THE
OREGON ELECTRIC CONSTRUCTION, INC.
DEFERRED COMPENSATION PLAN
Effective September 14, 2001
OREGON ELECTRIC CONSTRUCTION, INC.
DEFERRED COMPENSATION PLAN
This is the
Oregon Electric Construction, Inc. Deferred
Compensation Plan (the "Plan"), and is
adopted by OREGON ELECTRIC
CONSTRUCTION, INC., an Oregon corporation
(the "Company"), for
the purpose of providing an inducement for
continued service by
designated key employees of the Company
following the purchase of
all of the capital stock of the Company by
UTILITY SERVICES,
INC., a Delaware corporation (the
"Purchase"). Benefits
due
under the Plan constitute a mere promise by
the Company to pay
benefits as the Plan provides. Participants are general
unsecured creditors of the Company with
respect to their
benefits, and the Plan is unfunded for tax
purposes. Because
the
Plan does not systematically delay the
payment of benefits until
retirement or termination of employment, it
is not a pension
benefit plan subject to the Employee
Retirement Income Security
Act of 1974, as amended. This document contemplates the
establishment of a trust after the Purchase
for the purpose of
holding MDU Shares under this Plan, subject
to the claims of the
general creditors of the Company and
MDU.
ARTICLE I
ADOPTION OF PLAN; PARTICIPATION
The Plan is
adopted effective this 14th day of September,
2001; provided, however, that the Plan
shall automatically
terminate (and any Account balances shall
be forfeited entirely)
on the 30th day thereafter if the Purchase
has not then occurred.
Each individual listed on Schedule A shall
be a Participant,
provided that such individual is an
employee of the Company in
good standing on the Purchase Date.
ARTICLE II
VESTING AND FORFEITURES
2.1 Vesting. Except as provided otherwise in
this section,
a Participant shall vest in his or her
Account on the Vesting
Date if the Participant does not incur a
Termination before the
Vesting Date. A Participant who, before the
Vesting Date, incurs
a Termination shall forfeit the balance in
his or her Account
effective on the date of the Termination;
provided, however, that
the Account shall not be forfeited if the
Termination (i) results
from the Participant's death or total
disability before the
Vesting Date or (ii) is involuntary and is
not a Termination for
Cause. A reduction in base salary, and a
substantial reduction
in duties or responsibilities, shall each
constitute sufficient
reason for the Participant's Termination to
be deemed
involuntary, provided the Company has had
sufficient notice and
opportunity to correct such a change in the
terms of the
Participant's employment.
2.2 Disposition of Forfeited Shares.
If the MDU Shares
credited to any 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's
Secretary.
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 Purchase Date, the dollar
amount credited
to each Participant's Account shall be
converted into a number of
whole MDU Shares equal to the quotient of
such dollar amount
divided by the MDU Stock Price (as defined
in the Stock Purchase
Agreement dated as of September 14, 2001,
pursuant to which the
Purchase was consummated), such number
rounded up or down in an
appropriate manner determined by the
Administrator.
Following
such conversion, and subject to all of the
terms and conditions
of this Plan, each Participant shall be
entitled to receive the
MDU Shares credited to his Account rather
than the dollar amount
set forth in Schedule A. Each Account shall be charged
with
distributions, income taxes and any other
amounts required to be
withheld under Section 4.6.
3.2 Earnings. Earnings to be credited to an
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
Account.
ARTICLE IV
DISTRIBUTIONS
4.1 No Withdrawals. Except as otherwise provided in
this
article, withdrawals are not available from
an Account.
4.2 Timing of Distribution.
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
not incurred a
Termination before the Vesting Date as
described in Section 2.1.
4.3 Death or Disability. Should a Participant die or
become totally disabled before incurring a
Termination, the
Participant's Account shall vest in full
and be paid to his or
her Beneficiary under Article V (or to the
Participant, in the
case of disability) as soon as is
practicable.
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, MDU and
its Affiliates, and the Plan with respect
to such payment.
4.6 Tax Withholding. The Company (or Trustee, as the
case
may be) 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 and employment tax
obligations, as well as
the Company's portion of all such
applicable taxes), all
garnishments, and any other amounts
required to be withheld by
applicable law or court order.
ARTICLE V
BENEFICIARY DESIGNATIONS
5.1 Designation of Beneficiary.
Each Participant
may
designate, in the form and the manner
specified by the
Administrator, a Beneficiary to receive the
payment (if any) due
under Article IV at the Participant's
death. The Beneficiary
of
a married Participant shall be the
Participant's spouse, unless
the Participant designates a Beneficiary
other than the spouse
and the spouse consents in writing to the
designation in the form
and the manner prescribed by the
Administrator. A
Participant
may revoke such designation at any time and
substitute therefor
another Beneficiary. A married Participant may revoke a
prior
Beneficiary designation only with the
consent of his or her
spouse in the form and the manner
prescribed by the
Administrator. A designated spousal Beneficiary
who becomes
divorced from the Participa
