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EXIBIT 10-8
MCN CORPORATION
MANDATORY DEFERRED COMPENSATION PLAN
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TABLE OF CONTENTS
SECTION PAGE
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SECTION 1
TITLE, PURPOSE AND EFFECTIVE DATE
1.01. Title ..................................
1.02. Purpose ................................
1.03. Effective Date .........................
SECTION 2
DEFINITIONS
2.01. "Account" ..............................
2.02. "Affiliated Company" ...................
2.03. "Annual Base Salary" ...................
2.04. "Annual Incentive Compensation" ........
2.05. "Beneficiary" ..........................
2.06. "Board of Directors" ...................
2.07. "Code" .................................
2.08. "Committee" ............................
2.09. "Company" ..............................
2.10. "Covered Employee" .....................
2.11. "Deferral" .............................
2.12. "Deferral Form" ........................
2.13. "Deferral Period" ......................
2.14. "ERISA" ................................
2.15. "FICA" .................................
2.16. "In Pay Status" ........................
2.17. "Participant" ..........................
2.18. "Performance Unit Award" ...............
2.19. "Plan" .................................
2.20. "Plan Interest Rate" ...................
2.21. "Plan Year" ............................
2.22. "Restricted Stock Plan" ................
2.23. "Savings Plan" .........................
2.24. "Spouse" ...............................
2.25. "Total Compensation" ...................
SECTION 3 ..................................................................
PARTICIPATION
3.01. Determination of Covered Employee Status
3.02. Commencement of Participation ..........
3.03. Deferral Form ..........................
3.04. Amount of Deferral .....................
3.05. Increased Deferral .....................
3.06. Denomination of Deferrals ..............
3.07. Establishment of Account ...............
SECTION 4 ..................................................................
FUNDING OF BENEFITS
4.01. Unfunded Plan ..........................
4.02. Dividend Equivalents ...................
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SECTION PAGE
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SECTION 5 ..................................................................
FORM AND TIMING OF PAYMENT
5.01. Form and Timing of Payment .............
5.02. Change in Payment Option ...............
5.03. Hardship Withdrawal Benefits ...........
SECTION 6 ..................................................................
SELECTION OF AND PAYMENTS TO A BENEFICIARY ........................
6.01. Beneficiary Designation ................
6.02. Change in Beneficiary Designation ......
6.03. Pre-Retirement Survivor Benefit ........
6.04. Post-Retirement Survivor Benefit .......
SECTION 7 ..................................................................
VESTING OF BENEFITS
7.01. Vesting of Benefits ....................
SECTION 8 ..................................................................
ADDITIONAL PROVISIONS AFFECTING BENEFITS
8.01. Tax Withholding ........................
8.02. Dilution and Other Adjustments .........
SECTION 9
ADMINISTRATION OF THE PLAN
9.01. Duties and Power .......................
9.02. Benefit Statements .....................
SECTION 10
AMENDMENT, SUSPENSION, AND TERMINATION
10.01. Right to Amend or Terminate ............
10.02. Right to Suspend .......................
10.03. Non-ERISA Plan .........................
10.04. Right to Accelerate ....................
SECTION 11
MISCELLANEOUS
11.01. Right to Continued Employment ..........
11.02. Prohibition Against Alienation .........
11.03. Sayings Clause .........................
11.04. Payment of Benefit of Incompetent ......
11.05. Spouse's Interest ......................
11.06. Successors .............................
11.07. Gender, Number and Heading .............
11.08. Legal Fees and Expenses ................
11.09. Choice of Law ..........................
11.10. Affiliated Employees ...................
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SECTION PAGE
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SECTION 12
CHANGE IN CONTROL PROVISIONS
12.01. General ................................
12.02. Transfer to Rabbi Trust ................
12.03. Joint and Several Liability ............
12.04. Definition of Change in Control ........
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MCN CORPORATION
MANDATORY DEFERRED COMPENSATION PLAN
SECTION 1
TITLE, PURPOSE AND EFFECTIVE DATE
1.01. Title. The title of this Plan shall be the "MCN Corporation
Mandatory Deferred Compensation Plan" and shall be referred to in this document
as the "Plan."
