Exhibit 10(x)
NEW ENGLAND ELECTRIC COMPANIES
LONG-TERM PERFORMANCE SHARE AWARD PLAN
Adopted - November 28, 1995
Amended - February 24, 1997
TABLE OF CONTENTS
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Page
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I. PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . .1
II. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . .1
2.01 Base Compensation . . . . . . . . . . . . . . .1
2.02 Beneficial Owner. . . . . . . . . . . . . . . .1
2.03 Beneficiary . . . . . . . . . . . . . . . . . .1
2.04 Board . . . . . . . . . . . . . . . . . . . . .2
2.05 Change in Control . . . . . . . . . . . . . . .2
2.07 Disability. . . . . . . . . . . . . . . . . . .3
2.08 Employer. . . . . . . . . . . . . . . . . . . .4
2.09 Incentive Plans . . . . . . . . . . . . . . . .4
2.10 A Major Transaction . . . . . . . . . . . . . .4
2.11 New England Electric System . . . . . . . . . .6
2.12 Participant . . . . . . . . . . . . . . . . . .6
2.13 Performance Cycle . . . . . . . . . . . . . . .6
2.14 Performance Shares. . . . . . . . . . . . . . .6
2.15 Person. . . . . . . . . . . . . . . . . . . . .6
2.16 Plan Year . . . . . . . . . . . . . . . . . . .7
2.17 Retirement. . . . . . . . . . . . . . . . . . .7
2.18 Shares. . . . . . . . . . . . . . . . . . . . .7
2.19 System. . . . . . . . . . . . . . . . . . . . .7
III. ADMINISTRATION. . . . . . . . . . . . . . . . . . . . . .8
3.01 Administration and Interpretation.. . . . . . .8
3.02 Amendment and Termination.. . . . . . . . . . .8
3.03 No Segregation of Assets; No Assignment.. . . .8
3.04 Accounting. . . . . . . . . . . . . . . . . . .9
IV. PERFORMANCE SHARES. . . . . . . . . . . . . . . . . . . .9
4.01 Goals . . . . . . . . . . . . . . . . . . . . .9
4.02 Performance Shares. . . . . . . . . . . . . . .9
4.03 Plan Factor . . . . . . . . . . . . . . . . . 10
4.04 Change in Incentive Plan. . . . . . . . . . . 10
4.05 Determination of Shares to be Received. . . . 11
4.06 Restriction on Shares to Officers . . . . . . 11
V. PAYMENT UPON CHANGE OF CONTROL OR TERMINATION OF
EMPLOYMENT. . . . . . . . . . . . . . . . . . . . . . . 12
5.01 Change in Control . . . . . . . . . . . . . . 12
5.02 Death . . . . . . . . . . . . . . . . . . . . 13
5.03 Disability, Retirement or Special Severance . 13
5.04 Other Termination . . . . . . . . . . . . . . 14
5.05 Hardship. . . . . . . . . . . . . . . . . . . 14
5.06 Proof . . . . . . . . . . . . . . . . . . . . 14
VI. GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . 15
6.01 Other Benefit Plans.. . . . . . . . . . . . . 15
6.02 Future Employment.. . . . . . . . . . . . . . 15
6.03 Headings. . . . . . . . . . . . . . . . . . . 15
6.04 Gender and Number.. . . . . . . . . . . . . . 15
6.05 Governing Law.. . . . . . . . . . . . . . . . 16
6.06 Effective Date. . . . . . . . . . . . . . . . 16
SIGNATURE. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
NEW ENGLAND ELECTRIC COMPANIES
LONG-TERM PERFORMANCE SHARE AWARD PLAN
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I. PURPOSE
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The purpose of the Long-Term Performance Share Award Plan
(the Plan) is to achieve and maintain a high level of continued
corporate performance by making it possible for those executives
whose efforts and responsibilities have direct and major
influence on corporate activity to earn significant compensation
rewards in proportion to measured corporate performance over a
multi-year period.
II. DEFINITIONS
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2.01 Base Compensation means the Participant's salary
level as in effect on a given date of determination.
2.02 Beneficial Owner shall have the meaning defined in
Rule 13d-3 under the Exchange Act.
