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Exhibit 10a(5)
PUBLIC SERVICE ENTERPRISE GROUP
INCORPORATED
2007 EQUITY COMPENSATION PLAN FOR OUTSIDE DIRECTORS
The
purpose of this Public Service Enterprise Group Incorporated 2007
Equity Compensation Plan for Outside Directors is to advance the
interests of the Company and its stockholders by assisting the
Company in attracting and retaining individuals of superior talent,
ability and achievement to serve on its Board of
Directors.
It
is intended that the Plan will be interpreted and administered to
prevent taxation under Section 409A of the Code. Any provision of
or amendment to this Plan that would cause any amount to be taxable
under Section 409A with respect to any individual is void and
without effect. Any election by any participant, and any
administrative action by the Committee that would cause any amount
to be taxable under Section 409A with respect to any individual is
void and without effect under the Plan. In the event that a
Participant fails to make a Section 409A-compliant payment
election, the Plan’s default payment provisions, as set forth
in Subsection V.G and Article VIII, shall apply. It is further
intended that the Plan will be amended in accordance with present
and future guidance issued by the Treasury Department under Section
885 of the American Jobs Creation Act of 2004.
The
following words and phrases shall have the meanings set forth below
unless a different meaning is required by the context:
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a)
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Annual Meeting : The Annual Meeting of
Stockholders of the Company.
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b)
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Board : The Board of Directors of the
Company.
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c)
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Code : The Internal Revenue Code of 1986,
as amended.
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d)
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Committee : Those persons who are members
of the Board but who are not Outside Directors.
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e)
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Common Stock : The Common Stock without
nominal or par value of the Company.
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f)
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Company : Public Service Enterprise Group
Incorporated, a corporation organized and existing under the laws
of the State of New Jersey, or its successor or
successors.
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g)
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Disability : Any physical or mental
condition of a permanent nature which, in sole reasonable judgment
of the Committee, renders an Outside Director incapable of
performing the duties of a member of the Board.
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h)
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Effective Date : Upon approval by
stockholders at the 2007 Annual Meeting of Stockholders.
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i)
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Exchange Act : The Securities and Exchange
Act of 1934, as amended, or as it may be amended from time to
time.
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j)
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NYSE : The New York Stock Exchange,
Inc.
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k)
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Outside Director : A member of the Board
on or after the Effective Date who never has been employed by the
Company or any of its affiliates.
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l)
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Participant: An Outside Director who
receives a Stock Unit Award under this Plan.
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m)
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Plan : This Public Service Enterprise
Group Incorporated 2007 Equity Compensation Plan for Outside
Directors, as it may be amended from time to time.
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n)
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Securities Act : The Securities Act of
1933, as amended, or as it may be amended from time to
time.
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o)
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Service : A Director’s service as a
member of the Board.
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p)
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Stock Unit Award : An award, representing
the right to receive shares of Common Stock upon termination of
service as an Outside Director, subject to the provisions of
Article IV hereof.
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q)
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Year of Service : The annual period
commencing on May 1 st of each year and ending at the
earlier of the succeeding April 30 th or the next Annual
Meeting of Stockholders. For any person first elected a member of
the Board after May 1 st of any year, his/her first Year
of Service shall commence upon his/her election as a Director and
shall end at the earlier of the succeeding April 30 th
or the next Annual Meeting of Stockholders.
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III.
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SHARES SUBJECT TO THE PLAN
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200,000
shares of Common Stock are reserved to satisfy awards of Stock
Units pursuant to the terms of this Plan. Such shares may be
acquired directly from the Company or, at the discretion of the
Company, purchased on the open market by the Company or its
agent.
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A.
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Upon the commencement of each Year of Service as
a member of the Board, each Outside Director shall be granted an
award of Stock Units in an amount as shall be established from time
to time by the Board of Directors. The date of grant shall be the
first business day of May. With respect to an Outside Director
first elected as a director after May 1 of any year, the date of
such Outside Director’s initial award grant under this Plan
shall be the first business day of the month next following the
Outside Director’s initial election as a member of the
Board.
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B.
