ORANGE AND ROCKLAND UTILITIES, INC.
DEFERRED COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
As Amended and Restated through October 6, 1994
ORANGE AND ROCKLAND UTILITIES, INC.
DEFERRED COMPENSATION PLAN FOR NON-EMPLOYEE DIRECTORS
1. Eligibility
Each member of the Board of Directors of Orange and Rockland
Utilities, Inc. (the "Company") who is not an employee of the
Company, or of any of its subsidiaries (an "Eligible Director"),
is eligible to participate in the Orange and Rockland Utilities,
Inc. Deferred Compensation Plan for Non-Employee Directors (the
"Plan").
2. Participation
(a) Prior to the beginning of any calendar quarter,
commencing with the quarter beginning April 1, 1988, each
Eligible Director may elect to participate in the Plan by
directing that all or any part of the compensation (including
fees payable for services as a member of a committee of the Board
of Directors) which would otherwise have been payable currently
for services as a Director during such calendar quarter and
subsequent calendar quarters (the "Fees") shall be credited to a
deferred compensation account (the "Director's Account") subject
to the terms of the Plan. Any person who shall become an
Eligible Director during any calendar quarter and who was not an
Eligible Director of the Company prior to the beginning of such
calendar quarter, may elect, within 30 days after becoming an
Eligible Director, to defer payment of all or any part of the
Fees for the remainder of such calendar quarter and for
succeeding calendar quarters.
(b) An election to participate in the Plan shall be made by
written notice executed by the Eligible Director and filed with
the Secretary of the Company within the time specified in
paragraph 2(a) hereof. An election to participate, related to
Fees otherwise payable with respect to services as an Eligible
Director in subsequent calendar quarters, shall become
irrevocable as of the end of the calendar quarter preceding such
calendar quarter. An election shall continue until a Director
ceases to be an Eligible Director or until the Eligible Director
terminates or modifies such election to participate in the Plan
by written notice filed with the Secretary of the Company. Any
such termination or modification of an election to participate in
the Plan shall become effective as of the end of the calendar
quarter in which such notice is given and only with respect to
Fees payable with respect to services as an Eligible Director in
subsequent calendar quarters. Amounts credited to a Director's
Account prior to the effective date of any termination or
modification shall not be affected by such termination or
modification of an election to participate in the Plan and shall
be distributed only in accordance with the terms of the Plan,
provided however that an Eligible Director may modify an election
with respect to the distribution of amounts credited to a
Director's Account as provided in Section 4(a) hereof.
(c) An Eligible Director who has filed a termination of
election to participate may thereafter file another written
notice with the Secretary of the Company electing to participate
for any calendar quarter commencing subsequent to the filing of
such election and subsequent calendar quarters.
3. The Director's Account
(a) All deferred Fees shall be credited to the Director's
Account and shall bear interest as provided in paragraph 3(b)
hereof. The establishment and maintenance of, or credits to, the
Director's Account shall not vest in the Eligible Director or the
Eligible Director's Beneficiary any right, title or interest in
and to any specific assets of the Company.
(b) Interest shall be credited on the deferred Fees
credited to a Director's Account, commencing on the date such
Fees would otherwise have been paid, at a rate per annum for each
calendar quarter which prior to February 6, 1986 was a rate equal
to the average quoted rate for three-month U.S. Treasury Bills
for the last full week of the preceding calendar quarter and
which beginning February 6, 1986 is a rate equivalent to the
Company's allowable rate of return in effect from time to time as
set by the Department of Public Service of the State of New York
(the "New Rate"). Amounts so determined shall be compounded at
the end of each calendar quarter and credited to the Director's
Account. Amounts credited to a Director's Account shall continue
to be credited with interest until distributed in accordance with
the Plan, which interest beginning with February 6, 1986 shall be
at the New Rate.
4. Distribution from Director's Account
(a) At the time of election to participate in the Plan, an
Eligible Director shall also make a written election with respect
to the distribution of amounts credited to the Director's Account
(an "Initial Election"). An Eligible Director may elect to
receive such amount in one lump-sum payment or in some other
number or ratable annual installments (not exceeding 10). The
first installment (or the single lump-sum payment if the Director
has so elected) shall be paid on the later of the first business
day of the calendar year immediately following the year in which
the Director ceases to be an Eligible Director of the Company, or
the first business day of such later calendar year as the
Director shall have elected in accordance with the terms hereof.
Subsequent installments, if any, shall be paid on the first
business day of each succeeding calendar year until the entire
amount credited to the Director's Account shall have been paid.
(1) An Eligible Director while an Eligible Director
may modify any Initial Election or prior modification of an
election with respect to the distribution of amounts
credited to the Director's Account. Such modification may
relate to either or both (i) Fees payable with respect to
services as an Eligible Director in calendar quarters
subsequent to the effective date of such modification,
and/or (ii) all deferred Fees prior to the effective date of
such modification, provided however that any such
modification related to previously deferred Fees may only
provide for the further deferral of such previously deferred
Fees. In the event that the Eligible Director has made more
than one modification of any election, the most recent
modification shall control distribution of the amounts
credited to the Director's Account.
