EXHIBIT 10.4
NSTAR
Change in Control Agreement
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AGREEMENT, made this 11th day of May, 1999, by and between Xxxxxxx X.
Xxxxxx ("Executive") and NSTAR (the "Company"). This Agreement shall become
effective on the effective date (the "Effective Date") of the merger transaction
between Commonwealth Energy System and BEC Energy pursuant to the Amended and
Restated Agreement and Plan of Merger dated as of December 5, 1998 and amended
and restated as of May 4, 1999 among BEC Energy, Commonwealth Energy System, the
Company, BEC Acquisition LLC and CES Acquisition LLC.
WITNESSETH
WHEREAS, the Board of Trustees of the Company (the "Board") has determined
that it is in the best interests of the Company and its shareholders for the
Company to agree to provide benefits under the circumstances described below to
Executive and other executives who are responsible for the policy-making
functions of the Company and the overall viability of the Company's business;
and
WHEREAS, the Board recognizes that the possibility of a change of control of
the Company is unsettling to such executives and desires to make arrangements at
this time to help assure their continuing dedication to their duties to the
Company and its shareholders, notwithstanding any attempts by outside parties to
gain control of the Company; and
WHEREAS, the Board believes it important, should the Company receive
proposals from outside parties, to enable such executives, without being
distracted by the uncertainties of their own employment situation, to perform
their regular duties, and where appropriate to assess such proposals and advise
the Board as to the best interests of the Company and its shareholders and to
take such other action regarding such proposals as the Board determines to be
appropriate; and
WHEREAS, the Board also desires to demonstrate to the executives that the
Company is concerned with their welfare and intends to provide that loyal
executives are treated fairly; and
WHEREAS, the Board wishes to assure the executives of fair severance should
any of their employment terminate in specified circumstances following a change
of control of the Company and to assure the executives of other benefits upon a
change of control.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto agree as follows:
1. In the event that any individual, corporation, partnership, company,
or other entity (a "Person"), which term shall include a "group" (within the
meaning of section 13(d) of
the Securities Exchange Act of 1934 (the "Act")), begins a tender or exchange
offer, circulates a proxy to the Company's shareholders, or takes other steps to
effect a "Change of Control" (as defined in Exhibit A attached hereto and made a
part hereof), Executive agrees that he will not voluntarily leave the employ of
the Company and will render the services contemplated in the recitals to this
Agreement until such Person has terminated the efforts to effect a Change of
Control or until a Change of Control has occurred.
2. If, within 36 months following a Change of Control (the "Post Change
of Control Period") Executive's employment with the Company is terminated by the
Company for any reason other than for "Cause" or "Disability" (as defined
paragraph 4 below), or as a result of Executive's death, or Executive terminates
such employment for Good Reason (as defined in paragraph 5 below):
a. the Company will pay to Executive within 30 days of such termination
of employment a lump-sum cash payment equal to the sum of (i) the Executive's
annual base salary ("Annual Base Salary") through the date of such termination
of employment to the extent not theretofore paid, (ii) a prorated portion of the
target award payable under the Company's Executive Annual Incentive Compensation
Plan, or any comparable or successor plan (the "Annual Plan") determined by
calculating the product of (A) the target bonus award payable for the fiscal
year in which the date of termination occurs under the Annual Plan, times (B) a
fraction, the numerator of which is the number of days in the current fiscal
year through the date of termination of employment, and the denominator of which
is 365, (iii) a prorated portion of the target award payable under the Company's
Performance Share Plan, or any comparable or successor plan (the "Long-Term
Plan") for the performance period ending on the last day of the fiscal year
during which the date of termination of employment occurs determined by
calculating the product of (A) the target award payable for such performance
period and (B) a fraction, the numerator of which is the number of days in the
current performance period through the date of termination, and the denominator
of which is the actual number of days in the performance period (provided that
if any awards are expressed in shares of common stock rather than cash, the
Company will pay the cash equivalent of such awards based on the closing price
per share as reported in the Wall Street Journal (Eastern Edition) New York
Stock Exchange Composite Transactions determined on the date prior to the date
of the Change of Control or the average per share price for the 10 trading days
preceding the date of the Change of Control (whichever is higher)) and (iv) any
compensation for the fiscal year in which the date of termination occurs
previously deferred by the Executive (together with any accrued interest or
earnings thereon) and any accrued vacation pay, in each case to the extent not
theretofore paid; and