2.03 Beneficiary means any person designated in writing by
the Participant (which designation may be changed from time to
time) to receive benefits under the Plan payable upon death of
the Participant. Unless otherwise designated, the Beneficiary
will be the beneficiary under the Participant's Group Life
Insurance enrollment and insurance provided, in whole or in part,
by the Employer. If there is no designated Beneficiary alive
when the Participant dies, the benefit shall be paid to the
estate of the Participant.
2.04 Board means the Board of Directors of New England
Electric System.
2.05 Change in Control occurs when the conditions set
forth in either of the following paragraphs shall have been
satisfied:
(a) any Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of New
England Electric System (not including in the
securities beneficially owned by such Person any
securities acquired directly from New England
Electric System or its affiliates) representing
20% or more of the combined voting power of New
England Electric System's then outstanding
securities; or
(b) during any period of not more than two
consecutive years after January 1, 1995,
individuals who at the beginning of such period
constitute the Board and any new director (other
than a director designated by a Person who has
entered into an agreement with New England
Electric System to effect a transaction
described in clause (i) of this paragraph) whose
election by the Board or nomination for election
by New England Electric System's shareholders
was approved or recommended by a vote of at
least two-thirds of the directors then still in
office who either were directors at the
beginning of the period or whose election or
nomination for election was previously so
approved or recommended, cease for any reason to
constitute a majority of the Board.
2.06 Committee means the Compensation Committee of the
Board.
2.07 Disability means a physical or mental condition of
the Participant which, based on satisfactory medical evidence, is
believed to be permanent and to render the Participant unfit to
perform duties for an Employer.
2.08 Employer means the company within the New England
Electric System holding company system which pays the base payof
the Participant.
2.09 Incentive Plans means:
(a) the New England Electric Companies' Senior
Incentive Compensation Plan,
(b) the New England Electric Companies' Incentive
Compensation Plan I, and
(c) the New England Electric Companies' Incentive
Compensation Plan II.
2.10 A Major Transaction shall be deemed to have occurred
if the conditions set forth in any one of the following
paragraphs shall have been satisfied:
(a) the shareholders of New England Electric System
approve a merger or consolidation with any
corporation or business trust, other than (i) a
merger or consolidation which would result in
the individuals who prior to such merger or
consolidation constitute the Board constituting
at least two-thirds of the board of directors of
New England Electric System or the surviving or
succeeding entity immediately after such merger
or consolidation, or (ii) a merger or
consolidation effected to implement a
recapitalization (or similar trasaction) in
which no Person acquires more than 20% of the
combined voting power of New England Electric
System's then outstanding securities;
(b) the shareholders of New England Electric System
approve a plan of complete liquidation thereof;
or
(c) the shareholders of New England Electric System
approve an agreement for the sale or disposition
of all or substantially all of New England
Electric System's assets, other than a sale or
disposition which would result in the
individuals who prior to such sale or
disposition constitute the Board constituting at
least two-thirds of the board of directors of
the Person purchasing such assets immediately
after such sale or disposition.
2.11 New England Electric System means the trustee or
trustees for the time being (as trustee or trustees but not
personally) under an agreement and declaration of trust dated
January 2, 1926, as amended, which is hereby referred to, and a
copy of which as amended has been filed with the Secretary of The
Commonwealth of Massachusetts. Any agreement, obligation, or
liability made, entered into or incurred by or on behalf of New
England Electric System binds only its trust estate, and no
shareholder, director, trustee, officer, or agent thereof assumes
or shall be held to any liability therefor.
2.12 Participant means a participant in one of the
Incentive Plans.
2.13 Performance Cycle means a three-year performance
cycle commencing on January one of a Plan Year. A new,
independent Performance Cycle will commence each Plan Year.
2.14 Performance Shares means the potential share grants
assigned under Section 4.02.
2.15 Person shall have the meaning given in Section
3(a)(9) of the Exchange Act, as modified and used in Sections
13(d) and 14(d) thereof; however, a Person shall not include (i)
New England Electric System or any subsidiary thereof, (ii) a
trustee or other fiduciary holding securities under an employee
benefit plan of New England Electric System or any subsidiary
thereof, (iii) an underwriter temporarily holding securities
pursuant to an offering of such securities, or (iv) a corporation
owned, directly or indirectly, by the shareholders of New England
Electric System in substantially the same proportions as their
ownership of shares of New England Electric System.
