THE UNITED ILLUMINATING COMPANY
NON-EMPLOYEE DIRECTORS COMMON STOCK AND
DEFERRED COMPENSATION PLAN
SECTION 1. ESTABLISHMENT OF THE PLAN
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1.01 ESTABLISHMENT OF THE PLAN. THE UNITED ILLUMINATING COMPANY (the "Company")
hereby amends and restates its Directors' Deferred Compensation Plan for
the benefit of its Eligible Directors, as originally adopted on December
22, 1980, and previously amended and restated on July 23, 1990 and December
17, 1990, renaming it the Non-Employee Directors Common Stock and Deferred
Compensation Plan and amending and restating it in other respects as set
forth herein (the "Plan"). This amendment and restatement of the Plan shall
be effective, subject to its approval by the shareholders of the Company by
the affirmative vote of the holders of a majority of the votes cast by the
shareholders of the Company present, or represented, and entitled to vote
at the annual meeting of the shareowners of the Company to be held on May
15, 1996 in accordance with the laws of the State of Connecticut, on May
15, 1996 (the "Effective Date").
1.02 APPLICABILITY OF THE PLAN. The provisions set forth herein are applicable
only to Directors serving on the Board of the Company on or after the
Effective Date. The benefits of Directors terminating Service prior to that
date shall be governed by the terms of the Plan in effect on the date each
of them terminated Service.
1.03 PURPOSE OF THE PLAN. The purpose of the Plan is to provide for payment to
each Eligible Director of a portion of his or her compensation for Service
as a Director in shares of the Company's Stock, and to allow each Eligible
Director to defer the payment of part of the Fees payable to him or her for
Service as a Director of the Company, including Fees payable to an Eligible
Director for Service as the chairperson or a member of one or more
committees of the Board. It is also the purpose of the Plan to provide an
incentive for Eligible Directors to continue to contribute to the growth
and profitability of the Company by enabling them to share in the
appreciation of the value of the Company's Stock.
SECTION 2. DEFINITIONS
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2.01 Whenever used in the Plan, the following terms shall have the respective
meanings set forth below, unless otherwise expressly provided in the Plan:
(a) "Beneficiary" or "Beneficiaries" shall mean the person or persons
designated by a Participant in accordance with Subsection 6.02 hereof.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cash Account" shall mean the unfunded memorandum sub-account
maintained by the Company to record that portion of an Eligible
Director's Fees that he or she has elected to have deferred and
credited with interest pursuant to Subsection 5.02(a) of the Plan,
together with the amount of the interest credited from time to time to
such sub-account.
(d) "Change in Control" shall mean any of the following events:
(1) any merger or consolidation of the Company with any corporate
shareholder holding twenty-five percent (25%) or more of the
Stock of the Company or with any other corporation that is, or
after such merger or consolidation would be, controlled by a
shareholder or group of shareholders owning at least twenty-five
percent (25%) of the Stock of the Company (an "affiliate" of such
shareholder or group of shareholders); or
(2) any sale, lease, exchange, mortgage, pledge, transfer or
disposition, other than the payment of quarterly cash dividends,
to or with any shareholder or group of shareholders holding
twenty-five per cent (25%) or more of the Stock of the Company,
or any affiliate of such shareholder or group of shareholders, of
any assets of the Company having an aggregate fair market value
of $40 million or more; or
(3) the issuance or sale by the Company of any securities of the
Company to any shareholder or group of shareholders holding
twenty-five per cent (25%) or more of the Stock of the Company,
or to any affiliate of such shareholder or group of shareholders,
in exchange for cash, securities or other consideration having an
aggregate fair market value of $50 million or more; or
(4) the implementation of any plan or proposal for the liquidation or
dissolution of the Company proposed by or on behalf of any
shareholder or group of shareholders owning at least twenty-five
per cent (25%) of the Stock of the Company, or any affiliate of
such shareholder or group of shareholders; or
(5) any reclassification of securities (including a reverse stock
split) or recapitalization of the Company, or any other
transaction, which has the effect, direct or indirectly, of
increasing the proportionate share of outstanding shares of any
class of equity securities, or securities convertible into any
equity securities, of the Company, that is directly or indirectly
owned by a shareholder or group of shareholders owning at least
twenty-five percent (25%) of the Stock of the Company, or any
affiliate of such shareholder or group of shareholders.
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(e) "Committee" shall mean the Committee on Directors of the Board.
