Exhibit 10.1.af

 
 

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AGL RESOURCES INC.
 
NONQUALIFIED SAVINGS PLAN
 
As Amended and Restated Effective January 1, 2007
 
 
 
 
 
 

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AGL RESOURCES INC.
 
NONQUALIFIED SAVINGS PLAN
 
Effective as of the 1st day of January, 2007, AGL Resources Inc., a corporation
duly organized and existing under the laws of the State of Georgia (the
“Controlling Company”), hereby amends and restates the AGL Resources Inc.
Nonqualified Savings Plan (the “Plan”). The Plan was originally established as
of July 1, 1995, and was previously amended and restated effective as of
January 1, 2001.
 
 
STATEMENT OF PURPOSE
 
A. The primary purpose of the Plan is to recognize the contributions made to the
Controlling Company and its participating affiliates by certain employees and to
reward those contributions by providing eligible employees with an opportunity
to accumulate savings for their future security.
 
B. The Plan is intended to be an unfunded nonqualified deferred compensation
plan maintained by the Controlling Company primarily for the purpose of
providing deferred compensation for a select group of management or highly
compensated employees (within the meaning of §§ 201(2), 301(a)(3), 401(a)(1) and
4021(b)(6) of the Employee Retirement Income Security Act of 1974, as amended),
and shall be construed in all respects in accordance with such intended
purposes.
 
C. Any trust fund established to maintain and invest the amounts contributed to
the Plan shall be established under a trust agreement, which meets the
requirements of a “rabbi trust,” pursuant to guidelines issued by the Internal
Revenue Service (the “IRS”).
 
D. Regardless of the establishment of a trust fund, all assets of the Plan shall
remain assets of the Controlling Company and shall be subject to the general
creditors of the Controlling Company. Participants and Beneficiaries shall have
only the rights of unsecured creditors with respect to any assets of the Plan.
 
 
STATEMENT OF AGREEMENT
 
In order to amend and restate the Plan with the purposes and goals as
hereinabove described, the Controlling Company hereby sets forth the terms and
provisions of the amended and restated Plan as follows
 
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Page
   
STATEMENT OF PURPOSE
1
   
STATEMENT OF AGREEMENT
1
     
ARTICLE I
DEFINITIONS
5
1.1
1934 Act
5
1.2
Account
5
1.3
Active Participant
5
1.4
Administrative Committee
5
1.5
Affiliate
5
1.6
Aggregated Arrangements
5
1.7
Before-Tax Account
5
1.8
Before-Tax Contributions
5
1.9
Beneficiary
5
1.10
Board
5
1.11
Bonus
6
1.12
Bonus Compensation
6
1.13
Break in Service
6
1.14
Change in Control
6
1.15
Code
7
1.16
Company Contributions
7
1.17
Company Stock
7
1.18
Compensation
7
1.19
Contributions
7
1.20
Controlling Company
7
1.21
Covered Employee
7
1.22
Deferral Election
7
1.23
Disabled
8
1.24
Effective Date
8
1.25
Employee
8
1.26
Entry Date
8
1.27
Forfeiture
8
1.28
Hour of Service
8
1.29
Investment Committee
9
1.30
Investment Fund or Funds
9
1.31
Key Employee
9
1.32
Leave of Absence
9
1.33
Matching Account
10
1.34
Matching Contributions
10
1.35
Maternity or Paternity Leave
10
1.36
Normal Retirement Age
10
1.37
Participant
10
1.38
Participating Company
10
1.39
Payment Election
10
1.40
Plan
10
1.41
Plan Year
10
1.42
Retirement Savings Plus Plan or RSP
10
1.43
Separate from Service or Separation from Service
10
1.44
Special Bonus Deferral Election
10

 
 
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TABLE OF CONTENTS
(continued)

   
Page
     
1.45
Spouse or Surviving Spouse
11
1.46
Trust or Trust Agreement
11
1.47
Trustee
11
1.48
Trust Fund
11
1.49
Valuation Date
11
1.50
Year of Vesting Service
11
     
ARTICLE II
ELIGIBILITY
11
2.1
Initial Eligibility Requirements
11
2.2
Subsequent Eligibility Requirements
12
2.3
Treatment of Interruptions of Service
12
2.4
Change in Status
12
     
ARTICLE III
CONTRIBUTIONS
12
3.1
Before-Tax Contributions
12
3.2
Matching Contributions
14
3.3
Form of Contributions
15
     
ARTICLE IV
PARTICIPANTS’ ACCOUNTS; CREDITING AND ALLOCATIONS
15
4.1
Establishment of Participants’ Accounts
15
4.2
Allocation and Crediting of Before-Tax and Matching Contributions
15
4.3
Allocation and Crediting of Investment Experience
15
4.4
Notice to Participants of Account Balances
16
4.5
Good Faith Valuation Binding
16
4.6
Errors and Omissions in Accounts
16
     
ARTICLE V
INVESTMENT OF ACCOUNTS
16
5.1
Establishment of Trust Fund
16
5.2
Investment Funds
17
5.3
Investment Procedures
18
5.4
Acquisition of Company Stock
19
5.5
Value of Assets
19
     
ARTICLE VI
VESTING IN ACCOUNTS
20
6.1
General Vesting Rule
20
6.2
Vesting Upon Other Occurrences
20
6.3
Timing of Forfeitures
20
6.4
Vesting of Matching Contribution Accounts for NUI Participants
20
     
ARTICLE VII
PAYMENT OF BENEFITS
21
7.1
Benefit Payments
21
7.2
Election of Timing and Form of Benefit Payment
21
7.3
Forms of Payment Upon Separation from Service
23
7.4
Beneficiary Designation
23
7.5
Hardship Withdrawals
24
7.6
Unclaimed Benefits
24
7.7
Claims
25

 
 
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TABLE OF CONTENTS
(continued)
 

   
Page
     
ARTICLE VIII
ALLOCATION OF AUTHORITY AND RESPONSIBILITIES
26
8.1
Administrative Committee
26
8.2
Controlling Company and Board
28
8.3
Trustee
29
8.4
Delegation
29
     
ARTICLE IX
AMENDMENT, TERMINATION AND ADOPTION
29
9.1
Amendment
29
9.2
Termination
29
9.3
Delegation
29
     
ARTICLE X
MISCELLANEOUS
31
10.1
Nonalienation of Benefits and Spendthrift Clause
31
10.2
Headings
32
10.3
Construction, Controlling Law
32
10.4
No Contract of Employment
32
10.5
Legally Incompetent
32
10.6
Heirs, Assigns and Personal Representatives
32
10.7
Unsecured Creditor Rights
32
10.8
Legal Action
32
10.9
Severability
33
10.10
Predecessor Service
33
10.11
Plan Expenses
33
     
SCHEDULE A
 
34
     
SCHEDULE B
 
35

 
 

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DEFINITIONS
 
For purposes of the Plan, the following terms, when used with an initial capital
letter, shall have the meanings set forth below unless a different meaning
plainly is required by the context.
 
1.1  1934 Act shall mean the Securities Exchange Act of 1934, as amended.
 
1.2  Account shall mean, with respect to a Participant or Beneficiary, the
amount of money or other property as is evidenced by the last balance posted in
accordance with the terms of the Plan to the account record established for such
Participant or Beneficiary. The Administrative Committee may establish and
maintain separate subaccounts for each Participant and Beneficiary, provided
allocations are made to such subaccounts in the manner described in Article IV
of the Plan. “Account” shall refer to the aggregate of all separate subaccounts
or to individual, separate subaccounts, as may be appropriate in context.
 
1.3  Active Participant shall mean, for any Plan Year (or any portion thereof),
any Covered Employee who has been admitted to, and not removed from, active
participation since the last date his employment commenced or recommenced.
 
1.4  Administrative Committee shall mean the committee designated by the Board
which shall act on behalf of the Controlling Company to administer the Plan;
provided, the Controlling Company may act in lieu of the Administrative
Committee as it deems appropriate or desirable.
 
1.5  Affiliate shall mean, as of any date, (i) a Participating Company, and
(ii) any company, person or organization which, on such date, (A) is a member of
the same controlled group of corporations [within the meaning of Code §414(b)]
as is a Participating Company; (B) is a trade or business (whether or not
incorporated) which controls, is controlled by or is under common control with
[within the meaning of Code §414(c)] a Participating Company; (C) is a member of
an affiliated service group [as defined in Code §414(m)] which includes a
Participating Company; or (D) is required to be aggregated with a Participating
Company pursuant to regulations promulgated under Code §414(o).
 
1.6  Aggregated Arrangements shall mean the Plan and any other plan that that
would be considered as a single plan with the Plan under Code § 409A and
applicable guidance issued thereunder.
 
1.7  Before-Tax Account shall mean the separate subaccount(s) established and
maintained on behalf of a Participant or his Beneficiary to reflect his interest
in the Plan attributable to his Before-Tax Contributions.
 
1.8  Before-Tax Contributions shall mean the amounts paid by each Participating
Company to the Plan at the election of Participants, all pursuant to the terms
of §3.1(a).
 
1.9  Beneficiary shall mean the person(s) designated in accordance with §7.4 to
receive any death benefits that may be payable under the Plan upon the death of
a Participant.
 
1.10  Board shall mean the board of directors of the Controlling Company. A
reference to the board of directors of any other Participating Company shall
specify it as such.
 
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1.11  Bonus shall mean an annual bonus payable under the terms of the AGL
Resources Inc. Annual Incentive Plan (or its successor plan) or any other annual
bonus plan sponsored by a Participating Company.
 
1.12  Bonus Compensation shall mean that portion of a Participant’s Compensation
that is attributable to a Bonus.
 
1.13  Break in Service shall mean, with respect to an Employee, any year during
which such Employee fails to complete more than 500 Hours of Service; provided,
a Break in Service shall not be deemed to have occurred during any period for
which he is granted a Leave of Absence if he returns to the service of an
Affiliate within the time permitted as set forth in the Plan. A Break in Service
shall be deemed to have commenced on the first day of the year in which it
occurs.
 
For purposes of determining whether or not an Employee has incurred a Break in
Service, an Employee absent from work due to a Maternity or Paternity Leave
shall be credited with (i) the number of Hours of Service with which he normally
would have been credited but for the Maternity or Paternity Leave, or (ii) if
the Administrative Committee is unable to determine the hours described in (i),
8 Hours of Service for each day of absence included in the Maternity or
Paternity Leave; provided, the maximum number of Hours of Service credited for
purposes of this Section shall not exceed 501 hours. Hours of Service so
credited shall be applied only to the year in which the Maternity or Paternity
Leave begins, unless such Hours of Service are not required to prevent the
Employee from incurring a Break in Service, in which event such Hours of Service
shall be credited to the Employee in the immediately following year. No Hour of
Service shall be credited due to Maternity or Paternity Leave as described in
this Section unless the Employee furnishes proof satisfactory to the
Administrative Committee (A) that his absence from work was due to a Maternity
or Paternity Leave and (B) of the number of days he was absent due to the
Maternity or Paternity Leave. The Administrative Committee shall prescribe
uniform and nondiscriminatory procedures by which to make the above
determinations.
 
As used in this Section, the term “year” shall mean the same 12-month period as
forms the basis for determining a Year of Vesting Service.
 