2.16 Plan Year means a calendar year.
2.17 Retirement means termination of service with the
System on or after the date when the Participant could first
commence receiving benefits under the New England Electric System
Companies' Final Average Pay Pension Plan I.
2.18 Shares means common shares of New England Electric
System.
2.19 System means the New England Electric System and its
subsidiaries.
III. ADMINISTRATION
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3.01 Administration and Interpretation. The Plan shall be
administered by the Committee, and interpretations of the Plan by
the Committee shall be final and binding on all parties.
3.02 Amendment and Termination. The Committee may amend
or terminate the Plan at any time; provided, however, that no
such action shall affect any right or obligation with respect to
any Performance Shares allocated to a Participant's account.
3.03 No Segregation of Assets; No Assignment. Neither New
England Electric System nor any Employer is required to set aside
or segregate any assets of any kind to meet obligations under
this Plan. A Participant has no rights under this Plan to any
specific assets of New England Electric System or any Employer
(including any Shares purchased by the Employer to reflect its
obligations hereunder). A Participant may not commute, sell,
assign, transfer, or otherwise convey the right to receive any
payments under this Plan, which payments and the right thereto
shall be, to the fullest extent permitted by law, nonassignable
and nontransferable, whether voluntarily or involuntarily.
3.04 Accounting. The Manager of Internal Audits and the
Controller will be responsible to the Committee for accounting
matters directly affecting the Plan.
IV. PERFORMANCE SHARES
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4.01 Goals. Prior to commencement of a Performance Cycle,
the Committee shall establish independent goals for that cycle in
critical areas of System performance.There may be sub-goals
within each goal.
The Committee will identify the performance factor, the
award range, and the weight for each goal. All Participants will
share equally in all goals.
4.02 Performance Shares. For each Performance Cycle, the
account of each Participant will be assigned Performance Shares
of a value equivalent to the Participant's Base Compensation on
January 1 of the Plan Year (except as set forth in Section 4.04)
multiplied by the appropriate plan factor as set out in Section
4.03. The value of a Performance Share, whether purchased from
the System or on the open market, will be computed on the basis
of the average of high and low prices on the New York Stock
Exchange - Composite Transactions as reported in The Wall Street
Journal for the five consecutive trading days ending on the last
trading day prior to the fifteenth day of January of the Plan
Year.
No dividends (either in cash or shares) will be paid on or
accrued to Performance Shares during a Performance Cycle.
4.03 Plan Factor. The plan factors are as follows:
For Participants in:
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Senior Incentive Compensation Plan 50%
Incentive Compensation Plan I
- Level A 50%
Incentive Compensation Plan I
- Level B 25%
Incentive Compensation Plan I
- Level C 25%
Incentive Compensation Plan II 15%
4.04 Change in Incentive Plan. If a Participant becomes
eligible for a particular Incentive Plan during the Plan Year or
if a Participant ceases to be a Participant in a particular
Incentive Plan during the Plan Year, his Performance Shares for
that cycle will be adjusted to reflect (i) the ratio of the
months served in that particular Incentive Plan to twelve and
(ii) his Base compensation under the new Incentive Plan.
4.05 Determination of Shares to be Received. As soon as
practicable after the termination of a Performance Cycle, the
Participant will receive Shares equal to the number of
Performance Shares assigned to him at the commencement of the
cycle multiplied by the sum of the value of the goal achievements
for that cycle. Each goal will be independently measured. Any
fractional Share will be rounded up to the next whole Share.
The Participant may elect, prior to the close of the
Performance Cycle, to receive cash in lieu of 50% of the Shares
so awarded. The value of Shares so converted shall be determined
on the basis of the high and low prices, whether purchased from
the System or on the open market, computed on the basis of the
average of high and low prices on the New York Stock Exchange -
Composite Transactions as reported in The Wall Street Journal for
the five consecutive trading days ending on the last trading day
prior to the fifteenth day of January of the calendar year
following the close of the Performance Cycle.
