Document:

Exhibit 10.2

EXECUTION VERSION

 

AMENDMENT NO. 3

 

This Amendment No. 3 (this “Amendment”),
dated as of September 3, 2014, is entered into among Prestige Brands, Inc., a Delaware corporation (“Borrower”),
Prestige Brands Holdings, Inc., a Delaware corporation (“Holdings”), the Subsidiaries of the Borrower identified
as “Guarantors” on the signature pages hereto (the “Subsidiary Guarantors” and, together with Holdings,
the “Guarantors”), the Incremental Lenders (as defined below) signatory hereto (in their capacities as such),
the Lenders party hereto and Citibank, N.A., in its capacity as administrative agent for the Lenders (in such capacity, the “Administrative
Agent”), and in its capacity as L/C Issuer and Swing Line Lender and amends that certain ABL Credit Agreement dated as
of January 31, 2012 (as amended by that certain Incremental Amendment, dated as of September 12, 2012, that certain Incremental
Amendment dated as of June 11, 2013 and as further amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”) entered into among the Borrower, the institutions from time to time party thereto as Lenders (the “Lenders”),
the Administrative Agent, L/C Issuer and the other agents and arrangers named therein. Capitalized terms used herein and not otherwise
defined herein shall have the meanings ascribed to them in the Credit Agreement.

 

WITNESSETH:

 

WHEREAS, Section 2.14 of the Credit Agreement
provides that Borrower may from time to time make Incremental Commitment Requests, subject to the terms and conditions set forth
therein;

 

WHEREAS, in connection with the consummation
of the 2014 Transactions (as defined in Exhibit A), the Borrower desires to create a new class of term loans and affect certain
other amendments under the Term Loan Credit Agreement pursuant to an amendment thereto dated the date hereof (the “Term
Loan Amendment”);

 

WHEREAS, each Person identified on Schedule
1 hereto (each, an “Incremental Lender”, and collectively, the “Incremental Lenders”) has
agreed (on a several and not a joint basis), subject to the terms and conditions set forth herein and in the Credit Agreement,
to provide a Revolving Commitment Increase in the amount set forth opposite such Incremental Lender’s name on Schedule 1
hereto (and the total amount of Revolving Commitment Increases made pursuant to this Amendment shall be $40,000,000); and

 

WHEREAS, Section 10.01 of the Credit Agreement
permits certain amendments of the Credit Agreement with the consent of the Supermajority Lenders, Administrative Agent and the
applicable Loan Parties.

 

NOW, THEREFORE, in consideration of the premises
and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound hereby, agree as follows:

 

    	 

    	 

    

 

		Section 1.	Incremental Amendment

 

This Amendment includes an Incremental Amendment
referred to in Section 2.14(f) of the Credit Agreement, and Borrower and each Incremental Lender hereby agrees that, subject to
the satisfaction of the conditions in Section 3 hereof, on the September 2014 Amendment Closing Date (as defined below), the Revolving
Commitment Increase of such Incremental Lender shall become effective and the Revolving Credit Commitments shall be deemed increased
by the amount of the Revolving Commitment Increases of such Incremental Lenders. After giving effect to such Revolving Commitment
Increases, the Revolving Credit Commitment of each Revolving Credit Lender shall be as set forth on Schedule 2 hereto (and such
Schedule 2 shall supersede Schedule 2 to the Incremental Amendment to the Credit Agreement dated June 11, 2013). Subject to the
satisfaction of the conditions set forth in Section 3 of this Amendment, the Incremental Facility Closing Date with respect to
the Revolving Commitment Increases contemplated by this Amendment shall be September 3, 2014 (the “September 2014 Amendment
Closing Date”).

 

		Section 2.	Other Amendments

 

(a)The
Credit Agreement is, effective as of the September 2014 Amendment Closing Date, hereby futher amended to delete the stricken text
(indicated textually in the same manner as the following example: stricken text)
and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined
text) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto).