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The number of Stock Units to be awarded on any
particular date of grant shall be equal to the amount of the award
grant (expressed in dollars) divided by the closing price of the
Common Stock on the NYSE on the date of grant as provided in
Section IV.A, rounded up to the next whole share.
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C.
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If a Participant fails to complete the Year of
Service with respect to which a Stock Unit Award has been granted,
other than on account of Disability or death, such Stock Unit Award
and any earnings thereon shall be prorated to reflect the portion
of the Year of Service actually served by the
Participant.
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D.
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No stock certificates shall be issued in
connection with any Stock Unit Award and the Stock Unit Awards
shall be evidenced by bookkeeping account in the name of the
Participant maintained by the Company. The Company shall not be
required to segregate any amounts credited to these Stock Unit
Award accounts, which shall be established merely as an accounting
convenience. Amounts credited to the Stock Unit Award accounts
shall at all times remain solely the property of the Company
subject to the claims of its general creditors and available for
the Company’s use for whatever purpose desired. Stock Unit
Award accounts shall be credited with dividend equivalents at a
rate equal to such dividends as may be declared by the Company on
the Common Stock. Such dividends equivalents shall be invested as
additional Stock Units as of the last business day of each quarter
at a share price equal to closing price of the Common Stock on the
NYSE on the date the transaction is credited.
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E.
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Until distribution of shares of Common Stock from
the Plan, neither a Participant nor any other person shall have any
right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate, alienate or
convey the amounts, if any, payable hereunder, or any part thereof,
which are, and all rights to which are expressly declared to be,
unassignable and non-transferable. No part of the amounts payable
shall, prior to actual payment, be subject to seizure, attachment,
garnishment or sequestration for the payment of any debts,
judgments, alimony or separate maintenance owed by a Participant or
any other person, be transferable by operation of law in the event
of a Participant’s or any other person’s bankruptcy or
insolvency.
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Provided, however, that, in the event that
a domestic relations order of any State is received by the Plan and
thereafter determined to be a Qualified Domestic Relations Order
(QDRO) within the meaning of Code section 414(p), the
portion
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of the Account of the Participant to which such
QDRO is directed shall be apportioned as specified in such QDRO,
valued as of the business day preceding the date specified in such
QDRO. Upon notice to the Committee that a QDRO is being sought with
respect to a Participant’s Account, no distribution shall be
made to a Participant until such time as the status of the QDRO is
determined. The alternate payee of the Participant’s Account
shall thereafter participate in the Plan in accordance with its
terms, except such person shall not have the rights or benefits
provided in Subsection IV.A. If a QDRO is issued and the amount
awarded the alternate payee exceeds the value of the
Participant’s Account, the amount apportioned shall be
limited to the amount then in the account. If a QDRO so provides,
benefits may be paid to an alternate payee before they would
otherwise be distributable under the Plan, and no such distribution
to an alternate payee shall be treated as a distribution to the
Participant for purposes of Article V.
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F.
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No Participant shall have any of the rights of a
stockholder (including the right to vote and to receive dividends
and other distributions) with respect to Stock Units unless and
until shares of Common Stock are actually issued in his/her
name.
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G.
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In the event of any stock dividend, stock split,
combination or exchange of shares, merger, consolidation, spin-off
or other distribution (other than normal cash dividends) of Company
assets to shareholders, or any other change affecting the Common
Stock, such adjustments, if any, as are appropriate to reflect such
change shall be made with respect to outstanding Stock Unit
Awards.
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H.
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Upon a Change in Control of the Company all
outstanding Stock Unit Awards shall be considered as having met the
requirements of Section IV.C. For the purposes of this Plan,
“Change in Control” shall mean the occurrence of any of
the following events:
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a)
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any “person” (within the meaning of
Section 13(d) of the Exchange Act is or becomes the beneficial
owner within the meaning of Rule 13d-3 under the Exchange Act (a
“Beneficial Owner”), directly or indirectly, of
securities of the Company (not including in the securities
beneficially owned by such person any securities acquired directly
from the Company or its affiliates) representing 25% or more of the
combine
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