4.06 Restriction on Shares to Officers. All Shares
awarded under the Plan to officers of New England Electric System
shall not be commuted, sold, assigned, transferred, or otherwise
conveyed, whether voluntarily or involuntarily, for a period of
five years from issuance; provided, however, said Shares may be
deferred to the New England Electric Companies' Deferred
Compensation Plan. In the event of a Change in Control or a
Major Transaction, the foregoing restriction shall lapse. The
hardship provisions of the Incentive Share Plan shall apply to
these restricted shares.
V. PAYMENT UPON CHANGE OF CONTROL OR TERMINATION OF EMPLOYMENT
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5.01 Change in Control. In the event of a Change in
Control or a Major Transaction, each Participant will receive,
within 30 days of such event, a cash payment equal to the product
of "a" times "b" times "c", where:
"a" is the number of Performance Shares in the
Participant's account, and
"b" is the value of a Performance Share determined
using the highest Share price of any Share in the
sixty days preceding the Change in Control or Major
Transaction, and
"c" is, for performance cycles through December 31,
2000, the average of the target achievement
percentages for the Incentive Compensation Plan I for
the last three years prior to the Change in Control
or Major Transaction and, for performance cycles
ending after December 31, 2000, the average of the
goal achievements for this Plan for the last three
years prior to the Change in Control or Major
Transaction.
5.02 Death. In the event of a Participant's death, the
Beneficiary will receive, by the end of March following the
calendar year in which the death occurs, Shares calculated as
follows: The Performance Shares for the Plan Year in which the
Participant died will be adjusted to reflect the number of months
(or portions thereof) elapsed divided by twelve. For each
Performance Cycle, the Plan Factors will be calculated as if that
Cycle had terminated at the close of the calendar year in which
the Participant died.
5.03 Disability, Retirement or Special Severance. In the
event of his Disability, Retirement, transfer to a direct or
indirect subsidiary of New England Electric System in which the
New England Electric System owns 50% or less equity interest, or
severance as part of a program under which a number of employees
are being severed in connection with a unique event, such as sale
of the System generation or restructuring of the Company as part
of a restructuring of the electric utility industry, a
Participant will receive, by the end of the March following the
close of the Performance Cycle, a distribution in accordance with
Section 4.05. His Performance Shares for the Plan Year in which
he is disabled, retires, or is transferred will be adjusted to
reflect the number of months (or portions thereof) elapsed
divided by twelve.
5.04 Other Termination. In the event of termination of
employment other than those referred to in Section 5.02 or 5.03,
a Participant will forfeit his Performance Shares.
5.05 Hardship. Other than as provided herein, there will
be no distributions from the Plan to Participants, whether for
hardship or otherwise.
5.06 Proof. The Committee may require proof of the death,
Disability, incompetency, minority, or incapacity of any
Participant or beneficiary, and of the right of a person to
receive any distribution hereunder.
VI. GENERAL PROVISIONS
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6.01 Other Benefit Plans. Neither a Participant's
Performance Shares nor any cash or Shares distributed hereunder
will be used in determining the Participant's benefits under any
group insurance plan, pension plan, or any other incentive
program.
6.02 Future Employment. Neither the Plan nor the making
of awards hereunder shall be construed to create any obligation
to continue the Plan or to give any present or future employee
any right to continued employment.
6.03 Headings. The headings of articles and sections of
the Plan are for convenience of reference only.
6.04 Gender and Number. Unless the context requires
otherwise, the singular shall include the plural; the masculine
gender shall include the feminine; and such words as "herein",
"hereinafter", "hereof", and "hereunder" shall refer to this
instrument as a whole and not merely to the subdivisions in which
such words appear.
6.05 Governing Law. Except as otherwise required by law,
the Plan and all matters arising thereunder shall be governed by
the laws of The Commonwealth of Massachusetts.
6.06 Effective Date. This Plan shall be effective for
Plan Years beginning on and after January 1, 1996.
February 24, 1997
Dated:_____________________ s/George M. Sage
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Pursuant to vote of November 28,
1995, of the NEES Board and vote of
February 24, 1997, of the
Compensation Committee