(f) "Company" shall mean The United Illuminating Company and any
successor.
(g) "Deferred Compensation Account" shall mean the unfunded memorandum
account maintained by the Company to record that portion of an
Eligible Director's Stock Awards and Fees deferred under the Plan,
their hypothetical investment in either a Cash Account, Phantom Stock
Unit Account, or some combination thereof, and the accretions to and
payments from each such Account.
(h) "Director" shall mean any person who is duly elected and qualified to
serve on the Board and renders Service to the Company.
(i) "Eligible Director" shall mean a person who renders Service to the
Company on or after May 15, 1996 at a time when he or she is not an
employee of the Company.
(j) "Fair Market Value" shall mean the average on a particular date of the
high and low per share sale prices of shares of Stock on the New York
Stock Exchange, as reported on the composite tape, or, if there is no
sale on such date, then such average price on the last previous date
on which a sale is reported.
(k) "Fees" shall mean amounts earned for Service as an Eligible Director,
including quarterly retainers, Board meeting fees and Board committee
chairperson and meeting fees.
(l) "Grant Date" shall mean a date, on or about March 1, in each of the
years 1997 through 2010, inclusive, on which the New York Stock
Exchange conducts business; and, unless another date is designated as
the Grant Date for such year by the Secretary of the Company (the
"Corporate Secretary") on or before February 1 of such year, the Grant
Date for such year shall be the first day in March on which the New
York Stock Exchange conducts business.
(m) "Participant" shall mean a person for whom a Deferred Compensation
Account has been established and is being maintained under the Plan.
(n) "Phantom Stock Unit" shall mean a unit of measurement equivalent to
one share of Common Stock of the Company, but excluding all of the
attendant rights of a shareholder of such Stock (for example, the
right to own, control and vote such Stock) other than the right to be
credited with dividends thereon.
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(o) "Phantom Stock Account" shall mean the unfunded memorandum sub-account
maintained by the Company pursuant to Subsection 5.02(b) of the Plan
to record the number of Phantom Stock Units resulting from Stock
Awards and an election by an Eligible Director to have some portion of
all of his or her deferred Fees invested in Phantom Stock Units, and
shall include all Phantom Stock Units credited as a result of the
reinvestment of dividends on Phantom Stock Units.
(p) "Service" shall mean service as a Director, including service as a
member of a committee or committees of the Board.
(q) "Stock" shall mean the Common Stock of the Company.
(r) "Stock Award" shall mean a number of whole and fractional Phantom
Stock Units, computed to three decimal places, equal to the sum of 200
plus the quotient resulting from dividing (a) the quarterly retainer
Fee payable to an Eligible Director for Service during the first
quarter of each fiscal year of the Company during the period
commencing January 1, 1997 and ending December 31, 2010, by (b) the
Fair Market Value of the Stock on the Grant Date of such year.
SECTION 3. STOCK AWARDS
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3.01 ANNUAL AWARDS. On each Grant Date, in lieu of the quarterly retainer Fee
payable to each Participant who has served as a Director for at least six
(6) months immediately preceding such Grant date, a Stock Award shall be
credited to the Phantom Stock Account of such Participant.
3.02 ELECTION TO RECEIVE ANNUAL AWARD IN SHARES OF STOCK. With respect to each
Grant Date, each Eligible Director who would receive a Stock Award pursuant
to Subsection 3.01 of the Plan may elect to waive such Stock Award and
receive a whole number of shares of Stock, issued by the Company or
purchased by the Company for and in the name of such Eligible Director, in
lieu of such Stock Award. To the extent that the formula for such Stock
Award, as set forth in Subsection 2.01(r) of the Plan does not result in a
whole number of shares of Stock, the result shall be rounded downwards to
the next whole number, and the value of the fractional share shall be
distributed and paid to the Eligible Director promptly in cash. The stock
certificate for shares of Stock issued to or purchased for and in the name
of an Eligible Director pursuant to this Subsection 3.02 shall be held by
the Company for a period of six (6) months following the Grant Date and
shall be distributed to him or her as soon as practicable following the
expiration of such period; and during such period he or she shall have all
the rights of a shareholder of the Company with respect to such shares of
Stock, except that such shares of Stock shall not be transferrable other
than by will or the laws of descent and distribution. An election to waive
a Stock Award
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pursuant to this Subsection 3.02 shall be irrevocable and must be made at
least six (6) months in advance of the Grant Date.
