EXHIBIT A 10.17
CENTRAL VERMONT PUBLIC SERVICE
CORPORATION
MANAGEMENT INCENTIVE PLAN
2009
Execution Copy
April, 2009
CENTRAL VERMONT PUBLIC SERVICE
CORPORATION
MANAGEMENT INCENTIVE PLAN
Effective as of January 1,
2009
TABLE OF CONTENTS
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ARTICLE
I
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INTRODUCTION
AND PURPOSE
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Page
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1.1
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Purpose of the
Plan
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1
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ARTICLE
II
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DEFINITIONS
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2.1
2.2
2.3
2.4
2.5
2.6
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"Annual
Incentive Award"
"Award Payment
Date"
"Base
Salary"
"Board" or
"Board of Directors"
"Change in
Control"
"Code"
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2
2
2
2
2
2
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2.7
2.8
2.9
2.10
2.11
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"Committee"
"Company"
"Effective
Date"
"Eligible
Employees"
"For
Cause"
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2
2
3
3
3
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2.12
2.13
2.14
2.15
2.16
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"Participant"
"Performance
Goals"
"Performance
Period"
"Permanent and
Total Disability"
"Plan"
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3
3
3
4
4
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2.17
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"Target
Potential"
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4
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ARTICLE
III
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PARTICIPATION
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3.1
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Participation
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5
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ARTICLE
IV
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PERFORMANCE
GOALS AND AWARD OPPORTUNITIES
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4.1
4.2
4.3
4.4
4.5
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Performance
Goals
Performance
Levels
Participant
Goals
Target
Potential
Amount of
Award
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6
6
6
7
7
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ARTICLE
V
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DETERMINATION
AND PAYMENT OF ANNUAL INCENTIVE AWARDS
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5.1
5.2
5.3
5.4
5.5
5.6
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Timing and
Determination of Annual Incentive Awards
Short
Performance Year
Death or
Permanent and Total Disability
Termination or
Retirement
Change in
Control
Limitation on
Right to Payment of Award
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9
9
10
10
10
10
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ARTICLE
VI
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ADMINISTRATION
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6.1
6.2
6.3
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Committee
Authority of
the Committee
Costs
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11
11
11
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ARTICLE
VII
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MISCELLANEOUS
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7.1
7.2
7.3
7.4
7.5
7.6
7.7
7.8
7.9
7.10
7.11
7.12
7.13
7.14
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Amendment
Termination
Employment
Rights
Nonalienation
of Benefits
No
Funding
Tax
Withholding
Controlling
Laws
Gender and
Number
Action by the
Company
Mistake of
Fact
Severability
Effect of
Headings
No
Liability
Successors
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12
12
12
13
13
13
13
13
13
13
14
14
14
14
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ARTICLE I
INTRODUCTION AND
PURPOSE
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1.1
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Purpose of
the Plan . The Central
Vermont Public Service Corporation Management Incentive Plan (the
"Plan") is an incentive compensation program for eligible officers
of Central Vermont Public Service Corporation (the
"Company”). The purpose of the Plan is to focus
the efforts of the Executive Team on achieving challenging and
demanding annual performance objectives. The Plan is
designed and intended to further the attainment of the customer
service, financial, process improvement and employee related
objectives of the Company, to assist the Company in attracting and
retaining highly qualified executives, and to enhance the mutual
interest of customers, shareholders and eligible officers of the
Company. In addition, this Plan supports the Company's
performance oriented culture.
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ARTICLE II
DEFINITIONS
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2.1
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" Annual
Incentive Award " shall mean a cash incentive payable to a
Participant under the terms of this Plan.
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2.2
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" Award
Payment Date " shall mean, for each Performance Period, the
date that the amount of the Annual Incentive Award for that
Performance Period shall be paid to the Participant under Article V
of the Plan.
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2.3
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" Base
Salary " shall mean a Participant's annualized salary for the
Performance Period for which the amount of an Annual Incentive
Award is being determined.
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2.4
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" Board" or
"Board of Directors " shall mean the Board of Directors of the
Company.
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2.5
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" Change in
Control " shall have, in the case of each Participant
under the Plan, the meaning provided for in the Change in
Control Agreement, if any, between each Participant and the
Company. In the absence of a Change in Control Agreement with
a Participant, Change in Control shall have, with respect to such
Participant, the meaning provided for in the standard Change in
Control Agreement approved by the Board as the same may be amended
from time to time.
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2.6
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" Code "
shall mean the Internal Revenue Code of 1986, as amended, and
references to particular provisions of the Code shall include any
amendments thereto or successor provisions and any rules and
regulations promulgated thereunder.
