Unitil Corporation
2003 Restricted Stock Plan
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Article 1: Establishment, Objectives, and Duration
1.1 Establishment of the Plan. Unitil Corporation, a corporation organized and
existing under New Hampshire law (the "Company"), established the Unitil
Corporation 2003 Restricted Stock Plan (the "Plan") effective January 1, 2003
(the "Effective Date"). The Plan shall remain in effect as provided in Section
1.3 hereof.
1.2 Objectives of the Plan. The objectives of the Plan are to optimize the
profitability and growth of the Company through incentives which are consistent
with the Company's goals and which link the personal interests of Participants
to those of the Company's shareholders; to provide Participants with an
incentive for excellence in individual performance; and to promote teamwork
among Participants.
1.3 Duration of the Plan. The Plan shall remain in effect, subject to the right
of the Board to amend or terminate the Plan at any time pursuant to Article 13
hereof, until all Shares subject to it shall have been purchased or acquired
according to the Plan's provisions.
Article 2: Definitions
Whenever used in the Plan, the following terms shall have the meanings set forth
below, and, when the meaning is intended, the initial letter of the word shall
be capitalized:
2.1 "Affiliate" means any parent or subsidiary of the Company which meets the
requirements of Section 425 of the Code.
2.2 "Award" means, individually or collectively, an award under this Plan of
Restricted Stock.
2.3 "Award Agreement" means an agreement entered into by the Company and each
Participant setting forth the terms and provisions applicable to Awards made
under the Plan.
2.4 "Board" means the Board of Directors of the Company.
2.5 "Change in Control" means the satisfaction of any one or more of the
following conditions (and the "Change in Control" shall be deemed to have
occurred as of the first day that any one or more of the following conditions
shall have been satisfied):
a) the Company receives a report on Schedule 13D filed with the Securities
and Exchange Commission pursuant to Rule 13(d) of the Exchange Act, disclosing
that any person, group, corporation or other entity is the beneficial owner,
directly or indirectly, of 25% or more of the outstanding Shares;
b) any "person" (as such term is used in Section 13(d) of the Exchange
Act), group, corporation or other entity other than the Company or a
wholly-owned subsidiary of the Company, purchases Shares pursuant to a tender
offer or exchange offer to acquire any Shares (or securities convertible into
Shares) for cash, securities or any other consideration, provided that after
consummation of the offer, the person, group, corporation or other entity in
question is the "beneficial owner" (as such term is defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 25% or more of the outstanding
Shares (calculated as provided in paragraph (d) of Rule 13d-3 under the Exchange
Act in the case of rights to acquire Shares);
c) consummation of a transaction which involves (1) any consolidation or
merger of the Company in which the Company is not the continuing or surviving
corporation, or pursuant to which Shares of the Company would be converted into
cash, securities or other property (except where the Company's shareholders
before such transaction will be the owners of more than 75% of all classes of
voting securities of the surviving entity); or (2) any sale, lease, exchange or
other transfer (in one transaction or a series of related transactions) of all
or substantially all the assets of the Company.
d) there shall have been a change in a majority of the members of the Board
within a 25-month period, unless the election or nomination for election by the
Company's shareholders of each new director was approved by the vote of at least
two-thirds of the directors then still in office who were in office at the
beginning of the 25-month period.
2.6 "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
2.7 "Committee" means the Compensation Committee of the Board, as specified in
Article 3 herein, or such other Committee appointed by the Board to administer
the Plan with respect to grants of Awards.
2.8 "Company" means Unitil Corporation, a corporation organized and existing
under New Hampshire law, and any successor thereto as provided in Article 16
herein.
2.9 "Consultant" means an independent contractor who is performing consulting
services for one or more entities in the Group and who is not an employee of any
entity in the Group.
2.10 "Director" means a member of the Board or a member of the board of
directors of an Affiliate.
2.11 "Disability" shall have the meaning ascribed to such term in the long-term
disability plan maintained by the Company, or if no such plan exists, at the
discretion of the Committee.
2.12 "Effective Date" shall have the meaning ascribed to such term in Section
1.1 hereof.
2.13 "Employee" means any employee of the Group, including any employees who are
also Directors.
2.14 "Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor act thereto.
2.15 "Fair Market Value" means as of any date, the closing price based upon
composite transactions on a national stock exchange for one Share or, if no
sales of Shares have taken place on such date, the closing price on the most
recent date on which selling prices were quoted. In the event the Company's
Shares are no longer traded on a national stock exchange, Fair Market Value
shall be determined in good faith by the Committee.
