Exhibit 10.21
NISOURCE INC.
NONEMPLOYEE DIRECTOR
RETIREMENT PLAN
(AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2002)
NISOURCE INC.
NONEMPLOYEE DIRECTOR
RETIREMENT PLAN
(AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 2002)
TABLE OF CONTENTS
PAGE
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Section 1. Purpose......................................................... 1
Section 2. Definitions..................................................... 1
Section 3. Administration.................................................. 2
Section 4. Eligibility for Retirement Benefits............................. 2
Section 5. Amount of Retirement Benefit.................................... 3
Section 6. Payment of Retirement Benefits.................................. 3
Section 7. Payment in the Event of Death................................... 3
Section 8. Payment in the Event of Termination of Service Following
a Change in Control............................................. 4
Section 9. Unfunded Plan................................................... 5
Section 10. Certain Payments................................................ 5
Section 11. Miscellaneous................................................... 6
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NISOURCE INC.
NONEMPLOYEE DIRECTOR RETIREMENT PLAN
Section 1. Purpose. The NiSource Inc. Nonemployee Director Retirement Plan
(the "Plan"), adopted effective January 1, 1991, is hereby amended and restated
effective January 1, 2002. The purpose of the Plan is to assist the Company in
attracting and retaining individuals of superior talent, ability and achievement
to serve on its Board of Directors. As set forth in Section 4, the Plan, as
amended and restated herein, shall cover only Nonemployee Directors serving on
the Board of Directors on December 31, 2001, who elect to continue participation
in the Plan on and after June 1, 2002.
Section 2. Definitions. The following words and phrases shall have
the meanings set forth below unless a different meaning is required by the
context:
(a) "Annual Retainer" means the amount paid by the Company to each
Nonemployee Director as annual compensation for Service as a Director and as a
member of any committee of the Board and as chairman of any such committee,
which amount is exclusive of any Board or committee meeting fees, or
remuneration under other plans, agreements or policies.
(b) "Board" means the Board of Directors of the Company.
(c) "Change in Control" shall have the meaning ascribed to such term
in the Company's Change in Control and Termination Agreements.
(d) "Committee" means the Nominating and Compensation Committee of
the Board.
(e) "Company" means NiSource Inc., a Delaware corporation,
including its subsidiaries and any successor organizations.
(f) "Director" means an individual who is a member of the Board on
or after the Effective Date.
(g) "Disability" means any physical or mental condition of a
permanent nature which, in the sole judgment of the Committee, based upon the
advice of a competent medical professional selected by the Committee, prevents a
Director from performing his or her duties as a member of the Board.
(h) "Effective Date" means January 1, 1991.
(i) "Eligible Nonemployee Director" means a Nonemployee Director who
meets the eligibility requirements for retirement benefits under the Plan, as
set forth in Section 4 herein. "Eligible Nonemployee Director" also shall
include any Nonemployee Director eligible to receive retirement benefits by
virtue of a Change in Control, as set forth in Section 8 herein.
(j) "Nonemployee Director" means a Director who is not currently
employed by the Company or any subsidiary of the Company.
(k) "Plan" means the NiSource Inc. Nonemployee Director Retirement
Plan, including any amendments thereto.
(l) "Service" means a Director's service on the Board as a
Nonemployee Director.
(m) "Year of Service" means the 12-month period commencing with the
first day of the calendar month in which each annual meeting of the shareholders
of the Company takes place, and throughout which a Director served on the Board
as a Nonemployee Director.
Section 3. Administration. The Plan shall be administered by the
Committee. The Committee shall have the authority to interpret the Plan, and any
such interpretation shall be final and binding upon all parties. The Board or
the Committee may amend or terminate the Plan at any time, provided that no such
amendment or termination shall adversely affect the amounts payable or vested
under the Plan before the time of such amendment or termination. The Company
shall pay all distributions made pursuant to the Plan and all costs, charges and
expenses related to the administration of the Plan.
Section 4. Eligibility for Retirement Benefits.
(a) Except as otherwise provided in paragraph (b) next below, any
Eligible Nonemployee Director who retires, resigns or is terminated from Service
on or after the Effective Date, having completed at least five (5) full Years of
Service, shall be eligible to receive a retirement benefit calculated in
accordance with Section 5 herein, and payable in accordance with Section 6
herein.
(b) Any Nonemployee Director first appointed or elected to
membership on the Board on or after January 1, 2002 shall not be eligible to
participate in the Plan. Each Eligible Nonemployee Director participating in the
Plan on December 31, 2001, shall make an irrevocable election, by written
instrument delivered to the Committee between May 21, 2002
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and July 1, 2002, to: (i) continue his or her participation in the Plan on and
after July 1, 2002; or (ii) terminate his or her participation in the Plan as of
June 30, 2002 and have the present value of his or her total monthly retirement
benefit payments under Section 5, determined as of June 30, 2002, payable as
Restricted Stock Units of comparable value granted under the NiSource Inc.
Nonemployee Director Stock Incentive Plan, as amended and restated effective
July 1, 2002, and as subsequently amended.
An Eligible Nonemployee Director who fails to make a timely
election pursuant to clause (i) or (ii) above shall be deemed to have made the
election set forth in clause (i). An Eligible Nonemployee Director who makes the
election described in clause (ii) above shall be credited with five (5) Years of
Service for purposes of Section 4 and with actual Service through June 30, 2002
for purposes of Section 5. For purposes of determining the present value of the
retirement benefit of an Eligible Nonemployee Director who makes the election
described in clause (ii) the interest rate set forth in Section 7 shall be used,
determined as of June 30, 2002.
