Document:

EX 10.1 - Nonvested Share Agreement 2015

Exhibit 10.1

Form of
LEXINGTON REALTY TRUST
NONVESTED SHARE AGREEMENT 
(Performance and Service) 

This LEXINGTON REALTY TRUST NONVESTED SHARE AGREEMENT (PERFORMANCE AND SERVICE) (this “Agreement”) is effective as of ______________ ___, 20___ (the “Effective Date”) by and between Lexington Realty Trust, a Maryland real estate investment trust (the “Company”) and ____________________ (the “Participant”).
WITNESSETH THAT:
WHEREAS, the Participant, as an employee of the Company, is eligible to participate in the Lexington Realty Trust 2011 Equity-Based Award Plan (the “Plan”), and understands and recognizes that terms within the Agreement that begin with initial capital letters have the definitions set forth below or in the Plan; and
WHEREAS, the Compensation Committee of the Board of Trustees of the Company (the “Compensation Committee”) has approved this grant of an award to the Participant of the common shares of the Company, par value $0.0001 (“Company Shares”), herein, subject to the terms and conditions of the Plan and this Agreement, in order to incentivize the Participant’s performance, to enable the Participant to acquire an additional equity interest in the Company and to retain the Participant over the term of this Agreement.
NOW, THEREFORE, in consideration of the agreements hereinafter contained and other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:
		
	1.
	Grant of Shares.

(a)Subject to the restrictions and terms and conditions set forth in this Agreement and the Plan, including the vesting requirements set forth in Section 2 hereof, the Company hereby grants to the Participant, as of the Effective Date: (i) a Performance Compensation Award consisting of: (x) _________________ Company Shares (the “Index Shares”) and (y) _________________ Company Shares (the “Peer Group Shares,” and, together with the Index Shares, collectively, the “Performance Company Shares”), and (ii) a Restricted Share Award consisting of ________________ Company Shares (the “Restricted Shares,” and, together with the Performance Company Shares, collectively, the “Nonvested Company Shares”).  
(b)The Participant agrees that the Participant’s ownership of the Nonvested Company Shares, until vesting, if any, is determined to have occurred upon the expiration of the applicable Performance Period, shall be evidenced solely by a “book entry” (i.e., a computerized or manual entry) in the records of the Company or its designated share transfer agent in the Participant’s name.  
2.Vesting of Company Shares.  Except as otherwise provided in Section 3 below:

(a)the Performance Company Shares shall vest and become fully vested after December 31, 20___ (the “End Date”), only if and to the extent (i) the Participant remains in Continuous Service from the Effective Date through the End Date (the “Performance Period”), and (ii) the Company attains during the Performance Period the applicable performance goals, as set forth on Appendix A hereto (the “Performance Goals”) as determined by the Compensation Committee within thirty (30) days following the End Date.  Vesting shall occur only pursuant to the performance conditions, as set forth in Appendix A and as determined by the Compensation Committee in its sole and absolute discretion. The Performance Company Shares which do not vest following the Performance Period shall immediately and without notice be forfeited and the Participant shall have no rights with respect to such Performance Company Shares.
(b)One-third of the Restricted Shares shall vest and become fully vested on January 1st of each of 201__, 201__ and 201__, so long as the Participant remains in Continuous Service from the Effective Date through the applicable vesting date.  
3.Nontransferability and Acceleration/Forfeiture.
(a)The Participant acknowledges that prior to the date on which vesting, if any, is determined to have occurred pursuant to Section 2 above or upon the expiration of the applicable Performance Period, the Nonvested Company Shares may not be sold, transferred, pledged, assigned, encumbered or otherwise disposed of (whether voluntarily or involuntarily or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy)).  Upon the date on which vesting, if any, is determined to have occurred, as set forth in Section 2 hereof, and subject to the satisfaction of any tax obligations in accordance with Section 5 hereof, the restrictions set forth in this Agreement with respect to the applicable Nonvested Company Shares theretofore shall lapse and such Nonvested Company Shares shall be released from the Company’s restricted CUSIP file and be vested Company Shares. 
(b)Subject to the terms and conditions of any definitive written employment agreement between the Participant and the Company or, if no such definitive written employment agreement exists, any written executive severance policy then in effect (a “Service Agreement”), if the Participant’s Continuous Service ends prior to vesting (if any) at the complete expiration of the Performance Period, the Participant agrees that all of the Nonvested Company Shares, that are nonvested in accordance with Section 2 hereof as of the date of such termination, together with any dividends or distributions on account of such Nonvested Company Shares held by the Company for the Participant, shall be immediately and unconditionally forfeited and will revert to the Company without any action required by the Participant or the Company.  
4.Rights as Shareholder.  The Participant shall have all rights of a shareholder with respect to the Nonvested Company Shares for record dates occurring on or after the date of this Agreement and prior to the date any such Nonvested Company Shares are forfeited in accordance with this Agreement, except that any and all dividends or distributions with respect to the Performance Company Shares declared prior to vesting (if any) at the expiration of the applicable Performance Period shall be held by the Company for the Participant and shall be paid, without any interest, to the Participant upon such vesting (if any) at the 

expiration of the applicable Performance Period, unless either (i) not vesting pursuant to Section 2 above, or (ii) being forfeited in accordance with Section 3(b) hereof.

5.Withholding Tax Obligations.  The Participant acknowledges the existence of federal, state and local income tax and employment tax withholding obligations with respect to the vesting (if any) of the Nonvested Company Shares and agrees that such obligations must be met.  The Participant shall be required to pay and the Company shall have the right to withhold or otherwise require a Participant to remit to the Company any amount sufficient to pay any such taxes no later than the date as of which the value of any Nonvested Company Shares first become includible in the Participant’s gross income for income or employment tax purposes, provided however that the Board of Trustees or the Compensation Committee may permit the Participant to elect withholding vested Company Shares otherwise deliverable to the Participant in full or partial satisfaction of such tax obligations, provided further however that the amount of vested Company Shares so withheld shall not exceed the minimum statutory withholding tax obligation.  If tax withholding is required by applicable law, in no event shall vested Company Shares be delivered to the Participant until he has paid to the Company in cash the amount of such tax required to be withheld by the Company or otherwise entered into an agreement satisfactory to the Company providing for payment of withholding tax.  The Participant hereby notifies the Company that he will not make an election with respect to any portion of the Company Shares pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended.

6.Limitation of Rights.  Nothing contained herein shall be construed as conferring upon the Participant the right to continue in the employ of the Company as an employee or in any other capacity, or to interfere with the Company’s right to discharge him at any time for any reason whatsoever.

7.Receipt and Acceptance of Plan.  The Participant acknowledges receipt of a copy of the Plan and agrees to be bound by all terms and provisions thereof.  If and to the extent that any provision herein is inconsistent with the Plan, the Plan shall govern.

8.Assignment.  This Agreement shall be binding upon and inure to the benefits of the Company, its successors and assigns and the Participant and his heirs, executors, administrators and legal representatives.

9.Governing Law.  This Agreement and the obligation of the Company to transfer Company Shares shall be subject to all applicable federal and state laws, rules and regulations and any registration, qualification, approvals or other requirements imposed by any government or regulatory agency or body which the Compensation Committee of the Company shall, in its sole discretion, determine to be necessary or applicable.  This Agreement shall be construed in accordance with and governed by the law of the State of New York.

10.Amendment.  Except as otherwise permitted by the Plan, this Agreement may not be modified or amended, nor may any provision hereof be waived, in any way except in writing signed by the party against whom enforcement thereof is sought.

11.Execution.  This Agreement may be executed in counterparts each of which shall constitute one and the same instrument.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a duly authorized officer and the Participant has executed this Agreement effective as of the date first above written.
	
		
	LEXINGTON REALTY TRUST

	 
	 

	By:
	 

	Name:

	Title:
	Authorized Officer

	 
	 

	PARTICIPANT

	 
	 

	 
	 

Appendix A

The percentage of the Index Shares that will become vested at the end of the Performance Period will be based on the Percentile Rank of the Company’s Total Return relative to the Total Return of each of the companies in the Index for the Performance Period as set forth below:

	
			
	Percentile Rank
	Number of Index Shares Vested
	 

	At least the 75th percentile and including the 100th percentile
	100%
	Maximum

	At least 50th percentile but less than 75th percentile
	50%
	Target

	At least 33rd percentile but less than 50th percentile
	25%
	Threshold

	Less than 33rd percentile
	0%
	 

The percentage of the Peer Group Shares that will become vested at the end of the Performance Period will be based on the Percentile Rank of the Company’s Total Return relative to the Total Return of each of the companies in the Peer Group for the Performance Period as set forth below:

	
			
	Percentile Rank
	Number of Peer Group Shares Vested
	 

	At least the 75th percentile and including the 100th percentile
	100%
	Maximum

	At least 50th percentile but less than 75th percentile
	50%
	Target

	At least 33rd percentile but less than 50th percentile
	25%
	Threshold

	Less than 33rd percentile
	0%
	 

The number of Performance Company Shares that will become vested shall be interpolated on a straight line basis between the Threshold and Target and Target and Maximum set forth in the applicable chart above.

“Index” means the FTSE NAREIT All Equity REITs Index (or a successor index selected by the Compensation Committee if such index ceases to exist), except any company that (1) ceases to be publicly traded at any point during the Performance Period or (2) was added to the Index during the Performance Period, shall be excluded from the Index.  In lieu of excluding any company from the Index altogether, if the Participant’s compensation is not subject to the limitations of Code Section 162(m), the Compensation Committee may adjust the calculation of Index Total Return to the extent determined by the Compensation Committee in its reasonable discretion.

“Percentile Rank” shall be calculated using the following formula:

Percentile Rank = (N-R)/(N-1)

Where:

N = the number of companies in the Index Group or Peer Group, as applicable, including the Company.

R = the numeric rank of the Company’s Total Return relative to the Index Group or Peer Group, as applicable, where the highest return in the group is ranked the 100th Percentile Rank and the lowest return in the group is ranked the 0th Percentile Rank.

The Percentile Rank shall be rounded to the nearest whole percentage.

“Peer Group” means the competitor peer group consisting of: ___________________________________________.  Any such company shall be removed from the Peer Group if it ceases to be publicly traded at any point during the Performance Period.  At any time and from time to time, the Compensation Committee may make equitable adjustments to the composition of the Peer Group to manage any extenuating circumstances that may develop during the Performance Period; provided that such modification shall not increase the amount otherwise payable under any Award that is designated as being intended to be exempt from Code Section 162(m).

“Share” means a share of common equity of the Company or a company in the Index or the Peer Group, as applicable.

“Share Price” means, (i) with respect to a purchase, the average closing price on the stock exchange a Share is then listed for the twenty consecutive trading days with the first day of such period on the date of purchase, or (ii) with respect to a sale, the average closing price on the stock exchange a Share is then listed for the twenty consecutive trading days with the last day of such period on the date of sale.

“Total Return” means, with respect to the Performance Period, the compounded total annual return that would have been realized by a shareholder who (1) bought one Share on the first day of the Performance Period at the Share Price, (2) reinvested each dividend or other distribution declared during the Performance Period with respect to such Share  (including any other Shares previously received upon reinvestment of dividends or other distribution) in additional Shares at the Share Price on the applicable dividend payment date and (3) sold such Shares on the last day of the Performance Period at the Share Price on such date.  As set forth in, and pursuant to, Section 9(d)(ii) of the Plan, appropriate adjustments to the Total Return shall be made to take into account all events contemplated therein that occur during the Performance Period.  In calculating Total Return, it is the current intention of the Compensation Committee to use total return to stockholders data available from one or more third party sources, although the Compensation Committee reserves the right to retain the services of a consultant to 

analyze relevant data or perform calculations in its reasonable discretion for any calculations required hereunder.Exhibit 10.1 - Form of Performance Share Agreement

Exhibit 10.1
REPUBLIC SERVICES, INC.
PERFORMANCE SHARE AGREEMENT
THIS PERFORMANCE SHARE AGREEMENT (the “Agreement”), dated as of                    , 20    , between Republic Services, Inc., a Delaware corporation (the “Company”) and Participant (the “Participant”), is made pursuant and subject to the provisions of the Company’s Amended and Restated 2007 Stock Incentive Plan, and any future amendments thereto (the “Plan”). The Plan, as it may be amended from time to time, is incorporated in this Agreement by reference.
1.Definitions.  All capitalized terms used in this Agreement but not expressly defined shall have the meaning ascribed to them in the Plan, a copy of which is being provided as part of the grant acceptance materials and is incorporated in this Agreement by reference. All references to the Company in this Agreement shall also be deemed to include references to any and all entities directly or indirectly controlled by the Company and which are consolidated with the Company for financial accounting purposes.

2.Award of Performance Shares.  Subject to the terms and conditions of the Plan and to the terms and conditions set forth in this Agreement, the Company on this date awards to the Participant the target number of Performance Shares equal to       Performance Shares (the “Performance Shares Granted”).  The actual number of Performance Shares earned by the Participant shall be from 0% to 150% of the target Performance Shares Granted.  The Performance Shares shall be considered a “Long Term Award” or a “long term incentive grant” under any employment agreement or the Company’s Executive Separation Policy (“Separation Policy”), as applicable to the Participant.
3.    Vesting.
(a)    Vesting Schedule.  Subject to the terms and conditions of this Agreement, the Performance Shares shall be subject to a three-year performance period, consisting of the Company’s fiscal years 20[  ], 20[  ] and 20[  ] (the “Performance Period”), after which the number of Performance Shares earned (the “Earned Performance Shares”) shall be determined as provided in Appendix A.  Except as otherwise provided below, the number of Earned Performance Shares, if any, shall become vested as of the final date of the Performance Period (the “Vesting Date”) if the Participant remains in continuous service with the Company for the period beginning on the Grant Date and ending on the Vesting Date.
(b)    Death, Disability, Retirement, or for Other Reasons.  In the event that the Participant has entered into any employment agreement between the Participant and the Company that is in effect on the date on which the Participant’s continuous service with the Company is terminated or the Participant is covered under the Separation Policy, the following provisions in this Section 3(b) shall apply to the Performance Shares, notwithstanding any provision to the contrary in any employment agreement between the Participant and the Company or under the Separation Policy, except to the extent described in Section 3(b)(v):
(i)    Death or Disability.  In the event that the Participant’s continuous service with the Company terminates by reason of the Participant’s death or Disability prior to the Vesting Date, the Participant shall vest in a pro-rated portion of the Earned Performance Shares, which shall be the product of (1) the number of the Earned Performance Shares, and (2) a fraction, the numerator of which is the number of months of the Performance Period which have elapsed since the first day of the Performance Period to the end of the month in which the Participant’s continuous service with the Company terminates by reason of the Participant’s death or Disability and the denominator of which is the total number of months in the Performance Period.
(ii)    Retirement.  In the event that the Participant’s continuous service with the Company terminates by reason of the Participant’s retirement prior to the Vesting Date, the Participant shall vest in the full number of Earned Performance Shares, if, at the time of such retirement:
(A)    the Participant is at least fifty-five (55) years old and has completed twenty (20) years of continuous service with the Company; is at least fifty-six (56) years old and has completed ten (10) years of continuous service with the Company;  is at least sixty (60) years old and has completed at least five (5) years of continuous service with the Company;  or is at least sixty-five (65) years old (without regard to years of service), and 

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in any of these cases has provided the Company not less than one (1) year prior written notice of Participant’s intent to retire; and
(B)    the Company does not provide the Participant with written notice on or before the anticipated retirement date that the Company intends or has grounds to terminate the Participant’s continuous service for Cause.
For purposes of determining years of continuous service, service shall include service in any capacity as an employee or a director with any entity whose financial statements are required to be consolidated with the financial statements of Republic, including service with any such entity prior to the date on which the entity’s financial statements were required to be so consolidated.  The Participant agrees to make himself or herself reasonably available to the Company to assist any successor to his or her positions with the Company with any transition or other services as may be reasonably requested by the Board during the period beginning on the date the Participant’s continuous service with the Company terminates by reason of the Participant’s retirement and ending on the last day of the Performance Period.
(iii)    Termination Without Cause.  In the event that the Participant’s continuous service with the Company is terminated prior to the Vesting Date by the Company without Cause, the Participant shall vest in a pro-rated portion of the Earned Performance Shares, which shall be the product of (1) the number of the Earned Performance Shares, and (2) a fraction, the numerator of which is the number of months of the Performance Period which have elapsed since the first day of the Performance Period to the end of the month in which the Participant’s continuous service with the Company is terminated by the Company without Cause and the denominator of which is the total number of months in the Performance Period.
(iv)    Termination for Good Reason.  
(A)    In the event that the Participant’s continuous service with the Company is terminated prior to the Vesting Date by the Participant for Good Reason, the Participant shall vest in a pro-rated portion of the Earned Performance Shares, which shall be the product of (1) the number of the Earned Performance Shares, and (2) a fraction, the numerator of which is the number of months of the Performance Period which have elapsed since the first day of the Performance Period to the end of the month in which the Participant’s continuous service with the Company is terminated by the Participant for Good Reason and the denominator of which is the total number of months in the Performance Period.
(B)    For purposes of this Agreement, “Good Reason” shall have the equivalent meaning or the same meaning as “good reason” or “for good reason” set forth in any employment or other agreement for the performance of services between the Participant and the Company or, in the absence of any such agreement, as set forth under the Separation Policy.
(v)    Employment Agreement.  In the event that the Participant has entered into any employment agreement between the Participant and the Company that is in effect on the date on which the Participant’s continuous service with the Company is terminated and such employment agreement provides benefits upon the Participant’s retirement, the applicable provisions of such employment agreement relating to the Participant’s retirement shall apply, notwithstanding any provision in Section 3(b)(ii) of this Agreement to the contrary.  
4.    Terms and Conditions.  This award of Performance Shares is subject to the following terms and conditions:
(a)     Payment for Performance Shares; Forfeiture of Performance Shares; Deferral of Performance Shares.  
(i)  Except as otherwise provided in paragraph (ii) of this Section 4(a), Section 4(d), Section 5(b) or Section 14, 50% of the Earned Performance Shares that become vested pursuant to Section 3 shall be settled in shares of Common Stock (the “Stock-Settled Performance Shares”), and 50% of the Earned Performance Shares that become vested pursuant to Section 3 shall be settled in cash (the “Cash-Settled Performance Shares”).  With respect to each Stock-Settled Performance Share, the Participant shall receive one share of Common Stock for each of the Stock-Settled Performance Shares awarded hereunder, free and clear of the restrictions set forth in this Agreement, except for any restrictions necessary to comply with federal and state securities laws.  With respect to each Cash-Settled Performance Share, the Participant shall receive cash equal to (1) the Fair Market Value of the Common Stock on the day the Committee designates the number of Performance Shares to be payable, multiplied by (2) the number of Cash-