2.16 "Group" means the Company and its Affiliates.
2.17 "Named Executive Officer" means a Participant who, as of the date of
vesting of an Award, is one of the group of "covered employees," as defined in
the regulations promulgated under Code Section 162(m), or any successor section.
2.18 "Nonemployee Director" shall have the meaning ascribed to such term in Rule
16b-3 of the Exchange Act.
2.19 "Outside Director" shall have the meaning ascribed to such term under the
regulations promulgated with respect to Code Section 162(m).
2.20 "Participant" means a current or former Employee, Director, or Consultant
who has outstanding an Award granted under the Plan.
2.21 "Performance-Based Exception" means the performance-based exception from
the tax deductibility limitations of Code Section 162(m).
2.22 "Period of Restriction" means the period during which the transfer of
Shares of Restricted Stock is limited in some way (based on the passage of time,
the achievement of performance goals, or upon the occurrence of other events as
determined by the Committee, at its discretion), and the Shares are subject to a
substantial risk of forfeiture, as provided in Article 6 herein.
2.23 "Restricted Stock" or "Restricted Share" means an Award granted to a
Participant pursuant to Article 6 herein.
2.24 "Shares" means the shares of common stock (no par value) of the Company.
2.25 "Termination of Service" means, (i) if an Employee, termination of
employment with all entities in the Group, (ii) if a Director, termination of
service on the Board and the board of directors of any Affiliate, as applicable,
and (iii) if a Consultant, termination of the consulting relationship with all
entities in the Group; provided, however, that if a Participant serves the Group
in more than one of the above capacities, Termination of Service shall mean
termination of service in all such capacities.
Article 3: Administration
3.1 The Committee. The Plan shall be administered by the Committee. To the
extent the Company deems it to be necessary or desirable with respect to any
Awards made hereunder, the members of the Committee may be limited to
Nonemployee Directors or Outside Directors, who shall be appointed from time to
time by, and shall serve at the discretion of, the Board.
3.2 Authority of the Committee. Except as limited by law or by the Articles of
Incorporation or the By-laws of the Company, and subject to the provisions
herein, the Committee shall have full power to select the persons who shall
participate in the Plan; determine the sizes of Awards; determine the terms and
conditions of Awards in a manner consistent with the Plan; construe and
interpret the Plan and any agreement or instrument entered into under the Plan
as they apply to Participants; establish, amend, or waive rules and regulations
for the Plan's administration as they apply to Participants; and (subject to the
provisions of Article 13 herein) amend the terms and conditions of any
outstanding Award to the extent such terms and conditions are within the
discretion of the Committee as provided in the Plan. Further, the Committee
shall make all other determinations which may be necessary or advisable for the
administration of the Plan. As permitted by law, the Committee may delegate its
authority as identified herein.
3.3 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan and all related orders and resolutions of
the Board shall be final, conclusive and binding on all persons, including the
Company, its shareholders, Affiliates, Participants, and their estates and
beneficiaries.
Article 4: Shares Subject to the Plan and Maximum Awards
4.1 Number of Shares Available for Grants.
a) Subject to adjustment as provided in Section 4.2, the maximum number of
Shares available for Awards to Participants under the Plan shall be 177,500. If
any Award under the Plan expires before vesting or is forfeited, the Shares
subject to such Award shall again be available for issuance under the Plan.
b) The maximum aggregate number of Shares of Restricted Stock that may be
granted in any one calendar year to any one Participant shall be 20,000, subject
to adjustment in accordance with Section 4.2.
4.2 Adjustments in Authorized Shares. In the event of any change in corporate
capitalization affecting the Shares, including, without limitation, a stock
split, reverse stock split, stock dividend or other distribution,
recapitalization, consolidation, subdivision, split-up, spin-off, split-off,
combination or other exchange of Shares or other form of reorganization or
recapitalization, partial or complete liquidation, or other change affecting the
Shares, the Committee shall authorize and make such proportionate adjustments,
if any, as the Committee shall deem appropriate to prevent dilution or
enlargement of rights, including, without limitation,
an adjustment in the maximum number and kind of Shares that may be delivered
pursuant to Section 4.1 and in the Award limit set forth in Section 4.1(b);
provided, however, that the number of Shares subject to any Award shall always
be rounded to the nearest whole number, with one-half (1/2) of a share rounded
up to the next higher number.
Article 5: Eligibility and Participation
5.1 Eligibility. Persons eligible to participate in this Plan include all
Employees, Directors and Consultants of the Group.