(2) With respect to any modification of an election
related to Fees payable with respect to services as an
Eligible Director in subsequent calendar quarters, any such
modification shall become effective as of the end of the
calendar quarter in which such notice of modification is
given and only with respect to Fees payable for services as
an Eligible Director in subsequent calendar quarters.
(3) With respect to any modification of an election,
or portion thereof, related to previously deferred Fees, any
such modification shall become effective as of the first day
of the calendar year following the calendar year in which
such notice of modification is given. Amounts credited to a
Director's Account prior to the effective date of any such
modification related to previously deferred Fees may only be
further deferred by such modification made while the
Director is still an Eligible Director, shall be distributed
only in accordance with the terms of the Plan, and shall not
be affected by any modification purporting to accelerate
payment of such deferred Fees.
(b) The election with respect to the distribution of
amounts credited to the Director's Account and/or the
modification of any such election shall be made in the written
notice provided for in paragraph 2(b) hereof.
(c) Notwithstanding the provisions of paragraph 2(b) hereof
or the terms of an election or modification thereof made pursuant
to paragraph 4(a) hereof, if a Director ceases to be an Eligible
Director of the Company and becomes employed by any governmental
agency having jurisdiction over the activities of the Company or
any of its subsidiaries, the termination of the Director's
election to participate shall become effective immediately and
the entire balance of the Director's Account shall be paid in a
single lump-sum payment at the Company's earliest convenience.
(d) If an Eligible Director should die before payment in
full of all amounts credited to the Director's Account, the
balance of the Director's Account shall be paid on the first
business day of the calendar year following the year of death to
the Eligible Director's Beneficiary.
(e) Notwithstanding the terms of any election to defer or
modification thereof made by an Eligible Director hereunder, the
Secretary of the Company may, in his sole discretion, permit the
withdrawal of all or a portion of the amounts credited to a
Director's Account, upon the request of the Eligible Director or
the Eligible Director's representative, or following the death of
an Eligible Director upon the request of an Eligible Director's
Beneficiary or such Beneficiary's representative, if the
Secretary determines that the Eligible Director or Beneficiary,
as the case may be, is confronted with an unforeseeable
emergency. For this purpose, an unforeseeable emergency is an
unanticipated emergency caused by an event that is beyond the
control of the Eligible Director or Beneficiary and that would
result in severe financial hardship to the Eligible Director or
Beneficiary if an early hardship withdrawal were not permitted.
The Eligible Director or Beneficiary shall provide to the
Secretary such evidence as the Secretary may require to
demonstrate that such emergency exists and financial hardship
would occur if the withdrawal were not permitted. Any withdrawal
under this paragraph shall be limited to the amount necessary to
meet the emergency.
(f) The Company shall deduct from the distributions to be
made from a Director's Account any Federal, State or local
withholding or other taxes or charge which the Company is from
time to time required to deduct under applicable law.
5. Designation of Beneficiaries
Each Eligible Director shall file with the Secretary of the
Company a written designation of one or more persons as the
Beneficiary who shall be entitled to receive the amount, if any,
payable under the Plan upon the Eligible Director's death. An
Eligible Director may from time to time revoke or change the
Eligible Director's beneficiary designation without the consent
of any prior Beneficiary by filing a new designation with the
Secretary of the Company. The last such designation received by
the Secretary of the Company shall be controlling; provided
however, that no designation or change or renovation thereof
shall be effective unless received by the Secretary of the
Company prior to the Eligible Director's death, and in no event
shall it be effective as of a date prior to such receipt. If no
such beneficiary designation is in effect at the time of an
Eligible Director's death, or if no designated Beneficiary
survives the Eligible Director, or if such designation conflicts
with law, the Eligible Director's estate shall be the Beneficiary
entitled to receive the amount, if any, payable under the Plan
upon the death of the Eligible Director. If the Secretary of the
Company is in doubt as to the right of any person to receive
such amount, the Company may retain such amount, without
liability for any interest thereon, until the Secretary
determines the rights thereto, or the Company may pay such amount
into any court of appropriate jurisdiction and such payment shall
be a complete discharge of the liability of the Company therefor.
6. Miscellaneous
(a) Neither the Eligible Director nor any Beneficiary
designated by the Eligible Director shall have the right to,
directly or indirectly, alienate, assign, transfer, pledge,
anticipate or encumber (except by reason of death) any amount
that is or may be payable hereunder, nor shall any such amount be
subject to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment, or garnishment by creditors of
the Eligible Director or the Eligible Director's Beneficiary or
to the debts, contracts, liabilities, engagements, or torts of
any Eligible Director or Beneficiary, or transfer by operation of
law in the event of bankruptcy or insolvency of the Eligible
Director or any Beneficiary, or any legal process.