1.14  Change in Control shall mean:
 
(a)  any “person” as defined in Section 3(a)(9) of the 1934 Act, and as used in
Section 13(d) and 14(d) thereof, but excluding the Controlling Company and any
subsidiary and any employee benefit plan sponsored or maintained by the
Controlling Company or any subsidiary (including any trustee of such plan acting
as trustee), directly or indirectly, becomes the “beneficial owner” (as
determined pursuant to Rule 13d-3 under the 1934 Act), of securities of the
Controlling Company representing 35% or more of the combined voting power of the
Controlling Company’s then outstanding securities (unless the event causing the
35% threshold to be crossed is an acquisition of securities directly from the
Controlling Company); or
 
(b)  the shareholders of the Controlling Company shall approve (i) any merger,
share exchange, reorganization, or other business combination of the Controlling
Company, (ii) any sale of 50% or more of the Controlling Company’s assets, or
(iii) any combination of the foregoing transactions (the “Transactions”), other
than a Transaction immediately following which the shareholders of the
Controlling Company and any trustee or fiduciary of any Controlling Company
employee benefit plan immediately prior to the Transaction own at least 80% of
the voting power, directly or indirectly, of (A) the surviving corporation in
any such merger, share exchange, reorganization, or other business combination;
(B) the purchaser of the Controlling Company’s assets; (C) both the surviving
corporation and the purchaser in the event of any combination of Transactions;
or (D) the parent company owning 100% of such surviving corporation, purchaser
or both the surviving corporation and the purchaser, as the case may be; or
 
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(c)  A majority of members of the Board is replaced during any 24-month period
by directors whose appointment or election is not endorsed by a majority of
members of the Board prior to the date of their appointment or election.
 
1.15  Code shall mean the Internal Revenue Code of 1986, as amended, and any
succeeding federal tax provisions.
 
1.16  Company Contributions shall mean Before-Tax and Matching Contributions
made by the Participating Companies pursuant to the terms of the Plan.
 
1.17  Company Stock shall mean the common stock of the Controlling Company. As
of the Effective Date, the term “Company Stock” shall mean the $5.00 par value
common stock of AGL Resources Inc.
 
1.18  Compensation shall mean, for any Plan Year, the total of the amounts
described in subsections (a) and (b), minus the amount described in subsection
(c):
 
(a)  all such Participant’s wages, as defined in Code §3401(a) for purposes of
income tax withholding at the source, that are reportable for federal income tax
purposes on IRS Form W-2 (determined without regard to any rules that limit the
remuneration included in wages based on the nature or location of the employment
or the services performed (such as the exception for agricultural labor in Code
§3401(a)(2)); plus
 
(b)  all before-tax, salary deferral or reduction contributions made to the Plan
and other §401(k) and §125 plans (such as the Controlling Company’s Flex Plan)
of the Participating Companies on behalf of a Participant for such Plan Year
[including any contributions made under Code §402(a)(8) or §402(h)]; minus
 
(c)  any amounts (i) attributable to items listed on the attached Schedule B, as
modified from time to time by the Administrative Committee to reflect changes in
payroll codes listed thereunder, or (ii) paid or made available to a Participant
during the Plan Year while he is not an Active Participant.
 
1.19  Contributions shall mean, individually or collectively, the Before-Tax and
Matching Contributions permitted under the Plan.
 
1.20  Controlling Company shall mean AGL Resources Inc., a Georgia corporation
with its principal office in Atlanta, Georgia, and its successors.
 
1.21  Covered Employee shall mean any Employee of a Participating Company who,
as of his initial Entry Date or as of the December 1 immediately preceding a
subsequent Plan Year, had an annual base salary in an amount equal to or in
excess of the compensation limit designated by the IRS for determining “highly
compensated employee” under Code §414(q)(1)(C) plus $10,000 (for example, the
2007 IRS limit is $100,000 plus $10,000 = $110,000).
 
1.22  Deferral Election shall mean a written election by an Active Participant
directing the Participating Company of which he is an Employee to withhold a
percentage of his Compensation from his paychecks and to contribute such
withheld amount to the Plan as a Before-Tax Contribution, all as provided in
§3.1.
 
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1.23  Disabled shall mean that a Participant is (i) wholly prevented from
engaging in any substantially gainful activity by reason of a
medically-determinable physical or mental impairment which can be expected to
result in death or to be of long-continued and indefinite duration, and
(ii) determined eligible to receive long term disability benefits from a
Participating Company’s long term disability plan, or if no such plan exists,
upon the discretionary determination by the Administrative Committee that the
employee meets the definition of “disabled” under the Controlling Company’s
long-term disability plan.
 
1.24  Effective Date shall mean January 1, 2007, the date that this amendment
and restatement of the Plan shall be effective; provided, any effective date
specified herein for any provision, if different from the “Effective Date”,
shall control. The Plan was initially adopted effective as of July 1, 1995.
 
1.25  Employee shall mean any individual who is employed by a Participating
Company (including officers, but excluding directors who are not officers or
otherwise employees) and shall include leased employees of a Participating
Company within the meaning of Code §414(n). Notwithstanding the foregoing, if
leased employees constitute 20 percent or less of a Participating Company’s non
highly compensated work force within the meaning of Code §414(n)(5)(C)(ii), the
term “Employee” shall not include those leased employees covered by a plan
described in Code §414(n)(5)(B).
 
1.26  Entry Date shall mean each business day during which the Plan remains in
effect.
 
1.27  Forfeiture shall mean, for any Plan Year, the nonvested dollar amount of
an Account of a former Participant who separates from service from all
Affiliates. Forfeitures shall be used to reduce Matching Contributions.
 
1.28  Hour of Service shall mean the increments of time described in subsection
(a) hereof, as modified by subsections (b), (c) and (d) hereof:
 
(a)  (1)Each hour for which an Employee is paid, or entitled to payment, for the
performance of duties for an Affiliate during the applicable computation period;
 
(2)  Each hour for which an Employee is paid, or entitled to payment, by an
Affiliate on account of a period of time during which no duties are performed
(irrespective of whether the employment relationship has terminated) due to
vacation, holiday, illness, incapacity (including disability), layoff, jury
duty, military duty or Leave of Absence; provided:
 
(A)  No more than 501 Hours of Service shall be credited under this subsection
(2) to an Employee for any single continuous period during which he performs no
duties as an employee of an Affiliate (whether or not such period occurs in a
single computation period);
 
(B)  An hour for which an Employee is directly or indirectly paid, or entitled
to payment, on account of a period during which he performs no duties as an
employee of an Affiliate shall not be credited as an Hour of Service if such
payment is made or due under a plan maintained solely to comply with applicable
workers’ compensation, unemployment compensation or disability insurance laws;
and
 
(C)  Hours of Service shall not be credited to an Employee for a payment which
solely reimburses such Employee for medical or medically related expenses
incurred by him.
 
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For purposes of this subsection (2), a payment shall be deemed to be made by or
due from an Affiliate regardless of whether such payment is made by or due from
an Affiliate directly, or indirectly through, among others, a trust fund or
insurer, to which the Affiliate contributes or pays premiums and regardless of
whether contributions made or due to the trust fund, insurer or other entity are
for the benefit of particular employees or are on behalf of a group of employees
in the aggregate; and
 
(3)  Each hour for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by an Affiliate; provided, the same Hours of Service
shall not be credited both under subsection (1) or subsection (2), as the case
may be, and under this subsection (3); and, provided further, crediting of Hours
of Service for back pay awarded or agreed to with respect to periods described
in subsection (2) shall be subject to the limitations set forth in that
subsection.
 
(b)  Each Employee for whom an Affiliate does not keep records of actual Hours
of Service shall be credited, in accordance with this Section and applicable
regulations promulgated by the Department of Labor, with 45 Hours of Service for
each week for which such Employee would be required to be credited with at least
1 Hour of Service.
 
(c)  The rate or manner used for crediting Hours of Service may be changed at
the direction of the Administrative Committee from time to time so as to
facilitate administration and to equitably reflect the purposes of the Plan;
provided, no change shall be effective as to any Plan Year for which allocations
have been made pursuant to Article IV at the time such change is made; and,
provided further, Hours of Service shall be credited and determined in
compliance with Department of Labor Regulation §2530.200b-2(b) and (c), 29 CFR
Part 2530, as may be amended from time to time, or such other federal
regulations as may from time to time be applicable.
 
(d)  For purposes of this Section, a “computation period” shall mean the
12-month period that forms the basis for determining an Employee’s Years of
Vesting Service.
 
1.29  Investment Committee shall mean the committee which is appointed by and
acts on behalf of the Controlling Company with respect to making and effecting
investment decisions, all as provided in Article V. The Controlling Company may
act in lieu of the Investment Committee as it deems appropriate or desirable.
 
1.30  Investment Fund or Funds shall generally mean the investment fund or funds
established by the Trustee; except as otherwise determined by the Trustee, the
“Investment Fund or Funds” shall mean the investment fund or funds established
under the Retirement Savings Plus Plan, and any other investment funds
established from time to time by the Trustee pursuant to §5.2 hereof.
 
1.31  Key Employee shall mean a key employee as defined in Code §416(i) without
regard to paragraph (5) thereof, of any Affiliate, as determined under Code
§409A and guidance issued thereunder. The identification date for determining
Key Employees under the Plan shall be December 31.
 
1.32  Leave of Absence shall mean an excused leave of absence granted to an
Employee by an Affiliate in accordance with applicable federal or state law or
the Affiliate’s personnel policy. Among other things, Leave of Absence shall be
granted to an Employee:
 
(a)  who leaves the service of an Affiliate, voluntarily or involuntarily, to
enter the Armed Forces of the United States; provided, (i) the Employee is
legally entitled to reemployment under the veteran’s reemployment rights
provisions as codified at 38 USC §2021, et seq., its predecessors and
successors; and (ii) the Employee applies for and reenters service with an
Affiliate within the time, in the manner and under the conditions prescribed by
law;
 
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(b)  for any time such Employee is drawing workers’ compensation benefits or is
sick, disabled or incapacitated, if he is thereby precluded from properly
performing his assigned duties for a temporary period of time; and
 
(c)  under such other circumstances as the Administrative Committee shall
determine are fair, reasonable and equitable as applied uniformly among
Employees under similar circumstances.
 
1.33  Matching Account shall mean the separate subaccount(s) established and
maintained on behalf of a Participant or his Beneficiary to reflect his interest
in the Plan attributable to Matching Contributions.
 
1.34  Matching Contributions shall mean the amounts paid by each Participating
Company to the Plan as a match to Participants’ Before-Tax Contributions, all as
pursuant to the terms of §3.2.
 
1.35  Maternity or Paternity Leave shall mean any period, during which an
Employee is absent from work as an employee of an Affiliate (i) because of the
pregnancy of such Employee; (ii) because of the birth of a child of such
Employee; (iii) because of the placement of a child with such Employee in
connection with the adoption of such child by such Employee; or (iv) for
purposes of such Employee caring for a child immediately after the birth or
placement of such child.
 
1.36  Normal Retirement Age shall mean age 65.
 
1.37  Participant shall mean any person who has an Account under the Plan.
 
1.38  Participating Company shall mean the Controlling Company and all
Affiliates which have adopted or hereafter may adopt the Plan for the benefit of
their employees and which continue to participate in the Plan, all as provided
in §9.3.
 
