SUPPLEMENTAL RETIREMENT PLAN
EXHIBIT
10.2
This
is
an Agreement, entered into as of the date set forth on the Summary Schedule
(the
“Effective Date”), which is attached hereto and made a part hereof, and as
amended from time to time thereafter, by and between GREEN MOUNTAIN POWER
CORPORATION (hereinafter the “Company”) and the Executive named on the Summary
Schedule (hereinafter the “Executive”).
WHEREAS,
the Executive has provided valuable services to the Company and the Company
desires to retain the Executive’s valuable services and to aid in providing
retirement and death benefits to the Executive and his
beneficiaries;
WHEREAS,
the Executive is a highly compensated managerial employee;
WHEREAS,
the retirement and death benefits provided herein constitute an important and
integral portion of the Executive’s financial and retirement planning;
and
NOW
THEREFORE, the Company and the Executive in consideration of the terms and
conditions set forth herein hereby mutually covenant and agree as
follows:
1. Age
65 Benefit.
The
Company will pay the Executive a benefit under this Paragraph if the Executive
remains in the continuous employ of the Company from the Effective Date until
the date the Executive attains age 65 and a Change in Control (as defined in
Paragraph 3) has not occurred. The benefit payable under this Paragraph shall
equal the Executive’s Accrued Benefit (determined in accordance with the Summary
Schedule as of the Executive’s sixty-fifth birthday and payable as provided in
this Paragraph). If the value of such
Accrued Benefit
is
$1,000,000 or less, the benefit payable under this Paragraph shall be paid
to
the Executive in a single cash payment within thirty days after the Executive’s
sixty-fifth birthday. If the value of such
Accrued Benefit
exceeds
$1,000,000, the benefit payable under this Paragraph shall be paid as follows:
(x)
a single
cash payment of $1,000,000 will be paid to the Executive within thirty days
after the Executive’s sixty-fifth birthday and (y)
the
balance of the amount payable under this Paragraph, with interest determined
in
accordance with the Summary Schedule, shall be paid in equal or nearly equal
monthly installments for five years beginning on the first day of the month
coincident with or next following the Executive’s sixty-sixth birthday. If the
Executive dies after attaining age 65 while in the continuous employ of the
Company after the Effective Date, but before receiving all of the benefits
payable under this Paragraph, the balance of such benefits shall be paid by
the
Company, on the schedule and in the form described above, to the beneficiaries
named in the Summary Schedule.
2.
Termination
Before Age 65.
The
Company will pay the Executive a benefit under this Paragraph if the Executive’s
employment with the Company and its affiliates terminates (i) before the
Executive attains age 65, (ii) before a Change in Control (as defined in
Paragraph 3), (iii) for a reason other than cause (gross misconduct) and (iv)
after the Executive has completed at least five Years of Service (as defined
in
the Summary Schedule). The benefit payable under this Paragraph shall equal
the
Executive’s Accrued Benefit (determined in accordance with the Summary Schedule
as of the Executive’s termination and payable as provided in this Paragraph),
but subject
to an actuarial equivalence reduction using a
five
percent (5%) interest
rate (with no mortality assumption) for
each
full year that the Executive’s termination date precedes the Executive’s
sixty-fifth birthday unless the Executive has attained age 59 and completed
10
Years of Service as of the Executive’s termination date. If the value
of
such Accrued Benefit (after any reduction required by the preceding
sentence)
is
$1,000,000 or less, the benefit payable under this Paragraph shall be paid
to
the Executive in a single cash payment on the first day of the month coincident
with or next following the date that is six months after the Executive’s
termination of employment. If the value
of
such Accrued Benefit (after any reduction required by the second preceding
sentence)
exceeds
$1,000,000, the benefit payable under this Paragraph shall be paid as follows:
(x)
a single
cash payment of $1,000,000 will be paid to the Executive on the first day of
the
month coincident with or next following the date that is six months after the
Executive’s termination of employment and (y)
the
balance of the amount payable under this Paragraph, with interest determined
in
accordance with the Summary Schedule, shall be paid in equal or nearly equal
monthly installments for five years beginning on the first day of the month
coincident with or next following the anniversary of the Executive’s termination
of employment. If the Executive dies after the commencement of benefit payments
under this Paragraph but before receiving all of the benefits payable under
this
Paragraph, the balance of such benefits shall be paid by the Company, on the
schedule and in the form described above, to the beneficiaries named in the
Summary Schedule. If the Executive dies before the commencement of benefits
under this Paragraph, before a termination of employment for cause (gross
misconduct), before the Executive has attained age 65 and before a Change in
Control but after completing at least five Years of Service (as
defined in the Summary Schedule), then the benefits described in this Paragraph,
computed as of the Executive’s death, shall be paid by the Company, on the
schedule and in the form described above, to the beneficiaries named in the
Summary Schedule.