3.03 RETIREMENT PROGRAM TERMINATION AWARDS. On and as of the Effective Date,
each Eligible Director serving as such on the Effective Date who makes or
has made an irrevocable election to waive participation in, and any and all
benefits under, any prior retirement program maintained by the Company for
Directors, shall have credited to the Phantom Stock Account of such
Participant a number of Phantom Stock Units as follows: Ms. Albright 88;
Mr. Breslawsky 127; Mr. Carson 717; Mr. Croweak 1,343; Mr. Devlin 672; Ms.
Henley-Cohn 326; Mr. Lahey 183; Mr. McFadden 1,250; Mr. O'Keefe 2,059; Mr.
Thomas 568.
SECTION 4. DEFERRAL OF FEES
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4.01 GENERAL PARTICIPATION RULE. An Eligible Director may elect to defer payment
of all or a specific portion of all Fees (other than the quarterly retainer
Fee payable during the first quarter of a fiscal year of the Company during
the period commencing January 1, 1997 and ending December 1, 2010) payable
to the Eligible Director more than six (6) months after the date of such
election until he or she (i) elects to revoke or alter such election with
respect to such Fees payable more than six (6) months after the date of
such election to revoke, or (ii) terminates Service, or (iii) is paid upon
a Change in Control in accordance with Subsection 6.01(d) of the Plan.
Elections shall be made by written notice delivered to the Corporate
Secretary. Fees shall be considered deferred on the date on which they
would have been paid absent the election to defer (the "Deferral Date").
Any Fees deferred pursuant to the Plan shall not be affected by any
revocation of a Participant's election and shall be paid only in accordance
with Section 6 of the Plan, together with increments thereon determined in
accordance with Subsection 5.02 of the Plan.
4.02 ELECTION ALTERNATIVES. The election made pursuant to Subsection 4.01 shall
designate some portion or all of such Fees treated as if invested in the
Participant's (a) Cash Account, or (b) Phantom Stock Account, or some
combination thereof. Investment elections shall be made in multiples of
twenty-five per cent (.25) (for example, seventy-five per cent (.75) of
such deferred Fees treated as being invested in a Cash Account and
twenty-five per cent (.25) treated as being invested in a Phantom Stock
Account).
4.03 PRE-EFFECTIVE DATE ELECTIONS. Each election by a Participant under and
pursuant to the Directors' Deferred Compensation Plan of the Company in
effect prior to the Effective Date, shall be and remain in effect under the
Plan until revoked in accordance with Subsection 4.01 of the Plan; and each
amount in such Participant's Cash Account and number of whole and
fractional Phantom Stock Units in such Participant's Phantom Stock Account
on the Effective date shall be
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and remain in such Participant's Cash Account and Phantom Stock Account,
respectively, on and as of the Effective Date.
SECTION 5. ACCOUNTING FOR AWARDS AND DEFERRALS; HYPOTHETICAL
INVESTMENT OF DEFERRALS.
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5.01 SEPARATE ACCOUNTS. The Company shall maintain a Deferred Compensation
Account for each Participant. Such Account shall be maintained with enough
specificity to enable the Company to determine the amounts credited, at any
particular point in time, to the Participant's Cash Account and/or Phantom
Stock Account.
5.02 HYPOTHETICAL INVESTMENT OF DEFERRED COMPENSATION ACCOUNTS.
(a) Credits to Cash Account. A Participant's Cash Account shall be
credited on each Deferral Date with the amount of Fees then deferred
and elected to be invested in a Cash Account. On the first day of each
calendar quarter, interest shall be credited to the Cash Account of
each Participant for each month of the preceding quarter, calculated
on the basis of 30-day months and a 360-day year and the balance of
such Account on the first day of each month of the preceding quarter
(including interest for the preceding month) at the prime rate of
Citibank, N.A., its successor, or any other bank approved by the
Committee for such purpose, in effect on the first day of each such
month.
(b) Crediting of Phantom Stock Units; Reinvestment of Dividends in Phantom
Stock Account; Capital Adjustments. The number of whole and fractional
Phantom Stock Units, computed to three decimal places, to be credited
to the Phantom Stock Account of a Participant on each Deferral Date
shall be equal to the amount of Fees then deferred and elected to be
invested in a Phantom Stock Account, divided by Fair Market Value on
the Deferral Date. On each dividend payment date with respect to the
Stock, the Phantom Stock Account of a Participant shall be credited
with an additional number of whole and fractional Phantom Stock Units,
computed to three decimal places, equal to the product of the dividend
per share then payable, multiplied by the number of Phantom Stock
Units then credited to such account, divided by Fair Market Value on
the dividend payment date.
