THE WAGNER-SMITH COMPANY
DEFERRED COMPENSATION PLAN
Effective June 30, 2000
THE
WAGNER-SMITH COMPANY DEFERRED COMPENSATION PLAN
This The
Wagner-Smith Company Deferred Compensation
Plan (the "Plan") is adopted by The
Wagner-Smith Company, an Ohio
corporation, (the "Company") for the
purpose of providing an
inducement for continued service by
designated key employees of
the Company following the acquisition of
the Company by Utility
Services, Inc. ("USI"). Benefits due under the Plan
constitute a
mere promise by the Company to pay benefits
as the Plan provides.
Accordingly, Participants are general
unsecured creditors of the
Company with respect to their benefit, and
the Plan is unfunded
for tax purposes.
ARTICLE I
ADOPTION OF PLAN; PARTICIPATION
The Plan is adopted this 30th day of June, 2000,
subject to the condition that not later
than July 3, 2000, all of
the outstanding stock of the Company will
be acquired by USI in a
taxable purchase. Each person listed on Schedule A
shall be a
Participant in the Plan provided that such
person is an employee
of the Company in good standing on the
Effective Date.
ARTICLE II
VESTING; DISPOSITION OF FORFEITED SHARES
2.1 Vesting.
Except as provided
below, in order to become
entitled to receive the balance in the
Participant's Account
maintained pursuant to Section 3.1, a
Participant must be
continuously employed by the Company from
the Effective Date
until the Vesting Date set forth opposite
the Participant's name
on Schedule A (the "Vesting Date").
A Participant who voluntarily terminates employment or
is Terminated for Cause shall forfeit the
balance in the
Participant's Account effective on the date
that employment
ceases. A Participant who dies or becomes
totally disabled
before the Vesting Date shall be entitled
to receive the balance
in the Participant's Account maintained
pursuant to Section 3.1.
If the Company terminates a Participant
prior to the Vesting Date
but that termination is not within the
meaning of Terminated for
Cause, the Participant shall be entitled to
receive the balance
in the Participant's Account maintained
pursuant to Section 3.1.
"Terminated for Cause" means with the approval of
Philip H. Wagner a termination of a
Participant's employment
whenever occasioned by (i) criminal
conduct, (ii) failure of the
Participant to perform his duties with the
skill, knowledge, and
diligence reasonably expected of personnel
in similar positions
or refusal to carry out such reasonable
tasks as reasonably
directed, (iii) refusal to perform
employment duties on a full-
time basis, (iv) refusal to act in
accordance with any lawful
instructions of a more senior employee, or
(v) misconduct which
could be seriously damaging to the Company
without a reasonable
good faith belief by the Participant that
his conduct was in the
best interest of the Company.
2.2 Disposition of
Forfeited Shares. If
the MDU Shares credited
to any Participant's Account are forfeited
pursuant to Section
2.1, the Company shall notify the Trustee
of the forfeiture, and
the Trustee shall forthwith deliver the
forfeited shares to MDU.
ARTICLE III
CREDITS AND CHARGES TO ACCOUNTS
3.1 Account.
An Account shall be
established and maintained for
each Participant, which Account shall be
credited with the dollar
amounts set forth opposite the
Participant's name on Schedule A.
On the Effective Date, the dollar amount
credited to the account
of each Participant shall be converted into
a number of MDU
Shares equal to the quotient of such dollar
amount divided by the
MDU Stock Price (as defined in the
Acquisition Agreement dated as
of June 30, 2000, pursuant to which the
Acquisition was
consummated). Following such conversion, and
subject to all of
the terms and conditions of this Plan, the
Participants shall be
entitled to receive the MDU Shares credited
to their accounts
rather than the cash amount referred to in
the first sentence of
this Section 3.1. The Participant's Account shall be
charged
with distributions, income taxes and any
other amounts required
to be withheld under Section 4.6.
3.2 Earnings.
The Earnings to be
credited to a Participant's
Account shall be equal to the dividends
declared and paid from
time to time with respect to the number of
MDU Shares then
credited to the Participant's Account.
ARTICLE IV
DISTRIBUTIONS
4.1 No Withdrawals.
Except as otherwise
provided in this article,
withdrawals are not available from a
Participant's Account.
4.2 Timing of
Distribution. The
Earnings credited to a
Participant's Account shall be distributed
forthwith to the Participant,
subject to tax withholding pursuant to
Section 4.6. The MDU
Shares credited
to a Participant's Account shall be paid on
the Vesting Date if the
Participant has been continuously employed
by the Company from
the Effective Date of this Plan until the
Vesting Date.
4.3 Death Benefits.
Should a Participant
die before the
Vesting Date, the Account shall be paid to
the Participant's Beneficiary
under Article V, provided that the
Participant has been continuously
employed by the Company from the Effective
Date of the Plan until
the date of the Employee's death.
4.4 Limitation on
Distributions to Covered Employees.
Notwithstanding any other provision of this
article,
if a Participant is a "covered employee" as
defined in Code
Section 162(m)(3) at the time of any
distribution, the maximum
amount which may be distributed from such a
Participant's Account
in any Plan Year shall not exceed
$1,000,000, less the amount of
compensation paid to the Participant by the
Company in such Plan
Year which is not "performance-based" (as
defined in Code Section
162(m)(4)(C)). Such amount shall be reasonably
determined by the
Administrator at the time of the proposed
distribution. Any
amount not distributed to a Participant in
a Plan Year as a
result of the limitation set forth in this
section shall be
distributed in the next Plan Year, which
may again be subject to
the limitation of this section.
4.5 Payments to Minors
and Incompetents. If
any person
entitled to any payment under this Plan is,
in the judgment of
the Administrator, incapable of giving
receipt for such payment
because of minority, illness, infirmity or
other incapacity,
the Administrator may pay the amount due
such person to a duly
appointed legal representative, if there is
one, or, if none,
to the spouse, children, dependents, or
such other persons with
whom the person entitled to payment
resides. Any such
payment
shall be a complete discharge of the
liability of the Company,
its Affiliates, and the Plan with respect
to such payment.
4.6 Tax Withholding.
The Company shall
deduct from
any payment or share delivery made under
this Plan an amount equal
to, or shares having a value equal to, all
or part of the federal, state
and local taxes required by law to be
withheld by the Company
(including but not limited to any amount
that may be necessary to
satisfy applicable income tax withholding
an