1.39  Payment Election shall mean a written or electronic election by an Active
Participant directing the Participating Company regarding the time and form of
payment of such Active Participant’s Account under the Plan upon Separation from
Service, all as described in Article VII.
 
1.40  Plan shall mean the AGL Resources Inc. Nonqualified Savings Plan as
contained herein and all amendments thereto. The Plan is intended to be an
unfunded nonqualified deferred compensation plan for the benefit of a select
group of management or highly compensated employees.
 
1.41  Plan Year shall mean each 12-month period beginning on January 1 and
ending on December 31.
 
1.42  Retirement Savings Plus Plan or RSP shall mean the AGL Resources Inc.
Retirement Savings Plus Plan, as it may be amended from time to time.
 
1.43  Separate from Service or Separation from Service shall mean that a
Participant separates from service with all Affiliates, as determined under Code
§409A and guidance thereunder.
 
1.44  Special Bonus Deferral Election shall mean a separate election made by a
Participant to defer some or all of his Bonus Compensation received during a
Plan Year.
 
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1.45  Spouse or Surviving Spouse shall mean, with respect to a Participant, the
person who is treated as married to such Participant under the laws of the state
in which the Participant resides. The determination of a Participant’s Spouse or
Surviving Spouse shall be made as of the earlier of the date as of which benefit
payments from the Plan to such Participant are made or commence (as applicable)
or the date of such Participant’s death.
 
1.46  Trust or Trust Agreement shall mean a separate agreement between the
Controlling Company and the Trustee governing the creation of the Trust Fund,
and all amendments thereto.
 
1.47  Trustee shall mean the party or parties so designated from time to time
pursuant to the Trust Agreement.
 
1.48  Trust Fund shall mean the total amount of cash and other property held by
the Trustee (or any nominee thereof) at any time under the Trust Agreement.
 
1.49  Valuation Date shall mean each business day on which the fair market value
of the accounts under the Plan are determined.
 
1.50  Year of Vesting Service shall mean a Plan Year during which an Employee
completes no less than 1,000 Hours of Service; provided:
 
(a)  Years of Vesting Service completed prior to a period in which the
Participant incurred 5 or more consecutive Breaks in Service shall be
disregarded under the Plan if the Participant had no vested interest in his
Account at the time the first such Break in Service commenced and the number of
such consecutive Breaks in Service equals or exceeds the number of his prior
Years of Vesting Service;
 
(b)  Years of Vesting Service completed after a period in which the Participant
had at least 5 consecutive Breaks in Service shall be disregarded for the
purpose of determining his vested interest in that portion of his Account which
accrued before such Breaks in Service; and
 
(c)  For purposes of this Section, employment with an Affiliate shall be
considered employment with the Controlling Company, and in the case of a leased
employee (within the meaning of Code §414(n)) of any Affiliate, such leased
employee shall be considered as being a leased employee of the Controlling
Company.
 
ARTICLE II
 
ELIGIBILITY
 
2.1  Initial Eligibility Requirements.
 
(a)  General Rule. Except as provided in subsection (b) hereof, each Covered
Employee shall first become eligible to make contributions under the Plan as of
the Entry Date coincident with or next following the date of (i) such Covered
Employee’s attainment of age 21, and (ii) completion of thirty (30) days of
employment as a Covered Employee, provided he is a Covered Employee on such
date.
 
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(b)  New Participating Companies. Each Covered Employee employed by a
Participating Company on the date such Participating Company first becomes a
Participating Company shall first become eligible to make contributions under
the Plan as of the business day coincident with or next following the later of
such Participating Company’s commencement of participation in the Plan, or such
Covered Employee’s attainment of age 21 and completion of thirty (30) days of
employment with such Participating Company.
 
2.2  Subsequent Eligibility Requirements.
 
Each Covered Employee shall be eligible to make contributions under the Plan for
each Plan Year following the Plan Year in which the Covered Employee first
became eligible to make contributions under the Plan if such Covered Employee
satisfies the compensation requirements for Covered Employees as of the December
1 immediately preceding the first day of such subsequent Plan Year.
 
2.3  Treatment of Interruptions of Service.
 
(a)  Leave of Absence. If a Covered Employee satisfies the eligibility
requirements set forth in §2.1 but is on a Leave of Absence on the Entry Date on
which he otherwise would have become an Active Participant, he shall become an
Active Participant as of the date he subsequently resumes the performance of
duties as a Covered Employee in accordance with the terms of his Leave of
Absence.
 
(b)  Reparticipation Upon Reemployment. If an Active Participant separates from
service with a Participating Company (and all other Participating Companies),
his active participation in the Plan shall cease immediately, and he again shall
become an Active Participant as of the day he is reemployed as a Covered
Employee, regardless of whether he has received a distribution of his Account
balance under the Plan at the time of his reemployment. However, regardless of
whether he again becomes an Active Participant, he shall continue to be a
Participant until he no longer has an Account under the Plan.
 
2.4  Change in Status. If an Active Participant changes his status of employment
(but remains employed) so that he is no longer a Covered Employee, he shall
continue to be a Participant until he no longer has an Account under the Plan.
If an Active Participant does not meet the compensation requirements for Covered
Employees as of the December 1 immediately preceding the first day of any Plan
Year, he shall continue to be a Participant until he no longer has an Account
under the Plan and may again become an Active Participant in the Plan if, as of
the December 1 immediately preceding the first day of a Plan Year, he meets the
compensation requirements for Covered Employees.
 
ARTICLE III
 
CONTRIBUTIONS
 
3.1  Before-Tax Contributions.
 
(a)  Before-Tax Contributions. Each Participating Company shall contribute to
the Plan, on behalf of each Active Participant employed by such Participating
Company and for each payroll period for which such Active Participant has a
Before-Tax Deferral Election in effect with such Participating Company, a
Before-Tax Contribution in an amount equal to the amount by which such Active
Participant’s Compensation has been reduced for such period pursuant to his
Before-Tax Deferral Election. The amount of the Before-Tax Contribution shall be
determined in percentage increments of such Active Participant’s Compensation
for each payroll period.
 
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(b)  Deferral Elections. Each Active Participant who desires that his
Participating Company make a Before-Tax Contribution on his behalf shall
complete and deliver to the Participating Company (or its designee) a Deferral
Election. Such Deferral Election shall provide for the reduction of his
Compensation for each Plan Year for which the Deferral Election is applicable,
up to a maximum of 100 percent of his Compensation after all deductions required
by law or otherwise elected by the Participant. In addition, the Deferral
Election may contain a Special Bonus Deferral Election providing for the
reduction of the Participant’s Bonus Compensation received during the Plan Year,
up to a maximum of 100 percent of his Bonus Compensation after all deduction
required by law or otherwise elected by the Participant. The Administrative
Committee, in its sole discretion, shall prescribe the form of all Deferral
Elections and may prescribe such nondiscriminatory terms and conditions
governing the use of the Deferral Elections as it deems appropriate. Subject to
any modifications, additions or exceptions which the Administrative Committee,
in its sole discretion, deems necessary, appropriate or helpful, the following
terms shall apply to Deferral Elections:
 
(1)  Effective Date.
 
(A)  Deferrals for New Participants. In the case of the first year in which a
Participant becomes eligible to participate in the Plan and any Aggregated
Arrangements, such Active Participant’s initial Deferral Election with a
Participating Company must be made within 30 days after the date the Participant
first becomes eligible to participate in any Aggregated Arrangement, and shall
be effective for the first payroll period which ends after the Deferral Election
is made and after the effective date specified for such Deferral Election. Such
Active Participant’s Deferral Election with respect to Compensation payable with
respect to services performed during the initial Plan Year of participation
shall become irrevocable as of the earlier of the date the first Before-Tax
Contribution is made on behalf of the Participant or the end of the 30-day
period after the date the Participant first becomes eligible to participate in
an Aggregated Arrangement. Except as provided in subsection (B) below, such
Participant’s initial Deferral Election shall not apply to Compensation payable
with respect to services performed prior to the effective date of the Deferral
Election.
 
(B)  Bonus Deferrals.
 
(i)  New Participants. Except as provided in subsection (B)(ii) below, in the
case of the first year in which a Participant becomes eligible to participate in
the Plan and any Aggregated Arrangements, such Participant’s initial Special
Bonus Deferral Election, with respect to any Bonus for which the performance
period began prior to the date of the Special Bonus Deferral Election, must be
made within 30 days after the date the Participant first becomes eligible to
participate in any Aggregated Arrangement, and shall apply to the portion of the
Participant’s Bonus equal to the total amount of the Participant’s Bonus,
multiplied by the ratio of the number of days remaining in the performance
period after the date the Special Bonus Deferral Election is made, over the
total number of days in the performance period for the Bonus. Such Active
Participant’s Special Bonus Deferral Election with respect to Bonus Compensation
payable with respect to services performed during the initial Plan Year of
participation shall become irrevocable as of the end of the 30-day period after
the date the Participant first becomes eligible to participate in an Aggregated
Arrangement.
 
(ii)  New and Continuing Participants. If a Participant was a Covered Employee
continuously from the date on which the performance criteria of a Bonus was
established, through the date such Participant makes an initial or modified
Special Bonus Deferral Election under the Plan, such initial or modified Special
Bonus Deferral Election may be made with respect to the entire amount of such
Bonus on or before the date that is six (6) months before the end of the
performance period of the Bonus, but only if the Bonus has not become both
substantially certain to be paid and readily ascertainable at the time of such
initial or modified Special Bonus Deferral Election. This provision shall apply
to the first year in which a Participant becomes eligible to participate in the
Plan and any Aggregated Arrangements, notwithstanding the provisions of
subsection (B)(i) above, as well as to continuing Active Participants.
 
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(iii)  Additional Requirements. To be eligible for the election timing rules of
this subsection (B), the amount of, or entitlement to, the Bonus must satisfy
the requirements to be considered “performance-based compensation” as defined in
Code §409A and guidance issued thereunder. To the extent that a Bonus does not
meet the requirements for “performance-based compensation,” the election timing
rules under subsection (A) above apply.
 
(C)  All Other Deferral Elections. Except as provided in subsections (A) and (B)
above, a Participant’s initial Deferral Election, or new Deferral Election
following termination of a previously effective Deferral Election, shall be made
on or before December 31 of the preceding calendar year with respect to
Compensation payable with respect to services performed during the Plan Year. If
an Active Participant fails to submit an initial Deferral Election in a timely
manner, he shall be deemed to have elected a deferral of zero percent.
 
(2)  Term. Each Active Participant’s Deferral Election with a Participating
Company for a Plan Year shall remain in effect in accordance with its original
terms until the date the Active Participant ceases to be an Employee of all
Participating Companies, subject to subsection (3) below. If a Participant is
transferred from the employment of a Participating Company to the employment of
another Participating Company, his Deferral Election with the first
Participating Company will remain in effect and will apply to his Compensation
from the second Participating Company.
 