In the event that the number of outstanding shares of Common Stock of
the Company shall be increased or decreased by reason of a stock
split, stock dividend, recapitalization, reclassification or other
similar change in the Company's capital structure, the number of
Phantom Stock Units credited to a Participant's Phantom Stock Account
shall be adjusted accordingly by and at the direction of the Board.
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In the event of a Change of Control or of a termination of the Plan
pursuant to Subsection 8.03 of the Plan, the Phantom Stock Units
credited to a Participant's Phantom Stock Account shall be converted
immediately into a cash equivalent amount and credited to, and shall
thereafter be treated in all respects as part of, such Participant's
Cash Account. The cash equivalent amount added to the Cash Account
pursuant to the preceding sentence shall be determined by multiplying
the number of Phantom Stock units then standing to the Participant's
credit by the highest Fair Market Value on any day within the sixty
(60) calendar days preceding the Change in Control or termination of
the Plan.
SECTION 6. PAYMENT OF DEFERRED COMPENSATION ACCOUNT
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6.01 BENEFITS FOLLOWING TERMINATION OF SERVICE, TERMINATION OF THE PLAN, OR A
CHANGE IN CONTROL. Upon termination of a Participant's Service (other than
by death) or termination of the Plan pursuant to Subsection 8.03 of the
Plan:
(a) The amount of a Participant's Cash Account, together with interest
accrued thereon, shall be calculated and shall be distributed in
substantially equal annual installments (together with interest on the
undistributed amount, credited in accordance with Subsection 5.02(a)
of the Plan and payable annually, in arrears, with each annual
installment) over a period of five or ten years, as elected by the
Participant in accordance with Subsection 6.01(c) of the Plan. The
first installment (or the lump sum payment) shall be distributed,
except in the event of a subsequent Change of Control, promptly
following the calendar year in which the Participant's Service
terminates or the Plan is terminated; and subsequent installments
shall, except in the event of a subsequent Change of Control, be
distributed promptly at the beginning of each succeeding calendar year
until the entire amount credited to the Participant's Cash Account
shall have been distributed. All amounts distributed shall be paid in
cash.
(b) The number of Phantom Stock Units in a Participant's Phantom Stock
Account, including Phantom Stock Units credited as a result of
reinvested dividends, shall be calculated, and Stock shall be
distributed to the Participant, either in a single distribution
promptly after the date of such termination of Service or in
substantially equal annual installments (together with additional
Phantom Stock Units credited as a result of reinvested dividends) over
a period of five or ten years, as elected by the Participant in
accordance with Subsection 6.01(c) of the Plan. In the event of a
single distribution of Stock, (i) the value of any fractional Phantom
Stock Unit, calculated by reference to the Fair Market Value of a
share of Stock on the date of termination of the Participant's
Service, shall be distributed and paid in cash to the Participant, and
(ii) the whole number of Phantom Stock Units shall be and become
payable in an equal number
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of shares of Stock, issued by the Company or purchased by the Company
for and in the name of the Participant. In the event of payment of
Stock in installments, the first installment shall, except in the
event of a subsequent Change in Control, be distributed promptly
following the calendar year in which the Participant's Service
terminates, and subsequent installments shall, except in the event of
a subsequent Change in Control, be distributed promptly at the
beginning of each succeeding calendar year until the entire amount
credited to the Participant's Phantom Stock Account shall have been
distributed. To the extent that an installment calculation does not
result in a whole number, the result shall be rounded downwards to the
next whole number and that number of shares of Stock, issued by the
Company or purchased by the Company for and in the name of the
Participant, shall be distributed as and for that installment. Any
fractional Phantom Stock Unit payable as part of the final installment
shall be valued by reference to the Fair Market Value of a share of
Stock on the first business day of the calendar year of payment of the
installment and shall be distributed and paid in cash to the
Participant promptly. In the event of a single distribution of Stock,
or in connection with the first installment of a distribution of Stock
in installments, a stock certificate for any shares of Stock
distributable on account of Phantom Stock Units credited to the
Participant's Phantom Stock Account pursuant to Section 3 or Section 4
of the Plan within six (6) months prior to the date of such
termination of Service shall be held by the Company for a period of
six (6) months following such date and shall be distributed to the
former Director as soon as practicable following the expiration of
such period; and during such period the former Director shall have all
rights of a shareholder of the Company with respect to such shares of
Stock, except that such shares of Stock shall not be transferrable by
the former Director other than by will or the laws of descent and
distribution.