b. any stock, stock option or cash awards granted to the Executive by the
Company that would have become vested upon continued employment by the Executive
shall immediately vest in full notwithstanding any provision to the contrary of
such grant and shall remain exercisable until the earlier of the fifth
anniversary of such termination and the latest date on which such grant could
have been exercised; and
c. the Company will pay to Executive within 30 days of such termination
of employment a lump-sum cash payment equal to three times: (A) the amount of
the Executive's
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Annual Base Salary at the rate in effect immediately prior to the date of
termination or at the rate in effect immediately prior to the Change of Control,
whichever is higher, and (B) the amount of the actual bonus paid to the
Executive under the Annual Plan and the Long-Term Plan for the most recently
completed fiscal year ended before the Change of Control, or the target bonus
payable under the Annual Plan and Long-Term Plan for the fiscal year during
which the termination of employment occurs, whichever is higher (provided that
if any awards are expressed in shares of common stock rather than cash, the
Company will pay the cash equivalent of such awards based on the closing price
per share as reported in the Wall Street Journal (Eastern Edition) New York
Stock Exchange Composite Transactions determined on the date prior to the date
of the Change of Control or the average per share price for the 10 trading days
preceding the date of the Change of Control (whichever is higher)); and
d. the Company will pay to Executive within 30 days of such termination
of employment a lump-sum cash payment equal to the full balance standing to his
credit with the Company under any and all deferred compensation plans or
arrangements and the lump-sum actuarial equivalent of the Executive's accrued
benefit under any supplement retirement plan or arrangement (the sum of the
amounts described in subsections (a) and (d) shall be hereinafter referred to as
the "Accrued Obligations"); and
e. an amount equal to the excess of (i) the lump-sum actuarial equivalent
of the accrued benefit under (a) the Company's qualified defined benefit
Retirement Plan (the "Retirement Plan") (utilizing actuarial assumptions no less
favorable to the Executive than those in effect under the Retirement Plan
immediately prior to the date of the Change of Control), and (b) any
supplemental retirement plan of the Company in which the Executive participates
(the "SERP") which the Executive would receive if the Executive's employment
continued for three years after the date of termination assuming for these
purposes that all accrued benefits are fully vested, and further assuming that
the Executive's annual compensation for purposes of determining benefits under
the Retirement Plan and SERP ("Covered Compensation") in each of the three years
is at least equal to the higher of Executive's annual rate of Covered
Compensation for the most recently completed fiscal year ending prior to the
date of the Change of Control or the year in which the Change of Control occurs,
over (ii) the lump-sum actuarial equivalent of the Executive's actual accrued
benefit (paid or payable), if any, under the Retirement Plan and the SERP as of
the date of termination; and
f. Executive, together with his dependents, will continue following such
termination of employment to participate fully at the Company's expense in all
welfare benefit plans, programs, practices and policies, including without
limitation, life, medical, disability, dental, accidental death and travel
insurance plans, maintained or sponsored by the Company immediately prior to the
Change of Control, or receive substantially the equivalent coverage (or the full
value thereof in cash) from the Company, until the longer of the third
anniversary of such termination or any longer period as may be provided by the
terms of the appropriate plan, program, practice or policy, provided, however,
that if the Executive becomes re-employed with another employer and is eligible
to receive medical or other welfare benefits under another employer-provided
plan, the medical and other welfare benefits described herein shall be secondary
to those provided under such other plan during such applicable period of
eligibility. For purposes of determining eligibility (but not the time of
commencement of benefits) of the
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Executive for any retiree benefits pursuant to such plans, practices, programs
and policies, the Executive shall be considered to have remained employed until
three years after the date of termination and to have retired on the last day of
such period; and
g. to the extent not theretofore paid or provided for, the Company shall
timely pay or provide to the Executive any other amounts or benefits required to
be paid or provided or which the Executive is eligible to receive under any
plan, program, policy, practice, contract or agreement of the Company ("Other
Benefits"); and
h. the Company will promptly reimburse Executive for any and all legal
fees and expenses (including, without limitation, stenographer fees, printing
costs, etc.) incurred by him as a result of such termination of employment,
including without limitation all fees and expenses incurred to enforce the
provisions of this Agreement or contesting or disputing that the termination of
his employment is for Cause or other than for Good Reason (regardless of the
outcome thereof).