 

(b)Schedules 7.01, 7.02, 7.03, 7.08 and
7.09 attached hereto shall replace in their entirety Sections 7.01(b), 7.02(f), 7.03(b), 7.08 and 7.09 of the Confidential Disclosure
Letter.

 

		Section 3.	Conditions Precedent to the Effectiveness of this
Amendment

 

This
Amendment shall become effective as of the date when, and only when, the following conditions precedent have been satisfied:

 

(a)Administrative Agent shall have received
counterparts of this Amendment duly executed by (1) the Borrower, (2) each Guarantor, (3) the Administrative Agent, (4) the Incremental
Lenders and (5) the Supermajority Lenders.

 

(b)(x) no Default or Event of Default
shall exist after giving effect to this Amendment and any Revolving Loans made pursuant thereto on the September 2014 Amendment
Closing Date and (y) after giving effect to the Revolving Commitment Increases contemplated hereby, the conditions of Section 4.02(i)
of the Credit Agreement shall be satisfied (it being understood that all references to “the date of such Credit Extension”
or similar language in such Section 4.02(i) shall be deemed to refer to the September 2014 Amendment Closing Date).

 

(c)The Borrower shall have paid (x) to
the Administrative Agent, for the account of each Lender that consents hereto, a fee equal to 0.10% of the Revolving Credit Commitments
of such Lender immediately prior to the effectiveness of this Amendment and (y) to the Administrative Agent, for the account of
each Incremental Lender, such fees as the Borrower shall separately have agreed to pay such Person.

 

    	-2-

    	 

    

 

(d)The Administrative Agent shall have
received the executed legal opinion of Kirkland & Ellis LLP, counsel to the Borrower and the Guarantors, in form and substance
reasonably satisfactory to the Administrative Agent.

 

(e)The Term Loan Amendment shall have
substantially simultaneously become effective in accordance with its terms.

 

(f)With respect to Insight and its Subsidiaries,
the Administrative Agent’s receipt of the following each in form and substance reasonably satisfactory to the Administrative
Agent and its legal counsel:

 

(i)Security Agreement Supplement;

 

(ii)joinder to the Term Loan
Intercreditor Agreement;

 

(iii)joinder to the Credit
Agreement;

 

(iv)counterpart to the Intercompany
Note;

 

(v)subject to the Term Loan
Intercreditor Agreement, certificates, if any, representing the Pledged Equity of Insight and its Subsidiaries required to be delivered
pursuant to the Collateral and Guarantee Requirement, accompanied by undated stock powers executed in blank and instruments evidencing
the Pledged Debt indorsed in blank; and

 

(vi)to the extent requested
by the Administrative Agent, evidence that all other actions, recordings and filings required by the Collateral Documents that
the Administrative Agent may deem reasonably necessary to satisfy the Collateral and Guarantee Requirement shall have been taken,
completed or otherwise provided for in a manner reasonably satisfactory to the Administrative Agent.

 

		Section 4.	Representations and Warranties

 

On and as of the September 2014 Amendment
Closing Date, after giving effect to this Amendment, the Borrower hereby represents and warrants to the Administrative Agent and
the Lenders as follows:

 

(a)The execution, delivery and performance
by each Loan Party of this Amendment (a) has been duly authorized by all necessary corporate or other organizational action, and
(b) does not (i) contravene the terms of any of such Person’s Organization Documents, (ii) conflict with or result in any
breach or contravention of, or the creation of any Lien under (other than as permitted by Section 7.01 of the Credit Agreement),
or require any payment to be made under (x) any Contractual Obligation to which such Person is a party or affecting such Person
or the properties of such Person or any of its Subsidiaries or (y) any material order, injunction, writ or decree of any Governmental
Authority or any arbitral award to which such Person or its property is subject; or (iii) violate any Law; except with respect
to any conflict, breach or contravention or payment (but not creation of Liens) referred to in clauses (ii) and (iii), to the extent
that such violation, conflict, breach, contravention or payment could not reasonably be expected to have a Material Adverse Effect;

