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EXHIBIT 10.2
NISOURCE INC.
EXECUTIVE DEFERRED COMPENSATION PLAN
EFFECTIVE JANUARY 1, 2004
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ARTICLE I
PURPOSE; EFFECTIVE
DATE...................................................................
1
1.1
Purpose.......................................................................................
1
1.2 Effective
Date................................................................................
1
ARTICLE II
DEFINITIONS...............................................................................
1
2.1
Account.......................................................................................
1
2.2
Beneficiary...................................................................................
2
2.3
Code..........................................................................................
2
2.4
Committee.....................................................................................
2
2.5
Company.......................................................................................
2
2.6
Compensation..................................................................................
2
2.7 Deferral
Commitment...........................................................................
2
2.8 Deferral
Period...............................................................................
2
2.9
Determination
Date............................................................................
2
2.10
Discretionary
Contribution....................................................................
2
2.11
Election
Form.................................................................................
3
2.12
Employer......................................................................................
3
2.13
Participant...................................................................................
3
2.14
Plan..........................................................................................
3
2.15 Retirement
Committee..........................................................................
3
2.16
Severe Financial
Hardship.....................................................................
3
2.17
Gender and
Number.............................................................................
3
ARTICLE III
MERGER OF NISOURCE PLAN AND OTHER
PLANS...................................................
4
3.1 Bay State
Plan................................................................................
4
3.2 Columbia
Plan.................................................................................
4
ARTICLE IV
PARTICIPATION AND DEFERRAL
COMMITMENTS....................................................
4
4.1
Eligibility and
Participation.................................................................
4
4.2 Form and
Amount of
Deferral...................................................................
5
4.3 Deferral
Options..............................................................................
6
4.4
Modification of Deferral
Commitment...........................................................
6
4.5 Change in
Employment
Status...................................................................
6
ARTICLE V
DEFERRED COMPENSATION
ACCOUNT.............................................................
6
5.1
Account.......................................................................................
6
5.2 Timing of
Credits;
Withholding................................................................
6
5.3
Discretionary
Contributions...................................................................
7
5.4
Determination of
Account......................................................................
7
5.5 Vesting of
Account............................................................................
7
5.6 Statement
of
Account..........................................................................
8
ARTICLE VI
INVESTMENTS...............................................................................
8
6.1 Investment
Options............................................................................
8
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6.2 Special
Investment Option for Former Participants in the Bay State Plan
and
Participants in the
Plan......................................................................
8
6.3 Special
Investment Option for Former Participants in the Columbia
Plan........................ 9
ARTICLE VII
PLAN
BENEFITS.............................................................................
10
7.1
Distributions Prior to Termination of
Employment..............................................
10
7.2
Distributions Following Termination of
Employment.............................................
11
7.3 Form of
Benefit
Payment.......................................................................
11
7.4 Valuation
and
Settlement......................................................................
12
7.5
Modification of
Distribution..................................................................
13
7.6
Distribution Provisions Applicable to a Transferred Bay State
Account......................... 13
7.7
Withholding for
Taxes.........................................................................
14
7.8 Payment to
Guardian...........................................................................
14
ARTICLE VIII
BENEFICIARY
DESIGNATION...................................................................
15
8.1
Beneficiary
Designation.......................................................................
15
8.2 Changing
Beneficiary..........................................................................
15
8.3 Community
Property............................................................................
15
8.4 No
Beneficiary
Designation....................................................................
16
ARTICLE IX
ADMINISTRATION............................................................................
17
9.1 Committee;
Duties.............................................................................
17
9.2
Agents........................................................................................
17
9.3 Binding
Effect of
Decisions...................................................................
17
9.4 Indemnity
of Retirement
Committee.............................................................
17
ARTICLE X
CLAIMS
PROCEDURE..........................................................................
18
10.1
Claim.........................................................................................
18
10.2
Review of
Claim...............................................................................
18
10.3
Notice of Denial of
Claim.....................................................................
18
10.4
Reconsideration of Denied
Claim...............................................................
19
10.5
Employer to Supply
Information................................................................