5.2 Actual Participation. Subject to the provisions of the Plan, the Committee
may, from time to time, select from all eligible Employees, Directors and
Consultants those to whom Awards shall be made and shall determine the nature
and amount of each Award.
Article 6: Restricted Stock
6.1 Grant of Restricted Stock. Subject to the terms and provisions of the Plan,
the Committee, at any time and from time to time, may grant Shares of Restricted
Stock to Participants in such amounts as the Committee shall determine.
6.2 Restricted Stock Agreement. Each Restricted Stock grant shall be evidenced
by an Award Agreement that shall specify the Period(s) of Restriction, the
number of Shares of Restricted Stock granted, and such other provisions as the
Committee shall determine.
6.3 Transferability. Except as provided in this Article 6, the Shares of
Restricted Stock granted herein may not be sold, transferred, pledged, assigned
or otherwise alienated or hypothecated until the end of the applicable Period of
Restriction established by the Committee and specified in the Award Agreement.
6.4 Restrictions.
a) Subject to the terms hereof, the Committee shall impose such conditions
and/or restrictions on any Shares of Restricted Stock granted pursuant to the
Plan as it may deem advisable and as are expressly set forth in the Award
Agreement including, without limitation, a requirement that Participants pay a
stipulated purchase price for each Share of Restricted Stock, restrictions based
upon the achievement of specific performance goals (Company-wide, divisional,
and/or individual), time-based restrictions, and/or restrictions under
applicable federal or state securities laws.
b) The Company shall retain the certificates representing Shares of
Restricted Stock in the Company's possession until such time as all conditions
and/or restrictions applicable to such Shares have been satisfied. The
Participant shall execute appropriate stock powers in blank and such other
documents as the Committee shall prescribe.
c) Subject to restrictions under applicable law or as may be imposed by the
Company, Restricted Shares covered by each Award made under the Plan shall
become freely transferable by the Participant after the last day of the
applicable Period of Restriction.
6.5 Voting Rights. During the Period of Restriction, subject to any limitations
imposed under the By-laws of the Company, Participants holding Shares of
Restricted Stock granted hereunder may exercise full voting rights with respect
to those Shares.
6.6 Dividends and Other Distributions. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder may be
credited with regular dividends paid with respect to the underlying Shares while
they are so held. The Committee may apply any restrictions to the dividends that
the Committee deems appropriate and as are expressly set forth in the Award
Agreement. Without limiting the generality of the preceding sentence, if the
grant or vesting of Restricted Shares granted to a Named Executive Officer is
designed to comply with the requirements of the Performance-Based Exception, the
Committee may apply any restrictions it deems appropriate to the payment of
dividends declared with respect to such Restricted Shares, such that the
dividends and/or the Restricted Shares maintain eligibility for the
Performance-Based Exception.
Article 7: Termination of Service
Each Award Agreement shall set forth the effect that Termination of Service
shall have upon that Award. Such provisions shall be determined in the sole
discretion of the Committee, need not be uniform among all Awards issued
pursuant to the Plan, and may reflect distinctions based on the reasons for
Termination of Service; provided, however, that the following shall
automatically apply to the extent different provisions are not expressly set
forth in a Participant's Award Agreement:
a) Upon a Termination of Service for any reason other than death,
retirement or Disability, all unvested Restricted Shares shall be forfeited as
of the termination date.
b) Upon a Termination of Service as a result of the Participant's death,
retirement or Disability, all unvested Restricted Shares shall vest as of the
termination date.
Article 8: Restrictions on Shares
All Shares issued pursuant to Awards granted hereunder, and a Participant's
right to receive Shares upon vesting of an Award, shall be subject to all
applicable restrictions contained in the Company's By-laws, shareholders
agreement or insider trading policy, and any other restrictions imposed by the
Committee, including, without limitation, restrictions under applicable
securities laws, under the requirements of any stock exchange or market upon
which such Shares are then listed and/or traded, and restrictions under any blue
sky or state securities laws applicable to such Shares.
Article 9: Performance Measures
If an Award is subject to Code Section 162(m) and the Committee determines that
such Award should be designed to comply with the Performance-Based Exception,
the performance measure(s), the attainment of which determine the degree of
vesting, to be used for purposes of such Awards shall be chosen from among
earnings per share, economic value added, market share (actual or targeted
growth), net income (before or after taxes), operating income, return on assets
(actual or targeted growth), return on capital (actual or targeted growth),
return on equity (actual or targeted growth), return on investment (actual or
targeted growth), gross or net underwriting results, revenue (actual or targeted
growth), share price, stock price growth, total shareholder return, or such
other performance measures as are duly approved by the Committee and the
Company's shareholders.