Section 5. Amount of Retirement Benefit. Except as otherwise provided in
paragraph (b) of Section 4, each Eligible Nonemployee Director shall be paid
monthly payments in an amount equal to one-twelfth (1/12) of the Annual Retainer
in effect as of the effective date of his or her retirement, resignation or
termination from Service. The number of such payments shall equal the lesser of:
(i) one hundred twenty (120) or (ii) the number of full months of Service on the
Board as a Nonemployee Director.
Section 6. Payment of Retirement Benefits. Except as otherwise provided in
paragraph (b) of Section 4, payment of retirement benefits to an Eligible
Nonemployee Director under the Plan shall be made in cash, and shall commence
one (1) month following the termination of such Director's Service for any
reason. For this purpose, the termination of a Director's Service for Disability
shall be deemed to occur on the date that the Committee designates as the date
on which the definition of Disability under the Plan has been satisfied.
Section 7. Payment in the Event of Death. In the event that an Eligible
Nonemployee Director dies prior to the receipt of all retirement benefits set
forth in the Plan, the Company shall pay the present value of the remaining
unpaid retirement benefits owing to the Eligible
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Nonemployee Director under the Plan in one cash lump sum within sixty (60)
calendar days following the date of death. The interest rate to be used to
determine the present value of the unpaid retirement benefits shall be the
six-month U.S. Treasury Bill rate in effect on the date of death. Such payment
shall he made to the surviving spouse of the Eligible Nonemployee Director, if
any. If there is no surviving spouse, then the payment shall be made to the
representative of the estate of the Eligible Nonemployee Director.
Section 8. Payment in the Event of Termination of Service Following a
Change in Control. In the event that the Service of any Eligible Nonemployee
Director (not excluded from participation by paragraph (b) of Section 4) who
served on the Board on the effective date of a Change in Control terminates
within two (2) years following the effective date of a Change in Control, such
Director shall be entitled to receive his or her retirement benefits under the
Plan in the form of a cash lump sum payment in an amount equal to the present
value of the retirement benefits such Director is eligible to receive under the
Plan.
If, within two (2) years following the effective date of a Change in
Control, the Service on the Board of an Eligible Nonemployee Director (not
excluded from participation by paragraph (b) of Section 4) who served on the
Board on the effective date of the Change in Control, terminates prior to the
time when such Director has served on the Board for five (5) full years, such
Director shall be entitled to receive a cash lump sum payment in an amount equal
to seventy-five percent (75%) of the present value of the retirement benefits
such Director would have been entitled to receive under the Plan had such
Director served on the Board for five (5) full years prior to termination of
Service.
For purposes of this Section 8, the interest rate to be used to
determine the present value of the unpaid retirement benefits shall be the
six-month U.S. Treasury Bill rate in effect on
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the date of termination of Service. Payments of retirement benefits under this
Section 8 shall be made within sixty (60) calendar days following the date of
termination of Service on the Board.
In the event that the Committee determines that any payment, whether
paid or payable or distributed or distributable pursuant to the Plan would be
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended, or any interest or penalty with respect to such excise tax
(such excise tax together with any interest or penalties thereon are hereinafter
referred to collectively as the "Excise Tax"), the Nonemployee Director subject
to the Excise Tax shall be paid an additional payment (a "Gross-Up Payment") in
an amount such that, after the payment by such Nonemployee Director of all taxes
(together with any interest or penalties imposed with respect to such taxes),
including any Excise Tax imposed upon the Gross-Up Payment, such Nonemployee
Director retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the payment of retirement benefits under the Plan.
Section 9. Unfunded Plan. The Plan shall be a noncontributory,
nonqualified and unfunded plan. Retirement benefit payments under the Plan shall
represent an unsecured, general obligation of the Company, and shall be paid by
the Company from its general operating assets. No special fund or trust shall be
required to be created by the Company to fund the obligations under the Plan,
nor shall any notes or securities be issued with respect to any retirement
benefits under the Plan.
Section 10. Certain Payments. Whenever a former Nonemployee Director who is
entitled to receive a payment under the Plan is a person under legal disability
or a person not adjudicated incompetent but who, by reason of illness or mental
or physical disability, is, in the opinion of the Committee, unable to manage
properly his or her affairs, then such payments shall
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be paid in one of the following ways, as the Committee deems advisable: (i) to
such person directly; (ii) to the legally appointed guardian or conservator of
such person for his or her exclusive benefit; or (iii) in such other manner for
the exclusive benefit of such person as the Committee considers advisable. Any
payment made in accordance with the provisions of this Section 10 shall be a
complete discharge of any liability of the Company for the making of such
payment under the Plan.
Section 11. Miscellaneous.
(a) Neither the establishment of the Plan, nor any action taken
thereunder, shall in any way obligate: (i) the Company to nominate a Nonemployee
Director for reelection or to continue to retain a Nonemployee Director or (ii)
a Nonemployee Director to agree to be nominated for reelection or to continue to
serve on the Board.
(b) Subject to the provisions of Section 3 hereof, the Plan may not
be canceled by the Company upon any merger or consolidation with, or acquisition
of the Company by, any other entity, but shall be binding upon and inure to the
benefit of the successors and assigns of the Company, and the heirs, executors,
administrators, and assigns of each Eligible Nonemployee Director.
(c) The Plan shall not affect in any way the rights of any Eligible
Nonemployee Director under any deferred compensation plan or agreement between
such Director and the Company.
(d) The Plan shall be governed by and construed according to the
laws of the state of Indiana.
IN WITNESS WHEREOF, the Company has caused this amended and restated
Plan to be signed on this 9th day of September, 2002.
NISOURCE INC.
By: /s/ S. LaNette Zimmerman
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Its: Executive Vice President -
Human Resources and Communications
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