EXHIBIT 10-35
AMENDMENT NO. 1
to
THE ANNUAL EXECUTIVE INCENTIVE COMPENSATION PLAN
of
NEW YORK STATE ELECTRIC & GAS CORPORATION
The Annual Executive Incentive Compensation
Plan of New York State Electric & Gas Corporation (the
"Plan") is hereby amended, effective as of January 7,
1994, as follows:
1. The following new Articles XIII and XIV are
added to the Plan:
XIII. Payments upon a Change in Control
A. Calculation of Payments
Notwithstanding any other provisions hereof
(including, without limitation, Article IX
hereof), if a Change in Control (as defined in
Section B of this Article XIII) shall occur,
the following shall be paid, in cash, no later
than the tenth (10th) day following such Change
in Control:
(i) all incentive awards for any
completed fiscal year of the Company which
preceded the Change in Control, which awards
have been finally determined but not yet either
(x) distributed or (y) deferred pursuant to the
Deferred Compensation Plan for Salaried Employ-
ees,
(ii) if, at the time of the Change in
Control, the Board of Directors has not yet
finally determined the incentive awards with
respect to the fiscal year of the Company imme-
diately preceding the fiscal year in which the
Change in Control occurs, an incentive award
with respect to such fiscal year, determined by
the Board of Directors in accordance with the
provisions of the preceding Articles hereof,
and
(iii) an incentive award with respect
to the fiscal year of the Company in which the
Change in Control occurs which shall be calcu-
lated by (x) assuming that the Threshold Mea-
sure for such fiscal year has been met and
using such adjustments to the Variable Measure
as the Committee has provided and the Board of
Directors has approved prior to the Change in
Control, and (y) multiplying the result so ob-
tained by a fraction the numerator of which is
the number of days elapsed from the beginning
of such fiscal year until the Change in Control
and the denominator of which is three hundred
and sixty-five (365).
B. Definition of a Change in Control
A "Change in Control" shall be deemed to have
occurred if the conditions set forth in any one
of the following paragraphs shall have been
satisfied:
(i) any Person (as defined in this
Section B) is or becomes the Beneficial Owner
(as defined in this Section B), 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) represent-
ing 25% or more of the combined voting power of
the Company's then outstanding securities; or
(ii) during any period of two con-
secutive years (not including any period prior
to January 7, 1994), individuals who at the
beginning of such period constitute the Board
of Directors and any new director (other than a
director designated by a Person who has entered
into an agreement with the Company to effect a
transaction described in paragraph (i), (iii)
or (iv) of this Change in Control definition)
whose election by the Board of Directors or
nomination for election by the Company's stock-
holders was approved by a vote of at least two-
thirds (2/3) of the directors then still in
office who either were directors at the begin-
ning of the period or whose election or nomina-
tion for election was previously so approved,
cease for any reason to constitute a majority
thereof; or
(iii) the shareholders of the Compa-
ny approve a merger or consolidation of the
Company with any other corporation, other than
(x) a merger or consolidation which would re-
sult in the voting securities of the Company
outstanding immediately prior thereto continu-
ing to represent (either by remaining outstand-
ing or by being converted into voting securi-
ties of the surviving entity), in combination
with the ownership of any trustee or other
fiduciary holding securities under an employee
benefit plan of the Company, at least 75% of
the combined voting power of the voting securi-
ties of the Company or such surviving entity
outstanding immediately after such merger or
consolidation, or (y) a merger or consolidation
effected to implement a recapitalization of the
Company (or similar transaction) in which no
Person acquires more than 50% of the combined
voting power of the Company's then outstanding
securities; or
(iv) the shareholders of the Company
approve a plan of complete liquidation of the
Company or an agreement for the sale or dispo-
sition by the Company of all or substantially
all the Company's assets.
For purposes of the definition of Change in
Control in this Section B:
"Beneficial Owner" shall have the meaning de-
fined in Rule 13d-3 under the Exchange Act.
"Exchange Act" shall mean the Securities Ex-
change Act of 1934, as amended from time to
time.
"Person" shall have the meaning given in Sec-
tion 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) the
Company or any of its subsidiaries, (ii) a
trustee or other fiduciary holding securities
under an employee benefit plan of the Company
or any of its subsidiaries, (iii) an underwrit-
er temporarily holding securities pursuant to
an offering of such securities, or (iv) a cor-
poration owned, directly or indirectly, by the
stockholders of the Company in substantially
the same proportions as their ownership of
stock of the Company.
XIV. Plan Administration After a Change in Control
Notwithstanding any other provisions of the
Plan (including, without limitation, Sections
VI(B) and XII hereof), upon and after the oc-
currence of a Change in Control, neither the
Board of Directors nor the Committee shall be
authorized to, and no termination, suspension,
modification or amendment of the Plan shall be
permitted to, amend or modify the terms and
provisions (including, without limitation, the
payment provisions) of any incentive awards
theretofore made to participants in any way
which adversely affects the rights of such
participants.