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Settled Performance Shares awarded hereunder.  Except as otherwise provided in paragraph (ii) of this Section 4(a) or Section 5(b), cash and certificates (or other indicia of ownership) representing shares of Common Stock shall be delivered to the Participant in the calendar year following the calendar year in which the Performance Period ends, but in no event later than March 15 of the calendar year following the calendar year in which the Performance Period ends (the “Settlement Date”).  Any Performance Shares that are not vested as of the Participant’s separation from service, within the meaning of Section 409A of the Code and applicable Treasury Regulations (the “Separation from Service”), and that are not eligible to become vested pursuant to Section 3(b), shall automatically and immediately be forfeited on the date of the Participant’s Separation from Service.
 (ii)  The Participant may elect to defer the Performance Shares pursuant to the Republic Services, Inc. Deferred Compensation Plan, as may be amended from time to time (the “Deferred Compensation Plan”), and if the Participant properly and timely does so: (1) the portion elected by the Participant of the Performance Shares that shall be settled in shares of Common Stock shall be automatically converted into a corresponding number of units under the Republic Services Stock Unit Fund (the “Units”), and shall be credited to the Participant’s “Account Balance” (as defined in the Deferred Compensation Plan) in accordance with Section 3.9(c) of the Deferred Compensation Plan; and (2) the portion elected by the Participant of the Performance Shares that shall be settled in cash shall be, as of the date that would have qualified as the Settlement Date, credited to the Participant’s Account Balance under the Deferred Compensation Plan and allocated to any of the available “Measurement Funds” (as defined in the Deferred Compensation Plan) elected by the Participant in accordance with Section 3.9 of the Deferred Compensation Plan and shall be payable at the times provided for under the Deferred Compensation Plan.  The Units shall remain subject to the vesting and forfeiture provisions set forth in Sections 3, 4(g) and 4(j) of this Agreement.  The Units shall be payable in actual shares of Common Stock at the times provided for under the Deferred Compensation Plan.
(b)     Hypothetical Nature of Performance Shares.  The Performance Shares do not represent an equity security of the Company and do not carry any voting or dividend rights, except the right to receive Dividend Equivalents in accordance with Section 4(c).
(c)    Dividend Equivalents.  Participant shall receive Dividend Equivalents in the form of additional Performance Shares or fractional Performance Shares each time a dividend or other distribution is paid on the Company’s Common Stock. The number of Performance Shares awarded for a cash dividend or non-cash dividend other than a stock dividend shall be determined by (i) multiplying the number of Performance Shares that may be earned by the Participant pursuant to this Agreement as of the dividend record date by the amount of the dividend per share of Common Stock and (ii) dividing the product so determined by the Fair Market Value of the Common Stock on the dividend payment date. The number of Performance Shares awarded for a stock dividend shall be determined by multiplying the number of Performance Shares that may be earned by the Participant pursuant to this Agreement as of the dividend record date by the number of additional shares of Common Stock actually paid as a dividend per share of Common Stock. Any additional Performance Shares awarded pursuant to this Section 4(c) shall be awarded effective the date the dividend was paid, and shall have the same status, and shall be subject to the same terms and conditions (including without limitation the performance conditions set forth in Appendix A that must be satisfied for those Performance Shares to which they relate to become Earned Performance Shares, and the vesting and forfeiture provisions and the settlement form (i.e., cash or shares of Common Stock)) under this Agreement as the Performance Shares to which they relate, and shall be distributed on the same payment date referred to in Section 4(a) as the Performance Shares to which they relate (or if later, as of the applicable dividend payment date) or alternatively, at the times provided for under the Deferred Compensation Plan to the extent the Participant elected to defer some or all of the Performance Shares to which the Dividend Equivalents relate under the Deferred Compensation Plan.
(d)     Tax Withholding.  
(i)  The Participant shall pay to the Company, or make arrangements satisfactory to the Committee for payment of, any federal, state or local taxes of any kind required by law to be withheld with respect to the grant of Performance Shares (including without limitation the vesting thereof) and any Dividend Equivalents or other distributions made by the Company to the Participant with respect to the Performance Shares as and when the Company determines those amounts to be due, and the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to Participant any federal, state, or local taxes of any kind 