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2.7
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"
Committee " shall mean the Compensation Committee of the
Board of Directors of the Company or any other duly established
committee or subcommittee appointed by the Board for purposes of
this Plan.
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2.8
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"
Company " shall mean Central Vermont Public Service
Corporation, a Vermont corporation.
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2.9
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" Effective
Date " shall mean January 1, 2009. The Plan shall be
effective for the Performance Period beginning on January 1,
2009.
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2.10
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"Eligible
Employee " shall mean the
Chief Executive Officer (CEO) of Central Vermont Public Service
Corporation and other executive officers of the Company.
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2.11
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" For
Cause " shall mean, but is not limited to, (i) the willful
failure by Executive substantially to perform Executive’s
duties with Company or a Subsidiary, (other than any failure
resulting from Executive’s incapacity due to
Executive’s Disability, or any actual failure after the
issuance of a Notice of Termination for Good Reason by Executive
that continues for at least 30 calendar days after the Board
delivers to Executive a written demand for performance that
identifies specifically and in detail the manner in which the Board
believes that Executive willfully has failed substantially to
perform Executive’s duties,
(ii) a
conviction, guilty plea or plea of nolo contendere of Executive for
any felony,
(iii) the
willful engaging by Executive in misconduct that is demonstrably
and materially injurious to Company or any Subsidiary, monetarily
or otherwise,
(iv) a material
violation by Executive of the corporate governance guidelines and
code of ethics of Company or any Subsidiary; or
(v) a material
violation by Executive of the requirements of the Sarbanes-Oxley
Act of 2002 or other federal or state securities law, rule or
regulation.
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2.12
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"
Participant " for a Performance Period shall mean each
Eligible Employee who is an Eligible Employee for that Performance
Period.
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2.13
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"
Performance Goals " shall mean the measures of the Company's
performance as defined in Section 4.1 of this Plan that must be met
for any Participant to receive any Annual Incentive Award under
this Plan, as provided in Section 4.1.
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2.14
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"
Performance Period " shall mean the taxable year of the
Company or any other period designated by the Committee with
respect to which an Annual Incentive Award may be
granted.
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2.15
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" Permanent
and Total Disability " shall mean any disability that would
qualify as permanent and total disability under any long term
disability policy sponsored by the Company.
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2.16
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Plan shall mean this Central Vermont Public Service
Corporation Management Incentive Plan, as it may be amended from
time to time.
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2.17
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Target
Potential shall mean the
targeted percentage of Base Salary for each Participant.
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ARTICLE III
PARTICIPATION
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3.1
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Participation . An Eligible Employee will become a Participant
in this Plan as of the later of the Effective Date, the Eligible
Employee's date of hire or the date the individual becomes an
Eligible Employee.
An Eligible
Employee who is a Participant for the entire length of a
Performance Period shall be eligible for consideration for an
Annual Incentive Award with respect to that Performance
Period.
The Committee
may provide a prorated Annual Incentive Award for an Eligible
Employee who becomes a Participant during the Performance
Period.
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ARTICLE IV
PERFORMANCE GOALS AND AWARD
OPPORTUNITIES
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4.1
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Performance
Goals . The measures of
Performance Goals are established as follows:
(a) Company Balanced Business
Performance. Measures the overall company performance,
through a balanced set of measures established annually, including
customer satisfaction, financial performance, process improvement
and employee measures.
(b) Individual Performance. Based on advice and
recommendation from the Chief Executive Officer (CEO) for those
reporting to him, the Committee and Board evaluate each
Participant’s individual performance compared to performance
objectives set early in the year. The Chairman of the
Board and Committee evaluate the CEO’s performance versus his
performance objectives. This individual performance
measure is at the full discretion of the Board.
Company and
Individual Performance Goals will be established in writing for
each Performance Period by no later than the first quarter of the
Performance Period. The Company Balanced Business
Performance is weighted 80%, and Individual Performance has a 20%
weight.
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4.2
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Performance
Levels . Company measures described in
Section 4.1 will be established for three performance levels:
threshold, target and maximum. To the extent possible,
these levels are set based on the following
probabilities: 90% probability of achieving the
threshold level; 50% probability of achieving target level; and 10%
probability of achieving the maximum level.
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4.3
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Participant
Goals . Participants will
have a combination of Company Balanced Business Performance and
Individual Performance measured goals used in determining any
Annual Incentive Award as described in 4.1 above.
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4.4
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Target
Potential . For each Performance Period, the
Committee and Board set the target potential measured as a
percentage of Base Salary for each eligible
employee. &nb
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