(b) All payments of awards provided for under the Plan
shall be paid in cash from the general funds of the Company;
provided, however, that such payments shall be reduced by the
amount of any payments made to the Eligible Director or his or
her dependents, beneficiaries or estate from any trust or special
or separate fund established by the Company to assure such
payments. The Company shall not be required to establish a
special or separate fund or other segregation of assets to assure
such payments, and, if the Company shall make any investments to
aid it in meeting its obligations hereunder, the Eligible
Director shall have no right, title, or interest whatever in or
to any such investments except as may otherwise be expressly
provided in a separate written instrument relating to such
investments. Nothing contained in this Plan, and no action taken
pursuant to its provisions, shall create or be construed to
create a trust of any kind between the Company and any persons.
To the extent that any person acquires a right to receive
payments from the Company hereunder, such right shall be no
greater than the right of an unsecured creditor of the Company.
(c) Copies of the Plan and any and all amendments thereto
shall be made available at all reasonable times at the office of
the Secretary of the Company to all Eligible Directors.
(d) The Plan shall be administered by the Secretary of the
Company who shall have full power, discretion and authority to
interpret, construe and administer the Plan and any part thereof.
The Secretary's interpretations and constructions of the Plan,
and the actions taken thereunder by the Secretary, shall, except
as otherwise determined by the Board of Directors of the Company,
be binding and conclusive on all persons for all purposes.
(e) The Board of Directors may at any time amend or
terminate the Plan. The Plan may also be amended by the Chief
Executive Officer of the Company, provided that all such
amendments shall be reported to the Board. No amendment or
termination of the Plan shall impair the rights of any person
with respect to amounts then in the Director's Account.
(f) The Company, its officers and its Board of Directors
shall have the right to rely upon a written opinion of legal
counsel, which may be independent legal counsel or legal counsel
regularly employed by the Company, if any question should arise
as to any distribution from a Director's Account or any
obligation under the Plan.
(g) Each Eligible Director participating in the Plan shall
receive an annual statement indicating the amount credited to the
Director's Account as of the end of the preceding calendar year.
(h) All elections, designations, requests, notices,
instructions and other communications from an Eligible Director,
Beneficiary or other person to the Secretary of the Board of
Directors of the Company, required or permitted under the Plan
shall be in such form as is prescribed from time to time by the
Secretary and shall be mailed by first class mail or delivered to
such location as shall be specified by the Secretary.
(i) The terms of the Plan shall be binding upon the Company
and its successors and assigns.
(j) The Plan shall be governed by and construed in
accordance with the laws of the State of New York, as from time
to time in effect.
(k) The Plan became effective upon adoption by the Board of
Directors of the Company on September 8, 1983.
7. Change in Control.
(a) Notwithstanding anything else herein to the contrary,
in the event of the occurrence of a Change in Control, if any,
each Eligible Director shall have the right to receive, and shall
be paid, as soon as practicable after such occurrence becomes
reasonably certain, a lump sum cash amount equal to the entire
unpaid balance of the amount credited to a Director's Account,
including interest, and any prior election of such Eligible
Director to defer the payment of fees shall become null and void.
(b) As used in the Plan, "Change in Control" shall mean the
happening of any of the following:
(i) receipt by the Company of a report on Schedule 13D
filed with the Securities and Exchange Commission pursuant
to Section 13(d) of the Securities Exchange Act of 1934 (the
"1934 Act") disclosing that any person, group, corporation
or other entity is the beneficial owner, directly or
indirectly, of 20 percent or more of the outstanding stock
of the Company;
(ii) purchase by any person (as defined in
Section 13(d) of the 1934 Act), corporation or other entity,
other than the Company or a wholly-owned subsidiary of the
Company, of shares pursuant to a tender or exchange offer to
acquire any stock of the Company (or securities convertible
into stock) for cash, securities or any other consideration,
and, after consummation of the offer, such person, group,
corporation or other entity is the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act) directly or
indirectly, of 20 percent or more of the outstanding stock
of the Company (calculated as provided in paragraph (d) of
Rule 13d-3 under the 1934 Act in the case of rights to
acquire stock);
(iii) approval by the stockholders of the Company of
(a) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or
pursuant to which shares of stock of the Company would be
converted into cash, securities or other property, other
than a consolidation or merger of the Company in which
holders of its stock immediately prior to the consolidation
or merger have substantially the same proportionate
ownership of common stock of the surviving corporation
immediately after the consolidation or merger as immediately
before, or (b) any sale, lease, exchange or other transfer
(in one transaction or a series of related transactions) of
all or substantially all the assets of the Company; or
(iv) a change in the majority of the members of the
Board of Directors within a 12-month period unless the
election or nomination for election by the Company's
stockholders of each new director was approved by the vote
of two-thirds of the directors then still in office who were
in office at the beginning of the 12-month period.
orlaw\bod\defcomp.bod