EXHIBIT 10.2
NEW JERSEY RESOURCES CORPORATION
DIRECTORS' DEFERRED COMPENSATION PLAN - PRE-409A
As Amended and Restated Effective as of April 1, 1998
New Jersey Resources Corporation (the "Corporation") hereby
establishes a deferral plan (the "Plan") for the purpose of permitting a member
of the Board of Directors of the Corporation (a "Director") to elect from time
to time to defer the receipt of all or a portion of the Director's retainer and
other fees.
Section 1. Deferral Elections.
a. Election to Defer. A Director may irrevocably elect to
defer the receipt of all or a portion of the fees, including, without
limitation, any retainer, meeting fee or committee meeting fee ("Fees"),
that the Director will become entitled to receive for services as a member
of the Board of Directors of New Jersey Resources Corporation (the "Board
of Directors") for a given calendar year. If a Director elects to defer
only a portion of the Director's Fees, the Director must defer at least
20% of the Director's Fees and may defer any percentage of the Director's
Fees which is a multiple of 20%, in whole percentages, and such percentage
of each payment of Fees for services during the calendar year covered by
the Director's election shall be deferred.
b. Election of Deferral Period. A Director who elects to defer
receipt of all or a portion of the Director's Fees for a given calendar
year shall also elect whether the deferred Fees are to be paid, or
commence to be paid,
(i) during January of the sixth year following the
calendar year in which the deferred Fees would otherwise have been
paid to the Director, or, if earlier, within a reasonable period of
time after the last business day of the calendar quarter in which
the Director ceases to be a member of the Board of Directors; or
(ii) within a reasonable period of time after the last
business day of the calendar quarter in which the Director ceases to
be a member of the Board of Directors.
If the Director does not make an election under this Section 1 (b) with
respect to the time of payment of his deferred Fees for a given calendar
year, the Director's deferred Fees for that calendar year shall be paid
within a reasonable period of time after the last business day of the
calendar quarter in which the Director ceases to be a member of the Board
of Directors.
The Deferral Period is the period beginning on the date the
deferred Fees would otherwise have been paid to the Director and ending on
the date the deferred Fees are to be paid, or commence to be paid,
pursuant to the Director's election under this Section 1 (b).
c. Election of Method of Payment of Deferred Fees. A Director
who elects to defer the receipt of all or a portion of the Director's Fees
for a given calendar year shall also elect whether the deferred Fees are
to be paid, subject to Section 3,
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(i) in a single sum payment, as soon as practicable after the
end of the Deferral Period, or
(ii) in the number of annual installments elected by the
Director (but not more than 5) with such installments commencing as soon
as practicable after the end of the Deferral Period. The amount of each
such installment shall be equal to the amount credited to the Director's
Deferred Fee Account (as defined in Section 2 below) on the day next
preceding the date of payment of the installment, divided by the number of
installments remaining to be paid. The unpaid portion of the Director's
deferred Fees shall continue to be adjusted, as provided in Section 2,
during the period that the Director is receiving such installment
payments.
If a Director does not make an election under this Section 1 (c)
with respect to the method of payment of his deferred Fees for a given calendar
year, the Director's deferred Fees for that calendar year shall be paid in the
same manner as the Director's deferred Fees for the next preceding calendar year
with respect to which the Director made an election as to the method of payment.
If the Director has not previously elected to defer Fees, or has not previously
elected the method of payment of his deferred Fees, the Director's deferred Fees
shall be paid in a single sum payment, as soon as practicable after the end of
the Deferral Period for such deferred Fees.
d. Time and Manner of Elections. A Director's elections shall be
made by filing a written notice with the Secretary of the Corporation (the
"Secretary") on the form prescribed by the Secretary for this purpose. The
elections with respect to the deferral of the Director's Fees for a given
calendar year shall be made no later than December 31st of the preceding year;
provided, however, that (i) for calendar year 1995, a Director may make the
elections with respect to Fees for such year to be earned after such elections
are made within 30 days after the Plan is adopted by the Board of Directors, and
(ii) for the calendar year in which an individual first becomes a Director, the
Director may make the elections with respect to Fees for such year to be earned
after such elections are made within 30 days after first becoming a Director.