20
ARTICLE XI
AMENDMENT AND TERMINATION OF
PLAN.........................................................
20
11.1
Amendment.....................................................................................
20
11.2
Employer's Right to
Terminate.................................................................
21
ARTICLE XII
MISCELLANEOUS.............................................................................
22
12.1
Unfunded
Plan.................................................................................
22
12.2
Company and Employer
Obligations..............................................................
22
12.3
Unsecured General
Creditor....................................................................
22
12.4
Trust
Fund....................................................................................
22
12.5
Nonassignability..............................................................................
23
12.6
Not a Contract of
Employment..................................................................
23
12.7
Protective
Provisions.........................................................................
24
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12.8
Governing
Law.................................................................................
24
12.9
Validity......................................................................................
24
12.10
Notice........................................................................................
24
12.11
Successors....................................................................................
24
12.12 Tax
Savings
Clause............................................................................
25
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NISOURCE INC.
EXECUTIVE DEFERRED COMPENSATION PLAN
ARTICLE I
PURPOSE; EFFECTIVE DATE
1.1 PURPOSE.
The purpose of this Executive Deferred Compensation
Plan is to provide current tax planning
opportunities as well as supplemental
funds for retirement or death for selected
employees of an Employer. It is
intended that the Plan will aid in
attracting and retaining employees of
exceptional ability by providing them with
these benefits. Effective November 1,
2000, the Bay State Gas Company Key
Employee Deferred Compensation Plan (the
"Bay State Plan") was merged into the
NIPSCO Industries, Inc. Executive Deferred
Compensation Plan (the "NIPSCO Plan"), and
the NIPSCO Plan was renamed the
NiSource Inc. Executive Deferred
Compensation Plan (the "Plan"). Effective
January 1, 2004, the Columbia Energy Group
Deferred Compensation Plan (the
"Columbia Plan") shall be merged into the
Plan.
1.2 EFFECTIVE DATE.
The Plan is effective as of January 1, 2004.
ARTICLE II
DEFINITIONS
For the purposes of the Plan, the following terms shall have
the
meanings indicated, unless the context
clearly indicates otherwise:
2.1 ACCOUNT.
"Account" means the device used by an Employer to
measure and determine the amount to be paid
to a Participant under the Plan.
Each account shall be divided into a
NiSource Account containing contributions
to the Plan and, if applicable, a
Transferred
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Bay State Account containing any amount
transferred from the Bay State Plan or a
Transferred Columbia Account containing any
amount transferred from the Columbia
Plan.
2.2
BENEFICIARY. "Beneficiary" means the person, persons or entity
entitled under Article VIII to receive any
Plan benefits payable after a
Participant's death.
2.3 CODE.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time.
2.4 COMMITTEE.
"Committee" means the Nominating and Compensation
Committee of the Board of Directors of the
Company.
2.5 COMPANY.
"Company" means NiSource Inc., a Delaware
corporation.
2.6
COMPENSATION. "Compensation" means base salary and incentive
awards paid to a Participant during the
calendar year, before reduction for
amounts deferred under the Plan or any
other salary reduction program.
Compensation does not include expense
reimbursements, any form of noncash
compensation, or benefits. Compensation
does not include lump severance payments
or lump sum vacation payout.
2.7 DEFERRAL
COMMITMENT. "Deferral Commitment" means a commitment
made by a Participant to defer Compensation
pursuant to Article IV.
2.8 DEFERRAL
PERIOD. "Deferral Period" means each calendar year.
2.9
DETERMINATION DATE. "Determination Date" means each business
day.
2.10
DISCRETIONARY CONTRIBUTION. "Discretionary Contribution" means
the Employer contribution credited to a
Participant's Account under Section 5.3.
2
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2.11
ELECTION FORM. "Election Form" means the agreement submitted
by a Participant to the Retirement
Committee prior to the beginning of a
Deferral Period, with respect to a Deferral
Commitment made for such Deferral
Period.
2.12
EMPLOYER. "Employer" means the Company and any subsidiary or
affiliate of the Company designated by the
Committee to participate in the Plan.