(3)  Modification and Revocation. An Active Participant’s Deferral Election with
a Participating Company shall automatically terminate upon either: (i) his
ceasing to be an Employee of all Participating Companies, or (ii) his receipt of
a hardship withdrawal as provided in §7.5 of the Plan. Otherwise, except as
provided in subsections (b)(1)(A) and (B) above, an Active Participant’s
Deferral Election with respect to a Plan Year becomes irrevocable as of the
preceding December 31 with respect to Compensation payable with respect to
services performed during the Plan Year, and may not be modified or revoked by
the Active Participant during that Plan Year. An Active Participant may make a
new Deferral Election prior to the beginning of a Plan Year for Before Tax
Contributions attributable to services performed during that Plan Year. If an
Active Participant does not make a new Deferral Election for any subsequent Plan
Year, the most recent Deferral Election in place will remain in effect for that
subsequent Plan Year.
 
3.2  Matching Contributions.
 
(a)  For each Active Participant (other than those described in subsection (b)
hereof) on whose behalf a Participating Company has made any Before-Tax
Contributions to the Plan for the Plan Year, such Participating Company shall
make a Matching Contribution equal to 65 percent of the aggregate amount of such
Before-Tax Contributions up to the first 8 percent of the Participant’s
Compensation (or the difference between the amount of Before-Tax Contributions
made by the Participant and matched by the Controlling Company (or another
participating employer) under the Retirement Savings Plus Plan so that only a
total of 8 percent of the Participant’s Compensation is matched under both the
RSP and the Plan).
 
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(b)  For each Active Participant who was then an Active Participant and had
reached age 50 on or before July 1, 2000, on whose behalf a Participating
Company has made any Before-Tax Contributions to the Plan for the Plan Year,
such Participating Company shall make a Matching Contribution equal to 65
percent of the aggregate amount of such Before-Tax Contributions up to the first
6 percent of the Participant’s Compensation (or the difference between the
amount of Before-Tax Contributions made by the Participant and matched by the
Controlling Company (or another participating employer) under the Retirement
Savings Plus Plan so that only a total of 6 percent of the Participant’s
Compensation is matched under both the RSP and the Plan).
 
(c)  Matching Contributions shall be made to the Plan once each year within the
period of two months following the last day of each Plan Year. Matching
Contributions for a Plan Year shall be reduced by the amount of any Forfeitures
available for reallocation during that Plan Year.
 
3.3  Form of Contributions.
 
All Contributions shall be paid to the Trustee in the form of cash or Company
Stock or a combination thereof, as the Controlling Company or Administrative
Committee may determine from time to time.
 
ARTICLE IV
 
PARTICIPANTS’ ACCOUNTS; CREDITING AND ALLOCATIONS
 
4.1  Establishment of Participants’ Accounts.
 
To the extent appropriate, the Administrative Committee shall establish and
maintain, on behalf of each Participant and Beneficiary, an Account which shall
be divided into segregated subaccounts. The subaccounts shall include Before-Tax
and Matching Accounts, and such other subaccounts as the Administrative
Committee shall deem appropriate or helpful. Each Account shall be credited with
Contributions allocated to such Account and generally shall be credited with
income on investments derived from the assets of such Accounts. Each Account of
a Participant or Beneficiary shall be maintained until the value thereof has
been distributed to or on behalf of such Participant or Beneficiary.
 
4.2  Allocation and Crediting of Before-Tax and Matching Contributions.
 
As of each Valuation Date coinciding with or immediately following the date on
which Before-Tax and Matching Contributions are received on behalf of an Active
Participant, such Contributions shall be allocated and credited directly to the
appropriate Before-Tax and Matching Accounts, respectively, of such Active
Participant.
 
4.3  Allocation and Crediting of Investment Experience.
 
As of each Valuation Date, the Administrative Committee or its designated
recordkeeper shall determine the fair market value of the Trust Fund which shall
be the sum of the fair market values of the Investment Funds. The Administrative
Committee shall determine the amount of the Accounts as follows:
 
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(a)  Determination of Earnings or Losses. As of each Valuation Date, the
investment earnings (or losses) of each Investment Fund shall be the amount by
which the sum determined in (1) exceeds (or is less than) the sum determined in
(2), where (1) and (2) are as follows:
 
(1)  The sum of (A) the fair market value of such Investment Fund as of such
Valuation Date, plus (B) the amount of any distributions, withdrawals and
transfers to other Investment Funds made since the immediately preceding
Valuation Date from amounts invested in the Investment Fund; and
 
(2)  The sum of (A) the fair market value of the Investment Fund as of the
immediately preceding Valuation Date, plus (B) Contributions deposited in and
amounts transferred to such Investment Fund since the immediately preceding
Valuation Date.
 
(b)  Formula For Allocation. As of each Valuation Date and prior to the
allocations described in §4.2, and 4.3, each Participant’s Account shall be
allocated and shall be credited with a portion of such earnings or debited with
a portion of such losses of each Investment Fund, as determined in accordance
with subsection (a) hereof, in the proportion that (i)(A) the amount credited to
such Account that was invested in such Investment Fund as of the immediately
preceding Valuation Date, minus (B) any distributions, withdrawals or transfers
to other Investment Funds that were made from such Account since such preceding
Valuation Date and on or before such current Valuation Date, plus (C) any
Contributions deposited in and amounts transferred to such Investment Fund from
such Account since the preceding Valuation Date; bears to (ii)(A) the total
amount invested in such Investment Fund by all Participants as of the
immediately preceding Valuation Date, minus (B) any distributions, withdrawals
or transfers to other Investment Funds which were made from such Accounts since
such preceding Valuation Date and on or before such current Valuation Date, plus
(C) any Contributions deposited in and amounts transferred to such Investment
Fund since the preceding Valuation Date.
 
4.4  Notice to Participants of Account Balances.
 
At least once for each Plan Year, the Administrative Committee shall cause a
written statement of a Participant’s Account balance to be distributed to the
Participant.
 
4.5  Good Faith Valuation Binding.
 
In determining the value of the Accounts, the Administrative Committee and/or
its designated recordkeeper shall exercise its best judgment, and all such
determinations of value (in the absence of bad faith) shall be binding upon all
Participants and Beneficiaries.
 
4.6  Errors and Omissions in Accounts.
 
If an error or omission is discovered in the Account of a Participant or
Beneficiary, the Administrative Committee shall cause appropriate, equitable
adjustments to be made as of the Valuation Date coinciding with or immediately
following the discovery of such error or omission.
 
ARTICLE V
 
INVESTMENT OF ACCOUNTS
 
5.1  Establishment of Trust Fund.
 
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(a)  Rabbi Trust. The Controlling Company has established a Trust Fund to hold
assets to pay benefits under the Plan. All Contributions are to be paid over to
the Trustee to be held in the Trust Fund and invested in accordance with the
terms of the Plan and the Trust Agreement. The Trust Fund shall exist under an
agreement constituting a “rabbi trust” agreement, under which all assets of the
Trust Fund shall be considered to be subject to the general creditors of the
Controlling Company, and all Plan participants shall be unsecured creditors
under such Trust Agreement. In the event that no trust fund exists, benefits
shall be payable from the general assets of the Controlling Company.
 
(b)  Trust Required Upon Change in Control. Upon a Change in Control of the
Controlling Company, the Controlling Company must within ten (10) business days
after such Change in Control, establish and fully fund a rabbi trust (if and to
the extent such a fully funded rabbi trust does not already exist) to pay all
benefits accrued by Participants through that date under the Plan. Further, upon
a Change of Control, an entity other than the Controlling Company, a
Participating Company, any Affiliate or any employee, officer or director of
such companies shall be named by the Board as Trustee of the rabbi trust. This
subsection 5.1(c) of the Plan shall be irrevocable and may not be amended by the
Controlling Company or any other company after the effective date of the Plan
(unless required by law).
 
5.2  Investment Funds. To the extent a Trust Fund is established, the following
provisions shall apply:
 
(a)  Composition of Investment Committee. The Investment Committee shall consist
of not less than one member who shall be appointed by and serve at the pleasure
of the Board. The Board shall have the right to remove any member of the
Investment Committee at any time. A member may resign at any time by written
resignation to the Board. If a vacancy in the Investment Committee should occur,
a successor may be appointed by the Board.
 
(b)  Investment Committee Procedures. The Investment Committee may elect a
Chairman and a Secretary from among its members. The Investment Committee shall
act by majority vote. Its members shall serve as such without compensation. All
acts and determinations of the Investment Committee shall be duly recorded by
its Secretary or under his supervision, and all such records, together with such
other documents as may be necessary for the administration of the Plan, shall be
preserved in the custody of such Secretary.
 
(c)  Investment Committee Powers and Duties. In addition to those powers set
forth elsewhere in the Plan, the Investment Committee shall carry out the
Controlling Company’s responsibility and authority:
 
(1)  To appoint one or more persons to serve as investment manager with respect
to all or part of the Trust Fund assets;
 
(2)  To allocate the responsibility and authority being carried out by the
Investment Committee among the members of the Investment Committee;
 
(3)  To employ one or more persons to render advice with respect to any
responsibility or authority being carried out by the Investment Committee; and
 
(4)  To direct the Trustee regarding the investments and investment funds
available under the Plan.
 
(d)  Investment of Plan Contributions. All Contributions to the Plan shall be
invested in the following manner:
 
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(1)  Named Investment Funds. In accordance with instructions from the Investment
Committee and the terms of the Plan, the Trustee shall establish, for the
investment of assets of the trust fund, one or more of the investment fund or
funds established under the Retirement Savings Plus Plan.
 
(2)  Other Investment Funds. At the direction of the Investment Committee, the
Trustee shall establish other Investment Funds, in addition to or in lieu of the
Investment Funds described herein, which may include, for example, other income
funds or equity funds. Such other Investment Funds shall be established without
necessity of amendment to the Plan or the Trust and shall have the investment
objectives prescribed by the Investment Committee and to which the Trustee
consents. Such other Investment Funds also may be established and maintained for
any limited purpose(s) the Investment Committee may direct.
 
(3)  Reinvestment of Cash Earnings. Any investment earnings received in the form
of cash with respect to any Investment Fund (in excess of the amounts necessary
to make cash distributions for fractional shares of Company Stock or to pay Plan
or Trust expenses) shall be reinvested in such Investment Fund.
 
5.3  Investment Procedures.
 
Each Participant or Beneficiary generally may direct the manner in which his
Account shall be invested in and among the Investment Funds; provided, however,
that the Investment Committee shall have sole discretion as to investment of a
Participant’s or Beneficiary’s Account and may refuse to follow a Participant’s
or Beneficiary’s investment directions. A Participant’s or Beneficiary’s
investment directions shall be made in accordance with the following terms:
 
(a)  Investment of Future Contributions. Except as otherwise provided in this
Section [relating to special Investment Funds described in §5.2(d)(2)], each
Participant may elect, on a form provided by or any other means specified by the
Administrative Committee, the percentage of his future Before-Tax and Matching
Contributions that will be invested in each Investment Fund. An initial election
of a Participant shall be made as of the date the Participant commences or
recommences participation in the Plan and shall apply to all Before-Tax and
Matching Contributions attributable to payroll periods ending after such date.
Such Participants may make subsequent elections on a daily basis as provided by
the Administrative Committee. Any election made pursuant to this subsection with
respect to future Before-Tax and Matching Contributions shall remain effective
until changed by such Participant. In the event a Participant fails to make an
investment election or a Participant’s election form is incomplete or
insufficient in some manner, the Participant’s future Before Tax Contributions
will be invested in the default investment provided for the RSP Plan.
 