3. Change
in Control Benefit.
The
Company will pay the Executive a benefit under this Paragraph if the Executive
remains in the continuous employ of the Company from the Effective Date until
a
Change in Control. The benefit payable under this Paragraph shall be paid in
a
single cash payment, as soon as practicable following the earlier of the first
day of the month coincident with or next following the date that is six months
after the Executive’s termination of employment or the Executive’s attainment of
age 65. The benefit payable under this Paragraph shall be the value of
the
Executive’s Accrued Benefit (determined in accordance with the Summary Schedule
as of the Executive’s termination date or sixty-fifth birthday, as applicable,
but assuming that Executive had completed an additional two Years of
Service).
For
purposes of this Agreement, the term “Change in Control” has the same definition
as set forth in the Change of Control Agreement, dated April 3, 2006, between
the Company and the Executive. If the Executive dies after becoming entitled
to
a benefit under this Paragraph but before such benefit is paid, the Company
will
pay the benefit under this Paragraph to the Executive’s beneficiaries named in
the Summary Schedule. The timely payment of such lump sum benefit to the
Executive (or the Executive’s beneficiaries named in the Summary Schedule, as
applicable) shall be treated as compliance with the provisions of Paragraph
10
hereof.
4. Death
Benefit.
If the
Executive dies before the commencement of benefits to the Executive pursuant
to
Paragraphs 1, 2 or 3 above, then the Company shall pay to the Executive’s
beneficiaries an additional benefit of One Hundred Thousand Dollars
($100,000.00) which will be paid in a single cash payment within thirty days
after the Executive’s death.
5. Disability;
Leave of Absence.
If the
Executive shall become disabled within the meaning of the long-term disability
plan of the Company and prior to retirement, the Executive shall be considered
to be continuing in employment as an executive for as long as such disability
exists, but not after age sixty-five. The Company may grant the Executive one
or
more leaves of absence during which time the Executive shall be considered
to be
in the employ of the Company for purposes of this Agreement.
6. Executives
of Subsidiaries.
For
purposes of this Agreement, employment by the Company shall include employment
by a wholly-owned subsidiary of the Company. The transfer of an Executive from
the Company to any wholly-owned subsidiary of the Company, or from any
wholly-owned subsidiary to the Company, or from one wholly-owned subsidiary
to
another shall not constitute a termination of such Executive’s employment by the
Company under this Agreement.
7. Employment
and Other Rights.
This
Agreement creates no rights whatsoever in the Executive to continue in the
employ of the Company for any length of time, nor does it create any rights
in
the Executive or obligations on the part of the Company except as set forth
herein.
8. Anti-Alienability
Clause.
Neither
the Executive nor any beneficiary shall transfer, assign, pledge, mortgage
or
encumber any of the benefits and payments hereunder. The benefits shall not
be
subject to seizure, lien, judgment, alimony, levy, garnishment, or attachment.
In the event that the Executive or any beneficiary shall attempt any of the
acts
described in this Paragraph, then the payment of installment payments or
benefits by the Company shall immediately terminate.
9. No
Effect on Other Plans.
Nothing
contained herein shall affect any right or privilege of the Executive with
regard to other employee plans the Company has, or may have in the
future.
10. Reorganization
of the Company.
In
addition to those rights granted Executive under the Change of Control Agreement
referenced in Paragraph 3, the Company agrees that it will not merge or
consolidate with any other company, business, corporation, partnership, or
organization, and that it will not permit any of its activities to be taken
over
unless and until the succeeding or continuing corporation expressly assumes
all
rights, duties, privileges and obligations herein set forth. In the event the
Company fails to comply with this, provision, the Executive or Executive’s
beneficiary, as the case may be, shall be entitled to benefits equal to the
Executive’s Accrued Benefit (determined in accordance with the Summary Schedule
as if the Executive had earned twenty Years of Service). If benefits are payable
under the above-identified Change of Control Agreement, then the Executive
shall
be deemed to have satisfied all requirements for the full vesting of benefits
under this Agreement on the day prior to termination of employment with the
Company.
11. Unsecured
Provisions.
The
rights of the Executive under this Agreement, and of any beneficiary shall
be
solely those of an unsecured creditor of the Company. Any asset acquired by
the
Company in connection with any obligation herein shall not be deemed to be
held
in trust for the Executive or beneficiary. All such assets remain general,
un-pledged assets of the Company.
12. Communications.
Any
notice or communication shall be made in writing and addressed as the case
may
be to the principal offices of the Company and the principal residence of the
Executive. Each party shall notify the other of a change of address of the
principal office and principal residence.
13. Facility
of Payment.
