EXHIBIT 10.47
 

 

 
PUGET SOUND ENERGY, INC.
 
SUPPLEMENTAL DISABILITY PLAN
 
FOR EXECUTIVE EMPLOYEES
 

 

 

 

 

 

 

 
Effective October 1, 2000

 
PUGET SOUND ENERGY, INC.
 

 
SUPPLEMENTAL DISABILITY PLAN
 
FOR EXECUTIVE EMPLOYEES
 
Effective October 1, 2000
 
PURPOSE
 
The growth and success of Puget Sound Energy, Inc. (the "Company") depends on
its ability to attract and retain the services of executive employees of the
highest competence, and to provide incentives that motivate the continued and
effective service and contributions of such employees.  The purpose of this Plan
is to advance the interests of the Company and its shareholders through a
supplemental disability plan designed to attract, motivate and retain such
executive employees.  This Plan shall be unfunded for tax purposes and for
purposes of Title I of ERISA.
 
1.           DEFINITIONS
 
For purposes of this Plan, the following words and phrases shall have the
meanings indicated, unless a different meaning is clearly indicated by the
context:
 
1.1.
Basic LTD Plan

 
"Basic LTD Plan" means the plan maintained by the Company for its regular,
full-time employees through a policy of insurance, which plan provides benefits
(after a waiting period) in the event of Disability.  Such plan also provides
enhanced benefits to executives, including core and additional voluntary
coverage.
 
1.2.
Board

 
"Board" means the board of directors of the Company.
 
1.3.
Code

 
"Code" means the Internal Revenue Code of 1986, as it may be amended from time
to time.
 
1.4.
Company

 
"Company" means Puget Sound Energy, Inc., a Washington corporation, and any
successor to all or substantially all of the Company's assets or business.
 
1.5.
Disability

 
"Disability" means a period of long-term disability during which a Participant
qualifies for benefits under the executive component of the Basic LTD Plan.  If
the Company discontinues sponsorship of the executive component of the Basic LTD
Plan, the Company in its sole discretion shall determine Disability.  Disability
does not include any waiting period under the Basic LTD Plan or any period of
short-term disability under a Company or Employer plan that provides short-term
disability benefits.
 
1.6.
Disability Benefit

 
"Disability Benefit" means the benefit set forth in Article 3.
 
1.7.
Earnings

 
"Earnings" means one-twelfth (1/12) of annual base salary plus target incentive
bonus (as of the effective date of a Participant's Disability), before any
deferrals or reductions under a Code Section 401(k) plan, Code Section 125
cafeteria plan or a nonqualified deferred compensation plan, but excluding any
long-term incentive compensation.  Amounts paid after the Participant ceases to
be an active Participant in this Plan shall not be taken into account, unless
the Company specifically decides otherwise.
 
1.8.
Employee

 
"Employee" means an individual who is an employee of any Employer.
 
1.9.
Employer

 
"Employer" means the Company and shall include any of its subsidiaries at any
tier (now in existence or hereafter formed or acquired) that have been selected
by the Board to participate in this Plan and that have adopted this Plan.
 
1.10.
ERISA

 
"ERISA" means the Employee Retirement Income Security Act of 1974, as it may be
amended from time to time.
 
1.11.
Other Income Benefits

 
"Other Income Benefits" means all income, benefits and other amounts that a
Participant is eligible to receive from other sources and that reduce the
monthly benefit payable to the Participant under the Basic LTD Plan, including,
without limitation, workers' compensation, unemployment compensation, other
insurance benefits and Social Security benefits.
 
1.12.
Participant

 
"Participant" means any Employee who is eligible to participate in this
Plan.  Participation in this Plan shall be limited to a select group of
management and highly compensated Employees chosen by the Board in its
discretion.  A spouse or former spouse of a Participant shall not be treated as
a Participant even if such spouse has an interest in the Participant's benefits
under this Plan.
 
1.13.
Plan

 
"Plan" means this Supplemental Disability Plan for Executive Employees, as it
may be amended from time to time.
 
1.14.
Plan Year

 
"Plan Year" means, except for the first Plan Year, a period beginning on January
1 of each year and continuing through December 31 of such year.
 
1.15.
SERP

 
"SERP" means the Puget Sound Energy, Inc. Supplemental Executive Retirement Plan
and any successor plans.
 