 

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(b)No material approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or
required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Amendment,
except for (i) those approvals, consents, exemptions, authorizations or other actions, notices or filings, the failure of which
to obtain or make could not reasonably be expected to have a Material Adverse Effect or (ii) the approvals, consents, exemptions,
authorizations, actions, notices and filings which have been duly obtained, taken, given or made and are in full force and effect
(except to the extent not required to be obtained, taken, given or made or in full force and effect pursuant to the Collateral
and Guarantee Requirement);

 

(c)this Amendment and the Loan Documents
(as amended hereby) has been duly executed and delivered by each Loan Party that is a party thereto. This Agreement and each other
Loan Document (as amended hereby) constitutes, a legal, valid and binding obligation of such Loan Party, enforceable against each
Loan Party that is a party thereto in accordance with its terms, except as such enforceability may be limited by (i) Debtor Relief
Laws and by general principles of equity and (ii) the need for filings and registrations necessary to create or perfect the Liens
on the Collateral granted by the Loan Parties in favor of the Secured Parties and (iii) the effect of foreign Laws, rules and regulations
as they relate to pledges of Equity Interests in Foreign Subsidiaries; and

 

(d)(x) no Default or Event of Default
shall exist after giving effect to this Amendment and any Revolving Loans made pursuant thereto on the September 2014 Amendment
Closing Date and (y) after giving effect to the Revolving Commitment Increases contemplated hereby, the conditions of Section 4.02(i)
of the Credit Agreement are satisfied (it being understood that all references to “the date of such Credit Extension”
or similar language in such Section 4.02(i) shall be deemed to refer to the September 2014 Amendment Closing Date).

 

		Section 5.	Reallocation

 

The reallocation of the Revolving Credit Lenders’
Revolving Credit Loans contemplated by Section 2.14(g) with respect to any Revolving Commitment Increase shall occur with respect
to the Revolving Commitment Increases contemplated hereby on the September 2014 Amendment Closing Date, and the Incremental Lenders
shall make such Revolving Credit Loans on the September 2014 Amendment Closing Date as may be required to effectuate such reallocation.
Furthermore, on the September 2014 Amendment Closing Date, all participations in L/C Obligations and Swing Line Loans shall be
reallocated pro rata among the Revolving Credit Lenders after giving effect to the Revolving Commitment Increases contemplated
hereby.

 

		Section 6.	Reference to and Effect on the Loan Documents

 

(a)As of the September 2014 Amendment
Closing Date, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,”
“herein,” or words of like import, and each reference in the other Loan Documents to the Credit Agreement (including,
without limitation, by means of words like “thereunder,” “thereof” and words of like import), shall mean
and be a reference to the Credit Agreement as amended hereby, and this Amendment and the Credit Agreement shall be read together
and construed as a single instrument. Each of the table of contents and lists of Exhibits and Schedules of the Credit Agreement
shall be amended to reflect the changes made in this Amendment as of the September 2014 Amendment Closing Date.

 

    	-4-

    	 

    

 

(b)Except as expressly amended hereby
or specifically waived above, all of the terms and provisions of the Credit Agreement and all other Loan Documents are and shall
remain in full force and effect and are hereby ratified and confirmed.

 

(c)The execution, delivery and effectiveness
of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of the Lenders,
the Borrower or the Administrative Agent under any of the Loan Documents, nor constitute a waiver or amendment of any other provision
of any of the Loan Documents or for any purpose except as expressly set forth herein.

 

(d)This Amendment shall constitute a Loan
Document under the terms of the Credit Agreement.