(b)  Investment of Existing Account Balances. Except as otherwise provided in
this Section, each Participant or Beneficiary may elect, on a form provided by
the Administrative Committee, the percentage of his existing Accounts that will
be invested in each Investment Fund. Such Participant or Beneficiary may make
such elections on a daily basis as provided by the Administrative Committee.
Each such election shall apply to such Participant’s or Beneficiary’s Account
balance as of the date of such election, and shall remain in effect until
changed by such Participant or Beneficiary. In the event a Participant fails to
make an election for his existing Accounts pursuant to the terms of this
subsection (2) which is separate from his election made for his future
Before-Tax and Matching Contributions pursuant to the terms of subsection (1)
hereof, or if a Participant’s investment election form is incomplete or
insufficient in some manner, the Participant’s existing Accounts will continue
to be invested in the same manner provided under the terms of the most recent
election affecting that portion of his Accounts. The Administrative Committee
may determine at its discretion to charge a reasonable surcharge for changes to
investment of existing Account balances; payment of any such surcharges may be
made outside the Plan though payroll deduction or other methods as may be
determined by the Administrative Committee.
 
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(c)  Conditions Applicable to Elections. Allocations of investments in the
various Investment Funds, as described in subsections (a) and (b) hereof, shall
be made in even multiples of 1 percent as directed by the Participant or
Beneficiary. The Administrative Committee shall have complete discretion to
adopt and revise procedures to be followed in making such investment elections.
Such procedures may include, but are not limited to, the format of the election
forms, the deadline for filing elections and the effective date of such
elections; provided, elections must be permitted at least once every 3 months.
Any procedures adopted by the Administrative Committee that are inconsistent
with the deadlines specified in this Section shall supersede such provisions of
this Section without the necessity of a Plan amendment.
 
(d)  Compliance with Securities Exchange Commission Rule 16b-3. Notwithstanding
any other provisions of the Plan, the Administrative Committee shall take any
and all actions as may be necessary with regard to investment directions made by
Participants who are deemed to be “insiders” of the Controlling Company under
the terms of the 1934 Act, in order to meet the requirements of Rule 16b-3 and
regulations promulgated thereunder.
 
5.4  Acquisition of Company Stock.
 
(a)  In General. To the extent that Contributions and investment earnings on
Company Stock are paid in cash, the Trustee shall effect purchases of Company
Stock in compliance with all applicable securities laws, and in its sole
discretion, may purchase Company Stock in the open market and/or in privately
negotiated transactions with holders of Company Stock and/or the Controlling
Company. All purchases of Company Stock by the Trust will be made at a price or
prices which, in the judgment of the Trustee, do not exceed the fair market
value of such Company Stock as of the date of the purchase.
 
(b)  Stock Rights, Warrants or Options. In the event any rights, warrants or
options are issued on Company Stock, the Trustee may exercise them for the
acquisition of additional Company Stock, to the extent that cash is then
available and allocable to the Company Stock Fund. Any Company Stock acquired in
this fashion will be treated as Company Stock bought by the Trustee for the net
price paid. Any rights, warrants or options on Company Stock which cannot be
exercised for lack of available cash may be sold by the Trustee (provided the
sale thereof is reasonably practicable), and the proceeds of such a sale shall
be treated as a current cash dividend received on Company Stock.
 
5.5  Value of Assets.
 
For purposes under the Plan for which the value of assets must be determined,
the value of such assets shall be the fair market value. For purposes of
purchasing or selling Company Stock through an exchange on any day, the fair
market value per share of such stock on such day shall be the price of the stock
on the New York Stock Exchange at the time of the purchase or sale. For all
other purposes under the Plan, the fair market value per share of the Company
Stock on any particular day shall be the closing price of such Company Stock as
reported on the New York Stock Exchange Composite Transaction listing on the day
preceding the particular day in question. If, for any reason, the fair market
value per share of Company Stock cannot be ascertained or is unavailable for a
particular day, the fair market value of such stock shall be determined as of
the nearest preceding day on which such fair market value can be ascertained
pursuant to the terms hereof.
 
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ARTICLE VI
 
VESTING IN ACCOUNTS
 
6.1  General Vesting Rule.
 
All Participants shall at all times be fully vested in their Before-Tax Account.
Except as provided in §6.2, the Matching Account of a Participant shall vest in
accordance with the following vesting schedule, based on the total of the
Participant’s Years of Vesting Service:
 
Years of Vesting Service
Completed by Participant
Vested Percentage of
Participant’s Matching Account
   
Less than 1 Years
None
1 Year, but less than 2
50%
2 Years, but less than 3
75%
3 Years or more
100%

 
6.2  Vesting Upon Other Occurrences.
 
Notwithstanding §6.1, a Participant’s Matching Account shall become 100 percent
vested and nonforfeitable upon the occurrence of any of the following events:
 
(a)  The Participant’s attainment of Normal Retirement Age while still employed
as an employee of any Affiliate;
 
(b)  The Participant’s death while still employed as an employee of any
Affiliate; or
 
(c)  The Participant’s becoming Disabled while still employed as an employee of
any Affiliate.
 
6.3  Timing of Forfeitures.
 
If a Participant who is not yet 100 percent vested in his Matching Account
separates from service with all Affiliates, the nonvested amount in his Matching
Account shall be immediately forfeited and shall become available as a
Forfeiture as of the Valuation Date coincident with or immediately following the
date on which such termination occurs; provided, if a Participant has no vested
interest in his Account at the time he separates from service, he shall be
deemed to have received a cash-out distribution at the time he separates from
service, and the forfeiture provisions of this Section shall apply. If such a
Participant resumes employment with an Affiliate, such forfeited amount shall
not be restored.
 
6.4  Vesting of Matching Contribution Accounts for NUI Participants.
 
Past service credit for vesting purposes under the Plan shall be granted to
Employees of NUI Corporation and its directly or indirectly wholly-owned
subsidiaries who were employed on November 30, 2004, for service with NUI
Corporation and any other individual, partnership, limited liability
partnership, joint venture, corporation, limited liability company, trust,
unincorporated organization, or group consolidated with NUI Corporation for
financial reporting purposes.
 
 
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ARTICLE VII
 
PAYMENT OF BENEFITS
 
7.1  Benefit Payments.
 
(a)  Generally. Except as provided in §7.2(d) and §9.2, a Participant shall not
receive distribution of his or her benefits under the Plan earlier than the
Participant’s Separation from Service, the date of the Participant’s death, or
the occurrence of an “unforeseeable emergency” as defined in §7.5 below and Code
§409A.
 
(b)  Death Benefits. If a Participant dies before full payment of his benefits
from the Plan is made, the Beneficiary or Beneficiaries designated by such
Participant in his latest beneficiary designation form filed with the
Administrative Committee in accordance with the terms of §7.4 shall be entitled
to receive a distribution of the entire vested amount credited to such
Participant’s Account, determined as of the Valuation Date coincident with or
immediately preceding the date payment of such distribution is to be made.
Benefits payable to a Beneficiary or Beneficiaries under this Section shall be
distributed in a single lump sum payment sixty days after the end of the Plan
Year in which the Participant’s death occurs. Notwithstanding the foregoing, if
the amount of payment required to be made on such date cannot be ascertained by
such date, payment shall be made on the earliest date on which such payment can
be ascertained under the Plan. The Administrative Committee may direct the
Trustee to distribute a Participant’s Account to a Beneficiary without the
written consent of such Beneficiary.
 
7.2  Election of Timing and Form of Benefit Payment.
 
(a)  Generally. Each Active Participant who makes a Deferral Election under the
Plan shall complete and deliver to the Administrative Committee a Payment
Election under the Plan. Such Payment Election shall specify a form of payment
for the Participant’s Account under the Plan following Separation from Service.
The Administrative Committee, in its sole discretion, shall prescribe the format
of all Payment Elections and may prescribe such nondiscriminatory terms and
conditions governing the Payment Elections, subject to the terms and conditions
of the Plan, as it deems appropriate. The following terms shall apply to Payment
Elections:
 
(1)  Payment Elections for New Participants. In the case of the first year in
which a Participant becomes eligible to participate in the Plan and any
Aggregated Arrangements, such Active Participant’s initial Payment Election with
a Participating Company must be made within 30 days after the date the
Participant first becomes eligible to participate in any Aggregated Arrangement.
As of the end of the 30th day after the date such Participant first becomes
eligible to participate in an Aggregated Arrangement, the Participant’s Payment
Election shall become irrevocable, except as provided in subsection (b) below.
 
(2)  Other Initial Payment Election. Except as provided in subsection (1) above
or as may be permitted in transitional guidance issued under Code §409A, a
Participant’s initial Payment Election shall be made on or before December 31 of
the calendar year prior to the first Plan Year in which the Participant’s
initial Deferral Election becomes effective. At the end of the calendar year
prior to the first Plan Year in which a Participant’s initial Deferral Election
becomes effective, the Participant’s Payment Election shall become irrevocable,
except as provided in subsection (b) below or as may be permitted in
transitional guidance issued under Code §409A.
 
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(3)  Failure to Make Payment Election. If an Active Participant fails to submit
an initial Payment Election in a timely manner, he or she shall be deemed to
have elected a single lump sum payment as provided in §7.2(a).
 
(b)  Modification. A Participant may make one subsequent Payment Election to
revoke the form of payment initially elected (or deemed elected) and select a
new form of payment, provided that:
 
(1)  The modified Payment Election shall not take effect until at least twelve
months after the date on which the modified Payment Election is made; and
 
(2)  Each separate payment that is modified under the modified Payment Election
shall be deferred for a period of five years from the date such payment would
have been made (or, in the case of installment payments, the date of
commencement) under the previous Payment Election.
 
For purposes of this subsection and the Plan, an election to receive installment
payments shall be treated as entitlement to a single payment, and an election to
receive a lump sum and installments shall be treated as two separate payments
(the lump sum being a single payment and all installments together being a
single payment). In the case of a payment that does not have an objectively
determinable specified date within a calendar year for payment, such payment
date is deemed to be January 1 of such calendar year for purposes of applying
the rules of this subsection. A Participant may make no more than one modified
Payment Election under the Plan.
 
(c)  Overriding Provisions. Notwithstanding a Participant’s Payment Election,
the following shall apply:
 
(1)  Cash-Out of Small Accounts. If a Participant’s vested Account balance is
$10,000 or less at the time of the Participant’s Separation from Service, such
Participant shall receive payment in the form of a single lump sum on the first
day of the third month (except as provided in subsection (d)(2) below) following
the Participant’s Separation from Service.
 
(2)  Delay in Payment for Key Employees. In the case of any Participant who is a
Key Employee, distribution of such Participant’s benefits upon Separation from
Service may not be made before the date that is six (6) months after the date of
Separation from Service (or, if earlier, the date of death of the Participant).
Payments to which the Participant would otherwise be entitled during the first
six months following the date of Separation from Service shall be accumulated
and paid on the first day of the seventh month following the date of Separation
from Service.
 