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required by law to be withheld with respect to the Performance Shares or any Dividend Equivalents or other distributions made by the Company to the Participant with respect to any Performance Shares.
(ii)  The Participant agrees that his or her minimum withholding tax obligation with respect to the granting, vesting or settlement of the Stock-Settled Performance Shares and any Dividend Equivalents or other distributions made by the Company to the Participant with respect to the Stock-Settled Performance Shares will be satisfied (provided that the Participant has enough vesting or vested shares available) by the Company’s withholding a portion of the shares of Common Stock otherwise deliverable to the Participant, such shares being valued at their Fair Market Value as of the date on which the taxable event that gives rise to the withholding requirement occurs.  The Participant further agrees that each time the Company withholds shares to satisfy his or her minimum withholding tax obligation, the Company will round up to the nearest whole number of shares (with any over withholding applied to federal income tax).  For example, if 9.6 shares are required to satisfy the minimum withholding tax obligation, the Company will round up to 10 shares.  By accepting this Agreement, the Participant consents to this method of tax withholding, including the Company rounding up to the nearest whole number of shares.
(iii)  The Participant agrees that his or her minimum withholding tax obligation with respect to the granting, vesting or settlement of the Cash-Settled Performance Shares and any Dividend Equivalents or other distributions made by the Company to the Participant with respect to the Cash-Settled Performance Shares will be satisfied by the Company’s withholding a portion of the cash otherwise deliverable to the Participant.
(e)    No Right to Continued Employment or Service.  This Agreement does not confer upon the Participant any right with respect to continuance of employment or service by the Company, nor shall it interfere in any way with the right of the Company to terminate the Participant’s employment at any time.
(f)    Transferability of Awards.  
(i)  Restrictions on Transfer.  No Performance Shares shall be transferable or assignable by the Participant, other than by will or the laws of descent and distribution or pursuant to a domestic relations order within the meaning of Section 414(p)(1)(B) of the Code.  
(ii)  Notice.  No transfer permitted under Section 4(f)(i), of any Performance Shares, shall be effective to bind the Company unless the Committee shall have been furnished with (1) a Notice of Performance Share Transfer in the form required by the Committee executed and dated by the Participant (or the executor or personal representative of the deceased Participant’s estate) and a copy of the will, assignment or transfer document and/or such evidence as the Committee may deem necessary to establish the validity of the transfer, and (2) the Statement of Acknowledgement in the form required by the Committee executed and dated by the transferee which states that the transferee will comply with all the terms and conditions of the Plan and the Agreement relating to the Performance Shares that are or would have been applicable to the Participant.
(g)    Forfeiture by Reason of Detrimental Activity.  The Performance Shares shall be subject to Section 17(n) of the Plan.  Notwithstanding any other provision of this Agreement to the contrary, if the Participant engages in any Detrimental Activity at any time prior to or during the one year period after the latest date on which any portion of the Performance Shares become vested but prior to a Change in Control, the Company shall, upon the recommendation of the Committee in its sole and absolute discretion, be entitled to (i) immediately terminate and cancel any portion of the Performance Shares that have not previously been settled with shares of Common Stock or cash, and/or (ii) require within two (2) years after the latest date on which any portion of the Performance Shares are settled but prior to a Change in Control that the Participant (1) return to the Company any shares of Common Stock that were distributed to the Participant in settlement of the Performance Shares, or if such shares of Common Stock are not still owned by the Participant, that the Participant pay to the Company an amount equal to the Fair Market Value of such shares of Common Stock on the date they were issued, and (2) return to the Company any cash or other property (other than Common Stock) received by the Participant from the Company pursuant to this Agreement.
(h)    Right to Set Off.  By accepting this Agreement, the Participant consents to a deduction from any amounts the Company owes the Participant from time to time (including amounts owed to the Participant as wages or other compensation, for any benefits, or vacation pay, as well as any other amounts owed to the Participant by the Company), up to the dollar amount the Participant owes the Company under Section 4(g) or 4(j).  Whether or not the Company elects to make any set off in whole or in part, if the Company does not recover by means of set off the full 

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amount the Participant owes the Company calculated as set forth in Section 4(h), the Participant agrees to pay immediately the unpaid balance to the Company.
(i)    Board of Director Discretion.  The Participant may be released from his or her obligations under Sections 4(g) and 4(h) only if the Board, or a duly authorized committee thereof, determines, in its sole and absolute discretion, that such action is not adverse to the interests of the Company.
(j)    Clawback Policy.  Notwithstanding anything to the contrary contained, in consideration of the grant of this award, you agree that this award and any payments under it will be subject to forfeiture or repayment to the extent provided for in the Republic Clawback Policy, as in effect from time to time, if it is determined in accordance with such policy that a Restatement (as defined in such policy) has occurred.
		