 

		Section 7.	Acknowledgement and Reaffirmation of Guarantors

 

The Guarantors acknowledge and consent to
all terms and conditions of this Amendment and agree that this Amendment and all documents executed in connection herewith do not
operate to reduce or discharge the Guarantors’ obligations under the Loan Documents. Each Guarantor hereby ratifies and confirms
its obligations under the Loan Documents, including the Collateral and Guarantee Requirement of the Credit Agreement and including,
without limitation, its guarantee of the Obligations and its grant of the security interest in the Collateral (as defined in the
Security Agreement) to secure the Obligations (including any Obligations resulting from the Revolving Commitment Increases contemplated
hereby).

 

		Section 8.	Costs and Expenses

 

The Borrower agrees to pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent in connection with the preparation, reproduction, execution and delivery
of this Amendment (including, without limitation, the reasonable fees and out-of-pocket expenses of counsel for the Administrative
Agent with respect thereto).

 

		Section 9.	Execution in Counterparts

 

This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
Delivery by telecopier of an executed counterpart of a signature page to this Amendment shall be effective as delivery of an original
executed counterpart of this Amendment. The Administrative Agent may also require that any such documents and signatures delivered
by telecopier be confirmed by a manually signed original thereof; provided that the failure to request or deliver the same
shall not limit the effectiveness of any document or signature delivered by telecopier.

 

		Section 10.	Approval

 

To the extent required by the proviso to
Section 2.14(c) of the Credit Agreement, the Administrative Agent, the Swing Line Lender and the L/C Issuer hereby consent to the
provision by the Incremental Lenders providing Revolving Commitment Increases pursuant to the Amendment.

 

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		Section 11.	Governing Law

 

THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING ARISING UNDER THIS AMENDMENT OR
IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS AMENDMENT,
OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, SHALL BE BROUGHT IN THE COURTS OF
THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY (BOROUGH OF MANHATTAN) OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH
STATE, AND BY EXECUTION AND DELIVERY OF THIS AMENDMENT, EACH LOAN PARTY, THE ADMINISTRATIVE AGENT, THE SWING LINE LENDER, THE L/C
ISSUER AND EACH LENDER, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS AND AGREES THAT
IT WILL NOT COMMENCE OR SUPPORT ANY SUCH ACTION OR PROCEEDING IN ANOTHER JURISDICTION. EACH LOAN PARTY, THE ADMINISTRATIVE AGENT,
THE SWING LINE LENDER, THE L/C ISSUER AND EACH LENDER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING
IN SUCH JURISDICTION IN RESPECT OF THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO IRREVOCABLY CONSENTS
TO SERVICE OF PROCESS IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AMENDMENT IN THE MANNER PROVIDED FOR NOTICES
(OTHER THAN TELECOPIER) IN SECTION 10.02 OF THE CREDIT AGREEMENT. NOTHING IN THIS AMENDMENT WILL AFFECT THE RIGHT OF ANY PARTY
HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

 

		Section 12.	Notices

 

All communications and notices hereunder shall
be given as provided in the Credit Agreement.

 

		Section 13.	Waiver of Jury Trial

 

EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT
OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

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		Section 14.	FATCA

 

For purposes of determining withholding Taxes
imposed under FATCA, including any FATCA-related compliance of any Person with Section 3.01(e) of the Credit Agreement, from and
after the September 2014 Amendment Closing Date, the Borrower and the Administrative Agent agree to treat (and the Lenders hereby
authorize the Borrower and the Administrative Agent to treat) this Amendment, the Credit Agrement and any Obligations hereunder
and thereunder (including any advances or other Obligations outstanding on the September 2014 Amendment Closing Date) as no longer
qualifying as “grandfathered obligations” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i) and 1.1471-2T(b)(2).

 

		Section 15.	Waivers

 

The parties hereto agree to waive the notice
requirement for Eurocurrency Rate Loans set forth in Section 2.02(a) of the Credit Agreement with respect to any such Loans extended
on the September 2014 Amendment Closing Date.

 

    	-7-

    	 

    

 

In
Witness Whereof, the parties hereto have caused this Amendment to be executed by their respective officers thereunto
duly authorized, as of the date first written above.