1.02. Purpose. The purpose of the Plan is to promote the success of
MCN Corporation (hereinafter referred to as the "Company") by providing the
Company a method to meet the deduction limitation in Section 162(m) of the
Internal Revenue Code of 1986, as amended, whereby Covered Employees of the
Company and its affiliated companies are required to defer the amount of
compensation payable in one calendar year in excess of $1 million until after
completion of the Deferral Period thereby increasing the employees' personal
interest in the continued success and progress of the Company.
It is intended that this Plan provide benefits for "a select group of
management or highly compensated employees" within the meaning of Sections 201,
301 and 401 of the Employee Retirement Income Security Act of 1974, as amended
(hereinafter referred to as "ERISA") and, therefore, to be exempt from the
provisions of Parts 2, 3 and 4 of Title I of ERISA.
1.03. Effective Date. The Plan shall be effective January 1, 1995.
SECTION 2
DEFINITIONS
The following words and terms used herein shall, unless the context
clearly requires a different meaning, have the respective meanings hereinafter
set forth.
2.01. "Account" means the record maintained by the Company of each
Participant's Deferrals, credited dividend equivalents and distributions under
the Plan.
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2.02. "Affiliated Company" means any corporation while such
corporation is a member of the same controlled group of corporations (within
the meaning of Section 414(b) of the Code) as the Company or any other
employing entity while such entity is under common control (within the meaning
of Section 414(c) of the Code) with the Company.
2.03. "Annual Base Salary" means annual base salary payable in the
current Plan Year after any deferrals under Sections 125, 129 or 401(k) of the
Code and after any election to defer an amount under the MCN Executive Deferred
Compensation Plan and the MichCon Supplemental Savings Plan and before any
payroll deduction for taxes or any other purpose, but excluding any bonus,
fringe benefit or other form of remuneration.
2.04. "Annual Incentive Compensation" means the cash compensation
earned in the current Plan Year and payable in the subsequent Plan Year under
the MCN Corporation Annual Management Performance Plan.
2.05. "Beneficiary" means the person, persons or entity designated
in writing by the Participant on forms provided by the Company to receive
distribution of certain death benefits under the Plan in the event of the
Participant's death.
2.06. "Board of Directors" means the Board of Directors of the
Company.
2.07. "Code" means the Internal Revenue Code of 1986, as amended.
2.08. "Committee" means the Savings Plan Committee under the MichCon
Savings and Stock Ownership Plan (as defined in Section 2.23). The Committee
is responsible for the administration of the Plan.
2.09. "Company" means MCN, a Michigan corporation, its successors
and assigns, and any affiliated company.
2.10. "Covered Employee" means any employee with Total Compensation
in excess of $1 million who, on the last day of the taxable year, is the chief
executive officer ("CEO") of the Company or is acting in such capacity, or is
among the four highest compensated officers (other than the CEO) whose
compensation is required by the Securities Exchange Act of 1934 to be disclosed
in the Company's proxy statement.
2.11. "Deferral" means the amount of a Participant's Performance
Unit Award, Restricted Stock Award, Annual Incentive Compensation and/or Annual
Base Salary that must be deferred in accordance with Section 3 to reduce the
Participant's estimated Total Compensation to an amount less than $1 million
for a Plan
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Year. The source of the Deferral shall be at the discretion of the Company's
Director of Human Resources. Deferral amounts are retained by the Company as
part of its general assets.
2.12. "Deferral Form" means the deferral form described in Section
3.03 relating to a Participant's commitment to make a Deferral.
2.13. "Deferral Period" means the period beginning with the date a
Participant becomes a Covered Employee and ending the day after the date the
Participant is no longer a Covered Employee.
2.14. "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
2.15. "FICA" means the Federal Insurance Contributions Act tax as
set forth in Chapter 26 of the Code.
2.16. "In Pay Status" means a benefit under the Plan that is
currently being paid or that is about to be paid to a Participant or
Beneficiary under Section 5.01, 6.01, 6.03 or 6.04.
2.17. "Participant" means a Covered Employee who has made a written
election on a properly executed Deferral Form to participate in the Plan in
accordance with Section 3.02.
2.18. "Performance Unit Award" means the final award under the MCN
Corporation Long Term Incentive Performance Unit Plan which is part of the MCN
Corporation Stock Incentive Plan.
2.19. "Plan" means the MCN Corporation Mandatory Deferred
Compensation Plan, as described herein and as hereafter amended.
2.20. "Plan Interest Rate" means the interest rate for the latest
issue, as of the end of the previous month, of ten-year U.S. Treasury Notes,
or such other rate as set by the Committee.
2.21. "Plan Year" means the period beginning January 1 and ending
December 31 of each year (the calendar year).
2.22. "Restricted Stock Award" means the final award under the
Restricted Stock Program which is part of the MCN Corporation Stock Incentive
Plan.
2.23. "Savings Plan" means the MichCon Savings and Stock Ownership
Plan or a successor thereto.
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2.24. "Spouse" means an individual who is legally married to a
Participant under the laws of the State in which the Participant resides, on
the day immediately preceding the Participant's date of death.
2.25. "Total Compensation" means all remuneration for services
received by an employee in a calendar year, including cash and the cash value
of all noncash remuneration (including taxable benefits) less any amount
deferred under Sections 125, 129 and 401(k) of the Code, the MCN Executive
Deferred Compensation Plan and the MichCon Supplemental Savings Plan.
Generally, Total Compensation will equal the taxable compensation as reportable
on a Form W-2.
SECTION 3
PARTICIPATION
3.01. Determination of Covered Employee Status. To determine
whether an employee is a Covered Employee, the estimated Total Compensation of
an employee who would be a Covered Employee if such employee had Total
Compensation in excess of $1 million shall monitored.
3.02. Commencement of Participation. An employee shall become a
Participant upon execution of a Deferral Form no later than 15 days after the
execution of this Plan or the December 22 prior to the January 1 of the year
the Company has determined the employee will become a Covered Employee. A
properly executed Deferral Form shall be effective on the January 1 immediately
following execution of the Deferral Form, and shall contain the items described
in this Section and in Sections 3.03, 5.01 and 6.01. Subject to Section 5.03,
the mandatory deferral required by the Plan shall be effective for all Plan
Years the Participant is a Covered Employee and shall be irrevocable.
3.03. Deferral Form. The Committee shall provide each Covered
Employee with a Deferral Form as set forth in Exhibit A. A Participant shall
file a Deferral Form to defer Total Compensation in excess of $1 million for
all Plan Years in which he is a Covered Employee. A Participant's consent to
the mandatory deferral required by the Plan, as evidenced by his signature on
the Deferral Form, shall be irrevocable during the Deferral Period. The
Deferral Form shall set forth the Covered Employee's acceptance of the benefits
provided hereunder, his agreement to be bound by the terms of the Plan and such
other matters as are set forth in this Plan or deemed advisable by the
Committee.
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3.04. Amount of Deferral. A Participant's Deferral shall be equal
to an amount that will reduce the Participant's estimated Total Compensation
for the subsequent Plan Year to an amount less than $1 million. However, such
annual Deferral shall not exceed
(a) 100% of the Performance Unit Award less the FICA tax thereon;
(b) 100% of the Restricted Stock Award less the FICA tax thereon;
(c) 100% of the Annual Incentive Compensation less the FICA tax
thereon; and
(d) 100% of Annual Base Salary less the FICA tax thereon;
and shall not be less than $10,000.
3.05. Increased Deferral. A Participant's Deferral shall increase
automatically for each Plan Year in which he is a Participant, up to the limits
set forth in Section 3.04.