(3)  Payment Upon Domestic Relations Order. Payment of vested benefits under the
Plan may be made to an individual other than the Participant as may be necessary
to fulfill a domestic relations order as defined in Code §414(p)(1)(B).
 
(4)  Payment Upon Income Inclusion Under Code §409A. Payment of vested benefits
under the Plan may be made to a Participant at any time the Plan fails to meet
the requirements of Code §409A and related regulations. Such payment shall not
exceed the amount required to be included in income as a result of the failure
to comply with the requirements of Code §409A and related regulations.
 
(5)  Payment Upon a Change in Control. Upon a Participant’s Separation from
Service within the two-year period following a Change in Control, such
Participant shall receive payment of his or her vested Account balance in the
form of a single lump sum payment in the calendar year following the year in
which the Participant Separates from Service.
 
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(6)  Transitional Rule. Participants may make or change elections during the
transitional period provided by the Internal Revenue Service in guidance issued
under Code §409A. A Participant who would receive payment during 2007 under the
provisions of the Plan as in effect before the Effective Date will receive
payment as provided under such provisions.
 
7.3  Forms of Payment Upon Separation from Service.
 
Except as provided in §7.2(c), benefits payable to a Participant upon Separation
from Service shall be distributed in one of the following forms as elected by
the Participant in accordance with his or her Payment Election:
 
(a)  A single lump sum cash payment in the calendar year following the year in
which the Participant Separates from Service;
 
(b)  A lump sum cash payment of an objectively determinable dollar amount or
percentage of the Participant’s Account (as elected by the Participant), in the
calendar year following the year in which the Participant Separates from
Service, with the remainder of the Participant’s Account distributed in
substantially equal annual cash installments over up to ten (10) (as elected by
the Participant) consecutive subsequent calendar years;
 
(c)  Between one (1) and ten (10) (as elected by the Participant) consecutive
annual installments, commencing in the calendar year following the year in which
the Participant Separates from Service. Each annual installment payment shall be
equal to the vested balance of the Participant’s Account on the payment date,
divided by the number of installment payments remaining as of the payment date.
 
7.4  Beneficiary Designation.
 
(a)  General. Participants shall designate and from time to time may redesignate
their Beneficiary or Beneficiaries in such form and manner as the Administrative
Committee may determine. If any Participant dies prior to receiving his benefits
under the Plan, his Account shall be changed to the name of such deceased
Participant’s named or deemed Beneficiary or Beneficiaries.
 
(b)  No Designation or Designee Dead or Missing. In the event that:
 
(1)  a Participant dies without designating a Beneficiary;
 
(2)  the Beneficiary designated by a Participant is not surviving when a payment
is to be made to such person under the Plan, and no contingent Beneficiary was
designated by the Participant; or
 
(3)  the Beneficiary designated by a Participant cannot be located by the
Administrative Committee within 1 year from the date benefits are to commence to
such person;
 
then, in any of such events, the Beneficiary of such Participant with respect to
any benefits that remain payable under the Plan shall be the Participant’s
Surviving Spouse, if any, and if not, then the estate of the Participant.
 
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7.5  Hardship Withdrawals.
 
(a)  Parameters of Hardship Withdrawals. A Participant may make a withdrawal on
account of hardship from his vested Account. For purposes of this subsection, a
withdrawal will be on account of “hardship” only if it is necessary to respond
to an “unforeseeable emergency” resulting in a severe financial need of the
Participant. A withdrawal based on financial hardship cannot exceed the amount
reasonably necessary to satisfy the emergency need (which may include amounts
necessary to pay any Federal, state, or local income taxes or penalties
reasonably anticipated to result from the distribution). Determinations of
amounts reasonably necessary to satisfy the emergency need shall take into
account any additional compensation that would become available to the
Participant upon cancellation of the Participant’s Deferral Election as provided
in §3.1(b)(3)(ii). The Administrative Committee shall make its determination, as
to whether a Participant has suffered a severe financial need as a result of an
unforeseeable emergency and whether it is necessary to use a hardship withdrawal
from the Plan to satisfy that need, on the basis of all relevant facts and
circumstances.
 
(b)  Unforeseeable Emergency Definition. For purposes of this §7.5, an
unforeseeable emergency is a severe financial hardship of the Participant
resulting from an illness or accident of the Participant, the Participant’s
Spouse, or the Participant’s dependent (as defined in Code §152(a)); loss of the
Participant’s property due to casualty (including the need to rebuild a home
following damage to a home not otherwise covered by insurance, for example, not
as a result of a natural disaster); or other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant. For example, the imminent foreclosure of or eviction from the
Participant’s primary residence may constitute an unforeseeable emergency. In
addition, the need to pay for medical expenses, including non-refundable
deductibles, as well as for the costs of prescription drug medication, may
constitute an unforeseeable emergency. Finally, the need to pay for the funeral
expenses of a Spouse or a dependent (as defined in Code §152(a)) may also
constitute an unforeseeable emergency. Except as otherwise provided in this
paragraph, the purchase of a home and the payment of college tuition are not
unforeseeable emergencies. Whether a Participant is faced with an unforeseeable
emergency permitting a distribution under this Section is to be determined based
on the relevant facts and circumstances of each case, but, in any case, a
distribution on account of unforeseeable emergency may not be made to the extent
that such emergency is or may be relieved through reimbursement or compensation
from insurance or otherwise, by liquidation of the Participant’s assets, to the
extent the liquidation of such assets would not cause severe financial hardship,
or by cessation of deferrals under the Plan.
 
(c)  Application for Hardship Withdrawal. All applications for hardship
withdrawals shall be in writing on a form provided by the Administrative
Committee and shall contain such information as the Administrative Committee may
reasonably request.
 
(d)  Payment of Withdrawal. The amount of a hardship withdrawal shall be paid to
a Participant in a single sum in cash on the date the Administrative Committee
approves the withdrawal application. This payment date is intended as good faith
compliance with Code §409A, and shall be construed in all respects in accordance
therewith. Neither the Participating Companies, Trustee nor the Administrative
Committee shall be liable to a Participant or Beneficiary for any delay in such
payment, provided that payment is made within the same calendar year as the
payment date specified in this paragraph, or, if later, by the 15th day of the
third calendar month following the payment date specified in this paragraph.
 
7.6  Unclaimed Benefits.
 
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In the event a Participant becomes entitled to benefits under the Plan other
than death benefits and the Administrative Committee is unable to locate such
Participant (after sending a letter, return receipt requested, to the
Participant’s last known address, and after such further diligent efforts as the
Administrative Committee in its sole discretion deems appropriate) within 1 year
from the date upon which he becomes so entitled, the Administrative Committee
shall direct that such benefits be paid to the Beneficiary of such Participant;
provided, if the distribution is payable upon the termination of the Plan, the
Administrative Committee shall not be required to wait until the end of such
1-year period. If the Participant and the Beneficiary cannot be located and fail
to claim such benefits by the end of the 5th Plan Year following the Plan Year
in which such Participant becomes entitled to such benefits, then the full
Account of the Participant shall be deemed abandoned and shall be used to reduce
the Matching Contributions of the Participating Company or Companies which
employed such Participant; provided, in the event such Participant or
Beneficiary is located or makes a claim subsequent to the allocation of the
abandoned Account but prior to the expiration of the time within which any such
person’s claim to the Account would expire under appropriate state law, then the
amount of the abandoned Account (unadjusted for any investment gains or losses
from the time of abandonment) shall be restored (from abandoned Accounts, Trust
earnings or Contributions made by the Participating Company or Companies with
whom the Participant formerly was employed) and paid to such Participant or
Beneficiary, as appropriate; and, provided, further, the Administrative
Committee, in its sole discretion, may delay the deemed date of abandonment of
any such Account for a period longer than the prescribed 5 Plan Years if it
believes that it is in the best interest of the Plan to do so.
 
7.7  Claims.
 
(a)  Authorized Representative. A Participant or Beneficiary may name an
authorized representative to act on his behalf under the claims procedures of
the Plan, by providing written documentation of such authorization in such form
as is acceptable to the Administrative Committee.
 
(b)  Procedure for Making Initial Claims. Claims for benefits under the Plan may
be made by submitting a written claim to the Administrative Committee clearly
identified as a claim for benefits under the Plan.
 
(c)  Review of Initial Claims. The Administrative Committee shall furnish to the
claimant written notice of the disposition of a claim within 90 days after the
application therefor is filed; provided, if special circumstances require an
extension of time for processing the claim, the Administrative Committee shall
furnish written notice of the extension to the claimant prior to the termination
of the initial 90-day period, and such extension shall not exceed one
additional, consecutive 90-day period. In the event the claim is denied, the
notice of the disposition of the claim shall contain (i) specific reasons for
the denial, (ii) specific references to Plan provisions on which the
Administrative Committee based its denial, (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) a
description of the Plan’s review procedures and time limits applicable to such
procedures, including a statement of the claimant’s right to bring a civil
action under section 502(a) of ERISA following an adverse benefit determination
on review. The notice will also contain a statement that the claimant may (i)
request a review upon written application to the Administrative Committee within
60 days, (ii) submit written comments, documents, records and other information
relating to the claim, and (iii) request copies of all documents, records, and
other information relevant to the claim. If a claim is denied because of
incomplete information, the notice will also indicate what additional
information is required.
 
(d)  Review Procedure. Any Participant or Beneficiary who has been denied a
benefit, or his duly authorized representative, shall be entitled, upon request
to the Administrative Committee, to appeal the denial of his claim. To do so,
the claimant must make a written request to the Administrative Committee for
further consideration of his position. The form containing the request for
review, together with a written statement of the claimant’s position, must be
filed with the Administrative Committee no later than 60 days after receipt of
the written notification of denial of a claim provided for in subsection (a).
Pertinent documents may be reviewed in preparing an appeal, and issues and
comments may be submitted in writing. The claimant will be provided, upon
request and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant to the claim for benefits (as determined
under applicable regulations). The Administrative Committee will completely
review the appeal, taking into account all comments, documents, records and
other information submitted by the claimant without regard to whether such
information was submitted or considered in the initial benefit determination.
The Administrative Committee’s decision shall be made in writing within 60 days
following the claimant’s request for review, unless special circumstances
require a further extension of time for processing, in which case a benefit
determination shall be rendered no later than 120 days following the
Administrative Committee’s receipt of the request for review. If such an
extension of time for review is required because of special circumstances, the
Administrative Committee will provide the claimant with written notice of the
extension, describing the special circumstances and the date as of which the
benefit determination will be made, prior to the commencement of the extension.
If unfavorable, the notice of decision shall explain the reason or reasons for
denial and indicate the provisions of the Plan or other documents used to arrive
at the decision.
 
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(e)  Satisfaction of Claims. Any payment to a Participant or Beneficiary or to
their legal representative or heirs at law, all in accordance with the
provisions of the Plan, shall to the extent thereof be in full satisfaction of
all claims hereunder against the Trustee, the Administrative Committee and the
Controlling Company, any of whom may require such Participant, Beneficiary,
legal representative or heirs at law, as a condition to such payment, to execute
a receipt and release therefor in such form as shall be determined by the
Trustee, the Administrative Committee or the Controlling Company, as the case
may be. If receipt and release shall be required but execution by such
Participant, Beneficiary, legal representative or heirs at law shall not be
accomplished so that the terms of §§7.1 and 7.2 may be fulfilled, such benefits
may be distributed or paid into any appropriate court or to such other place as
such court shall direct, for disposition in accordance with the order of such
court, and such distribution shall be deemed to comply with the requirements of
§§7.1 and 7.2.
 
ARTICLE VIII
 
ALLOCATION OF AUTHORITY AND RESPONSIBILITIES
 
8.1  Administrative Committee
 
(a)  Appointment and Term of Office. The Administrative Committee shall consist
of not less than one member who shall be appointed by and serve at the pleasure
of the Board. The Board shall have the right to remove any member of the
Administrative Committee at any time. A member may resign at any time by written
resignation to the Board. If a vacancy in the Administrative Committee should
occur, a successor may be appointed by the Board. A written certification shall
be given to the Trustee by the Board of all members of the Administrative
Committee together with a specimen signature of each member. For all purposes
hereunder, the Trustee shall be conclusively entitled to rely upon such
certification until the Trustee is otherwise notified in writing.
 
(b)  Organization. The Administrative Committee may elect a Chairman and a
Secretary from among its members. In addition to those powers set forth
elsewhere in the Plan, the Administrative Committee may appoint such agents, who
need not be members of such Administrative Committee, as it may deem necessary
for the effective performance of its duties and may delegate to such agents such
powers and duties, whether ministerial or discretionary, as the Administrative
Committee may deem expedient or appropriate. The compensation of such agents who
are not full-time Employees of a Participating Company shall be fixed by the
Administrative Committee within limits set by the Board and shall be paid by the
Controlling Company (to be divided equitably among the Participating Companies)
or from the Trust Fund as determined by the Administrative Committee. The
Administrative Committee shall act by majority vote. Its members shall serve as
such without compensation.
 
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(c)  Powers and Responsibility. The Administrative Committee shall have complete
control of the administration of the Plan hereunder, with all powers necessary
to enable it properly to carry out its duties as set forth in the Plan and the
Trust Agreement. The Administrative Committee shall have the sole authority in
its discretion to (i) construe the Plan and to determine all questions that
shall arise thereunder; (ii) decide all questions relating to the eligibility of
Employees to participate in the benefits of the Plan; (iii) determine the
benefits of the Plan to which any Participant or Beneficiary may be entitled;
(iv) maintain and retain records relating to Participants and Beneficiaries; (v)
prepare and furnish to the Trustee sufficient employee data and the amount of
Contributions received from all sources so that the Trustee may maintain
separate accounts for Participants and Beneficiaries and make required payments
of benefits; (vi) arrange for any required fiduciary bonding; and (vii) prepare
and file or publish with the Secretary of Labor, the Secretary of the Treasury,
their delegates and all other appropriate government officials all reports and
other information required under law to be so filed or published.
 
(d)  Administrative Committee Records. Any notice, direction, order, request,
certification or instruction of the Administrative Committee to the Trustee
shall be in writing and shall be signed by a member of the Administrative
Committee. The Trustee and every other person shall be entitled to rely
conclusively upon any and all such notices, directions, orders, requests,
certifications and instructions received from the Administrative Committee and
reasonably believed to be properly executed, and shall act and be fully
protected in acting in accordance therewith. All acts and determinations of the
Administrative Committee shall be duly recorded by its Secretary or under his
supervision, and all such records, together with such other documents as may be
necessary for the administration of the Plan, shall be preserved in the custody
of such Secretary.
 
(e)  Reporting and Disclosure. The Administrative Committee shall keep all
individual and group records relating to Participants and Beneficiaries and all
other records necessary for the proper operation of the Plan. Such records shall
be made available to the Participating Companies and to each Participant and
Beneficiary for examination during normal business hours except that a
Participant or Beneficiary shall examine only such records as pertain
exclusively to the examining Participant or Beneficiary and the Plan and Trust
Agreement. The Administrative Committee shall prepare and shall file as required
by law or regulation all reports, forms, documents and other items required by
any relevant statute, each as amended, and all regulations thereunder. This
provision shall not be construed as imposing upon the Administrative Committee
the responsibility or authority for the preparation, preservation, publication
or filing of any document required to be prepared, preserved or filed by the
Trustee or by any other entity to whom such responsibilities are delegated by
law or by the Plan.
 
(f)  Plan Construction. The Administrative Committee shall take such steps as
are considered necessary and appropriate to remedy any inequity that results
from incorrect information received or communicated in good faith or as the
consequence of an administrative error. The Administrative Committee shall
interpret the Plan and shall determine the questions arising in the
administration, interpretation and application of the Plan. The Administrative
Committee shall endeavor to act, whether by general rules or by particular
decisions, so as not to discriminate in favor of or against any person and so as
to treat all persons in similar circumstances uniformly. The Administrative
Committee shall correct any defect, reconcile any inconsistency or supply any
omission with respect to the Plan.
 
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(g)  Assistants and Advisers. The Administrative Committee shall have the right
to hire, at the expense of the Controlling Company (to be divided equitably
among the Participating Companies), such professional assistants and consultants
as it, in its sole discretion, deems necessary or advisable. To the extent that
the costs for such assistants and advisers are not so paid by the Controlling
Company, they shall be paid at the direction of the Administrative Committee
from the Trust Fund as an expense of the Trust Fund. The Administrative
Committee and the Participating Companies shall be entitled to rely upon all
certificates and reports made by an actuary, accountant or attorney selected
pursuant to this §8.1; the Administrative Committee, the Participating
Companies, and the Trustee shall be fully protected in respect to any action
taken or suffered by them in good faith in reliance upon the advice or opinion
of any such actuary, accountant or attorney; and any action so taken or suffered
shall be conclusive upon each of them and upon all other persons interested in
the Plan.
 
(h)  Indemnification. The Administrative and Investment Committees and each
member of those committees shall be indemnified by the Participating Companies
against judgment amounts, settlement amounts (other than amounts paid in
settlement to which the Participating Companies do not consent) and expenses
reasonably incurred by the Administrative and Investment Committees or each
member of the Administrative and Investment Committees in connection with any
action to which the Administrative or Investment Committee or any member thereof
may be a party (by reason of his service as a member of the Administrative or
Investment Committee) except in relation to matters as to which the
Administrative or Investment Committee or any member thereof shall be adjudged
in such action to be personally guilty of gross negligence or willful misconduct
in the performance of its or any member’s duties. The foregoing right to
indemnification shall be in addition to such other rights as such Administrative
and Investment Committees or each member may enjoy as a matter of law or by
reason of insurance coverage of any kind. Rights granted hereunder shall be in
addition to and not in lieu of any rights to indemnification to which such
Administrative and Investment Committees or each member may be entitled pursuant
to the by-laws of the Controlling Company. Service on the Administrative or
Investment Committee shall be deemed in partial fulfillment of a committee
member’s function, if any, as an Employee, officer and/or director of the
Controlling Company or any Participating Company.
 
8.2  Controlling Company and Board.
 
(a)  General Responsibilities. The Controlling Company and the Board shall have
the authority and responsibility to (i) appoint the Trustee, the Investment
Committee and the Administrative Committee and to monitor each of their
performances; (ii) communicate such information to the Trustee, the Investment
Committee and the Administrative Committee as each needs for the proper
performance of its duties; (iii) provide channels and mechanisms through which
the Administrative Committee, the Investment Committee and/or the Trustee can
communicate with Participants and Beneficiaries; and (iv) perform such duties as
are imposed by law or by regulation and serve as Plan Administrator in the
absence of an appointed Administrative Committee.
 
(b)  Allocation of Authority. In the event any of the areas of authority and
responsibilities of the Controlling Company and the Board overlap with that of
any other entity, the Controlling Company and the Board shall coordinate with
such other entity the execution of such authority and responsibilities;
provided, the decision of the Controlling Company and the Board with respect to
such authority and responsibilities ultimately shall be controlling.
 
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(c)  Authority of Participating Companies. Notwithstanding anything herein to
the contrary, and in addition to the authority and responsibilities specifically
given to the Participating Companies in the Plan, the Controlling Company, in
its sole discretion, may grant the Participating Companies such authority and
charge them with such responsibilities as the Controlling Company deems
appropriate.
 
8.3  Trustee.
 
The Trustee shall have the powers and duties set forth in the Trust Agreement.
 
8.4  Delegation.
 
Entities described in this section shall have the power to delegate specific
responsibilities (other than Trustee responsibilities) to persons whom shall
serve at the pleasure of the entity making such delegation and, if full-time
Employees of a Participating Company, without compensation. Any such person may
resign by delivering a written resignation to the delegating entity. Vacancies
created by any reason may be filled by the appropriate entity or the assigned
responsibilities may be reabsorbed or redelegated by the entity.
 
ARTICLE IX
 
AMENDMENT, TERMINATION AND ADOPTION
 
9.1  Amendment.
 
The provisions of the Plan may be amended at any time and from time to time by
the Board; provided:
 
(a)  No amendment shall increase the duties or liabilities of the Trustee
without the consent of such party;
 
(b)  No amendment shall decrease the balance or vested percentage of an Account;
 
(c)  Each amendment shall be approved by the Board by resolution;
 
(d)  No amendment shall be made that violates the restrictions of Code §409A;
and
 
(e)  No amendment shall be made to §5.1(c) of the Plan (unless required by law).
 
9.2  Termination.
 
(a)  Right to Terminate. The Controlling Company expects the Plan to be
continued indefinitely, but, subject to subsection (c) below, it reserves the
right to terminate the Plan or to completely discontinue Contributions to the
Plan at any time by action of the Board. In either event, the Administrative
Committee, each Participating Company and the Trustee shall be promptly advised
of such decision in writing.
 
(b)  Dissolution of Trust. In the event that the Administrative Committee
decides to dissolve the Trust, as soon as practicable following the termination
of the Plan or the Administrative Committee’s decision, whichever is later, the
assets under the Plan shall be converted to cash or other distributable assets,
to the extent necessary to effect a complete distribution of the Trust assets to
the Controlling Company.
 
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(c)  Restrictions on Termination. No termination of this Plan shall decrease or
eliminate the vested Account balance of any Participant hereunder as determined
as of the date of such termination. Furthermore, the Plan may be terminated only
as follows:
 
(1)  The Board may terminate the Plan within 12 months of a corporate
dissolution taxed under Code §331, or with the approval of a bankruptcy court
pursuant to 11 U.S.C. §503(b)(1)(A). In the event of termination pursuant to
this subsection, the amounts deferred under the Plan shall be included in the
Participants’ gross incomes in the latest of the calendar year in which the Plan
termination occurs, the calendar year in which the amount is no longer subject
to a substantial risk of forfeiture, or the first calendar year in which the
payment of benefits is administratively practicable.
 
(2)  The Board may terminate the Plan within the 30 days preceding or the 12
months following a “change in control event”; provided that the Plan may not be
terminated pursuant to this provision unless all substantially similar
arrangements sponsored by the Controlling Company (and its related entities as
determined under Code §409A and guidance issued thereunder) are terminated, so
that the Participants and all participants under substantially similar
arrangements are required to receive all amounts of compensation deferred under
the Plan and any other terminated arrangements within 12 months of the date of
termination of such arrangements. For purposes of this paragraph, “change in
control event” shall have the meaning set forth in Proposed Treasury Regulations
under Code §409A, or successor provisions, and substantially similar
arrangements shall be determined pursuant to regulations under Code §409A.
 