2.           PARTICIPATION
 
2.1.
Enrollment Requirements

 
A Participant shall complete and return to the Company an enrollment form, and
such other materials as the Company may request, within 30 days after becoming
eligible to participate in this Plan.
 
2.2.
When Participation Begins and Ends

 
A Participant shall commence participation in this Plan on the first day of the
month following the month in which the Participant completes all enrollment
requirements.  A Participant who does not meet the requirements within the time
specified in Section 2.1 shall not be eligible to participate in this Plan until
the first day of the Plan Year following delivery to the Company of the required
forms.  An individual's participation in this Plan shall end upon the
termination of this Plan under Article 4, upon the individual ceasing to qualify
as a Participant or upon the date of the individual's death.
 
3.           PAYMENT OF BENEFITS
 
3.1.
When Disability Benefits Begin

 
A Participant will be paid a monthly Disability Benefit when the Participant
submits proof (sufficient to the Company) that he or she is entitled to
executive benefits under the Basic LTD Plan, after satisfying any applicable
waiting period thereunder.  The payment of Disability Benefits under this Plan
is subject to all other applicable conditions in this Plan and in the Basic LTD
Plan.
 
3.2.
Disability Benefit Amount

 
The amount of the monthly Disability Benefit shall equal the following amount:
 
65% of Earnings reduced by (a) the maximum monthly benefit payable under the
Basic LTD Plan, including the maximum monthly benefit payable under the
executive core and voluntary components of such Basic LTD Plan (regardless of
whether the Participant has elected and paid the premiums for such voluntary
benefit), and (b) Other Income Benefits.
 
If, during a period of Disability, monthly Disability Benefits are not payable
under the executive component of the Basic LTD Plan due to any exclusion or
limitation set forth in the Basic LTD Plan (or its related insurance policies),
then no monthly Disability Benefits shall be payable under this Plan.  In no
event shall Disability Benefits be payable under this Plan to the extent they
would have been paid by an insurer or from another source but for the existence
of this Plan.  No survivor benefit shall be payable under this Plan.
 
3.3.
Incapacity

 
If the Disability Benefit is payable to a Participant who the Company reasonably
believes is legally incapacitated, then the Company may withhold payments to the
Participant until such time as a legally appointed guardian makes a claim for
payment under this Plan and presents proof (sufficient to the Company) of his or
her status.
 
3.4.
When Disability Benefits End

 
The payment of Disability Benefits to a Participant shall end on the earliest of
the dates listed below:
 
 
(a)
The date this Plan is terminated under Article 4;

 
 
(b)
The date the Participant no longer qualifies as a Participant;

 
 
(c)
The date the Participant's Disability ends;

 
 
(d)
The date of the Participant's death; and

 
 
(e)
The date the Participant is no longer entitled to benefits under the executive
component of the Basic LTD Plan.

 
4.           TERMINATION, AMENDMENT OR MODIFICATION
 
4.1.
Termination

 
Although the Company anticipates that it will continue this Plan for an
indefinite period of time, it reserves the right to terminate this Plan at any
time.  This Plan will automatically terminate if the Company is legally
dissolved, files for liquidation under the Bankruptcy Code or merges with,
consolidates with or sells substantially all of its assets to another entity and
the Company is not the surviving entity (unless the Company's successor in
interest expressly agrees in writing to assume this Plan or the liabilities
hereunder).
 
4.2.
Amendment

 
The Company may, at any time, amend or modify this Plan in whole or in part;
provided, that no amendment or modification of this Plan shall affect the rights
of any Participant to a monthly benefit under Article 3 that is due and owing at
the time of the amendment or modification.
 
4.3.
Effect of Payment

 
The full payment of benefits under Article 3 shall completely discharge all
obligations of the Company and all Employers to a Participant under this Plan.
 
5.           ADMINISTRATION
 
The Company is the "named fiduciary" of this Plan within the meaning of
Section 402(a)(1) of ERISA.  The Company shall administer this Plan.  The
Company expressly reserves the right to interpret in its sole discretion any
ambiguities in this Plan regarding eligibility or benefits.  The decisions or
actions of the Company with respect to the administration, interpretation and
application of this Plan and the rules and regulations hereunder shall be final
and conclusive and shall be binding on all persons having any interest in this
Plan.
 