Section 2. Earnings on Deferred Fees.
a. Establishment of Deferral Accounts. A Director's deferred Fees
for a given calendar year shall be credited to an account established and
maintained to record such deferred Fees (a "Deferred Fee Account"). Such credit
shall be as of the date such deferred Fees would otherwise have been payable to
the Director. A separate Deferred Fee Account shall be established and
maintained for each calendar year.
b. Investment Elections for Deferred Fees. At the time a Director
elects to defer receipt of Fees, the Director shall designate in writing the
portion of such Deferred Fees, stated as a whole percentage, to be credited to
the Interest Account and the portion to be credited to the Stock Account. Any
Deferred Fees to be credited to either such Account shall be rounded to the
nearest whole cent, with amounts equal to or greater than $.005 rounded up and
amounts below $.005 rounded down. If a Director fails to elect how to allocate
any Deferred Fees between the two investment accounts, 100% of such Deferred
Fees shall be credited to the Stock Account. By written notice to the
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Secretary of the Company, a Director may request that Deferred Fees previously
credited to the Interest Account be allocated to the Stock Account.
Notwithstanding any other provision of the Plan to the contrary, amounts
credited to a Director's Stock Account, whether originally credited or
reallocated to the Stock Account, may not be reallocated or deemed reinvested in
any other investment vehicle, but shall remain as Deferred Stock until such time
as the Deferred Fee Account is settled in accordance with Section 1.d. Any such
election shall be effective as of the first calendar quarter commencing after
receipt of such election. No Director may make any election to change the way in
which amounts previously allocated to the Director's Interest Account are
deemed invested within six months of the date of the last such election by such
Director to change the way in which such amounts are deemed invested. A Director
may elect to change the way Fees not yet credited to the Director's Deferred Fee
Account are deemed invested as of the end of any calendar month by written
notice to the Secretary of the Company received prior to the end of such month,
and may make up to three such elections each year."
As of the end of each calendar month, any Deferred Fees credited to
the Interest Account will be credited with interest, at an annual rate equal to
(1) the Prime Rate in effect during such month plus two (2) percentage points,
on the average daily balance credited to the account during such month. The
Prime Rate in effect during a calendar month shall be determined by reference to
the Prime Rate listed in the Wall Street Journal as the "base rate on corporate
loans posted by at least 75% of the nation's 30 largest banks or, if at any time
such rate is not reported in the Wall Street Journal, such comparable publicly
available measurement of the cost of corporate borrowing as the Board of
Directors shall determine. If the Prime Rate changes during a calendar month,
the Prime Rate used to determine the amount of interest to be credited to a
Director's Deferred Fee Account will be determined by dividing (1) the sum of
the products of (A) each Prime Rate in effect during the month and (B) the
number of business days that such Prime Rate was in effect, by (2) the number of
business days during such month. If more than one Prime Rate is listed in the
Wall Street Journal for a given day, the Prime Rate for that day shall be the
average of such Prime Rates.
(c) Stock Account. Any Deferred Fees allocated to the Stock Account
shall be deemed invested in a number of notional shares of the Company's common
stock (the "Units") equal to the quotient of (i) such Deferred Fees divided by
(ii) the Fair Market Value (defined below) on the date the Deferred Fees then
being allocated to the Stock Account would otherwise have been paid or the
Shares would have been granted, as the case may be. Fractional Units shall be
credited, but shall be rounded to the nearest hundredth percentile, with amounts
equal to or greater than .005 rounded up and amounts less than .005 rounded
down. Whenever a dividend other than a dividend payable in the form of shares is
declared with respect to the shares, the number of Units in the Director's Stock
Account shall be increased by the number of Units determined by dividing (i) the
product of (A) the number of Units in the Director's Stock Account on the
related dividend record date and (B) the amount of any cash dividend declared by
the Company on a Share (or, in the case of any dividend distributable in
property other than common stock, the per share value of such dividend, as
determined by the Company for purposes of income tax reporting) by (ii) the Fair
Market Value on the related dividend payment date. In the case of any dividend
declared on common stock which is payable in shares of common stock, the
Director's Stock Account shall be increased by the number of Units
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equal to the product of (i) the number of Units credited to the Directors Stock
Account on the related dividend record date and (ii) the number of shares
(including any fraction thereof) distributable as a dividend on a share. In the
event of any change in the number or kind of outstanding shares of common stock
by reason of any recapitalization, reorganization, merger, consolidation, stock
split or any similar change affecting such shares, other than a stock dividend
as provided above, the Board shall make an appropriate adjustment in the number
of Units credited to the Director's Stock Account. For purposes of this section,
"Fair Market Value" on any date shall mean the closing price of a share of
Common Stock on such date as reported in the principal consolidated transaction
reporting system on which the common stock is principally traded.
