HOUSTON INDUSTRIES INCORPORATED EXECUTIVE INCENTIVE COMPENSATION PLAN
(As Amended and Restated Effective January 1, 1991)
FIFTH AMENDMENT
Houston Industries Incorporated, a Texas corporation (the
"Company"), having amended and restated the Houston Industries Incorporated
Executive Incentive Compensation Plan, effective January 1, 1991 (the "Plan"),
and having reserved the right under Section 18 thereof to amend the Plan, does
hereby amend the Plan, as follows:
1. The last sentence of the first paragraph of Section 4 of the
Plan is hereby amended in its entirety, effective January 1, 1995, to
read as follows:
"Only Participants who were ineligible to participate in the Houston
Industries Incorporated Long-Term Incentive Compensation Plan and who
have participated in the Plan and been continuously employed by an
Employer through December 31 of the current Plan Year and each of the
three (3) preceding Plan Years shall be eligible to receive a Long-Term
Award at the end of the current Plan Year."
2. The first paragraph of Section 10B. of the Plan is hereby
amended in its entirety, effective January 1, 1995, to read as follows:
"B. PAYMENT OF VESTED PORTION OF ANNUAL AWARD. A Participant who
has been granted an Annual Award for a Plan Year must have been
continually employed with an Employer through December 31 of such Plan
Year in order to be eligible for payment of such Annual Award; provided,
however, that if (i) a Participant's Agreement specifies that his Annual
Award contains a vested portion and (ii) the Participant terminates
employment during the Plan Year, but after completion of no less than
three months of continuous service with an Employer, the Participant
shall be eligible to receive a prorated Annual Award which shall be
calculated as a fraction multiplied by the vested portion of the
Participants' target Annual Award for the Plan Year, where the numerator
is the number of full months of completed continuous service with an
Employer during the Plan Year and the denominator is twelve. Such a
prorated Annual Award shall be payable in cash on or before December 31
of the Plan Year during which the Participant terminates employment.
Payment of the vested portion of Annual Awards for Participants who are
continually employed by an Employer
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through December 31 of a Plan Year shall be made in cash as soon as
practicable after the close of the Plan Year, unless such a
Participant's Agreement offered the Participant an irrevocable election,
which the Participant duly made, to defer payment of the vested portion
of such Annual Award and to credit such portion to an account maintained
for such Participant under the Deferred Compensation Plan, which portion
shall then be subject to all the terms and conditions of the Deferred
Compensation Plan and payable as provided in the Deferred Compensation
Plan."
3. The first paragraph of Section 10C. of the Plan is hereby
amended, effective January 1, 1995, by adding the following sentence to
the beginning thereof:
"A Participant must be continuously employed by an Employer
through December 31 of a Plan Year (and through the applicable
Forfeiture Period unless otherwise provided in Section 10E. of the Plan)
in order to be eligible for payment of the contingent portion, if any,
of his Annual Award."
4. Section 12 of the Plan is hereby amended in its entirety,
effective September 7, 1994, to read as follows:
"12. NON-ALIENATION OF BENEFITS. No right or benefit under this
Plan shall be subject to anticipation, alienation, transfer, sale,
assignment, pledge, encumbrance or charge, whether voluntary,
involuntary, direct or indirect, by operation of law or otherwise,
including, without limitation, a change in beneficial interest of any
trust and a change in ownership of a corporation or partnership, but not
including a change of legal and beneficial title of a right or benefit
resulting from the death of any Participant or the spouse of any
Participant (any such proscribed transaction hereinafter a
'Disposition') and any attempted Disposition will be null and void. No
right or benefit hereunder shall in any manner be liable for or subject
to any debts, contracts, liabilities, or torts of any Participant or
other person entitled to such benefits. The foregoing provisions of this
Section 12 shall not apply to a domestic relations order awarding any
benefits under the Plan to the divorced spouse of a Participant. The
foregoing provisions of this Section 12 shall also not apply to an
irrevocable Disposition of a right or benefit under this Plan to a
'Permitted Assignee', as defined below, by (i) a Participant age 55 or
older (an 'Eligible Participant'), or (ii) a 'Permitted Assignee', as
defined below, who has received an assignment from an Eligible
Participant pursuant to this sentence.
(a) PERMITTED ASSIGNEE. The term 'Permitted Assignee'
shall mean:
(i) The Eligible Participant;
(ii) A spouse of the Eligible Participant;
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(iii) Any person who is a lineal ascendant or
descendant of the Eligible Participant or the Eligible
Participant's spouse;
(iv) Any brother or sister of the Eligible
Participant;
(v) Any spouse of any individual described in
subparagraph (iii) or (iv);
(vi) A trustee of any trust which, at the
applicable time, is 100% Actuarially Held for a Permitted
Assignee or Assignees (as defined in Section 12(c));
(vii) Any corporation in which, at the applicable
time, each class of stock is 100% owned by a Permitted
Assignee or Permitted Assignees;
(viii) Any partnership in which, at the applicable
time, each class of partnership interest is 100% owned by
a Permitted Assignee or Permitted Assignees; or
(ix) Any limited liability company or other form of
incorporated or unincorporated business organization in
which each class of stock, membership or other equity
interest is 100% owned by a Permitted Assignee or
Assignees.
(b) SUBSEQUENT ASSIGNEES. This Section 12 shall be fully
applicable to all Permitted Assignees, and the provisions of this
Section 12 shall be fully applicable to any right or benefit
transferred by an Eligible Participant to any Permitted Assignee
as if such Permitted Assignee were an Eligible Participant;
provided, however, that no Permitted Assignee shall be deemed an
Eligible Participant for determining the persons who constitute
Permitted Assignees under Section 12(a). Any Permitted Assignee
acquiring a right or benefit under this Plan shall execute and
deliver to the Committee an Agreement pursuant to which such
Permitted Assignee agrees to be bound by all of the terms and
provisions of the Plan, provided that the failure to execute and
deliver such an Agreement shall not be deemed to relieve such
Permitted Assignee of the restrictions imposed by the Plan. Any
attempted Disposition of a right or benefit under this Plan in
breach of this Section 12, whether voluntary, involuntary, by
operation of law or otherwise shall be null and void.
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(c) ACTUARIALLY HELD. In making the determination whether
a trust is 100% Actuarially Held for Permitted Assignee(s), a
trust, at the applicable point in time, is 100% Actuarially Held
for Permitted Assignee or Assignees when 100% of the actuarial
value of the beneficial interests of the trust, except as
provided in the following sentence, are held for a Permitted
Assignee or Permitted Assignees. For purposes of making the
determination described above, the possibility that an interest
in a trust may be appointed pursuant to a special or general
power of appointment shall be ignored; provided, that the actual
exercise of any such power of appointment shall not be ignored."
IN WITNESS WHEREOF, Houston Industries Incorporated has caused
these presents to be executed by its duly authorized officer in a number of
copies, all of which shall constitute one and the same instrument, which may be
sufficiently evidenced by any executed copy hereof, this 9th day of March, 1995,
but effective as of the date specified herein.
HOUSTON INDUSTRIES INCORPORATED
By /s/ D. D. SYKORA
D. D. Sykora
President and Chief
Operating Officer
ATTEST:
/s/ R. B. DAUPHIN
Assistant Corporate Secretary
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