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EXHIBIT 10.15
SOUTHWEST GAS CORPORATION
BOARD OF DIRECTORS
RETIREMENT PLAN
Effective January 1, 1988
Amended Effective May 9, 1990
Amended and Restated Effective October 1, 1993
Amended and Restated Effective March 1, 1999
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SOUTHWEST GAS CORPORATION
BOARD OF DIRECTORS RETIREMENT PLAN
PURPOSE
The principal objective of this Board of Directors Retirement Plan is to ensure
that a competitive level of retirement income is paid in order to attract and
retain Directors of Southwest Gas Corporation. The Plan is designed to provide a
benefit that will meet this objective. Eligibility for participation in the Plan
shall be limited to outside, non-employee Directors retiring after January 1,
1988. The original Plan was effective on January 1, 1988, and amended May 9,
1990, October 1, 1993 and March 1, 1999.
I. DEFINITIONS
1.1 "Board" means the Board of Directors of the Company.
1.2 "Change in Control" means the first to occur of any of the following
events:
(a) Any "person" (as the term is used in Sections 13 and 14(d)(2)
of the Securities Exchange Act of 1934 ("Exchange Act")) who
becomes a beneficial owner (as that term is used in Section
13(d) of the Exchange Act), directly or indirectly, of 50% or
more of the Company's capital stock entitled to vote in the
election of directors; or
(b) During any period of not more than two consecutive years, not
including any period prior to the adoption of this Plan,
individuals who, at the beginning of such period constitute
the board of directors of the Company, and any new director
(other than a director designated by a person who has entered
into an agreement with the Company to effect a transaction
described in clause (a) of this Section 1.2) whose election by
the board of directors or nomination for election by the
Company's shareholders was approved by a vote of at least
three-fourths (3/4ths) of the directors then still in office,
who either were directors at the beginning of the period or
whose election or nomination for election was previously
approved, cease for any reason to constitute at least a
majority thereof.
1.3 "Committee" means the Compensation Committee of the Board to which the
Board has given authority to administer the Plan. After a Change in
Control, the Committee shall cease to have any powers under the Plan
and all powers previously vested in the Committee under the Plan will
then be vested in the Third Party Fiduciary.
1.4 "Company" means Southwest Gas Corporation and any Successor
Corporation.
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1.5 "Director" means an outside, non-employee member of the board of
directors of Southwest Gas Corporation prior to a Change in Control.
1.6 "Effective Date" previously was October 1, 1993. This amended and
restated Plan is effective March 1, 1999.
1.7 "Participant" means an outside, non-employee Director. Inside Directors
and retired employees of the Company are excluded from participation in
the Plan.
1.8 "Plan" is the Southwest Gas Board of Directors Retirement Plan as
described in this document.
1.9 "Retiree" means a former Director eligible for receiving benefits from
the Plan.
1.10 "Retire" or "Retirement" means the termination of a Director's service
on the Board on one of the dates specified in Section II.
1.11 "Successor Corporation" means any corporation or other legal entity
which is the successor to Southwest Gas Corporation, whether resulting
from merger, reorganization or transfer of substantially all of the
assets of Southwest Gas Corporation, regardless of whether such entity
shall expressly agree to continue the Plan.
1.12 "Third Party Fiduciary" means an independent third party (a corporate
entity with no other relationship with the Company) selected by the
Company to take over the administration of the Plan upon and after a
Change in Control and to determine appeals of claims denied under the
Plan before and after a Change in Control pursuant to a Third Party
Fiduciary Services Agreement.
1.13 "Third Party Fiduciary Services Agreement" means the agreement with the
Third Party Fiduciary to perform services with respect to the Plan.
1.14 "Trust Agreement" means an agreement establishing a "grantor trust" of
which the Company is the grantor, within the meaning of subpart E, part
I, subchapter J, chapter 1, subtitle A of the Internal Revenue Code of
1986, as amended (the "Code").
1.15 "Trust Fund or Funds" means the assets of every kind and description
held under any Trust Agreement forming a part of the Plan.
1.16 "Trustee" means any person or entity selected by the Company to act as
trustee under any Trust Agreement at any time of reference.
1.17 "Years of Service" means the length of time, in discrete 12-month
periods, a Participant has served on the board of directors of
Southwest Gas Corporation.
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II. ELIGIBILITY FOR BENEFITS
2.1 Each Participant is eligible to Retire and receive a benefit under this
Plan beginning on one of the following dates, provided he qualifies:
(a) "Normal Retirement Date," which is the first day of the month
following the month in which the Participant reaches age 65,
provided he has at least ten Years of Service.
