EXHIBIT 10.28a
UIL HOLDINGS
CORPORATION
________________________________
CHANGE IN CONTROL SEVERANCE PLAN
II
Originally effective October 24,
2003
As amended and restated August 4,
2008
________________________________
ARTICLE I
Purpose of
Plan
1.1 The
purpose of the UIL Holdings Corporation Change in Control Severance
Plan (“Plan”) is to provide the officers and certain
other executive employees of UIL Holdings Corporation
(“UIL”), The United Illuminating Company and any other
wholly-owned direct or indirect subsidiary of UIL (UIL and its
subsidiaries each referred to herein as an “Employing
Company” and collectively, along with any successor, as the
“Company”) with appropriate assurances of continued
income and other benefits for a reasonable period of time in the
event that the individual’s employment with the Company is
terminated under any of the circumstances described herein, thereby
encouraging the continued attention and dedication of each such
employee to the continued success of the Company.
ARTICLE II
Eligibility for
Participation
2.1 The
Board of Directors of UIL (the “UIL Board”) shall, from
time to time and in its absolute discretion, (i) select the persons
to be covered by the Plan (each a “Participant”), (ii)
determine the classification and benefit levels applicable to such
Participant, and (iii) direct that each Participant be notified of
this selection and provided with a copy of the Plan.
2.2 Participation
in the Plan shall not in any respect be deemed to grant the
Participant a right to continued participation in the Plan; nor
shall participation in the Plan be deemed to grant the Participant
a right to continued employment by the Company.
2.3 A
Participant may be a party to an employment agreement with an
Employing Company that provides for the payment of severance and
other benefits to such Participant under certain circumstances
which constitute an Involuntary Separation from
Service. In the event that a Change in Control has
occurred, as defined in this Plan, and thereafter the Participant
experiences an Involuntary Separation from Service as described in
Section 4.2, below, except as otherwise expressly provided herein
or in the Participant’s employment agreement, benefits under
this Plan shall be paid in lieu of the benefits to which the
Participant would or may be entitled to on account of an
Involuntary Separation from Service pursuant to the terms of the
Participant’s employment agreement and in lieu of any
benefits a Participant may be eligible for under any severance plan
or policy of the Company that is generally applicable to employees
of the Company.
2.4 Notwithstanding
the foregoing, nothing in this Plan shall impair a
Participant’s rights to (a) regular compensation and benefits
through the date of the Participant’s Separation from
Service; (b) deferred compensation and other employee benefits
otherwise payable to a Participant in accordance with the terms of
the Participant’s employment agreement and/or Company plans
or arrangements on account of a Separation from Service which are
not contingent on the Separation from Service being an Involuntary
Separation from Service; or (c) compensation that is payable on
account of a non-compete agreement (or comparable provisions in
such Participant’s employment agreement), regardless of
whether eligibility for such compensation shall arise either before
or after a Change in Control.
ARTICLE III
Effect of Change in Control on
Modification or Termination
3.1 Termination
or suspension of the Plan, or any amendment of the Plan that
impairs the rights of any Participant, occurring on or after a
Change in Control, as defined herein, shall not take effect until
twenty-four (24) months after the occurrence of such Change in
Control.
3.2 Subject
to Section 3.1, above, the UIL Board may, at any time and from time
to time, remove a Participant from the Plan, or modify or amend, in
whole or in part, any or all of the provisions of the Plan, or
suspend or terminate it entirely.
ARTICLE IV
Eligibility for
Benefits
4.1 A
“Change in Control” of UIL or any subsidiary (an
“Employing Company”) occurs on the date on which any of
the following events occur: a change in the ownership of
the Employing Company; a change in the effective control
of the
Employing
Company; and a change in the ownership of a substantial portion of
the assets of the Employing Company.
(a) A
change in the ownership of the Employing Company occurs on the date
on which any one person, or more than one person acting as a group,
acquires ownership of stock of the Employing Company that, together
with stock held by such person or group constitutes more than 50%
of the total fair market value or total voting power of the stock
of the Employing Company.