(d) Distribution from Accounts Upon Termination of Service as a
Director. At the time a Director makes a deferral election, the Director shall
also file with the Secretary of the Company a written election (a "Distribution
Election") with respect to whether the aggregate amount, if any, credited to the
Interest Account at any time and the value of any Units to be credited to the
Stock Account shall be distributed wholly in cash, in the greatest number of
whole shares of common stock (with any fractional interest payable in cash) or
combination of cash and whole Shares. A Director may at any time, and from time
to time, change any Distribution Election applicable to the Director's
investment accounts.
Section 3. Method of Payment in the Event of Death. If a Director dies while a
member of the Board of Directors or prior to the full payment to the Director of
all of the Director's deferred Fees, as adjusted as provided in Section 2, an
amount equal to the unpaid portion of such deferred Fees, as adjusted as
provided in Section 2, shall be paid in a single sum payment to the Director's
designated beneficiary or beneficiaries. Such single sum payment shall be made
as soon as practicable after the death of the Director.
Section 4. Miscellaneous.
a. Designation of Beneficiary. A Director may designate a
beneficiary or beneficiaries (which may be an entity other than a natural
person) to receive any payments of the Director's deferred Fees to be made upon
the Director's death. At any time, and from time to time, any such designation
may be changed or canceled by the Director without the consent of any
beneficiary. Any such designation, change or cancellation must be by written
notice filed with the Secretary and shall not be effective until received by the
Secretary. Any such written notice may apply to (i) only the Director's deferred
Fees for a particular calendar year or years, or (ii) all of the Director's
deferred Fees, including Fees to be deferred in future years.
If a Director designates more than one beneficiary with respect to any
portion of the Director's deferred Fees, any payments to such beneficiaries
shall be made in equal shares unless the Director has designated otherwise, in
which case the payments shall be made in the shares designated by the Director.
If no beneficiary has been named by a Director with respect to all or a portion
of the Director's deferred Fees, or the designated beneficiaries with respect to
all or a portion of the Director's deferred Fees have predeceased the Director,
the Director's beneficiary with respect to such deferred Fees shall be the
executor or administrator of the Director's estate.
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b. All Payments In Cash. All payments of deferred Fees shall
be made in cash, provided that a Director who has elected to have all or a
portion of any of the Director's Deferred Fee Account treated as though
invested in Shares and who elects to receive a distribution of any such
Account in a single lump sum may elect to receive the portion of such
Account so invested in Shares.
c. No Right to Continue as a Director. Nothing contained in
this Plan shall be construed as conferring upon a Director any right to
continue as a member of the Board of Directors.
d. No Right to Corporate Assets. Nothing contained in this
Plan shall be construed as giving a Director, a Director's designated
beneficiaries or any other person any equity or interest of any kind in
the assets of the Corporation or creating a trust of any kind or a
fiduciary relationship of any kind between the Corporation and any such
person. As to any claim for payments due with respect to a Director's
deferred Fees, the Director, the Director's designated beneficiaries and
any other persons having a claim for payments shall be unsecured creditors
of the Corporation.
e. No Limit on Further Corporate Action. Nothing contained in
this Plan shall be construed so as to prevent the Corporation from taking
any corporate action which is deemed by the Corporation to be appropriate
or in its best interest.
f. Assignment; Successor in Interest. The rights and benefits
of a Director with respect to the Director's deferred Fees are personal to
the Director, and neither the Director nor the Director's designated
beneficiaries shall have the power or right to transfer, assign,
anticipate, mortgage, or otherwise encumber any payments to be made with
respect to the Director's deferred Fees.
The obligations of the Corporation with respect to deferred
Fees are not assignable or transferable except to a corporation which
acquires all or substantially all of the assets of the Corporation, or any
corporation into which the Corporation may be merged, converted or
consolidated.
These terms and provisions shall inure to the benefit of a
Director's designated beneficiaries, heirs, executors, administrators and
successors in interest.
g. Amendment and Termination. The Board of Directors may from
time to time and at any time alter or amend this Plan or suspend,
discontinue or terminate the deferral by Directors of their retainer and
other fees; provided, however, that no such action, which would adversely
affect the amount, form or time of payment of the retainer and other fees
which, as of the effective date of such action, had been deferred pursuant
to a Director's election, shall be effective without the Director's
written consent.
h. Governing Law. This Plan shall be construed in accordance
with and be governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, New Jersey Resources Corporation has caused this
Amended and Restated Plan to be executed this 16th day of May, 2006.
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NEW JERSEY RESOURCES CORPORATION
Attest: /s/ Rhonda M. Figueroa By: /s/ Laurence M. Downes
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Rhonda M. Figueroa Laurence M. Downes
Corporate Secretary Chairman and Chief Executive Officer
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