2.13
PARTICIPANT. "Participant" means any eligible individual who
has elected to defer Compensation under the
Plan.
2.14
PLAN. "Plan" means the NiSource Inc. Executive Deferred
Compensation Plan, as set forth herein and
as amended from time to time.
2.15
RETIREMENT COMMITTEE. "Retirement Committee" means a committee
consisting of the Executive Vice President,
Human Resources and Communications
and the Vice President, Total Rewards of
the Company.
2.16
SEVERE FINANCIAL HARDSHIP. "Severe Financial Hardship" means a
financial hardship to the Participant
resulting from a sudden and unexpected
illness or accident of the Participant or
of a dependent of the Participant, or
loss of the Participant's property due to
casualty, or other similar
extraordinary and unforeseeable
circumstances arising as a result of events
beyond the control of the Participant.
2.17
GENDER AND NUMBER. Except when otherwise required by the
context, any masculine terminology in this
document shall include the feminine,
and any singular terminology shall include
the plural.
3
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ARTICLE III
MERGER OF NISOURCE PLAN AND OTHER PLANS
3.1 BAY STATE
PLAN. As of November 1, 2000, the Bay State Plan was
merged into the Plan. The balance of the
account of each Bay State Plan
participant, determined as of November 1,
2000, was transferred to the Plan and
became the initial balance in such
Participant's Transferred Bay State Account
in the Plan. A Participant's Transferred
Bay State Account shall be held,
administered, invested, and distributed
pursuant to the terms of the Plan.
3.2 COLUMBIA
PLAN. As of January 1, 2004, the Columbia Plan was
merged into the Plan. The balance of the
account of each Columbia Plan
participant, determined as of December 31,
2003, was transferred to the Plan and
became the initial balance in such
Participant's Transferred Columbia Account in
the Plan. A Participant's Transferred
Columbia Account shall be held,
administered, invested, and distributed
pursuant to the terms of the Plan.
ARTICLE IV
PARTICIPATION AND DEFERRAL COMMITMENTS
4.1
ELIGIBILITY AND PARTICIPATION.
(a)
Eligibility. Any employee who was eligible to participate in
the Bay State
Plan or the NIPSCO Plan as of October 31, 2000 remained
eligible to
participate in the Plan as of November 1, 2000. Any employee
eligible to
participate in the Columbia Plan or the Plan as of December 31,
2003 shall be
eligible to participate in the Plan as of the Effective Date.
From and after
the Effective Date, eligibility to participate in the Plan
for a Deferral
Period shall be limited to (1) an employee in job scope
level D2 or
above, and (2) any other key employee of an Employer who is
designated from
time to time by the Committee.
4
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(b)
Participation. An eligible individual may elect to become a
Participant in
the Plan with respect to any Deferral Period by submitting
an Election Form
to the Retirement Committee during the annual enrollment
period,
established by the Retirement Committee, last preceding the
beginning of the
Deferral Period.
(c) Part-Year
Participation. When an individual first becomes
eligible to
become a Participant during a Deferral Period, an Election Form
may be submitted
to the Retirement Committee within thirty (30) days after
the Retirement
Committee notifies the individual of eligibility to
participate.
Such Election Form shall be effective beginning with regard to
Compensation
payable in the next payroll period or as soon as practicable
following
submission of such Election Form to the Retirement Committee.
4.2 FORM AND
AMOUNT OF DEFERRAL. A Participant may elect Deferral
Commitments in the Election Form as
follows:
(a) Salary
Deferral Commitment. A salary Deferral Commitment for a
Deferral Period
shall be related to the base salary payable by an Employer
to a Participant
during that Deferral Period. The amount to be deferred
shall be stated
as a whole percentage of base salary from 5% to 80%.
(b) Incentive
Award Deferral Commitment. An incentive award
Deferral
Commitment for a Deferral Period shall be related to the
incentive
award payable to the
Participant in that Deferral Period. The amount to be
deferred shall
be stated as a whole percentage of the incentive award from
5% to 100%.