(b) A
change in the effective control of the Employing Company occurs on
the date on which either (i) a person, or more than one person
acting as a group, acquires ownership of stock of the Employing
Company possessing 30% or more of the total voting power of the
stock of the Employing Company, taking into account all such stock
acquired during the 12-month period ending on the date of the most
recent acquisition, or (ii) a majority of the members of the
Employing Company’s Board of Directors is replaced during any
12-month period by directors whose appointment or election is not
endorsed by a majority of the members of such Board of Directors
prior to the date of the appointment or election, but only if no
other corporation is a majority shareholder of the Employing
Company.
(c) A
change in the ownership of a substantial portion of assets occurs
on the date on which any one person, or more than one person acting
as a group, other than a person or group of persons that is related
to the Employing Company, acquires assets from the Employing
Company that have a total gross fair market value equal to or more
than 50% of the total gross fair market value of all of the assets
of the Employing Company immediately prior to such acquisition or
acquisitions, taking into account all such assets acquired during
the 12-month period ending on the date of the most recent
acquisition.
(d) An
event constitutes a Change in Control with respect to a Participant
only if the Participant performs services for the Employing Company
that has experienced the Change in Control, or the
Participant’s relationship to the affected Employing Company
otherwise satisfies the requirements of Treasury Regulation
§1.409A-3(i)(5)(ii).
(e) In
determining whether a person or group has acquired a percentage of
stock, stock of the Company held pursuant to the terms of an
employee benefit plan of the Company (or any subsidiary thereof) in
a suspense account or otherwise unallocated to a
participant’s account shall be disregarded to the extent that
expressing the applicable percentage as a fraction, such shares
shall not be included in the numerator, but such shares will be
included in the denominator.
(f) The
determination as to the occurrence of a Change in Control shall be
based on objective facts and in accordance with the requirements of
Internal Revenue Service Code (“Code”)
§409A.
4.2 If
an Employing Company (or its successor) terminates a
Participant’s employment involuntarily other than for Cause,
as defined in Section 4.4 below, and under circumstances
constituting an Involuntary Separation from Service, as defined in
Section 4.3, below, during the 24-month period beginning on the
date a Change in Control with respect to the Participant occurs,
the benefits described in Article V hereof shall become payable to
the Participant. Likewise, if a Participant has an
Involuntary Separation from Service after a Constructive
Termination Event, as defined in Section 4.3, below, during the
24-month period beginning on the date a Change in Control with
respect to the Participant occurs and the Participant’s
Employing Company (or its successor) did not have Cause (as defined
in Section 4.4, below) to terminate the Participant’s
employment, the benefits described in Article V hereof shall become
payable to the Participant.
4.3 Involuntary
Separation from Service means a Separation from Service due to the
independent exercise of the unilateral authority of the
Participant’s Employing Company (or its successor) to
terminate the Participant’s employment, other than due to the
Participant’s implicit or explicit request, where the
Participant was willing and able to continue working for the
Employing Company (or its successor).
(a) A
voluntary Separation from Service will be treated as an Involuntary
Separation from Service by the Company for purposes of this Plan if
the Separation from Service occurs under the following
circumstances:
(1) One
(or more) of the following events arises without the consent of the
Participant (a “Constructive Termination
Event”):
(i) A
material diminution in the Participant’s annual Base Salary,
unless such reduction is part of, and consistent with, a general
reduction of the compensation rates of all employees of the
Participant’s Employing Company;
(ii) A
material diminution in the Participant’s authority, duties,
or responsibilities, including the assignment of duties
inconsistent in any material adverse respect with such
Participant’s position, duties, responsibilities and status
with the Participant’s Employing Company immediately prior to
the Change in Control, or material diminishment in such
Participant’s management responsibilities, duties or powers
as in effect immediately prior to the Change in Control, or the
removal from or failure to re-elect such Participant to any such
position or office;
(iii) A
requirement that the Participant relocate his or her principal
place of employment by more than seventy-five (75) miles from such
location immediately prior to the Change in Control; or
(iv) Any
other action or inaction that constitutes a material breach by the
Participant’s Employing Company (or its successor) of the
agreement under which the Participant provides services, including
(1) a failure to include the Participant in the management salary
compensation programs then in effect on substantially the same
terms and conditions as that applicable to the other officers or
similarly situated executives of the Company; (2) a failure to
continue the Participant’s participation in the material
benefit plans of the Participant’s Employing Company (or its
successor) on substantially the same basis, both in terms of the
amount of benefits provided (other than due to the Company’s
stock price performance, provided such performance is a relevant
criterion in determining the amount of benefits) and the level of
the Participant’s participation relative to other officers or
similarly situated executives of the Company, as that in effect
immediately prior to the Change in Control; (3) a failure to renew
the Participant’s employment agreement at the time such
agreement expires, provided that the Participant was willing and
able to execute a new agreement providing terms and conditions
substantially similar to those in the expiring agreement and to
continue working for the Company; or (4) any successor to UIL fails
to assume and adopt this Plan for a period of no less than
twenty-four (24) months following a Change in Control;
and
(2) Within thirty-one (31) days of
the occurrence of the Constructive Termination Event the
Participant has given notice to the UIL Board (or the governing
board of its successor) stating that, in the Participant’s
opinion, a Constructive Termination Event has occurred and setting
forth in reasonable detail the relevant facts; and
(3) The Company shall fail to remedy
or otherwise cure the situation within thirty-one (31) days after
receipt of the notice described in (2), above; and
(4) The Separation from Service
occurs within 90 days of the initial occurrence of the Constructive
Termination Event; and
(5) Until the Separation from
Service, the Participant was willing and able to continue working
for the Company and the Company did not have grounds to terminate
the Participant’s employment for Cause.
(b) Whether
an Involuntary Separation from Service has occurred will be
determined in accordance with Treasury Regulation
§1.409A-1(n).
(c) “Separation
from Service” means a Separation from Service within the
meaning of Code §409A and related regulations. The
UIL Board (or its successor) will determine, in accordance with
Code §409A, whether a Separation from Service has
occurred.
(1) A Participant incurs a Separation
from Service upon termination of employment with the Company and
all affiliates. For purposes of determining whether
another entity is an affiliate of the Company, common ownership of
at least 50% shall be determinative.
(2) Except in the case of an
Participant on a bona fide leave of absence, a Participant is
deemed to have incurred a Separation from Service if the Company
and the Participant reasonably anticipated that the level of
services to be performed by the Participant after a date certain
would be reduced to 20% or less of the average services rendered by
the Participant during the immediately preceding 36-month period
(or the total period of employment, if less than 36 months),
disregarding periods during which the Participant was on a bona
fide leave of absence.
(3) The UIL Board specifically
reserves the right to determine whether a sale or other disposition
of substantial assets to an unrelated party constitutes a
Separation from Service with respect to a Participant providing
services to the seller immediately prior to the transaction and
providing services to the buyer after the
transaction. Such determination shall be made in
accordance with the requirements of Code §409A.
4.4 For
the purposes of the Plan, an Employing Company (or its successor)
shall be deemed to have Cause to terminate a Participant’s
employment only upon such Participant’s (A) commission of a
serious crime, such as an act of fraud, misappropriation of funds,
embezzlement, or a crime involving personal dishonesty or moral
turpitude; or (B) willful failure of the Participant to
substantially perform his or her duties (other than by reason of
incapacity due to physical or mental illness or injury); or (C)
misconduct that is demonstrably injurious to the Company or its
affiliates. The placement of an executive on paid leave
for up to ninety (90) days pending a determination of whether or
not there is a basis to terminate the executive fo