Notwithstanding anything herein to the contrary, to the extent that any
payment or benefit provided for herein is required to be paid or vested at any
earlier date under the terms of any plan, agreement or arrangement, such plan,
agreement or arrangement shall control.
3. Death, Disability, Cause, Other Than For Good Reason.
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a. Death. If the Executive's employment shall terminate during the Post
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Change of Control Period by reason of the Executive's death, this Agreement
shall terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations and the timely payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive's estate or beneficiary, as
applicable, in a lump sum in cash within 30 days of death.
b. Disability. If the Executive's employment is terminated during the
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Post Change of Control Period by reason of the Executive's Disability, this
Agreement shall terminate without further obligations to the Executive other
than for payment of Accrued Obligations and the timely payment or provision of
Other Benefits. Accrued Obligations shall be paid to the Executive in a lump
sum in cash within 30 days of the date of termination of employment. For
purposes of this Agreement, "Disability" shall mean the absence of the Executive
from the Executive's duties with the Company on a full-time basis for 180
consecutive business days as a result of incapacity due to mental or physical
illness which is determined to be total and permanent by a physician selected by
the Company or its insurers and acceptable to the Executive or the Executive's
legal representative. If the Company determines in good faith that the
Disability of the Executive has occurred during the Post Change of Control
Period, it may give the Executive written notice of its intention to terminate
the Executive's employment. In such event, the Executive's employment with the
Company shall terminate effective on the 30th day after receipt of such notice
by the Executive, provided that, within the 30 days of such receipt, the
Executive shall not have returned to full-time performance of the Executive's
duties.
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c. Cause. If the Executive's employment shall be terminated for Cause (as
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defined in Section 4 below) during the Post Change of Control Period, this
Agreement shall terminate without further obligations to the Executive other
than the obligation to pay the Executive (A) his Annual Base Salary through the
date of termination, (B) the amount of any compensation previously deferred by
the Executive, and (C) Other Benefits, in each case to the extent theretofore
unpaid. If the Executive voluntarily terminates employment during the Post
Change of Control Period, excluding a termination for Good Reason, this
Agreement shall terminate without further obligations to the Executive other
than for Accrued Obligations and the timely payment or provisions of Other
Benefits.
In such case, all Accrued Obligations shall be paid to the Executive in a
lump sum in cash within 30 days of date of the termination of employment.
4. "Cause" means only: (a) commission of a felony or gross neglect of
duty by the Executive which is intended to result in substantial personal
enrichment of the Executive at the expense of the Company, (b) conviction of a
crime involving moral turpitude, or (c) willful failure by the Executive of his
duties to the Company which failure is deliberate on the Executive's part,
results in material injury to the Company, and continues for more than 30 days
after written notice given to the Executive pursuant to a two-thirds vote of all
of the members of the Board at a meeting called and held for such purpose (after
reasonable notice to Executive) and at which meeting the Executive and his
counsel were given an opportunity to be heard, such vote to set forth in
reasonable detail the nature of the failure. For purposes of this definition of
Cause, no act or omission shall be considered to have been "willful" unless it
was not in good faith and the Executive had knowledge at the time that the act
or omission was not in the best interest of the Company. Any act, or failure to
act, based on authority given pursuant to a resolution duly adopted by the Board
or upon the instructions of the Chief Executive Officer or another senior
officer of the Company or based on the advice of counsel of the Company shall be
conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interest of the Company.