(c) An election pursuant to Subsection 6.01(a) or Subsection 6.01(b) of
the Plan must be made by written notice delivered to the Corporate
Secretary on or before December 31 of the calendar year prior to the
date on which the Participant terminates his or her Service or the
date of the Plan's termination. Upon written request of the Committee,
and in its absolute discretion, a Participant may receive a single
lump-sum distribution of his or her Cash Account. Such request must be
delivered to the Corporate Secretary prior to the date on which the
Participant's Service terminates or the Plan is terminated. In the
event that no timely filed payment election is on record with respect
to a Participant, and except in the event of a Change of Control,
payment of his or her cash Account and Phantom Stock Account shall be
made in installments over a five-year period. Except in the event of a
Change of Control or the termination of the Plan, no portion of a
Deferred Compensation Account shall be distributed to a Participant
prior to his or her termination of Service.
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(d) In the event of a Change of Control, whether the same occurs before or
after termination of the Participant's Service or after termination of
the Plan, all of the Phantom Stock Units credited to a Participant's
Phantom Stock Account, including Phantom Stock Units credited as a
result of reinvested dividends, shall be converted into a cash
equivalent amount, in accordance with Subsection 5.02(b) of the Plan,
and all amounts credited to a Participant's Deferred Compensation
Account, including the amounts converted into cash equivalents from
the Participant's Phantom Stock Account, shall be distributed and paid
in cash to the Participant immediately in a single lump sum.
6.02 DESIGNATION OF BENEFICIARIES. A Participant's spouse shall be the
Participant's Beneficiary under the Plan unless the Participant designates
a different Beneficiary and the Participant's spouse consents to such
designation. If a Participant leaves no surviving spouse, his or her estate
shall be the Beneficiary unless the Participant had designated a different
Beneficiary prior to his or her death. A Participant may designate, on a
form provided for that purpose by the Corporate Secretary, a Beneficiary or
Beneficiaries to receive the cash distributions and/or Stock payments from
the Participant's Deferred Compensation Account in the event of his or her
death, and the period or periods of payment (not to exceed ten years); and
a Participant may direct that such payments be divided in specific portions
among two or more Beneficiaries; but no such designation shall be effective
until it has been filed by the Participant during his or her lifetime with
the Corporate Secretary. Each Participant may, from time to time during his
or her lifetime, on a form filed with the Corporate Secretary, revoke or
change such designation in any or all respects; and the death of a
designated Beneficiary prior to or simultaneously with the death of the
designating Participant shall automatically revoke such designated
Beneficiary's status as a Beneficiary.
6.03 PAYMENTS UPON DEATH. Upon a Participant's death, the provisions of
Subsections 6.01(a) and 6.01(b) of the Plan shall become applicable to the
Participant's Deferred Compensation Account, except that distributions and
payments of cash and Stock shall be made to the Beneficiary or
Beneficiaries, at the time or times designated by the Participant;
provided, however, that in the event of a subsequent Change of Control, or
at the election of the executor or administrator of the estate of such
Participant, all of the Phantom Stock Units remaining credited to the
decedent's Phantom Stock Account, shall be converted into a cash equivalent
amount, in accordance with Subsection 5.02(b) of the Plan in the event of a
Change in Control, or determined by multiplying the number of such Phantom
Stock Units by the Fair Market Value of the Stock on the date of the
election of the decedent's executor or administrator, and distributed and
paid in cash, together with any amount remaining credited to the decedent's
Cash Account on such date, in a lump sum, to such Beneficiary or
Beneficiaries.
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6.04 PAYMENTS TO INCOMPETENTs. If a court of competent jurisdiction determines
that a person entitled to receive any cash amount or Stock to be
distributed or paid hereunder is under a legal disability or is otherwise
incapacitated so that he or she is unable to manage his or her financial
affairs to his or her own best interest and advantage, the Company shall
distribute or pay such cash amount or Stock (a) to such person's spouse,
(b) or his or her legal guardian or conservator, or (c) to any person, to
be held and/or used for such person's benefit, with no responsibility on
the part of the Committee or the Company to monitor the application of the
same. Distributions and/or payments made pursuant to this Subsection 6.04
shall operate as a complete discharge of the obligations under the Plan of
the Company and the Committee in respect of such Participant and all other
persons.
6.05 PROCEDURE FOR CLAIMING A PAYMENT. Any person who believes himself or
herself to be entitled to a distribution or payment pursuant to the Plan
may request, in writing, a review by the Committee of such person's
entitlement under the Plan. Such a request must be sent to the Corporate
Secretary within one year after the Director's termination of Service, or
the termination of the Plan or a Change of Control, or, in the case of a
Beneficiary, within on year after a Participant's death. After review, the
Committee shall, within a reasonable period of time, give, or cause to be
given, to the requesting person written notice of its decision. If
distribution of any cash amount or payment of any Stock claimed is denied,
the decision shall set forth the specific reason(s) for the denial.
6.06 UNCLAIMED BENEFITS. Neither the Company nor the Committee shall be
responsible for locating any person to whom cash amounts or Stock are
distributable or payable pursuant to the Plan.
6.07 SUSPENSION OF DISTRIBUTIONS UPON RE-ELECTION TO THE BOARD. If a Participant
receiving distributions under the Plan returns to Service, distribution or
payment of any undistributed or unpaid cash amounts or Stock under the Plan
shall be suspended until his or her Service terminates again, or the Plan
is terminated pursuant to Subsection 8.02, or a Change of Control occurs,
at which time his or her Deferred Compensation Account shall be recomputed
and adjusted to give effect to any additional cash amounts or Stock
distributable or payable to him or her and to the cash amounts or Stock
previously distributed or paid.
SECTION 7. ADMINISTRATION OF THE PLAN
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7.01 ACCOUNTS AND RECORDS. The accounts and all records necessary for the
administration of the Plan shall be maintained by the Corporate Secretary
and shall accurately disclose the history and status of each Participant's
Deferred Compensation Account and his or her Cash Account and/or Phantom
Stock Account, and all distributions and payments made to each Participant
or Beneficiary or other person under the Plan.
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7.02 EXPENSES. The expenses of administering the Plan shall be paid out of the
general funds of the Company.
SECTION 8. AMENDMENT OR TERMINATION OF THE PLAN
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8.01 AMENDMENT. The Plan may, at any time and from time to time, be amended or
modified in whole or in part by action of the Board; provided, however,
that:
(a) no such amendment shall become effective without the approval of the
shareholders of the Company, if and to the extent shareholder approval
is required in order to comply with Rule 16b-3 promulgated by the
Securities and Exchange Commission under the Securities Exchange Act
of 1934; and
(b) the provisions of the Plan that set forth the amounts and the formula
for determining the amounts, pricing and timing of Stock Awards may
not be amended more than once every six (6) months, other than to
comport with changes in the Internal Revenue Code, the Employee
Retirement Income Security Act, or rules promulgated by the Internal
Revenue Service thereunder; and
(c) unless required by law, no such amendment or modification shall
deprive a Participant of any portion of those Stock Awards and
deferred Fees that have been credited to the Participant's Deferred
Compensation Account as of the date of such amendment or modification;
and
(d) notice of every such amendment shall be given to each Director and
Beneficiary of a deceased Director.
8.02 TERMINATION OF STOCK AWARDS. Unless the Plan is sooner terminated, no Stock
Award shall be made after March 5, 2010.
8.03 TERMINATION OF PLAN. The Plan may be terminated prospectively at any time
by action of the Board; provided, however, that:
(a) the amounts then credited to the Deferred Compensation Accounts of the
Participants shall be distributed to the Participants as provided in
Section 6 of the Plan; and
(b) unless required by law, no such termination shall deprive a
Participant of any portion of those Stock Awards and deferred Fees
that have been credited to the Participant's Deferred Compensation
Account as of the date of such termination; and
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(c) the Board shall not terminate the Plan solely to accelerate the
payment of any amounts previously credited to a Participant's Cash
Account or Phantom Stock Account.
SECTION 9. MISCELLANEOUS PROVISIONS
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9.01 FUNDING. The Company's obligations under the Plan shall be unfunded; and
the Company is not, under any circumstances, required to fund its
obligations hereunder. The Company may, in its sole discretion, purchase
shares of Stock and/or set aside or invest funds to meet its obligations
hereunder in whole or in part. If the Company determines to make such
provisions, the manner of making it, and the continuance or discontinuance
of such provision is solely within the discretion of the Company.
