Document:

EXHIBIT
10.21

 

Compensatory Arrangements with Executive Officers

 

Base Salary

 

The current annual base salaries of each of
the executive officers of PLC Systems Inc. (the “Company”) are as follows:

 

	
  Mark R. Tauscher, President and Chief Executive
  Officer

  	
   

  	
  $

  	
  310,247

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  James G. Thomasch, Senior Vice President of
  Finance and Administration, Chief Financial Officer and Treasurer  

  	
   

  	
  $

  	
  194,776

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Kenneth J. Luppi, Vice President of Operations

  	
   

  	
  $

  	
  164,625

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Vincent C. Puglisi, Managing Director, International  

  	
   

  	
  $

  	
  161,537

  	
   

  

 

Other Compensation

 

Mr. Tauscher and Mr. Thomasch each
currently receive an annual car allowance of $12,000.  Mr. Luppi and Mr. Puglisi each
currently receive an annual car allowance of $6,000.

 

The Compensation Committee may also, from
time to time, award each of the executive officers compensation in the form of
stock options granted under the Company’s 2005 Stock Incentive Plan, as
amended.EXHIBIT
10.22

 

Compensatory Arrangements with Non-Employee Directors

 

Each
non-employee director (other than the chairman of the board) of PLC Systems
Inc. (the “Company”) receives $12,000 per year and the chairman of the board
receives $24,000 per year, paid in quarterly installments. In addition,
non-employee directors (other than the chairman of the board) who serve as
chairman of a committee receive an additional $500 per quarter and those who
serve on more than one committee also receive an additional $500 per quarter.
At a meeting held on March 2, 2010, the board of directors voted
unanimously to suspend all director fees that they otherwise would be entitled
to receive until such time as the board of directors votes at a subsequent
meeting to reinstate them. The Company reimburses its directors for reasonable
out-of-pocket expenses incurred in attending meetings of the board of directors
and committees of the board of directors.

 

The
Company also grants stock options to its non-employee directors. Generally, on
the date of their initial election to the board of directors, new non-employee
directors receive an initial grant of an option to purchase 30,000 shares of
the Company’s common stock that vests in installments over three years. Once
the initial grant has fully vested, non-employee directors (other than the
chairman of the board) receive an annual grant of an option to purchase 15,000
shares of the Company’s common stock that generally vests in four equal
quarterly installments. The chairman of the board receives an annual grant of
an option to purchase 30,000 shares of the Company’s common stock that
generally vests in four equal quarterly installments. The annual grants are
generally made on the date of the Company’s annual meeting of shareholders.  All such options have an exercise price equal
to the fair market value of the Company’s common stock on the date of grant.EXHIBIT
10.23

 

Severance Arrangements with Executive Officers

 

Pursuant to resolutions adopted by the Board
of Directors of PLC Systems Inc. (the “Company”) on January 20, 2010,
Kenneth J. Luppi, the Company’s Vice President of Operations, and Vincent C. Puglisi,
the Company’s Managing Director, International, are entitled to receive
payments equal to 26 weeks of base salary in the event that they are terminated
for any reason without cause on or before July 20, 2011.

 

Mark R. Tauscher, the Company’s President and
Chief Executive Officer, and James G. Thomasch, the Company’s Senior Vice
President of Finance and Administration, Chief Financial Officer and Treasurer,
are separately entitled to receive severance payments pursuant to the terms of
their respective employment agreements with the Company.Exhibit 10.1

[NAME]

 

COMFORT SYSTEMS USA, INC.

2006 Equity Incentive Plan

Performance Restricted Stock Award Agreement

 

Comfort
Systems USA, Inc.

675
Bering Drive, Suite 400

Houston,
Texas  77057

 

Ladies
and Gentlemen:

 

The
undersigned (“Employee”) (i) acknowledges that he or she has received an
award (the “Award”) of performance restricted stock from Comfort Systems USA, Inc.,
a Delaware corporation (the “Company”), under the Company’s 2006 Equity
Incentive Plan (the “Plan”), subject to the terms set forth below and in the
Plan; (ii) further acknowledges receipt of a copy of the Plan as in effect
on the date hereof; and (iii) agrees with the Company as follows:

 

1.                                       Effective
Date.  This
Agreement shall take effect as of March [##], [####], which is the date of
grant of the Award.