(b) "Mandatory Retirement Date," which is the first day of the
month following the month in which the Participant reaches age
72.
(c) "Postponed Retirement Date," which is the first day of the
month following the Participant's Normal Retirement Date, but
no later than the Mandatory Retirement Date, in which the
Participant terminates service on the Board, provided he has
at least ten Years of Service.
(d) "Disability Retirement Date," which is the first day of the
month following the month in which the Participant's total and
permanent disability began, as determined by the Committee,
but no later than the Participant's Normal Retirement Date,
provided he has at least ten Years of Service at the time of
the disability.
2.2 A Participant is eligible to take "Early Retirement" from the Board
prior to age 65 provided he has at least ten Years of Service. The
Participant taking "Early Retirement" will be eligible to receive
benefits pursuant to Section 3.3 when he reaches age 65.
2.3 Notwithstanding the foregoing and upon the occurrence of a Change in
Control, a Participant will Retire immediately prior to such an event
and receive the Normal Retirement Benefit beginning the first day of
the month following such an event, provided he has at least eight Years
of Service at such time.
III. AMOUNT AND FORM OF RETIREMENT BENEFIT
3.1 Normal Retirement Benefit. The annual benefit payable under the Plan
will be the amount of the Participant's annual retainer fee on his
Normal Retirement Date and will be paid for life.
3.2 Mandatory Retirement Benefit. The annual benefit payable under the Plan
will be the amount of the Participant's annual retainer fee on his
Mandatory Retirement Date and will be paid for life.
3.3 Early Retirement Benefit. The annual benefit payable for Early
Retirement under the Plan will be the amount of the Participant's
annual retainer fee on his Early
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Retirement date and will be paid for life commencing when the
Participant reaches age 65.
3.4 Postponed Retirement Benefit. The annual benefit payable at a Postponed
Retirement Date under the Plan will be the amount of the Participant's
annual retainer fee on the date of his postponed retirement and will be
paid for life.
3.5 Disability Retirement Benefit. The annual benefit under the Plan for a
totally and permanently disabled Participant, payable at a Disability
Retirement Date, will be the amount of the Participant's annual
retainer fee on the date of the disability and will be paid for life.
3.6 Discretionary Benefits. The Board may, at its sole discretion, grant to
an eligible Participant an increased benefit of $1,000 per year for
life for each ten-year period of service beyond the minimum qualifying
service period of ten years.
IV. PAYMENT OF RETIREMENT BENEFITS
4.1 One-quarter of the benefit determined in accordance with Section III
will be payable on the first day of each calendar quarter. The initial
benefit payment will be paid at the time of Retirement or within 30
days thereof, and will be prorated for a partial quarter if the
Retirement date is not on the first day of a quarter.
4.2 Benefit payments will cease on the first day of the calendar quarter
following the Retiree's death.
V. NO DEATH BENEFITS
5.1 No benefits are payable under this Plan in the event of death.
VI. GENERAL
6.1 Amounts payable to a Participant shall be paid from the general assets
of the Company or from the assets of a grantor trust within the meaning
of subpart E, part I, subchapter J, chapter 1, subtitle A of the Code,
established for use in funding executive compensation arrangements and
commonly known as a "Rabbi Trust."
6.2 The Company shall have no obligation under the Plan to a Participant,
except as provided in this Plan.
6.3 The Participant must cooperate with the Committee in furnishing all
information requested by the Company to facilitate the payment of his
benefit.
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6.4 Participants and their heirs, successors, and assigns shall have no
legal or equitable rights, claims, or interest in any specific property
or assets of the Company. No assets of the Company shall be held under
any trust, or held in any way as collateral security for the fulfilling
of the obligations of the Company under the Plan. Any and all of the
Company's assets shall be, and remain, the general unpledged,
unrestricted assets of the Company. The Company's obligation under the
Plan shall be merely that of an unfunded and unsecured promise of the
Company to pay money in the future, and the rights of the Participants
shall be no greater than those of unsecured general creditors. It is
the intention of the Company that this Plan (and the Trust Funds
described in Section VII) be unfunded for purposes of the Code.
6.5 There shall be deducted from each payment made under the Plan or other
compensation payable to the Participant all taxes which are required to
be withheld by the Company in respect to such payment or this Plan. The
Company shall have the right to reduce any payment (or other
compensation) by the amount of cash sufficient to provide the payment
amount of said taxes.