5. Executive shall be deemed to have voluntarily terminated his
employment for Good Reason if the Executive leaves the employ of the Company for
any reason following:
a. The assignment to the Executive of any duties inconsistent in any
respect with the Executive's position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities immediately prior
to the Change of Control; or any other action by the Company which results in a
diminution in such position, authority, duties or responsibilities, excluding
for this purpose an isolated, insubstantial and inadvertent action not taken in
bad faith and which is remedied by the Company promptly after receipt of notice
thereof given by the Executive; or
b. Any reduction in the Executive's rate of Annual Base Salary for any
fiscal year to less than 100% of the rate of Annual Base Salary paid to him in
the completed fiscal year immediately preceding the Change of Control, or
reduction in Executive's total cash and stock compensation opportunities,
including salary and incentives, for any fiscal year to less than 100% of the
total cash and stock compensation opportunities made available to him in the
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completed fiscal year immediately preceding the Change of Control (for this
purpose, such opportunities shall be deemed reduced if the objective standards
by which the Executive's incentive compensation measured become more stringent
or the amount of such compensation is materially reduced on a discretionary
basis from the amount that would be payable solely by reference to the objective
standards); or
c. Failure of the Company to continue in effect any retirement, life,
medical, dental, disability, accidental death or travel insurance plan, in which
Executive was participating immediately prior to the Change of Control unless
the Company provides Executive with a plan or plans that provide substantially
similar benefits, or the taking of any action by the Company that would
adversely effect Executive's participation in or materially reduce Executive's
benefits under any of such plans or deprive Executive of any material fringe
benefit enjoyed by Executive immediately prior to the Change of Control other
than an isolated, insubstantial and inadvertent failure not occurring in bad
faith and which is remedied by the Company promptly after receipt of notice
thereof given by the Executive; or
d. The Company requires Executive to be based at any office or location
outside the Greater Boston Metropolitan Area or the Company requires the
Executive to travel on Company business to a substantially greater extent than
required immediately prior to the date of Change of Control; or
e. Any purported termination by the Company of the Executive's employment
otherwise than is expressly permitted by this Agreement; or
f. Any failure by the Company to comply with and satisfy Section 8 of
this Agreement.
For purposes of this Section 5, any good faith determination of Good Reason
made by the Executive shall be conclusive.
6. If any payment or benefit received by Executive (whether paid or
payable or distributed or distributable pursuant to the terms of this Agreement
or otherwise, but determined without regard to any additional payments required
under this Section 6) would be subject to the excise tax imposed by Section
4999 of the Internal Revenue Code of 1986, as amended (the "Code"), or any
interest or penalties are incurred by the Executive with respect to such excise
tax), the Company will pay to Executive an additional amount in cash (the
"Additional Amount") equal to the amount necessary to cause the aggregate
payments and benefits received by Executive, including such Additional Amount
(net of all federal, state, and local income taxes and all taxes payable as a
result of the application of Sections 28OG and 4999 of the Code and including
any interest and penalties with respect to such taxes) to be equal to the
aggregate payments and benefits Executive would have received, excluding such
Additional Amount (net of all federal, state and local income taxes) as if
Sections 28OG and 4999 of the Code (and any successor provisions thereto) had
not been enacted into law.
Following the termination of Executive's employment, Executive may submit
to the Company a written opinion (the "Opinion") of a nationally recognized
accounting firm,
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employment consulting firm, or law firm selected by Executive setting forth a
statement and a calculation of the Additional Amount. The determination of such
firm concerning the extent of the Additional Amount (which determination need
not be free from doubt), shall be final and binding on both Executive and the
Company. The Company will pay to Executive the Additional Amount not later than
10 days after such firm has rendered the Opinion. The Company agrees to pay the
fees and expenses of such firm in preparing and rendering the Opinion.
If, following the payment to Executive of the Additional Amount,
Executive's liability for the excise tax imposed by Section 4999 of the Code on
the payments and benefits received by Executive is finally determined (at such
time as the Internal Revenue Service is unable to make any further adjustment to
the amount of such liability) to be less than the amount thereof set forth in
the Opinion, Executive shall reimburse the Company, without interest, in an
amount equal to the amount by which the Additional Amount should be reduced to
reflect such decrease in the actual excise tax liability. The calculation of
such reimbursement shall be made by a nationally recognized accounting firm, an
employment consulting firm, or a law firm selected by Executive, whose
determination shall be binding on Executive and the Company and whose fees and
expenses therefor shall be paid by the Company.
7. In the case of any dispute under this Agreement, Executive may
initiate binding arbitration in Boston, Massachusetts, before the American
Arbitration Association by serving a notice to arbitrate upon the Company or, at
Executive's election, institute judicial proceedings, in either case within 90
days of the effective date of his termination or, if later, his receipt of
notice of termination, or such longer period as may be reasonably necessary for
Executive to take such action if illness or incapacity should impair his taking
such action within the 90-day period. The Company shall not have the right to
initiate binding arbitration, and agrees that upon the initiation of binding
arbitration by Executive pursuant to this paragraph 7 the Company shall cause to
be dismissed any judicial proceedings it has brought against Executive relating
to this Agreement. The Company authorizes Executive from time to time to retain
counsel of his choice to represent Executive in connection with any and all
actions, proceedings, and/or arbitration, whether by or against the Company or
any trustee, officer, shareholder, or other person affiliated with the Company,
which may affect Executive's rights under this Agreement. The Company agrees (i)
to pay the fees and expenses of such counsel, (ii) to pay the cost of such
arbitration and/or judicial proceeding, and (iii) to pay interest to Executive
on all amounts owed to Executive under this Agreement during any period of time
that such amounts are withheld pending arbitration and/or judicial proceedings.