 

2.                                       Shares
Subject to Award.  The Award
consists of [####] shares (the “Shares”) of common stock of the Company (“Stock”).  Employee’s rights to the Shares are subject
to the restrictions described in this Agreement and the Plan (which is
incorporated herein by reference with the same effect as if set forth herein in
full) in addition to such other restrictions, if any, as may be imposed by
law.  In the event that any provision of
this Agreement is inconsistent with the terms of the Plan, the terms of the
Plan shall govern.

 

3.                                       Meaning
of Certain Terms.  Except as
otherwise expressly provided in this Agreement, all terms used herein shall
have the same meaning as in the Plan. 
The term “vest” as used herein with respect to any Share means the
lapsing of the restrictions described herein and in the Plan with respect to
such Share, which entitles Employee to transfer the Share and to retain such
Share after a termination of employment.

 

4.                                       Nontransferability
of Shares.  The Shares
acquired by Employee pursuant to this Agreement shall not be sold, transferred,
pledged, assigned or otherwise encumbered or disposed of until such time as
they become vested under Section 7 of this Agreement.

 

5.                                       Forfeiture
Risk.  Except as
provided in Section 7(c) of this Agreement, if Employee ceases to be
employed by the Company and its subsidiaries for any reason, including death,
any then unvested Shares acquired by Employee hereunder shall be immediately
forfeited upon such termination with no consideration due to Employee.  Employee hereby (i) appoints the Company
as his or her attorney-in-fact to take such actions as may be necessary or
appropriate to effectuate a transfer of the record ownership of any such Shares
that are unvested and forfeited hereunder, (ii) agrees to deliver to the
Company, as a precondition to the issuance of any certificate or certificates
with respect to unvested Shares hereunder, one or more stock powers, endorsed
in blank, with respect to such Shares, and (iii) agrees to sign such other
powers and take such other actions as the Company may reasonably request to
accomplish the transfer or forfeiture of any unvested Shares that are forfeited
hereunder.

 

 

6.                                       Retention
of Certificates.  Any
certificates representing unvested Shares shall be held by the Company.  Employee agrees that the Company may give
stop transfer instructions to the depository to ensure compliance with the
provisions hereof.

 

7.                                       Vesting
of Shares.  The Shares
acquired hereunder shall vest in accordance with the provisions of this Section 7
and applicable provisions of the Plan, as follows:

 

(a)                                  (i)            If the Committee determines that, for the prior 12-month
period preceding the first scheduled vesting date set forth in Section 7(b) herein,
the Company did not have positive earnings from its continuing operations, all
as determined and reported in accordance with generally accepted accounting
principles in the Company’s regularly-prepared financial statements, excluding
the following non-cash items: (A) good will impairment; (B) write-off
of debt costs; (C) restructuring charges; and (D) any cumulative
effect of a change in accounting principles, Employee shall immediately and
irrevocably forfeit all of the Shares with no consideration due to Employee.

 

(ii)           If the Committee determines that for
the 12-month period prior to the date that such Shares are scheduled to vest
under Section 7(b) herein the Company’s prior 36-month performance
did not achieve 60% of the average 3-year trailing EBITDA or EPS target
(whichever the case may be) as set by the Committee under the average of the
Company’s prior 3-year Senior Management Incentive Programs, then Employee
shall immediately and irrevocably forfeit all of the Shares scheduled to vest
on such date with no consideration due to Employee.

 

(b)                                 Subject to Section 7(a) above
and Sections 7(c) and 7(d) below, and provided that Employee is then,
and since the date of grant has continuously been, employed by the Company or
its subsidiaries, then the Shares shall vest as follows:

 

[#####] on May 15, [####];

 

[#####] on April 1, [####]; and

 

[#####] on April 1, [####].

 

provided, however, that, not withstanding
anything to the contrary in Section 7(a) above or this Section 7(b),
any unvested Shares that have not earlier been forfeited shall vest immediately
in the event of (i) a “Change in Control,” as defined in Employee’s change
in control agreement, if any, with the Company, or (ii) if Employee and
Company have not entered into a change in control agreement, in the event the
Company experiences a “Change in Control” as defined herein.

 

(c)                                  Notwithstanding anything to
the contrary in Section 7(b) above, if Employee retires from the
Company at a time when the sum of his or her age in whole years and his or her
years of service with the Company (as determined in a manner consistent with
the method used for purposes of determining vesting under the Comfort Systems
USA, Inc. 401(k) Plan) is at least 75, Employee shall be deemed to
satisfy the continuous employment condition set forth in Section 7(b) 

 

 

on
each vesting date following retirement. 
The number of Shares that vest will in all cases be determined in
accordance with the provisions of Section 7(a) above.