Article 10: Beneficiary Designation
Subject to the terms and conditions of the Plan and the applicable Award
Agreement, each Participant may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom Shares
under the Plan are to be transferred in the event of the Participant's death.
Each such designation shall revoke all prior designations by the same
Participant, shall be in a form prescribed by the Company, and will be effective
only when filed by the Participant in writing during the Participant's lifetime
with the party chosen by the Company, from time to time, to administer the Plan.
In the absence of any such designation, Shares shall be paid to the
Participant's estate following his death.
Article 11: Rights of Participants
11.1 Continued Service. Nothing in the Plan shall:
a) interfere with or limit in any way the right of the Company to terminate
any Participant's employment, service as a Director, or service as a consultant
with the Group at any time, or
b) confer upon any Participant any right to continue in the service of any
member of the Group as an Employee, Director or Consultant.
11.2 Participation. Participation is determined by the Committee. No person
shall have the right to be selected to receive an Award under the Plan, or,
having been so selected, to be selected to receive a future Award.
Article 12: Change in Control
Upon the occurrence of a Change in Control, unless otherwise specifically
prohibited under applicable laws, or by the rules and regulations of any
governing governmental agencies or national securities exchanges, any
restrictions and transfer limitations imposed on Restricted Shares shall
immediately lapse
Article 13: Amendment or Termination
The Board may at any time and from time to time amend or terminate the Plan or
any Award hereunder in whole or in part; provided, however, that no amendment
which requires shareholder approval in order for the Plan to continue to comply
with any applicable tax or securities laws or regulations, or the rules of any
securities exchange on which the securities of the Company are listed, shall be
effective unless such amendment shall be approved by the requisite vote of
shareholders of the Company entitled to vote thereon; provided further that no
such amendment or termination shall adversely affect any Award hereunder without
the consent of the Participant.
Article 14: Withholding
14.1 Tax Withholding. The Company shall have the right to deduct or withhold, or
require a Participant to remit to the Company, an amount sufficient to satisfy
any taxes required by federal, state, or local law or regulation to be withheld
with respect to any taxable event arising in connection with an Award.
14.2 Share Withholding. Participants may elect, subject to the approval of the
Committee, to satisfy all or part of such withholding requirement by having the
Company withhold Shares having a Fair Market Value equal to the minimum
statutory total tax which could be imposed on the transaction. All such
elections shall be irrevocable, made in writing, signed by the Participant, and
shall be subject to any restrictions or limitations that the Committee, in its
sole discretion, deems appropriate.
Article 15: Indemnification
Each person who is or shall have been a member of the Committee, or of the
Board, shall be indemnified and held harmless by the Company to the fullest
extent permitted by applicable law against and from any loss, cost, liability,
or expense that may be imposed upon or reasonably incurred by him or her in
connection with or resulting from any claim, action, suit, or proceeding to
which he or she may be a party or in which he or she may be involved by reason
of any action taken or failure to act under the Plan and against and from any
and all amounts paid by him or her in settlement thereof, with the Company's
approval, or paid by him or her in satisfaction of any judgment in any such
action, suit, or proceeding against him or her, provided he or she shall give
the Company an opportunity, at its own expense, to handle and defend the same
before he or she undertakes to handle and defend it on his or her own behalf.
The foregoing right of indemnification is subject to the person having been
successful in the legal proceedings or having acted in good faith and what is
reasonably believed to be a lawful manner in the Company's best interests. The
foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the Company's
Articles of Incorporation or Bylaws, as a matter of law, or otherwise, or any
power that the Company may have to indemnify them or hold them harmless.
Article 16: Successors
All obligations of the Company under the Plan with respect to Awards granted
hereunder shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.
Article 17: Legal Construction
17.1 Gender and Number. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.
17.2 Severability. In the event any provision of the Plan shall be held illegal
or invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Plan, and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included.
17.3 Requirements of Law. The granting of Awards and the issuance of Shares
under the Plan shall be subject to, and may be made contingent upon satisfaction
of, all applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or national securities exchanges as may be required.
17.4 Governing Law. To the extent not preempted by federal law, the Plan, and
all agreements hereunder, shall be construed in accordance with and governed by
the laws of the state of New Hampshire.
IN WITNESS WHEREOF, this Plan has been executed as of the date first
written above.
UNITIL CORPORATION
s/Mark H. Collin/
By: Mark H. Collin
Its: Treasurer