Such interest will be at the base rate as announced from time to time by
BankBoston, N.A.
In addition, notwithstanding any existing prior attorney-client
relationship between the Company and counsel retained by Executive, the Company
irrevocably consents to Executive entering into an attorney-client relationship
with such counsel and agrees that a confidential relationship shall exist
between Executive and such counsel.
8. If the Company is at any time before or after a Change of Control
merged or consolidated into or with any other corporation or other entity
(whether or not the Company is the surviving entity), or if substantially all of
the assets thereof are transferred to another
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corporation or other entity, the provisions of this Agreement will be binding
upon and inure to the benefit of the corporation or other entity resulting from
such merger or consolidation or the acquirer of such assets (the "Successor
Entity"), and this paragraph 8 will apply in the event of any subsequent merger
or consolidation or transfer of assets. The Company will require any such
Successor Entity to assume expressly and agree to perform this Agreement in the
same manner and to the same extent that the Company would be required to perform
if no such transaction had taken place. As used in this Agreement, "Company"
shall mean the Company as hereinbefore defined and any Successor Entity which
assumes and agrees to perform this Agreement by operation of law or otherwise.
In the event of any merger, consolidation, or sale of assets described
above, nothing contained in this Agreement will detract from or otherwise limit
Executive's right to or privilege of participation in any stock option or
purchase plan or any bonus, profit sharing, pension, group insurance,
hospitalization, or other incentive or benefit plan or arrangement which may be
or become applicable to executives of the corporation resulting from such merger
or consolidation or the corporation acquiring such assets of the Company.
In the event of any merger, consolidation, or sale of assets described
above, references to the Company in this Agreement shall unless the context
suggests otherwise be deemed to include the entity resulting from such merger or
consolidation or the acquirer of such assets of the Company.
9. Any termination by the Company for Cause, or by the Executive for Good
Reason, shall be communicated by Notice of Termination to the other party hereto
given in accordance with the last paragraph of Section 14 of this Agreement.
For purposes of this Agreement, a "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than thirty days after the
giving of such notice). The failure by the Executive or the Company to set
forth in the Notice of Termination any fact or circumstance which contributes to
a showing of Good Reason or Cause shall not waive any right of the Executive or
the Company, respectively, hereunder or preclude the Executive or the Company,
respectively, from asserting such fact or circumstance in enforcing the
Executive's or the Company's rights hereunder.
"Date of Termination" means (i) if the Executive's employment is terminated
by the Company for Cause, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified therein, as the
case may be, (ii) if the Executive's employment is terminated by the Company
other than for Cause or Disability, the Date of Termination shall be the date on
which the Company notifies the Executive of such termination and (iii) if the
Executive's employment is terminated by reason of death or Disability, the Date
of Termination shall be the date of death of the Executive or the effective date
of the Disability, as the case may be.
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10. All payments required to be made by the Company hereunder to Executive
or his dependents, beneficiaries, or estate will be subject to the withholding
of such amounts relating to tax and/or other payroll deductions as may be
required by law.
11. There shall be no requirement on the part of the Executive to seek
other employment or otherwise mitigate damages in order to be entitled to the
full amount of any payments and benefits to which Executive is entitled under
this Agreement, and the amount of such payments and benefits shall not be
reduced by any compensation or benefits received by Executive from other
employment.
12. Nothing contained in this Agreement shall be construed as a contract
of employment between the Company and the Executive, or as a right of the
Executive to continue in the employ of the Company, or as a limitation of the
right of the Company to discharge the Executive with or without Cause; provided
that the Executive shall have the right to receive upon termination of his
employment the payments and benefits provided in this Agreement and shall not be
deemed to have waived any rights he may have either at law or in equity in
respect of such discharge.
13. No amendment, change, or modification of this Agreement may be made
except in writing, signed by both parties.