 

(d)                                 Notwithstanding anything to
the contrary in Sections 7(a), 7(b), or 7(c) above, the Committee may, in
its sole discretion, reduce the number of Shares vesting on any date pursuant
to this Award, and may cause any unvested Shares under this Award to be
forfeited, based on the individual performance of Employee as compared with specific
individual goals, which may be based on objective or nonobjective factors
related to Employee’s performance.

 

8.                                       Legend.  Any certificates representing unvested Shares
shall be held by the Company, and any such certificate shall contain a legend
substantially in the following form:

 

THE
TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY
ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE COMPANY’S
2006 EQUITY INCENTIVE PLAN AND A PERFORMANCE RESTRICTED STOCK AWARD AGREEMENT
ENTERED INTO BETWEEN THE REGISTERED OWNER AND COMFORT SYSTEMS USA, INC.  COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE
IN THE OFFICES OF COMFORT SYSTEMS USA, INC.

 

As soon as practicable following the vesting of any such Shares the Company
shall cause a certificate or certificates covering such Shares to be delivered
to Employee.

 

9.                                       Voting
Rights; Dividends, etc.  As of the date of grant, Employee shall have
the right to vote the Shares (to the same extent as any other holder of Stock),
and the right, subject to this Section 9, to receive dividends on the
Shares, unless and until the Shares are forfeited as provided for in Section 7
of this Agreement.  Unless the Committee
determines otherwise, payment of any cash dividend, additional shares of Stock,
any other securities of the Company and any other property distributed with
respect to the Shares shall be deferred until the Shares vest and are no longer
subject to forfeiture under the terms of this Agreement (and shall be subject
to forfeiture upon forfeiture under Section 7 above of any unvested Shares
to which such deferred dividends relate). The dividends or distributions
allocable to the Shares shall be paid or delivered to the Participant on the
vesting date for the Shares to which the dividends or distributions relate, but
only to the extent such Shares vest under the terms of this Agreement.

 

10.                                 Sale of
Vested Shares.  Employee
understands that he or she will be free to sell any Share only once it has
vested, subject to (i) satisfaction of any applicable tax withholding
requirements with respect to the vesting or transfer of such Share; (ii) the
completion of any administrative steps (for example, but without limitation,
the transfer of certificates) that the Company may reasonably impose; and (iii) applicable
company policies and the requirements of federal and state securities laws.

 

11.                                 Certain
Tax Matters.  Employee
expressly acknowledges the following:

 

a.                                       Employee has
been advised to confer promptly with a professional tax advisor to consider
whether Employee should make a so-called “83(b) election” with respect to
the Shares.  Any such election, to be
effective, must be made in accordance with applicable regulations and within
thirty (30) days following the 

 

 

grant
date of this Award.  The Company has made
no recommendation to Employee with respect to the advisability of making such
an election.

 

b.                                      The award or
vesting of the Shares acquired hereunder, and the payment of dividends with
respect to such shares, may give rise to “wages” subject to withholding.  Employee expressly acknowledges and agrees
that his or her rights hereunder are subject to his or her satisfaction of any
applicable tax withholdings associated with such award, vesting or payment
by:  (i) delivering cash (including
check, money order or wire transfer made payable to the order of the Company), (ii) having
the Company withhold a portion of the Shares to be delivered hereunder having a
Fair Market Value equal to the minimum tax withholding amount for such taxes,
or (iii) delivering to the Company shares of Stock having a Fair Market
Value equal to the minimum tax withholding amount for such taxes.

 

12.                                 Definition:
Change in Control.  For
the purpose of Section 7(b)(ii) herein, a “Change in Control” shall
be deemed to have occurred if:

 

a.                                       any person
(including any “person” within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1934, as amended, and more than
one person acting as a group), other than the Company, or an employee benefit
plan of the Company, or any entity controlled by either, acquiring directly or
indirectly the beneficial ownership of any voting security of the Company and
if immediately after such acquisition such person is, directly or indirectly,
the beneficial owner of voting securities representing 50% or more of the total
voting power of all of the then-outstanding voting securities of the Company,
provided that if any one person, or more than one person acting as a group,
owned more than 50% of the total fair market value or total voting power of
Company stock as of the date of this Agreement, the acquisition of additional
stock by the same person or persons shall not be deemed to be a Change in
Control;