	5.
	Change of Control or Capital Structure.

(a)    Change in Capital Structure.  Subject to any required action by the shareholders of the Company, the number of Performance Shares covered by this award shall be proportionately adjusted and the terms of the restrictions on such Performance Shares shall be adjusted as the Committee shall determine to be equitably required for any increase or decrease in the number of issued and outstanding shares of Common Stock of the Company resulting from any stock dividend (but only on the Common Stock), stock split, subdivision, combination, reclassification, recapitalization or general issuance to the holders of Common Stock of rights to purchase Common Stock at substantially below Fair Market Value or any change in the number of such shares outstanding effected without receipt of cash or property or labor or services by the Company or for any spin-off, spin-out, split-up, split-off or other distribution of assets to shareholders.
(b)    Change in Control.  The award of Performance Shares shall not become vested in the event that a Change in Control occurs, except to the extent required in any employment agreement between the Company and the Participant or under the Separation Policy, as applicable.  In the event of a change in the Common Stock as presently constituted, which is limited to a change in all of its authorized shares without par value into the same number of shares with par value, the shares resulting from any such change shall be deemed to be the Common Stock within the meaning of the Plan.
(c)    Other Adjustments.  The award of Performance Shares pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure or to merge or to consolidate or to dissolve, liquidate or sell, or transfer all or any part of its business or assets.
6.    Governing Law and Venue.  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to its principles of conflict of laws. The parties agree that any action, suit or proceeding arising out of or related to this Agreement or the relationship of the Participant and the Company, shall be instituted only in the state or federal courts located in Maricopa County in the State of Arizona, and each party waives any objection which such party may now or hereafter have to such venue or jurisdictional court in any action, suit, or proceeding. Any and all services of process and any other notice in any such action, suit or proceeding shall be effective against any party if given by mail (registered or certified where possible, return receipt requested), postage prepaid, mailed to such party at the address set forth in this Agreement.
7.    Severability.  The invalidity or enforceability of any one or more provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.  In the event that a court of competent jurisdiction should determine that any time period provided for in Section 4(g) or 4(j) is unenforceable, then such period shall be reduced to the longest period of time which such court shall deem enforceable, taking into consideration the purpose and intent of the Plan to serve the interests of the Company and its shareholders.
8.    Notices.  All notices or other communications with respect to the Performance Shares shall be deemed given and delivered in person or mailed by registered or certified mail (return receipt requested, postage prepaid) to the Company’s Stock Administrator at the following address (or such other address, as shall be specified by like notice of a change of address) and shall be effective upon receipt:
                    

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Stock Administrator
Republic Services, Inc.
18500 N. Allied Way
Phoenix, AZ  85054
9.    Waiver.  The failure of any party at any time to require strict performance of any condition, promise, agreement or understanding set forth in this Agreement shall not be construed as a waiver or relinquishment of the right to require strict performance of the same condition, promise, agreement or understanding at a subsequent time.
10.    Interpretation/Provisions of Plan Control.  In the event of any conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall govern.  The Participant hereby accepts as final, conclusive and binding, any decisions by the Committee with respect to the interpretation or administration of the Plan and this Agreement.
11.    Participant Bound by Plan.  The Participant hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms, conditions and provisions thereof.
12.    Binding Effect.  Subject to the limitations stated in this Agreement and in the Plan, this Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Company and the Participant’s heirs, legatees, distributees and personal representatives.
13.    Counterparts.  This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.  The facsimile or email transmission of a signed signature page, by any party to the other(s), shall constitute valid execution and acceptance of this Agreement by the signing/transmitting party.
14.    Section 409A.
(a)    General.  It is the intention of both the Company and the Participant that the benefits and rights to which the Participant could be entitled pursuant to this Agreement comply with Section 409A of the Code and the Treasury Regulations and other guidance promulgated or issued thereunder (“Section 409A”), to the extent that the requirements of Section 409A are applicable thereto, and the provisions of this Agreement shall be construed in a manner consistent with that intention.  If the Participant or the Company believes, at any time, that any such benefit or right that is subject to Section 409A does not so comply, it shall promptly advise the other and shall negotiate reasonably and in good faith to amend the terms of such benefits and rights such that they comply with Section 409A (with the most limited possible economic effect on the Participant and on the Company).
(b)    No Representations as to Section 409A Compliance.  Notwithstanding the foregoing, the Company does not make any representation to the Participant that the Performance Shares awarded pursuant to this Agreement are exempt from, or satisfy, the requirements of Section 409A, and the Company shall have no liability or other obligation to indemnify or hold harmless the Participant or any Beneficiary for any tax, additional tax, interest or penalties that the Participant or any Beneficiary may incur in the event that any provision of this Agreement, or any amendment or modification thereof or any other action taken with respect thereto is deemed to violate any of the requirements of Section 409A.
(c)    Separation from Service.  If and to the extent permitted by Treasury Regulations Section 1.409A-1(h)(5) or other applicable law, if the Participant provides services both as an employee of the Company and as a member of the Board, the services provided as a member of the Board shall not be taken into account in determining whether the Participant has incurred a Separation from Service for purposes of Section 4(a).
(d)    6 Month Delay for Specified Employees. 
(i) If the Participant is a “Specified Employee”, then no payment or benefit that is payable on account of the Participant’s “Separation from Service”, shall be made before the date that is six months after the Participant’s “Separation from Service” (or, if earlier, the date of the Participant’s death) if and to the extent that such payment or benefit constitutes deferred compensation (or may be nonqualified deferred compensation) under Section 409A and such deferral is required to comply with the requirements of Section 409A.  Any payment or benefit delayed 