14. This Agreement shall terminate on the third anniversary of the
Effective Date, provided, however, that commencing on the date one year after
the Effective Date, and on each annual anniversary of such date (each such date
hereinafter referred to as a "Renewal Date"), unless previously terminated, the
term of this Agreement shall be automatically extended so as to terminate three
years from such Renewal Date, unless at least sixty days prior to the Renewal
Date the Company shall give notice to the Executive that the term of this
Agreement shall not be so extended. This Agreement shall not apply to a Change
of Control which takes place after the termination of this Agreement.
Payments made by the Company pursuant to this Agreement shall be in lieu of
severance payments, if any, which might otherwise be available to Executive
under any severance plan, policy, program or arrangement generally applicable to
the employees of the Company. If for any reason Executive receives severance
payments (other than under this Agreement) upon the termination of his
employment with the Company, the amount of such payments shall be deducted from
the amount paid under this Agreement. The purpose of this provision is solely
to avert a duplication of benefits; neither this provision nor the provisions of
any other agreement shall be interpreted to reduce the amount payable to
Executive below the amount that would otherwise have been payable under this
Agreement.
The provisions of this Agreement shall be binding upon and shall inure to
the benefit of Executive, his executors, administrators, legal representatives,
and assigns, and the Company and its successors.
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The validity, interpretation, and effect of this Agreement shall be
governed by the laws of The Commonwealth of Massachusetts. Any ambiguities in
this Agreement shall be construed in favor of the Executive.
The invalidity or unenforceability of any provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.
The Company shall have no right of set-off or counterclaims, in respect of
any claim, debt, or obligation, against any payments to Executive, his
dependents, beneficiaries, or estate provided for in this Agreement.
No right or interest to or in any payments shall be assignable by the
Executive; provided, however, that this provision shall not preclude him from
designating one or more beneficiaries to receive any amount that may be payable
after his death and shall not preclude the legal representative of his estate
from assigning any right hereunder to the person or persons entitled thereto
under his will or, in the case of intestacy, to the person or persons entitled
thereto under the laws of intestacy applicable to his estate. The term
"beneficiaries" as used in this Agreement shall mean a beneficiary or
beneficiaries so designated to receive any such amount, or if no beneficiary has
been so designated, the legal representative of the Executive's estate.
No right, benefit, or interest hereunder shall be subject to anticipation,
alienation, sale, assignment, encumbrance, charge, pledge, hypothecation, or
set-off in respect of any claim, debt, or obligation, or to execution,
attachment, levy, or similar process, or assignment by operation of law. Any
attempt, voluntary or involuntary, to effect any action specified in the
immediately preceding sentence shall, to the full extent permitted by law, be
null, void, and of no effect.
All notices and other communications hereunder shall be in writing and
shall be given by hand delivery to the other party or by registered or certified
mail, return receipt requested, postage prepaid, addressed as follows:
If to the Executive: Xxxxxxx X. Xxxxxx
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COM/Energy
Xxx Xxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxxx, XX 00000-0000
If to the Company: NSTAR
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000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: General Counsel
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or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.
IN WITNESS WHEREOF, NSTAR and Executive have each caused this Agreement to
be duly executed and delivered as of the date set forth above.
NSTAR
By: /s/ Xxxxxx X. May
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Name: Xxxxxx X. May
Title: Chairman of the Board, Chief Executive
Officer and Treasurer
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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EXHIBIT A
Change of Control. For the purposes of this Agreement, a "Change of
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Control" shall mean:
a. The acquisition by any Person of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% 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 trustees (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this subsection (a), the following
acquisitions shall not constitute a Change of Control: (i) any acquisition
directly from the Company, (ii) any acquisition by the Company, (iii) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (iv)
any acquisition by any corporation pursuant to a transaction which complies with
clauses (i), (ii) and (iii) of subsection (c) of this Exhibit A; or
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 trustee 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 trustees 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 an actual or
threatened election contest with respect to the election or removal of trustees
or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or
c. Consummation of a reorganization, merger or consolidation or sale or
other disposition of all or substantially all of the assets of the Company (a
"Business Combination"), in each case, unless, following such Business
Combination, (i) 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
Business Combination beneficially own, directly or indirectly, more than 50% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Company Common
Stock and outstanding Company Voting Securities, as the case may be, (ii) no
Person (excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 30% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to
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the Business Combination and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such Business Combination
were members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or
d. Approval by the shareholders of the Company of a complete liquidation
or dissolution of the Company.
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