 

b.                                      the date a
majority of the following individuals are replaced during any 12-month period
by directors whose appointment or election is not endorsed by a majority of the
members of the Company’s Board of Directors before the date of the appointment
or election: (i) the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (the “Original Directors”); (ii) the
individuals who thereafter are elected to the Board of Directors of the Company
and whose election, or nomination for election, to the Board of Directors of
the Company was approved by a vote of at least two-thirds of the Original
Directors then still in office (such directors becoming “Additional Original
Directors” immediately following their election); and (iii) the
individuals who are elected to the Board of Directors of the Company and whose
election, or nomination for election, to the Board of Directors of the Company
was approved by a vote of at least two-thirds of the Original Directors and
Additional Original Directors then still in office (such directors also becoming
“Additional Original Directors” immediately following their election); or

 

c.                                       any one person,
or more than one person acting as a group, acquiring (or who has acquired
during the 12-month period ending on the date of the most recent acquisition by
such person or persons) assets from the Company that have a total gross fair
market value equal to or more than 50% of the total gross fair market 

 

 

value
of the assets of the Company immediately before such acquisition or
acquisitions.

 

13.                                 Non-Competition Agreement.  Employee will not, during the period of
employment by or with the Company, and for a period of twelve (12) months
immediately following the termination of employment, for any reason whatsoever,
directly or indirectly, on his or her own behalf or on behalf of or in
conjunction with any other person, company, partnership, corporation or
business of whatever nature:

 

a.                                       engage, as an
officer, director, shareholder, owner, partner, joint venturer, or in a
managerial capacity, whether as an employee, independent contractor, consultant
or advisor, or as a sales representative, or make guarantee loans or invest, in
or for any business engaged in the business of mechanical contracting services,
including heating, ventilation and air conditioning, plumbing, fire protection,
piping and electrical and related services (“Services”) in competition with the
Company or any of its affiliates within seventy-five (75) miles of where the
Company or any affiliated operation or subsidiary conducts business if within
the preceding two (2) years Employee has had responsibility for, or
material input or participation in, the management or operation of such other
operation or subsidiary;

 

b.                                      call upon any
person who is, at that time, an employee of the Company or any of its
affiliates in a technical, managerial or sales capacity for the purpose or with
the intent of enticing such employee away from or out of the employ of the
Company or any affiliate;

 

c.                                       call upon any
person or entity which is at that time, or which has been within two (2) years
prior to that time, a customer of the Company or any affiliate for the purpose
of soliciting or selling Services; or

 

d.                                      call upon any
prospective acquisition candidate, on Employee’s own behalf or on behalf of any
competitor, which acquisition candidate either was called upon Employee on
behalf of the Company or any affiliate or was the subject of an acquisition
analysis made by Employee on behalf of the Company or any affiliate for the
purpose of acquiring such acquisition candidate.

 

Notwithstanding
the above, the foregoing agreements and covenants shall not be deemed to
prohibit Employee from acquiring as an investment not more than one percent
(1%) of the capital stock of a competing business whose stock is traded on a
national securities exchange or on an over-the-counter or similar market.  It is specifically agreed that the period
during which the agreements and covenants of Employee made in this Section 13
shall be effective shall be computed by excluding from such computation any
time during which Employee is in violation of any provision of this Section 13.

 

14.                                 Remedies in the Event of Breach.  If the Company determines that Employee is
not in compliance with the agreements and covenants set forth in Section 13
above, and such non-compliance has not been authorized in advance in a specific
written waiver from the Company, the Committee may, without limiting other
remedies that may be available to the Company, cause all or any portion of the
Award to be forfeited, whether or not previously vested, and may require
Employee to remit or deliver to the Company the amount of any consideration
received by Employee upon the sale of any Shares delivered 

 

 

under
the Award.  Employee acknowledges and
agrees that the calculation of damages from a breach of the foregoing
agreements and covenants would be difficult to calculate accurately and that
the remedies provided for herein are reasonable and not a penalty.  Employee further agrees not to challenge the
reasonableness of this provision even if the Company rescinds or withholds the
delivery of Shares hereunder or withholds any amount otherwise payable to
Employee as an offset to effectuate the foregoing.

 

15.                                 Entire Agreement.  The Plan and this Agreement constitute the
entire agreement of the parties and supersede in their entirety all prior
undertakings and agreements of the Company and Employee with respect to the
subject matter hereof.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [NAME]

  

 

The foregoing Performance
Restricted Stock

Award Agreement is hereby
accepted:

 

COMFORT SYSTEMS USA, INC.

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [NAME]

  	
   

  
	
  Its:

  	
  [TITLE]

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