of

  fiscal year 2010 Company

  Revenue

  	
   

  	
  Revenue Growth

  Multiplier

  	
   

  
	
  < 100.0%

  	
   

  	
  0%

  	
   

  
	
  > 100.0% but
  < 102.0%

  	
   

  	
  80% (-20%)

  	
   

  
	
  > 102.0% but
  < 104.0%

  	
   

  	
  100%

  	
   

  
	
  > 104.0%

  	
   

  	
  120% (+20%)

  	
   

  



 

















 


There shall be no upward or downward rounding of the
calculated amount of Adjusted EBITDA Margin in determining the Contingent Percentage
in accordance with Table A, nor shall there be any upward or downward rounding
in determining the percentage change in Company Revenue in accordance with
Table B.


 


Definitions


 


“Adjusted
EBITDA” means, for the six-month period ending June 30, 2013, the
Company’s net income determined in accordance with U.S. GAAP consistently
applied and reported in the Company’s audited financial statements, plus
(without duplication and only to the extent actually deducted in computing net
income) an amount equal to the Company’s net interest expense (interest expense
less interest income), income taxes, depreciation and amortization for the
applicable period, transaction costs, integration costs, and non-cash
stock-based compensation for the applicable period arising from the merger
between Towers Perrin and Watson Wyatt, and other net non-operating losses
(non-operating losses less non-operating income).


 


“Adjusted
EBITDA Margin” means the percentage equal to the quotient of (i) Adjusted
EBITDA divided by (ii) Company Revenue, each determined for the six-month
period ending June 30, 2013.


 


“Company
Revenue” means the Company’s gross revenue determined in accordance with
U.S. GAAP consistently applied and reported in the Company’s audited financial
statements, except to the extent that such amount is subsequently adjusted in
accordance with the following provisions:


 


·                  Revenue for
Towers Perrin for the period July 1, 2009 to December 31, 2009 will
be added to fiscal year 2010 Company Revenue so that fiscal year 2010 Company
Revenue reflects a full twelve months of Towers Perrin financial performance.


 


·                  Revenues
associated with the divestiture or discontinuation of an operation (e.g., Pay
Governance and VIPitech) will be eliminated from both fiscal year 2010 Company Revenue
and fiscal year 2013 Company Revenue.


 


·                  Revenue
associated with acquisitions:


 


·                  In the event an
acquisition occurs during the first year of the performance period (fiscal year
2011), the acquired entity’s revenue for the year preceding the
acquisition will be added to fiscal year 2010 Company Revenue.


·                  In the event an
acquisition occurs during the second or third year of the performance period
(fiscal year 2012 or fiscal year 2013), the acquired entity’s revenue for the
year preceding the acquisition will be discounted using Towers Watson’s revenue
growth rate from the year preceding the acquisition to the beginning
of the performance period, and will be added to fiscal year 2010 Company
Revenue.  In addition, the revenue to be counted for the acquired company
in fiscal year 2013 Company Revenue will be adjusted, as necessary, to be
representative of a full twelve months of revenue.


 


2

















 


·                  Any adjustments
to revenue resulting from acquisition accounting or conversion to US GAAP will
be reflected in both fiscal year 2010 Company Revenue and fiscal year 2013
Company Revenue, as applicable.


 


·                  Acquisition
revenue used will be as reported in the acquired entity’s publicly filed
financial reports, if available, or the acquired entity’s audited financial
reports.  In the event such financial reports are unavailable, revenue
generated by the acquired entity will be provided by the 3rd
party due diligence provider or by the investment bankers familiar
with the acquired entity.


 


·                  Fiscal year 2010 Company
Revenue will be adjusted to reflect a constant currency exchange between the
local currency and the U.S. dollar over the 3-year measurement period.  Constant currency will be calculated by translating
fiscal year 2010 Company Revenue using the fiscal year 2013 average applicable
exchange rates.


 


The
determination of the number of RSUs that become vested and payable pursuant to
the Award, including the determinations of Adjusted EBITDA, Adjusted EBITDA
Margin and Company Revenue, shall be in the sole discretion of the Committee,
whose determination shall be final and binding on the Participant.  The Committee may exercise negative
discretion in determining the number of RSUs that become vested and payable
pursuant to the Award.


 


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