3.06. Denomination of Deferrals. A Participant's Deferral shall be
denominated in Company common stock valued at an amount equal to the closing
price of a share of Company common stock on the New York Stock Exchange
Composite Tape for the trading day preceding the day on which a deferral is to
be made. Dividend equivalents shall be credited to the Participant's Account
in accordance with Section 4.02.
3.07. Establishment of Account. The Committee shall establish an
Account for each Participant to which the Participant's Deferrals shall be
credited, dividend equivalents in accordance with Section 4.02 shall be
reinvested and distributions shall be debited.
SECTION 4
FUNDING OF BENEFITS
4.01. Unfunded Plan. The Plan shall be unfunded. All benefits
payable under the Plan shall be paid from the Company's general assets. The
Company shall not be required to set aside or hold in trust any funds for the
benefit of a Participant or Beneficiary, who shall have the status of a general
unsecured creditor with respect to the Company's obligation to make benefit
payments pursuant to the Plan. Any assets of the Company available
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to pay Plan benefits shall be subject to the claims of the Company's general
creditors and may be used by the Company in its sole discretion for any
purpose.
4.02. Dividend Equivalents. Dividend equivalents equal to 50% of
the dividends payable on MCN Common Stock shall be credited to a Participant's
Account during the Deferral Period based on the number of shares of Company
common stock deemed to be held in such Participant's Account. A Participant
may elect on his Deferral Form to have 0%, 50% or 100% of such credited
dividend equivalents paid directly to him in cash during the Plan Year. A
Participant's election regarding credited dividend equivalents shall be
effective on the January 1 immediately following execution of his Deferral Form
and shall remain in effect until revoked by the Participant. Revocation of a
dividend equivalent election shall be effective on the January 1 immediately
following revocation.
SECTION 5
FORM AND TIMING OF PAYMENT
5.01. Form and Timing of Payment. After completion of his Deferral
Period, a Participant shall be entitled to a distribution of his Account on the
first of the month following the month in which his Deferral Period ends. The
distribution to a Participant shall be paid in cash in an amount equal to the
number of shares of Company common stock deemed to be held in the Participant's
Account and valued at the closing price of MCN Corporation common stock on the
New York Stock Exchange Composite Tape on the day before payment is made.
Payment shall be made in accordance with the Participant's selection on his
Deferral Form; either in equal monthly payments over a period not less than one
year and not more than 15 years, in one year increments, or as a lump sum
distribution of the Participant's Account. The amount of monthly payments
shall be calculated to pay out over the specified period the entire balance in
the Participant's Account as of the end of the Deferral Period with interest
credited monthly on the declining balance at the Plan Interest Rate. The
amount of the monthly payments to the Participant shall be adjusted on January
1 of each year to reflect changes in the Plan Interest Rate and other changes
to the Participant's Account balance.
5.02. Change in Payment Option. The payment option selected by the
Participant on his Deferral Form may be changed at any time by the Participant
by submitting a new payment selection to the Committee, but a change shall be
effective only if it is received by the Committee at least 36 months before
payments under the Plan commence.
5.03. Hardship Withdrawal Benefits. At any time prior to
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a distribution in accordance with Section 5.01, a Participant may request that
the Committee make a distribution to him of all or part of his Account within
120 days. Such distribution shall be made only if the Committee determines
that the Participant is suffering from a financial hardship that cannot be
satisfied from his normal sources of income, and the distribution shall be
limited to the amount required to meet the financial hardship. In making these
determinations, the Committee shall utilize the regulations proposed or adopted
by the U.S. Department of Treasury pursuant to Section 401(k) of the Code and
the rules under the Savings Plan. A financial hardship shall be satisfied from
the Plan to the extent possible then from the MCN Executive Deferred
Compensation Plan, the Supplemental Savings Plan, and finally from the Savings
Plan.