(3)  The Board may terminate the Plan other than as provided in subsections (1)
and (2) above only if:
 
(A)  All arrangements sponsored by the Controlling Company (and its related
entities as determined under Code §409A and guidance issued thereunder) that
would be aggregated with the Plan under Code §409A if the same service provider
participated in all of the arrangements (the “Aggregated Arrangements”) are
terminated; and
 
(B)  No payments other than payments that would be payable under the terms of
the Plan and the Aggregated Arrangements if the termination had not occurred are
made within 12 months of the termination of the Plan; and
 
(C)  All payments pursuant to the Plan and the Aggregated Arrangements are made
within 24 months of the termination of the Plan; and
 
(D)  The Controlling Company (and its related entities as determined under Code
§409A and guidance issued thereunder) does not adopt a new arrangement that
would be aggregated with the Plan or any Aggregated Arrangement if the same
service provider participated in both arrangements, at any time within five
years following the date of termination of the Plan.
 
(d)  Payment Upon Termination. If the Plan is terminated, the value of the
vested Account balances of Participants shall be paid to such Participants in a
single lump sum cash payment on the earlier of the date of termination, or the
earliest date permissible under subsection (c) above.
 
9.3  Adoption of the Plan by a Participating Company.
 
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(a)  Procedures for Participation. The Controlling Company and each Affiliate
shall be Participating Companies in the Plan; provided, however, the Controlling
Company may determine that any Affiliate is not to be a Participating Company,
and such Affiliate shall be recorded on Schedule A hereto which shall be
appropriately modified from time to time without the necessity of a Plan
amendment. Upon an Affiliate becoming a Participating Company as herein
provided, the Employees of such company shall be eligible to participate in the
Plan subject to the terms hereof and of the documentation designating the
Participating Company as such.
 
(b)  Authority under Plan. Each Participating Company shall be bound by, and
subject to, all provisions of the Plan and the Trust. The exclusive authority to
amend the Plan and the Trust shall be vested in the Administrative Committee,
and no Participating Company other than the Controlling Company shall have any
right to amend the Plan or the Trust. Any amendment to the Plan or the Trust
adopted by the Controlling Company shall be binding upon every Participating
Company without further action by such Participating Company.
 
(c)  Contributions to Plan. Each Participating Company shall be required to make
Contributions to the Plan at such times and in such amounts as specified in
Article III. The Contributions made (or to be made) to the Plan by the
Participating Companies shall be allocated between and among such companies in
whatever equitable manner or amounts as the Administrative Committee shall
determine.
 
(d)  Withdrawal from Plan. No Participating Company other than the Controlling
Company shall have the right to terminate the Plan. However, any Participating
Company may withdraw from the Plan, with the approval of the Administrative
Committee, by action of its board of directors, provided such action is
communicated in writing to the Administrative Committee. The withdrawal of a
Participating Company shall be effective as of the last day of the Plan Year
which follows receipt of the notice of withdrawal (unless the Controlling
Company consents to a different effective date). In addition, the Administrative
Committee may terminate the designation of a Participating Company to be
effective on such date as the Administrative Committee specifies. Any such
Participating Company which ceases to be a Participating Company shall be liable
for all costs accrued through the effective date of its withdrawal or
termination. In the event of the withdrawal or termination of a Participating
Company as provided in this Section, such Participating Company shall have no
right to direct that assets of the Plan be transferred to a successor plan for
its employees, unless such transfer is approved by the Controlling Company or
Administrative Committee in its sole discretion.
 
ARTICLE X
 
MISCELLANEOUS
 
10.1  Nonalienation of Benefits and Spendthrift Clause.
 
None of the Accounts, benefits, payments, proceeds or distributions under the
Plan shall be subject to the claim of any creditor of a Participant or
Beneficiary or to any legal process by any creditor of such Participant or of
such Beneficiary; and neither such Participant nor any such Beneficiary shall
have any right to alienate, commute, anticipate or assign any of the Accounts,
benefits, payments, proceeds or distributions under the Plan except to the
extent expressly provided herein. If any Participant shall attempt to dispose of
his Account or the benefits provided for him hereunder or to dispose of the
right to receive such benefits, or, in the event there should be an effort to
seize such Account or benefits by attachment, execution or other legal or
equitable process, such right may pass and be transferred, at the discretion of
the Administrative Committee, to such person or persons as may be selected by
the Administrative Committee from among the Beneficiaries, if any, theretofore
designated by the Participant, or from the Spouse, children or other dependents
of the Participant, in such shares as the Administrative Committee may appoint.
Any appointments so made by the Administrative Committee may be revoked by it at
any time, and further appointments made by it may include the Participant.
 
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10.2  Headings.
 
The headings and subheadings in the Plan have been inserted for convenience of
reference only and are to be ignored in any construction of the provisions
hereof.
 
10.3  Construction, Controlling Law.
 
In the construction of the Plan, the masculine shall include the feminine and
the feminine the masculine, and the singular shall include the plural and the
plural the singular, in all cases where such meanings would be appropriate.
Unless otherwise specified, any reference to a section shall be interpreted as a
reference to a section of the Plan. The Plan shall be construed in accordance
with the laws of the State of Georgia and applicable federal laws.
 
10.4  No Contract of Employment.
 
Neither the establishment of the Plan, nor any modification thereof, nor the
creation of any fund, trust or account, nor the payment of any benefits shall be
construed as giving any Participant, Employee or any person whomsoever the right
to be retained in the service of any Affiliate, and all Participants and other
Employees shall remain subject to discharge to the same extent as if the Plan
had never been adopted.
 
10.5  Legally Incompetent.
 
The Administrative Committee may in its discretion direct that payment be made
and the Trustee shall make payment on such direction, directly to an incompetent
or disabled person, whether incompetent or disabled because of minority or
mental or physical disability, or to the guardian of such person or to the
person having legal custody of such person, without further liability with
respect to or in the amount of such payment either on the part of any
Participating Company, the Administrative Committee or the Trustee.
 
10.6  Heirs, Assigns and Personal Representatives.
 
The Plan shall be binding upon the heirs, executors, administrators, successors
and assigns of the parties, including each Participant and Beneficiary, present
and future.
 
10.7  Unsecured Creditor Rights.
 
No Participant or Beneficiary shall have any right to, or interest in, any
assets of the Trust Fund other than that of a general unsecured creditor of the
Controlling Company.
 
10.8  Legal Action.
 
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In any action or proceeding involving the assets held with respect to the Plan
or Trust Fund or the administration thereof, the Participating Companies, the
Administrative Committee and the Trustee shall be the only necessary parties and
no Participants, Employees, or former Employees, their Beneficiaries or any
other person having or claiming to have an interest in the Plan shall be
entitled to any notice of process; provided, that such notice as is required by
the IRS and the Department of Labor to be given in connection with Plan
amendments, termination, curtailment or other activity shall be given in the
manner and form and at the time so required. Any final judgment which is not
appealed or appealable that may be entered in any such action or proceeding
shall be binding and conclusive on the parties hereto, the Administrative
Committee and all persons having or claiming to have an interest in the Plan.
 
10.9  Severability.
 
If any provisions of the Plan shall be held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provisions hereof, and
the Plan shall be construed and enforced as if such provisions had not been
included.
 
10.10  Predecessor Service.
 
In the event a Participating Company maintains the Plan as successor to a
predecessor employer who maintained the Plan, service for the predecessor
employer shall be treated as service for the Participating Company.
 
10.11  Plan Expenses.
 
Expenses incurred with respect to administering the Plan and Trust shall be paid
by the Trustee from the Trust Fund only to the extent such costs are not paid by
the Participating Companies or to the extent the Controlling Company requests
that the Trustee reimburse it for its payment of such expenses.
 
IN WITNESS WHEREOF, the Controlling Company has caused this Plan to be executed
by its duly authorized officers and its corporate seal to be affixed hereto, as
of the 11th day of December, 2006.
 
AGL RESOURCES INC.
 
By: /s/ Melanie M. Platt
 
Title: Senior Vice President
 

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SCHEDULE A
 
NONPARTICIPATING AFFILIATES

NONE

 

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SCHEDULE B
 
EFFECTIVE FOR PERIODS BEGINNING ON OR AFTER JANUARY 1, 2007
ITEMS EXCLUDED FROM “COMPENSATION” UNDER §1.15 OF NSP
 
PAYROLL CODE
DESCRIPTION
ADP
Adoption Aid Assistance
APD
Appliance discount
APR
Appliance Reimbursement
ATT
ATPI Bonus-Terminated Employee
AWD
Non-cash Awards
CAR
Car Allowance
CCD
Country Club Dues
CCR
Cntry Club Cash Reimbursement
DCC
Dependent Care Current Year
DCR
Dependent Care Reimbursement
DIS
State Dis Earnings (#05)
EAF
Executive Allowance Fund
EAG
EAF Gross Up Amount
EAP
Executive Allowance Payout
EFB
Employee Fitness Reimbursement
ESP
ESPP Taxable Earnings
EXE
Executive Pay
EXP
Expense Reporting Reimbursement
EXS
Executive Retirement Pay
FIM
Flex Imputed Life
FIT
Health Club
FLX
Flex Dollars
FRE
Flex Vacation Refund
GRP
GRIP Premium
GRU
Gross Up for Taxes
HCC
Health Care Current Year
HCR
Health Care Reimbursement
INS
Additional Insurance
ISO
Incentive Stock Option
LDV
Lump Sum Payment Deceased Employee
LSR
Lump Sum Retirement
LSS
Lump Sum Severance Pay
LTD
LTD Flex Credit Adjustment
LTF
Long Term Disability Flex Dollars
LTI
Long Term Incentive
MEA
Meals Overtime
MED
Medical Credit
MO2
Moving Expense / Taxable
MO3
Taxable Moving Third Party
MOA
Moving Expense
MOV
Moving Expense / Non Taxable
MPY
Mileage Pay - Propane
NQP
Non Qualified Savings Plan
NQR
Non Qualified Retirement Plan
NQS
Non Qualified Stock Options
NTU
Nontaxable Tuition Reimbursement
PAR
Restricted PAR Stock
PTY
3rd Party Tax Ben
QSK
Qualified Restricted Stock
RGP
Grip for Retiree
RGU
Retiree Grossup
RIM
Retiree Imputed Income
RTA
Retirement Adjustment
SAR
SAR Stock Option
SAV
Severance Salaried
SEP
Separation Pay
SET
Settlement - Union
SEV
Severance Pay
SIG
Sign on Bonus Less than 30 days
SLF
Supplemental Life Flex Dollars
SPB
Spouse Benefit
SUP
Supplemental Pay
TEL
Tele Reimbursement (#22 Share)
TPY
Third Party Sick Pay
TRA
Transportation Allowance
TUI
Tuition Reimbursement / Taxable
TX1
Taxable Dist. under Age 59 ½
TX2
Taxable Dist. over Age 59 ½
UNI
Uniform Reimbursement
VEH
VNG Car Allowance
WGL
Wages in Lieu of Notice

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