6.6 The Company is without power to lawfully assure a Participant continued
tenure as a Director, and nothing herein constitutes a contract for
continuing service between the Company and the Participant.
VII. TRUSTS
7.1 The Company may maintain one or more Trust Funds to finance all or a
portion of the benefits under the Plan by entering into one or more
Trust Agreement(s). Any Trust Agreement is designated as, and shall
constitute, a part of the Plan, and all rights which may accrue to any
person under the Plan shall be subject to all the terms and provisions
of such Trust Agreement. A Trustee shall be appointed by the Committee
or the Board and shall have such powers as provided in the Trust
Agreement. The Committee or the Board may modify any Trust Agreement,
in accordance with its terms, to accomplish the purposes of the Plan
and appoint a successor Trustee under the provisions of such Trust
Agreement. By entering into such Trust Agreement, the Committee or the
Board may vest in the Trustee, or in one or more investment managers
(as defined in ERISA), the power to manage and control the Trust Fund.
The Committee's authority under the provisions of this Section 7.1 will
cease with a Change in Control.
VIII. TERMINATION, AMENDMENT OR MODIFICATION OF THE PLAN
8.1 The Board may, at any time, without notice, amend or modify the Plan in
whole or in part; provided, however, that: (i) no amendment or
modification shall be effective to decrease or restrict (a) the benefit
the Participant qualifies for under the provisions of the Plan, or (b)
benefit payments to Participants once such payments
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have commenced; and (ii) effective March 1, 1999, no amendment or
modification of this Section VIII, Section X, or Section XI of the Plan
shall be effective.
8.2 The Board shall not terminate the Plan until all benefits have been
paid in full under the provisions of the Plan.
IX. RESTRICTIONS ON ALIENATION OF BENEFITS
9.1 To the maximum extent permitted by law, no interest or benefit under
the Plan shall be assignable or subject in any manner to alienation,
sale, transfer, claims of creditors, pledge, attachment, or
encumbrances of any kind.
X. ADMINISTRATION OF THE PLAN
10.1 Except as otherwise provided in this Section X, and subject to Section
XI, the general administration of the Plan, as well as construction and
interpretation thereof, shall be vested in the Committee. Specifically,
the Committee shall have the discretion and authority to: (a) make,
amend, interpret, and enforce all appropriate rules and regulations for
the administration of the Plan; and (b) decide or resolve any and all
questions including interpretations of the Plan. Any individual serving
on the Committee who is a Participant shall not vote or act on any
matter relating solely to himself or herself. The number of members of
the Committee shall be established by, and the members shall be
appointed from time to time by, and shall serve at the pleasure of, the
Board of Directors. Members of the Committee may be Participants under
the Plan.
10.2 Upon and after a Change in Control, the administration of the Plan
shall be vested in a Third Party Fiduciary, as provided for herein and
pursuant to the terms of a Third Party Fiduciary Services Agreement.
Any Third Party Fiduciary Services Agreement is designated as, and
shall constitute, a part of the Plan. The Third Party Fiduciary shall
also have the discretion and authority to: (a) make, amend, interpret,
and enforce all appropriate rules and regulations for the
administration of the Plan; and (b) decide or resolve any and all
questions including interpretation of the Plan and the Trust Agreement.
Except as otherwise provided for in any Trust Agreement, the Third
Party Fiduciary shall have no power to direct the investment of Plan or
Trust Funds or select any investment manager or custodial firm for the
Plan or Trust Agreement. The Company shall pay all reasonable
administrative expenses and fees of the Third Party Fiduciary when it
acts as the administrator of the Plan or pursuant to Section XI. The
Third Party Fiduciary may not be terminated by the Company without the
consent of 50% of the Participants in the Plan.
10.3 In the administration of the Plan, the Committee or the Third Party
Fiduciary, as the case may be, may from time to time employ such
agents, consultants, advisors, and managers as it deems necessary or
useful in carrying out its duties as it sees fit (including acting
through a duly authorized representative) and may from to time to time
consult with counsel to the Company.
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10.4 The decision or action of the Committee or the Third Party Fiduciary,
as the case may be, with respect to any question arising out of or in
connection with the administration, interpretation, and application of
the Plan (and the Trust Agreement to the extent provided for in Section
10.2) and the rules and regulations promulgated hereunder shall be
final and conclusive and binding upon all persons having any interest
in the Plan.