SECTION 6
SELECTION OF AND PAYMENTS TO A BENEFICIARY
6.01. Beneficiary Designation. A Participant shall designate a
Beneficiary on his Beneficiary Designation Form, as provided in Exhibit B. The
designation of a Beneficiary other than the Participant's Spouse must be
consented to in writing by the Spouse. If a Participant has not designated a
Beneficiary, or if a designated Beneficiary is not living or in existence at
the time of a Participant's death, any death benefits payable under the Plan
shall be paid to the Participant's Spouse, if then living, and if the
Participant's Spouse is not then living, to the Participant's estate.
6.02. Change in Beneficiary Designation. A Participant may change
the designated Beneficiary, subject to the restriction in Section 6.01, from
time to time by filing a new written designation with the Committee. Such
designation shall be effective upon receipt by the Committee.
6.03. Pre-Retirement Survivor Benefit. If a Participant dies prior
to completion of the Deferral Period, his Beneficiary shall be entitled to
receive a distribution of the Participant's Account. The distribution to a
Beneficiary shall be paid in cash in an amount equal to the number of shares of
Company common stock deemed to be held in the Participant's Account and valued
at the closing price of MCN Corporation common stock on the New York Stock
Exchange Composite Tape on the day of the Participant's death. The
distribution shall be paid in accordance with the Participant's selection on
his Deferral Form; either in monthly payments over a period not less than one
year and not more than 15
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years, in one year increments, or as a lump sum distribution. Payments to the
Beneficiary shall begin as soon as practicable, but in no event later than one
year following the Participant's death.
6.04. Post-Retirement Survivor Benefit. If a Participant dies
subsequent to the start of his distribution payments under Section 5.01, his
Beneficiary shall be entitled to continue to receive the distribution of the
Participant's Account for the remainder of the period over which benefits were
being paid to the deceased Participant.
SECTION 7
VESTING OF BENEFITS
7.01. Vesting of Benefits. A Participant shall be 100% vested in
his benefits under the Plan at all times, except as set forth in Sections 8.02,
10.02, 10.03 and 10.04. A Participant shall rank as an unsecured creditor of
the Company for all benefits under the Plan.
SECTION 8
ADDITIONAL PROVISIONS AFFECTING BENEFITS
8.01. Tax Withholding. Benefit payments hereunder shall be subject
to applicable federal, state or local tax withholding laws.
8.02. Dilution and Other Adjustments. In the event of any change in
the outstanding shares of Company common stock by reason of any stock dividend,
stock split, recapitalization, merger, consolidation, spin-off, reorganization,
combination or exchange of shares or other similar corporate change, the
Committee, in its sole discretion, shall make the appropriate adjustment in
each Participant's Account. If any such adjustment shall result in a
fractional share, such fraction shall be disregarded. Such adjustments made by
the Committee shall be conclusive and binding for all purposes of the Plan.
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SECTION 9
ADMINISTRATION OF THE PLAN
9.01. Duties and Power. The Committee shall be responsible for the
general administration of the Plan and the proper execution of its provisions.
It shall also be responsible for the interpretation of the Plan and the
determination of all questions arising thereunder. It shall maintain all
necessary books of accounts and records. It shall have power to establish,
interpret, enforce, amend, and revoke, from time to time, such rules and
regulations for the administration of the Plan and the conduct of its business
as it deems appropriate, including the right to remedy ambiguities,
inconsistencies and omissions (provided such rules and regulations are
uniformly applied to all persons similarly situated). Any action that the
Committee is required or authorized to take shall be final and binding upon
each and every person who is or may become a Plan Participant or Beneficiary.
The Committee may amend this Plan to comply with changes to the Code, so long
as the amendment does not materially increase the cost of maintaining the Plan
or decrease benefits to Participants or Beneficiaries.
9.02. Benefit Statements. No later than 120 days after the end of
each Plan Year, the Committee will provide each Participant with a statement
setting forth the Participant's Account balance as of the last day of the
immediately preceding Plan Year.
SECTION 10
AMENDMENT, SUSPENSION, AND TERMINATION
10.01. Right to Amend or Terminate. The Plan may be amended or
terminated by the Board of Directors at any time. Such amendment or
termination may modify or eliminate any benefit hereunder except that such
amendment or termination shall not affect the rights of Participants or
Beneficiaries to the vested portion of a Participant's Account as of the date
of such amendment or termination.
10.02. Right to Suspend. If the Board of Directors determines that
payments under the Plan would have a materially adverse affect on the Company's
ability to carry on its business, the Board of Directors may suspend such
payments temporarily for such time as in it sole discretion it deems advisable,
but in no event for a period in excess of one year. During the period of
suspension, the payment of dividend equivalents shall continue to
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be made in cash to the Participant in accordance with Section 5.01. The
Company shall pay such suspended payments in a lump sum immediately upon the
expiration of the period of suspension.
10.03. Non-ERISA Plan. The Plan is intended to provide benefits for
"a select group of management or highly compensated employees" within the
meaning of Sections 201, 301 and 401 of ERISA, and therefore to be exempt from
Sections 2, 3 and 4 of Title 1 of ERISA. Accordingly, the Plan shall terminate
and, existing Account balances and other benefits In Pay Status shall be paid
in a single, actuarially equivalent lump-sum and no further benefits, vested or
non-vested, shall be paid hereunder in the event it is determined by a court of
competent jurisdiction or by an opinion of counsel that the Plan constitutes an
employee pension benefit plan within the meaning of Section 3(2) of ERISA which
is not so exempt.
10.04. Right to Accelerate. The Board of Directors in its sole
discretion may accelerate all vested benefits upon termination of the Plan, and
pay such benefits in a single, actuarially equivalent lump-sum.
SECTION 11
MISCELLANEOUS
11.01 Right to Continued Employment. Nothing in the Plan shall
create or be construed as a contract between the Company and employees for any
matter including giving any person employed by the Company the right to be
retained in the Company's employ. The Company expressly reserves the right to
dismiss any person at any time, with or without cause, without liability for
the effect that such dismissal might have upon him as a Participant in the
Plan.
11.02. Prohibition Against Alienation. Except as otherwise provided
in the Plan, no right or benefit under the Plan shall be subject in any manner
to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
or charge, and any attempt to so anticipate, alienate, sell, transfer, assign,
pledge, encumber, or charge the same shall be void. No such right or benefit
shall be liable for or subject to the debts, contracts, liabilities,
engagements, or torts of the person entitled to such right or benefit.
11.03. Sayings Clause. If any provision of this Plan is held by a
court of competent jurisdiction to be invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provision and the remaining
provisions hereof shall continue to be construed and enforced as if the invalid
or unenforceable provision had not been included.
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11.04. Payment of Benefit of Incompetent. In the event the Committee
finds that a Participant, former Participant, or Beneficiary is unable to care
for his affairs because of his minority, illness, accident, or other reason,
any benefits payable hereunder may, unless other claim has been made therefor
by a duly appointed guardian, committee or other legal representative, be paid
to a spouse, child, parent, or other blood relative or dependent or to any
person found by the Committee to have incurred expenses for the support and
maintenance of such Participant, former Participant, or Beneficiary; and any
such payments so made shall be a complete discharge of all liability therefor.
11.05. Spouse's Interest. The interest in the benefits hereunder of
a Spouse who has predeceased the Participant shall automatically pass to the
Participant and shall not be transferable by such Spouse in any manner
including but not limited to such Spouse's will, nor shall such interest pass
under the laws of intestate succession.
11.06. Successors. In the event of any consolidation, merger,
acquisition or reorganization of the Company, the obligations of the Company
under this Plan shall continue and be binding upon the Company and its
successors.
11.07. Gender, Number and Heading. Whenever any words are used
herein in the masculine gender, they shall be construed as though they were
also used in the feminine gender in all cases where they would so apply.
Whenever any words used herein are in the singular form, they shall be
construed as though they were also used in the plural form in all cases where
they would so apply. Headings of sections and subsections as used herein are
inserted solely for convenience and reference and constitute no part of the
Plan.
11.08. Legal Fees and Expenses. The Company shall pay all legal fees
and expenses that a Participant may incur as a result of the Company contesting
the validity, enforceability, or the Participant's interpretation of, or
determinations under this Plan, other than Section 5.03.
11.09. Choice of Law. This Plan shall be governed by and construed
in accordance with the laws of the State of Michigan to the extent not
superseded by applicable federal statues or regulations.
11.10. Affiliated Employees. Transfers of employment between
Affiliated Companies and the Company or other Affiliated Companies will be
treated as continuous and uninterrupted service under the Plan.
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SECTION 12
CHANGE IN CONTROL PROVISIONS
12.01. General. In the event of a Change in Control, as defined in
Section 12.04, then notwithstanding any other provision of the Plan, the
provisions of this Section 12 shall be applicable and shall supersede any
conflicting provisions of the Plan.
12.02. Transfer to Rabbi Trust. The Company has established a trust
pursuant to a Trust Agreement dated January 3, 1991 (the "Rabbi Trust"). The
terms of the Rabbi trust provide that, in the event of a Change in Control and
thereafter, assets are to be transferred to such trust to provide benefits
under the Plan. The Company shall make all transfers of funds required by such
Rabbi trust in a timely manner and shall otherwise abide by the terms of such
Rabbi trust.
12.03. Joint and Several Liability. Upon and at all times after a
Change in Control, the liability under the Plan of the Company and each
Affiliated Company that has adopted the Plan shall be joint and several so that
the Company and each such Affiliated Company shall each be liable for all
obligations under the Plan to each employee covered by the Plan, regardless of
the corporation by which such employee is employed.
12.04. Definition of Change in Control. A "Change of Control" means:
(a) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of
either (i) the then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (ii) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that the following acquisition shall not constitute a Change
of Control: (A) any acquisition directly from the Company (excluding an
acquisition by virtue of the exercise of a conversion privilege), (B) any
acquisition by the Company, (C) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company or (D) any acquisition by any corporation pursuant to
a reorganization, merger or consolidated, if, following such reorganization,
merger or consolidation, the conditions described in clauses (i), (ii) and
(iii) or subsection (c) of this Section 12.04 are satisfied; or
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(b) Individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director
subsequent to the date hereof whose election, or nomination for election by the
Company's shareholders, was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board shall be considered as though
such individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest (as such terms are
used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or
other actual or threatened solicitation of proxies or consents by or on behalf
of a Person other than the Board; or
(c) Approval by the shareholders of the Company of a
reorganization, merger or consolidation, in each case, unless, following such
reorganization, merger or consolidation, (i) more than 60% of, respectively,
the then outstanding shares of common stock of the corporation resulting from
such reorganization, merger or consolidation and the combined voting power of
the then outstanding voting securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation in substantially the same proportions
as their ownership, immediately prior to such reorganization, merger or
consolidation, of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be (ii) no person (excluding the Company,
any employee benefit plan or related trust) of the Company or such corporation
resulting from such reorganization, merger or consolidation and any Person
beneficially owning, immediately prior to such reorganization, merger or
consolidation, directly or indirectly, 20% or more of the Outstanding Company
Common Stock or Outstanding Voting Securities, as the case may be beneficially
owns, directly or indirectly, 20% or more of, respectively, the then
outstanding shares of common stock of the corporation resulting from such
reorganization, merger or consolidation or the combined voting power of the
then outstanding voting securities or such corporation entitled to vote
generally in the election of directors and (iii) at least a majority of the
members of the board of directors of the corporation resulting from such
reorganization, merger or consolidation were members of the Incumbent Board at
the time of the execution of the initial agreement providing for such
reorganization, merger or consolidation; or
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(d) Approval by the shareholders of the Company of (i) a complete
liquidation or dissolution of the Company or (ii) the sale or other disposition
of all or substantially all of the assets of the Company, other than to a
corporation, with respect to which following such sale or other disposition,
(A) more than 60% of, respectively, the then outstanding shares of common stock
of such corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the
election of directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such sale or other
disposition in substantially the same proportion as their ownership,
immediately prior to such sale or other disposition, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case may be, (B)
no person (excluding the Company and any employee benefit plan (or related
trust) of the Company or such corporation and any Person beneficially owning,
immediately prior to such sale or other disposition, directly or indirectly,
20% or more of the Outstanding Company Common Stock or Outstanding Company
Voting Securities, as the case may be beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of such corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the
election of directors and (C) at least a majority of the members of the board
of directors of such corporation were members of the Incumbent Board at the
time of the execution of the initial agreement or action of the Board providing
for such sale or other disposition of assets of the Company.
IN WITNESS WHEREOF, MCN Corporation has caused this Plan to be executed
as of this 21st day of December, 1994.
MCN CORPORATION
/s/ Daniel L. Schiffer
By: -----------------------------------
Daniel L. Schiffer, Vice President,
General Counsel and Secretary
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EXHIBIT A
MCN CORPORATION
MANDATORY DEFERRED COMPENSATION PLAN
DEFERRAL FORM
Employee Name (Print) Social Security No. I. D. Number
Address (Number/Street) City State Zip Code
In accordance with the terms of the MCN Corporation Mandatory Deferred
Compensation Plan ("Plan" ), which is hereby incorporated by reference, I
hereby accept and agree to all the provisions of the Plan and irrevocably elect
pursuant to Section 3 of the Plan to have all Total Compensation paid to me in
excess of $1 million in any calendar year in which I am a Covered Employee
deferred until completion of the Deferral Period.
Benefit Payment Election
That the amount deferred shall be paid to me after completion of the Deferral
Period in the manner specified below:
________ Lump-sum payment
________ Payment in monthly installments over _________ years (in 1
year increments, not to exceed 15 years)
I understand that, notwithstanding the above benefit payment election, I may be
eligible for a hardship withdrawal pursuant to Section 5 of the Plan.
Dividend Payment Election
I hereby elect to have the dividend equivalents credited to my Account paid as
specified below:
________ All reinvested in my Account and denominated in shares of MCN
Corporation common stock
________ 50% reinvested in my Account, denominated in shares of MCN
Corporation common stock, and 50% paid directly to me in cash
________ 100% paid directly to me in cash
Employee Signature Date
Receipt Acknowledged By Title Date
December 20, 1994
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EXHIBIT B
MCN CORPORATION
MANDATORY DEFERRED COMPENSATION PLAN
BENEFICIARY DESIGNATION FORM
Employee Name (Print) Social Security No. I. D. Number
Address (Number/Street) City State Zip Code
I hereby designate, pursuant to Article 6 of the above-referenced plan,
the below designated person(s) as my beneficiary in the event of my
death:
Beneficiary's Name Address
I UNDERSTAND THAT THE DESIGNATION OF A BENEFICIARY OTHER THAN MY SPOUSE
MUST BE CONSENTED TO IN WRITING BY MY SPOUSE.
In the event any of the above-named beneficiaries should predecease me,
or shall survive me but die before receiving all amounts to be paid, I
hereby name the following as a contingent beneficiary to receive any such
unpaid amounts:
Beneficiary's Name Address
In the event none of the above-named beneficiaries survive me, any unpaid
amounts shall be paid to my lawful successor in interest. I reserve the
right to change this beneficiary designation at any time by filing with
the Committee or its Designee a new beneficiary designation form.
I UNDERSTAND THAT MY MOST RECENT ELECTION AS TO THE BENEFICIARY
DESIGNATION WILL APPLY TO ALL DEFERRALS BY ME UNDER THE PLAN.
Employee Signature Date
Receipt Acknowledged By Title Date
Spousal Consent: I hereby consent to the designation of beneficiary set
fourth herein.
Spouse's Signature Date
Witness Date
December 9, 1994
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