6

by reason of the prior sentence shall be paid out or provided in a single lump sum at the end of such required delay period in order to catch up to the original payment schedule.
(ii) For purposes of this provision, the Participant shall be considered to be a “specified employee” if, at the time of his or her Separation from Service, the Participant is a “key employee”, within the meaning of Section 416(i) of the Code, of the Company (or any person or entity with whom the Company would be considered a single employer under Section 414(b) or Section 414(c) of the Code) any stock in which is publicly traded on an established securities market or otherwise.
(e)    No Acceleration of Payments.  Neither the Company nor the Participant, individually or in combination, may accelerate any payment or benefit that is subject to Section 409A, except in compliance with Section 409A and the provisions of this Agreement, and no amount that is subject to Section 409A shall be paid prior to the earliest date on which it may be paid without violating Section 409A.
15.    Fractional Performance Shares. Notwithstanding any provisions in this Agreement to the contrary, no full share of Common Stock or cash will be issued for a fractional Stock-Settled Performance Share unless the fractional Stock-Settled Performance Share is for at least one-half of a Performance Share.
IN WITNESS WHEREOF, the Company has caused this Agreement to be signed by a duly authorized officer, and the Participant has affixed his or her signature hereto.

	
		
	REPUBLIC SERVICES, INC.

	 
	 

	 
	 

	By:
	Donald W. Slager

	Chief Executive Officer and President

	 
	 

	THE PARTICIPANT

	 
	 

	 
	 

	 

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APPENDIX A

The following table provides the formula for determining the number of Earned Performance Shares based on the Company’s achievement of target levels of cash flow value creation (“CFVC”), return on invested capital (“ROIC”) and total shareholder return relative to the S&P 500 Index (“RTSR”) over the Performance Period, as determined as soon as practicable after the end of the Performance Period by the Committee in writing.  To the extent permitted under Section 162(m) of the Code, the Committee may, in its sole and absolute discretion, use negative discretion to decrease, but not increase, the number of Earned Performance Shares otherwise payable to the Participant based upon such performance.  For example, negative discretion may be used in the event of certain infrequent or unusual gain from an unexpected event that would favorably impact the number of Earned Performance Shares absent the use of negative discretion.  All determinations by the Committee shall be final, conclusive and binding.

		
	1.
	Target Performance Goals.  The target performance goals for each performance criteria shall be as follows:

		
	a.
	CFVC: $[         ] (the “CFVC Target Goal”)

		
	b.
	ROIC: [   ]% (the “ROIC Target Goal”)

		
	c.
	RTSR: [     ] percentile (the “RTSR Target Goal”)

		
	2.
	The Earned Performance Shares shall be the sum of (i) the CFVC/ROIC Target Award multiplied by the CFVC/ROIC Earning Percentage and (ii) the RTSR Target Award multiplied by the RTSR Earning Percentage.

		
	3.
	Definitions.

		
	a.
	“CFVC” shall mean                                         .

		
	b.
	“CFVC/ROIC Earning Percentage” shall mean the percentage determined by straight line interpolation for results achieved between the targets listed on the following matrix: 

	
						
	Cumulative 
3-year 
CFVC ($millions)
	$[   ] or
greater
	75%
	100%
	125%
	150%

	$[   ] (T)
	50%
	75%
	100%
	125%

	$[   ]
	25%
	50%
	75%
	100%

	Less than
$[   ]
	0%
	25%
	50%
	75%

	 
	 
	Less than
[   ]%
	[   ]%
	[   ]% (T)
	[   ]%

	 
	 
	Average ROIC (%)

		
	c.
	 “CFVC/ROIC Target Award” shall mean 80% of the Performance Shares Granted.

		
	d.
	 “ROIC” shall mean                                   .

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	e.
	“RTSR Earning Percentage” shall mean the percentage determined by straight line interpolation1 for results achieved between the targets listed on the following matrix:

	
		
	RTSR Attained During the Performance Period 
	RTSR Earning Percentage

	Less than 20th Percentile
	0%

	[ 20th Percentile     ]
	25%

	[ 40th Percentile     ]
	67%

	[ 56th Percentile     ]
	100%

	[  60th Percentile  ]
	108%

	[  80th Percentile or higher    ]
	150%

		
	f.
	“RTSR Target Award” shall mean 20% of the Performance Shares Granted.

_________________________________ 
1 Straight line interpolation between points (i.e., 2.083% additional payout for each 1% increase in percentile performance).

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