 

	 	PRESTIGE BRANDS HOLDINGS, INC. 1,
    as Holdings and Guarantor
	 	 	 
	 	By:	/s/ Ron Lombardi
	 	 	Name: Ronald M. Lombardi
	 	 	Title: Chief Financial Officer and Treasurer
	 	 	 
	 	 	 
	 	PRESTIGE BRANDS, INC., as Borrower
	 	 	 
	 	By:	/s/ Ron Lombardi
	 	 	Name: Ronald M. Lombardi
	 	 	Title: Chief Financial Officer and Treasurer
	 	 	 
	 	BLACKSMITH BRANDS, INC.
	 	MEDTECH HOLDINGS, INC.
	 	MEDTECH PRODUCTS INC.
	 	PRESTIGE BRANDS HOLDINGS, INC. 2
	 	PRESTIGE BRANDS INTERNATIONAL, INC.
	 	PRESTIGE SERVICES CORP.
	 	THE CUTEX COMPANY
	 	THE SPIC AND SPAN COMPANY, as Subsidiary Guarantors
	 	 	 
	 	By:	/s/ Ron Lombardi
	 	 	Name: Ronald M. Lombardi
	 	 	Title: Chief Financial Officer 

 

1
A Delaware corporation

 

2
A Virginia corporation

 

[Prestige Brands – Signature Page
to Amendment No. 3 (ABL)]

 

    	 

    	 

    

 

	 	Citibank, N.A., as Administrative Agent, Swing Line Lender, L/C Issuer, Lender and as an Incremental Lender
	 	 	 
	 	By:	/s/ Justin McMahan
	 	 	Name: Justin McMahan
	 	 	Title:  Vice President

 

[Prestige Brands – Signature Page
to Amendment No. 3 (ABL)]

 

    	 

    	 

    

 

	 	Morgan Stanley Bank, N.A., 
	 	as a Lender and as an Incremental Lender
	 	 	 
	 	By:	/s/ Lisa Hansen
	 	 	Name: Lisa Hansen
	 	 	Title: Authorized Signatory

 

[Prestige Brands – Signature Page
to Amendment No. 3 (ABL)]

 

    	 

    	 

    

 

	 	Royal Bank of Canada, as a Lender and as an Incremental Lender
	 	 	 
	 	By:	/s/ John Flores
	 	 	Name: John Flores
	 	 	Title: Authorized Signatory

 

[Prestige Brands – Signature Page
to Amendment No. 3 (ABL)]

 

    	 

    	 

    

 

	 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as a Lender and as an Incremental Lender
	 	 	 
	 	By:	/s/ Peter Cucchiara
	 	 	Name: Peter Cucchiara
	 	 	Title: Vice President
	 	 	 
	 	By:	/s/ Michael Winters
	 	 	Name: Michael Winters
	 	 	Title: Vice President

 

[Prestige Brands – Signature Page
to Amendment No. 3 (ABL)]

 

    	 

    	 

    

 

Schedule 1

 

Revolving Commitment
Increase

 

	

        Incremental
        Lender
	

        Revolving
        Commitment Increase

	
         

        Citibank, N.A.
	
         

         

        $9,500,000

	
         

        Morgan Stanley Bank, N.A.
	
         

         

        $9,500,000

	
         

        Royal Bank of Canada
	
         

         

        $9,500,000

	
         

        Deutsche Bank Trust Company Americas
	
         

         

        $11,500,000

	
         

        Total
	
         

         

        $40,000,000

 

    	 

    	 

    

 

Exhibit A

 

Revolving Credit Commitments

 

	

        Lender
	
        

        Revolving
        Credit Commitments

	
         

        Citibank, N.A.
	
         

        $39,500,000

	
         

        Morgan Stanley Bank, N.A.
	