9.02 A PARTICIPANT'S RIGHT TO ASSETS; ASSIGNMENTS; ENCUMBRANCES. Except with
respect to Stock purchased by the Company for and in the name of a
Participant pursuant to Subsection 3.02 or Subsection 6.01(b) of the Plan,
the Plan confers on a Participant no right, title or interest whatsoever in
or to any shares of Stock, or any specific funds or assets of the Company.
The Participant has the rights solely of a general, unsecured creditor with
respect to the enforcement of and payment from the Plan. Except as
aforesaid, if any Stock funds or assets are acquired by the Company in
connection with its obligations under this Plan, they shall not be deemed
to be held in trust or otherwise for the benefit of the Participant, and
the Participant shall have no property right or security interest in such
funds or assets; and any Stock funds or assets so acquired shall be, and
remain, the general, unpledged and unrestricted funds or assets of the
Company. A Participant's right to receive a Stock Award, a Retirement
Program Termination Award, shares of Stock in lieu of a Stock Award, and/or
payment with respect to Phantom Stock Units, under the Plan is not
assignable or transferrable and shall not be subject to any encumbrances,
liens, pledges or charges of the Participant or his or her creditors. Any
attempt to assign, transfer or hypothecate any such Stock Award, Retirement
Program Termination Award, shares of Stock or right to receive payment
shall be null and void and of no force or effect whatsoever.
9.03 STOCK. The aggregate number of shares of Stock that may be issued by the
Company under the Plan shall not exceed 200,000; provided, however, that in
the event of a stock split, stock dividend, recapitalization,
reclassification or other similar change in the Company's capital
structure, the number of shares of Stock that may be issued by the Company
under the Plan shall be appropriately adjusted by and at the direction of
the Board. The grant of Stock Awards and the crediting of Phantom Stock
Units to Phantom Stock Accounts under the Plan shall not affect in any way
the right, power or authority of the Company to issue additional Stocks or
other securities, to make adjustments, reclassifications, reorganizations
or other changes in its corporate, capital or other business
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structure, to participate in a merger, consolidation or share exchange, or
to transfer its assets, dissolve or liquidate.
9.04 GOVERNMENT REGULATIONS.
(a) The obligations of the Company to issue, or purchase, and deliver any
shares of Stock payable under the Plan shall be subject to all
applicable laws, rules and regulations, and to the obtaining of all
such approvals by governmental agencies as may be deemed necessary or
appropriate by the Board.
(b) Except as otherwise provided in Subsection 8.01 of the Plan, the Board
may make such changes in the Plan as may be necessary or appropriate
to comply with the rules and regulations of any governmental
authority.
9.05 EFFECT OF MISTAKE. In the event of a mistake or misstatement as to the
eligibility of any person, or the amount or kind of distributions or
payments made or to be made to a Participant or Beneficiary, the Committee
shall, to the extent it deems possible, make such adjustments as will in
its judgment accord to such Participant or Beneficiary the distributions
and payments to which he or she is properly entitled under the Plan. No
member of the Board and no officer or employee of the Company shall be
liable to any person for any action taken or omitted in connection with the
administration of the Plan, unless attributable to his or her own fraud or
wilful misconduct; and the Company shall not be liable to any person for
any such action, unless attributable to fraud or wilful misconduct on the
part of a Director, officer or employee of the Company.
9.06 NON-EXPANSION OF RIGHTS. Nothing contained in the Plan shall afford any
Director the right to be retained on the Board of Directors of the Company.
Neither the provisions of this Plan nor any act of the Committee or the
Company hereunder shall be construed as giving to any Director or other
person any legal or equitable right or claim against the Company for the
payment of any Stock Award or deferred Fees hereunder, except as otherwise
specifically provided in the Plan.
9.07 HEADINGS OF SECTIONS AND SUBSECTIONS. The headings of Sections and
Subsections are included solely for convenience of reference, and if there
is any conflict between such headings and text of the Plan, the text shall
control.
9.08 ILLEGALITY OF PARTICULAR PROVISION. The illegality of any particular
provision of the Plan shall not affect the other provisions thereof, but
the Plan shall be construed in all respects as if such invalid provision
were omitted.
9.09 APPLICABLE LAW. The validity, interpretation and administration of the
Plan, and the rights of any and all persons having or claiming any interest
in or under the Plan, shall be governed by the law of the State of
Connecticut, except to the extent preempted by federal law.
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