If any
installment or payment is required to be made by the Company under this
Agreement to any person under a legal disability at the time, then the Company
may, in its sole discretion, make the payment in any of the following
ways:
| A. |
Directly
to the person.
|
| B. |
To
the legal representative of the person.
|
| C. |
To
some near relative of the person, said payment to be used for the latter’s
benefit.
|
| D. |
Directly
for the payment of expenses relating to the health, maintenance, support
and education of the person.
|
Any
such
payment by the Company shall be a discharge of the obligation to make said
payment. The Company shall not be liable for making the payment to any of the
parties enumerated above.
Arbitration.
In the
event of any dispute arising between the parties to this Agreement, the parties
agree that such controversy shall be settled exclusively by arbitration in
Burlington, Vermont, in accordance with the rules of the American Arbitration
Association. Judgment may be entered on the arbitrator’s award in any court
having jurisdiction. In the event that the Executive prevails and is awarded
benefits or money damages by the arbitrator, such benefits or damages shall
be
equal to one hundred twenty-five (125%) of the benefits or damages otherwise
due
under this Agreement; however, if the arbitrator finds that the Company acted
in
good faith, such benefits or damages shall only be equal to one hundred percent
(100%) of the amount due under this Plan.
Attorney’s
Fees.
The
Company shall pay the Executive or his beneficiaries all costs and expenses,
including reasonable attorney’s fees and arbitration costs, incurred by them in
reasonably exercising any of their rights hereunder, or in enforcing any terms,
conditions, or provisions hereof.
State
Law.
This
Agreement shall be construed under the laws applicable to agreements made
entirely within the State of Vermont.
Revocability.
This
Agreement may be revoked or amended in whole or part only by writing signed
by
both parties hereto (except as set forth in Paragraph 18 below).
Amendment.
Notwithstanding any other provision of this Agreement, in the event of a
substantial change in the federal income tax laws affecting the economic
viability of this Plan, the Board of Directors may amend the Plan by freezing
the Executive’s salary level for purposes of this Plan at the level as of date
of the amendment, provided, however, that this right to amend shall terminate
upon a Change in Control.
Whole
Agreement.
This
writing contains the whole Agreement, with no other understandings or provisions
other than what is contained herein.
SUMMARY
SCHEDULE
1. Name
of
Executive: Xxxx
X. Xxxxxx
2. Address:
000
Xxxxx Xxx Xxxxxx, Xxxxxxxxxx, XX 00000
3. Date
of
Agreement: April
3, 2006
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4.
|
Accrued
Benefit: As of any date the Executive’s Accrued Benefit is equal to the
amount determined by multiplying (i) 10 times (ii) 33% of the Executive’s
Salary from the Company for the twelve months immediately before
the
termination date times (iii) a fraction. The numerator of the fraction
is
the Executive’s Years of Service (not to exceed twenty) and the
denominator of the fraction is
twenty.
|
|
5.
|
Year
of Service: A year of service recognized for vesting purposes under
the
Company’s tax-qualified pension
plan.
|
6. Beneficiaries:
Xxxxx
Xxxxxx
|
7.
|
Interest:
Unpaid balance subject to installment payments will be credited with
interest each month equal to one-twelfth of the average annual yield
on
Public Utility Bonds as reported by Xxxxx’x Investors Service and
published in the issue of “Moody’s Public Utility” that is published
closest to the 15th
day of the applicable month. The average annual yield shall reflect
the
Company’s debt rating on the date the Executive’s employment with the
Company and its affiliates
terminates.
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Executed
this 3rd
day of
April, 2006.
WITNESS:
/s/
Xxxxx X. Xxxxxxx s/s
Xxxx X. Xxxxxx
(as
to
both) Executive
/s/
Xxxxxx X. Xxxxx XXXXX
MOUNTAIN POWER CORPORATION
(as
to
both)
By: /s/
Xxxxxxxxxxx X. Xxxxxx
Duly
Authorized Agent
ACKNOWLEDGMENT
OF ARBITRATION
The
parties hereto understand that this Agreement contains an Agreement to
arbitrate. After signing this document, the parties understand that they will
not be able to bring a lawsuit concerning any dispute that may arise which
is
covered by the arbitration agreement, unless it involves a question of
constitutional or civil rights. Instead, the parties agree to submit any such
dispute to an impartial arbitrator.
EXECUTED
this 3rd
day of
April, 2006.
IN
THE
PRESENCE OF:
/s/
Xxxxx X. Xxxxxxx /s/
Xxxx X. Xxxxxx
(as
to
both) Executive
/s/
Xxxxxx X. Xxxxx XXXXX
MOUNTAIN POWER CORPORATION
(as
to
both)
By:
/s/
Xxxxxxxxxxx X. Xxxxxx
Duly
Authorized Agent
Form
Approved: /s/
Xxxxxx X. Xxxxxxx, Xx.
General
Counsel