10.5 The Company shall indemnify and save harmless each member of the
Committee, the Third Party Fiduciary, and any employee of the Company
to whom the duties of the Committee may be delegated against any and
all claims, losses, damages, expenses, and liabilities arising from any
action or failure to act with respect to the Plan, except in the case
of fraud, gross negligence, or willful misconduct by the Committee, any
of its members, the Third Party Fiduciary, or any such employee.
10.6 To enable the Committee and the Third Party Fiduciary to perform their
functions, the Company shall supply full and timely information to the
Committee and the Third Party Fiduciary, as the case may be, on all
matters relating to the compensation of all Participants, their
Retirement, death or other cause for termination of service, and such
other pertinent facts as the Committee or the Third Party Fiduciary may
require.
XI. CLAIMS PROCEDURE
11.1 Any Participant (such Participant being referred to below as a
"Claimant") may deliver to the Committee a written claim for
determination with respect to benefits available to such Claimant from
the Plan. The claim must state with particularity the determination
desired by the Claimant.
11.2 The Committee shall consider a claim and notify the Claimant within 90
calendar days after receipt of a claim in writing:
(a) That the Claimant's requested determination has been made, and
that the claim has been allowed in full; or
(b) That the Committee has reached a conclusion contrary, in whole
or in part, to the Claimant's requested determination, and
such notice must set forth in a manner calculated to be
understood by the Claimant: (i) the specific reason(s) for the
denial of the claim, or any part thereof; (ii) the specific
reference(s) to pertinent provisions of the Plan upon which
the denial was based; (iii) a description of any additional
material or information necessary for the Claimant to perfect
the claim, and an explanation of why such material or
information is necessary; and (iv) an explanation of the claim
review procedure set forth in Section 11.3.
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11.3 Within 60 days after receiving a notice from the Committee that a claim
has been denied, in whole or in part, a Claimant (or the Claimant's
duly authorized representative) may file with the Third Party Fiduciary
a written request for a review of the denial of the claim. Thereafter,
the Claimant (or the Claimant's duly authorized representative) may
review pertinent documents, submit written comments or other documents,
and request a hearing, which the Third Party Fiduciary, in its sole
discretion, may grant.
11.4 The Third Party Fiduciary shall render its decision on review promptly,
and not later than 60 days after the filing of a written request for
review of a denial, unless a hearing is held or other special
circumstances require additional time, in which case the Third Party
Fiduciary's decision must be rendered within 120 calendar days after
such date. Such decision must be written in a manner calculated to be
understood by the Claimant, and it must contain: (i) the specific
reason(s) for the decision; (ii) the specific reference(s) to the
pertinent Plan provisions upon which the decision was based; and (iii)
such other matters as the Third Party Fiduciary deems relevant.
11.5 A Claimant's compliance with the foregoing provisions of this Section
XI is a mandatory prerequisite to a Claimant's right to commence any
legal action with respect to any claim for benefits under the Plan.
XII. MISCELLANEOUS
12.1 No Director will participate in an action of the Committee or the Board
on a matter that solely applies to that Director. Such matters will be
determined by a majority of the rest of the Committee or the Board.
12.2 Each Participant will receive a copy of this Plan, and the Committee
will make available for any Participant's inspection a copy of the
rules and regulations the Committee uses in administering the Plan.
12.3 This Plan is established under, and will be construed according to, the
laws of the state of Nevada.
12.4 The Plan shall be binding upon the Company and any of its successors
and assigns, and upon a Participant, Participant's beneficiary,
assigns, heirs, executors, and administrators.
12.5 Masculine pronouns wherever used shall include feminine pronouns and
when the context dictates, the singular shall include the plural.
12.6 In case any provision of the Plan shall be held illegal or invalid for
any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but the Plan shall be construed and enforced as
if such illegal and invalid provisions had never been inserted herein.
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12.7 Any notice given under the Plan shall be in writing and shall be mailed
or delivered to:
SOUTHWEST GAS CORPORATION
Board of Directors Retirement Plan
Compensation Committee
5241 Spring Mountain Road
Las Vegas, NV 89102
and
CRG Fiduciary Services, Inc.
633 West Fifth Street, 53rd floor
Los Angeles, CA 90071-2086
Attn: Managing Director
IN WITNESS WHEREOF, the Company has executed this Amended and Restated Board of
Directors Retirement Plan this 30th day of July 1999.
SOUTHWEST GAS CORPORATION
By
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Thomas Y. Hartley
Chairman of Board of Directors
By
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Michael O. Maffie
President & Chief Executive Officer
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