No Deferral Commitment shall be made subsequent to the date of
a
Participant's termination of employment
with all Employers.
5
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4.3 DEFERRAL
OPTIONS. A Participant shall make an election in his
Election Form as to the time and form of
payment of the Deferral Commitment for
each Deferral Period. A Participant shall
not be required to designate the same
time and form of payment for each Deferral
Period. However, payments pursuant to
a Deferral Commitment shall not be made or
begin later than the Participant's
date of termination of employment with all
Employers.
4.4
MODIFICATION OF DEFERRAL COMMITMENT. Except as provided in
Sections 7.1(a) and 7.5 below, Deferral
Commitments shall be irrevocable.
4.5 CHANGE IN
EMPLOYMENT STATUS. If the Committee determines that
a Participant's performance is no longer at
a level that deserves reward through
participation in the Plan, but does not
terminate the Participant's employment
with an Employer, the Participant's
existing Deferral Commitment shall terminate
at the end of the current Deferral Period,
and no new Deferral Commitment may be
made by such Participant for any Deferral
Period beginning after notice of such
determination is given by the
Committee.
ARTICLE V
DEFERRED COMPENSATION ACCOUNT
5.1 ACCOUNT.
The Compensation deferred by a Participant under the
Plan, any Discretionary Contributions and
earnings thereon shall be credited to
the Participant's Account. Separate
subaccounts may be maintained to reflect
different forms of distribution, investment
options, levels of vesting, and
forms of payment. The Account shall be a
bookkeeping device utilized for the
sole purpose of determining the benefits
payable under the Plan and shall not
constitute a separate fund of assets.
5.2 TIMING OF
CREDITS; WITHHOLDING. A Participant's deferred
Compensation shall be credited to the
Participant's Account at the time it would
have been payable to the Participant.
6
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Any withholding of taxes or other amounts
with respect to deferred Compensation
that is required by state, federal or local
law shall be withheld from the
Participant's nondeferred Compensation to
the maximum extent possible and any
remaining amount shall reduce the amount
credited to the Participant's Account.
5.3
DISCRETIONARY CONTRIBUTIONS. An Employer may make
Discretionary Contributions to a
Participant's Account. Discretionary
Contributions shall be credited at such
times and in such amounts as the
Committee in its sole discretion shall
determine.
5.4
DETERMINATION OF ACCOUNT. Each Participant's Account as of
each Determination Date shall consist of
the balance of the Account as of the
immediately preceding Determination Date,
adjusted as follows:
(a) New
Deferrals. The Account shall be increased by any
deferred Compensation credited since such preceding Determination
Date.
(b) Discretionary
Contributions. The Account shall be
increased by any Discretionary Contributions credited since
such
preceding Determination Date.
(c)
Distributions. The Account shall be reduced by any
benefits distributed from the Account to the Participant since
such
preceding Determination Date.
(d) Valuation
of Account. The Account shall be increased
or decreased by the aggregate earnings, gains and losses on
such
Account since such preceding Determination Date.
5.5 VESTING OF
ACCOUNT. Each Participant shall be vested in the
amounts credited to such Participant's
Account and earnings thereon as follows:
7
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(a) Amounts
Deferred. A Participant shall be one hundred
percent (100%) vested at all times in the amount of
Compensation
elected to be deferred under the Plan, and earnings thereon.
(b)
Discretionary Contributions. A Participant's
Discretionary Contributions, and earnings thereon, shall become
vested
as determined by the Committee.
(c)
Transferred Account. A Participant shall be one
hundred percent (100%) vested at all times in the balance of
his
Transferred Bay State Account or Transferred Columbia Account, if
any.
5.6 STATEMENT
OF ACCOUNT. The Retirement Committee shall give to
each Participant a statement showing the
balance in the Participant's Account on
a quarterly basis and at such other times
as may be determined by the Retirement
Committee.
ARTICLE VI
INVESTMENTS
6.1 INVESTMENT
OPTIONS. Amounts credited hereunder to the Account
of a Participant shall be invested as such
Participant elects among the
investment choices set forth on Exhibit A
or available pursuant to Section