         

        $39,500,000

	
         

        Royal Bank of Canada
	
         

        $39,500,000

	
         

        Deutsche Bank Trust Company Americas
	
         

        $16,500,000

	
         

        Total
	
         

         

        $135,000,000Exhibit 10.1

 

New Enterprise Stone & Lime Co., Inc. (“NESL”)

 

Incentive Compensation Guidelines (“IC”)

 

Date: August 26, 2014

 

A.            General Parameters

 

1.              The purpose of the IC is to provide opportunities for incentive compensation awards to NESL management and selected key professional personnel who, through high levels of performance, contribute to the success and profitability of the company.  IC is designed to support organizational financial goals and company growth and sustainability, by making available additional, variable, and contingent compensation in the form of cash awards.

 

2.              IC is based upon the achievement of NESL financial targets and other defined objectives, before any incentive compensation award is considered.  The calculation of the share of the awards for potential distribution to IC participants, and the target/award formulas, are constructed to integrate the interests of the company and its shareholders with those of the participants.  The potential awards are designed to enable NESL to attract, retain, and motivate competent and effective management personnel, as well as supporting the continued growth and profitability of the company.

 

3.              IC is intended to augment regular salary and benefits programs already in existence.  It is not meant to be a substitute for salary increases but supplemental to base salary and benefits and, as stated, a reward for performance that contributes to outstanding levels of performance.

 

4.              The NESL Board of Directors will act on final disposition of all matters pertaining to the approval of IC, supplements or revisions to the guidelines and annual performance targets.  Authority will be delegated to the Board’s Compensation Committee for the ongoing administration and interpretation of the IC guidelines, as well as recommended targets, and payouts.

 

5.              In consultation with Chief Executive Officer, the Compensation Committee will establish parameters, performance targets, and payout guidelines for IC prior to the beginning of each fiscal year, consistent with the budgeting and operating plan processes of the company, and recommend to the Board of Directors for approval.

 

1

 

6.              Although guidelines will be established for the formation and administration of IC, the awarding of incentive compensation payments to eligible participants is at the discretion of the Board of Directors.  With regard to this discretion, the Board and the Compensation Committee may take into account the presence or absence of nonrecurring or extraordinary items of income, gain, expense, or loss and any and all factors which the Board and Compensation Committee may deem relevant. These EBITDA adjustments may include, but not be limited to, the use or production of working capital through changes in accounts payable, accounts receivable, inventory and capital expenditures relative to prior year and budgeted and actual sales. Extraordinary occurrences will be considered factors in potential IC payouts to insure that the best interests of the company and its shareholders are protected and not brought into conflict with the interests of participants.

 

7.              IC payouts will be computed based upon company performance at the end of the fiscal year and will be paid as set forth by the Board of Directors or Compensation Committee.  Participants must be employed by the company on the payout date in order to be eligible to receive an IC award.

 

B.            Eligible Positions

 

Exclusions include Chairman of the Board, Vice Chairman of the Board, Director of Internal Audit, and three Senior Managers of Utilities Construction, who are eligible for a separate bonus plan.

 

2

 

C.            Performance Factors & Payout Weights Guidelines

 

1.              As outlined in IC guidelines and as approved by the Compensation Committee, the potential pool is created when company EBITDA targets are achieved.

 

2.              In addition to company EBITDA , annual performance targets will also be established as follows:

 

·                  Business Operations Divisions — Division EBITDA vs. approved budget

 

·                  Shared Services and Business Support & Margin Growth Divisions/Departments — Division/Department performance vs. approved strategic objectives

 

·                  Individual Participants — Participant performance vs. approved individual strategic performance objectives for Executive Management and selected Sr. Management positions and results of annual Performance Appraisals for all other participants

 

3.              Recommendations for individual awards for eligible participants will be made by corporate executive management, consistent with the guidelines established for the current fiscal year IC, and submitted to the Compensation Committee for consideration.  Following their review, the Compensation Committee will recommend IC payouts to the Board of Directors for final approval.

 

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