6.           CLAIMS PROCEDURES
 
6.1.
Presentation of Claim

 
Any Participant (such Participant being referred to in this Article 6 as a
"Claimant") may deliver to the Company a written claim for a determination with
respect to the amounts distributable to such Claimant from this Plan.  If such a
claim relates to the contents of a notice received by the Claimant, the claim
must be made within 60 days after the Claimant received such notice.  All other
claims must be made within 180 days of the date on which the event that caused
the claim to arise occurred.  The claim must state with particularity the
determination desired by the Claimant.
 
6.2.
Notification of Decision

 
The Company shall consider a Claimant's claim within a reasonable time, and
shall notify the Claimant 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 Company has reached a conclusion contrary, in whole or in part, to the
Claimant's requested determination.  Such notice shall state:

 
 
(i)
the specific reason(s) for the denial of the claim, or any part of it; and

 
 
(ii)
specific reference(s) to pertinent provisions of this Plan upon which such
denial was based.

 
6.3.
Legal Action

 
Compliance with the foregoing provisions of this Article 6 is a mandatory
prerequisite to a Claimant's right to commence any legal action with respect to
any claim for benefits under this Plan.
 
7.           MISCELLANEOUS
 
7.1.
Status of Plan

 
This Plan is intended to be a welfare plan within the meaning of DOL Regulation
Section 2520.104-24.  This Plan shall be administered and interpreted in a
manner consistent with that intent.
 
7.2.
Unsecured General Creditor

 
Participants and their heirs, successors and assigns shall have no legal or
equitable rights, interests or claims in any property or assets of the
Company.  For purposes of the payment of benefits under this 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 this Plan
shall consist solely of an unfunded and unsecured promise to pay money in the
future.
 
7.3.
Company's Liability; Right of Recovery

 
The Company's liability for the payment of benefits shall be defined only by
this Plan.  The Company shall have no obligation to a Participant under this
Plan except as expressly provided in this Plan.  If payments have been made in
excess of the benefit amount payable under this Plan, the Company has the right
to recover the amount of the excess from the Employee, the Employee's estate or
any other person to whom payments were made.
 
7.4.
Nonassignability

 
Neither a Participant nor any other person shall have any right to commute,
sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber,
transfer, hypothecate, alienate or convey in advance of actual receipt, the
amounts, if any, payable under this Plan, or any part thereof.  All of such
rights are expressly declared to be unassignable and nontransferable.  None of
the amounts payable under this Plan shall, prior to actual payment, be subject
to seizure, attachment, garnishment or sequestration for the payment of any
debts, judgments, alimony or separate maintenance owed by a Participant or any
other person, or be transferable by operation of law in the event of a
Participant's or any other person's bankruptcy or insolvency, or be transferable
to a spouse as a result of a property settlement or otherwise.
 
7.5.
Furnishing Information

 
A Participant shall cooperate with the Company by furnishing any and all
information requested by the Company and shall take such other actions as may be
requested in order to facilitate the administration of this Plan and the
payments of benefits hereunder, including, but not limited to, taking such
physical examinations (at the Company's expense) as the Company may deem
necessary.
 
7.6.
Captions

 
The captions of the articles, sections and paragraphs of this Plan are for
convenience only and shall not control or affect the meaning or construction of
any of its provisions.
 
7.7.
Governing Law

 
Subject to ERISA, the provisions of this Plan shall be construed and interpreted
according to the internal laws of the State of Washington, without regard to its
conflict of laws principles, except to the extent preempted by ERISA or by other
federal law.
 
7.8.
Successors

 
The provisions of this Plan shall bind and inure to the benefit of the Company
and its successors and assigns.
 
7.9.
Validity

 
If any provision of this Plan shall be found to be illegal or invalid for any
reason, such illegality or invalidity shall not affect the remaining parts
hereof, but this Plan shall be construed and enforced as if such illegal or
invalid provision had never been inserted herein.
 
7.10.
Insurance

 
The Company, on its own behalf and in its sole discretion, may apply for and
procure insurance related to this Plan and in such amounts and in such forms as
the Company may choose.  The Company shall be the sole owner and beneficiary of
any such insurance.  The Participant shall have no interest whatsoever in any
such policy or policies, and at the request of the Company shall submit to
medical examinations and supply such information and execute such documents as
may be required by the insurance company or companies to which the Company has
applied for insurance.
 
IN WITNESS WHEREOF, the Company has executed this Plan as of the effective date
set forth above.
 

 
PUGET SOUND ENERGY, INC.
 

 

 
By:                                                                
 
     Name:                                                                
 
     Title: