Exhibit 10.2.10

CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.

DEFERRED INCOME PLAN

Effective January 1, 1994

Amended and Restated Effective as of April 1, 1999

As Further Amended Effective as of September 1, 2000

As Further Amended Effective October 1, 2003

As Further Amended Effective January 1, 2006

As Further Amended Effective January 1, 2008

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TABLE OF CONTENTS

 

PREAMBLE

   1

ARTICLE I DEFINITIONS

   2

1.01

  

Accounts

   2

1.02

  

Affiliated Company

   2

1.03

  

Affiliated Company Bonus Plan

   3

1.04

  

Affiliated Company Bonus Plan Award Contributions

   3

1.05

  

Affiliated Company Bonus Plan Award Contributions Account

   3

1.06

  

ATIP

   3

1.07

  

ATIP Award Contributions

   3

1.08

  

ATIP Award Contributions Account

   3

1.09

  

Basic Salary Deferral Account

   4

1.10

  

Basic Salary Deferrals

   4

1.11

  

Beneficiary

   4

1.12

  

Board or Board of Trustees

   4

1.13

  

Change in Administration Date

   4

1.14

  

Change of Control

   5

1.15

  

Code

   7

1.16

  

Company

   7

1.17

  

Compensation

   7

1.18

  

Deemed Investment Option

   7

1.19

  

Deferred Compensation Agreement

   8

1.20

  

Dividend Equivalent Payments Contributions

   8

1.21

  

Dividend Equivalent Payments Contributions Account

   9

1.22

  

Effective Date

   9

1.23

  

EIP

   9

1.24

  

EIP Award Contributions

   9

1.25

  

EIP Award Contributions Account

   9

1.26

  

Eligible Employee

   9

1.27

  

ERISA

   10

1.28

  

Executive Incentive Plan

   10

1.29

  

Incentive Award

   10

 

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1.30

  

LTIP

   10

1.31

  

LTIP Award Contributions

   10

1.32

  

LTIP Award Contributions Account

   10

1.33

  

Mandatory Bonus Deferral Contributions

   10

1.34

  

Mandatory Bonus Deferral Account

   10

1.35

  

Mandatory Deferral Portion

   10

1.36

  

Matching Company Contribution Account

   11

1.37

  

Matching Company Contributions

   11

1.38

  

O&R

   11

1.39

  

Optional Bonus Deferral Contributions

   11

1.40

  

Optional Bonus Deferral Account

   11

1.41

  

Optional Deferral Portion

   11

1.42

  

Participant

   11

1.43

  

Plan

   12

1.44

  

Plan Administrator

   12

1.45

  

Plan Year

   12

1.46

  

Potential Change of Control

   12

1.47

  

Restricted Stock Cash Value Contributions

   16

1.48

  

Restricted Stock Cash Value Contributions Account

   16

1.49

  

Retirement

   16

1.50

  

Section 409A

   16

1.51

  

Separation from Service

   16

1.52

  

Specified Employee

   16

1.53

  

Statutory Compensation Limitation

   17

1.54

  

Statutory Limitations

   17

1.55

  

Supplemental Matching Company Contributions Account

   17

1.56

  

Supplemental Matching Company Contributions

   17

1.57

  

Supplemental Salary Deferral Account

   17

1.58

  

Supplemental Salary Deferrals

   17

1.59

  

Supplemental Thrift Plan

   17

1.60

  

Thrift Savings Plan

   17

1.61

  

Unforeseeable Emergency

   18

1.62

  

Valuation Date

   18

 

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ARTICLE II PARTICIPATION

   18

2.01

  

Participation

   18

2.02

  

Deferred Compensation Agreements

   19

2.03

  

Agreements that Qualify as Deferred Compensation Agreements

   23

2.04

  

Termination of Participation

   23

ARTICLE III ACCOUNTS

   23

3.01

  

Amount of Contributions to be Credited

   23

3.02

  

Accounting for Contributions

   28

3.03

  

Accounts and Rate of Return

   29

3.04

  

Vesting of Accounts

   31

3.05

  

Individual Accounts

   32

ARTICLE IV PAYMENT OF BENEFITS

   32

4.01

  

Commencement of Payment and Timing of Distributions

   32

4.02

  

Method or Form of Payment

   34

4.03

  

Payment Upon Death

   36

4.04

  

Payment Upon the Occurrence of a Change of Control

   36

4.05

  

Payment Upon Unforeseeable Emergency

   36

4.06

  

Additional Death Benefit

   37

4.07

  

Six-month Delay for Specified Employees

   38

4.08

  

Subsequent Redeferral

   38

4.09

  

Transition Rule Election

   38

ARTICLE V PLAN ADMINISTRATION

   39

5.01

  

Responsibility for Account Determination

   39

5.02

  

Duties of Plan Administrator

   39

5.03

  

Procedure for Payment of Benefits Under the Plan

   39

ARTICLE VI GENERAL PROVISIONS

   40

6.01

  

Funding

   40

6.02

  

Discontinuance and Amendment

   41

6.03

  

Termination of Plan

   42

6.04

  

Plan Not a Contract of Employment

   42

6.05

  

Facility of Payment

   43

6.06

  

Withholding Taxes

   43

6.07

  

Nonalienation

   43

 

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6.08

  

Assumption of Liabilities

   44

6.09

  

Section 409A

   44

6.10

  

Claims and Review Procedure

   44

6.11

  

Construction

   47

6.12

  

Adoption by Affiliated Companies

   48

 

iv

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CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.

DEFERRED INCOME PLAN

PREAMBLE

The Supplemental Thrift Savings Plan of Consolidated Edison Company of New York,
Inc., effective as of January 1, 1994, has been amended and restated in its
entirety and renamed the Consolidated Edison Company of New York, Inc. Deferred
Income Plan (the “Plan”), effective as of April 1, 1999. The purpose of the Plan
is to provide a means (i) for receiving employer matching contributions for
those employees participating in The Con Edison Thrift Savings Plan (the “Thrift
Savings Plan”) with respect to whom salary deferral and matching contributions
under the Thrift Savings Plan are or will be limited by application of the
limitations imposed on qualified plans by certain sections of the Code (as
defined below); (ii) of providing such employees with an opportunity to defer a
portion of their salary in accordance with the terms of the Plan as hereinafter
set forth; and (iii) of providing employees who receive an “Incentive Award,” as
such term is defined in the Consolidated Edison Company of New York, Inc.
Executive Incentive Plan (the “Executive Incentive Plan”) or the 2005
Consolidated Edison Company of New York, Inc. Executive Incentive Plan, as
applicable, with an opportunity to defer receipt of all or a portion of such
Incentive Award.

All benefits payable under this Plan, which is intended to constitute a
nonqualified, unfunded deferred compensation plan for a select group of
management employees under Title I of ERISA, shall be paid out of the general
assets of the Company. The Company may establish and fund a trust in order to
aid it in providing benefits due under the Plan. Effective September 1, 2000,
the Plan was amended to provide, among other provisions, the right of a
Participant who has not terminated employment to make an irrevocable election to
distribute payment of his or her Supplemental Salary Deferral Account, Mandatory
Bonus Deferral Account, Optional Bonus

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Deferral Account and Other Deferrals to a date earlier than the Participant’s
Separation from Service (as defined below); to permit the Participant to elect
subsequent redeferrals of payments to distribute up to the fifteenth anniversary
of his or her Separation from Service; and to permit Affiliated Companies to
adopt the Plan on behalf of some or all of their eligible employees. The Plan
was amended effective January 1, 2006 to comply with Proposed Treasury
Regulations §§ 1.409A-1 to -6. The Plan was amended effective January 1, 2008 to
comply with the final Treasury Regulations of Section 409A. No portion of the
benefits accrued under this Plan prior to January 1, 2005 shall be
“grandfathered” for purposes of Section 409A of the Code.

ARTICLE I

DEFINITIONS

1.01 Accounts means the aggregate of a Participant’s Basic Salary Deferral
Account, Supplemental Salary Deferral Account, Matching Company Contribution
Account, Supplemental Matching Company Contribution Account, Optional Bonus
Deferral Account, Mandatory Bonus Deferral Account, Dividend Equivalent Payments
Contributions Account, Restricted Stock Cash Value Contributions Account, EIP
Award Contributions Account, ATIP Award Contributions Account, LTIP Award
Contributions Account, Affiliated Company Bonus Plan Award Contributions Account
and any other Account that may be established by the Plan Administrator from
time to time on behalf of a Participant.

1.02 Affiliated Company means any company other than the Company which is a
member of a controlled group of corporations (as defined in Section 414(b) of
the Code) that includes the Company; any trade or business under common control
(as defined in Section 414(c) of the Code) with the Company; any organization
(whether or not incorporated) which is a member of an affiliated service group
(as defined in Section 414(m) of the Code) that includes the Company; and any
other entity required to be aggregated with the Company pursuant to regulations
under Section 414(o) of the Code.

 

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1.03 Affiliated Company Bonus Plan means the short term bonus plan, as amended
from time to time, of any Affiliated Company, except O&R, that has been approved
by the Plan Administrator.

1.04 Affiliated Company Bonus Plan Award Contributions means the amount of an
applicable Participant’s Affiliated Company Bonus Plan Awards contributed to
this Plan and credited on such Participant’s behalf pursuant to Section 3.01.

1.05 Affiliated Company Bonus Plan Award Contributions Account means the
bookkeeping account maintained for each applicable Participant to record all
amounts contributed to this Plan from his or her Affiliated Company Bonus Plan
Awards and credited on his or her behalf pursuant to Section 3.01, earnings,
gains and losses, if any pursuant to Section 3.03, and debits for administrative
expenses allocated pursuant to Section 6.01.

1.06 ATIP means the Orange and Rockland Utilities, Inc. Annual Team Incentive
Policy, as amended from time to time.

1.07 ATIP Award Contributions means the amount of an applicable Participant’s
ATIP Awards contributed to this Plan and credited on such Participant’s behalf
pursuant to Section 3.01.

1.08 ATIP Award Contributions Account means the bookkeeping account maintained
for each applicable Participant to record all amounts contributed to this Plan
from his or her ATIP Awards and credited on his or her behalf pursuant to
Section 3.01, earnings, gains and losses, if any pursuant to Section 3.03, and
debits for administrative expenses allocated pursuant to Section 6.01.

 

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1.09 Basic Salary Deferral Account means the bookkeeping account maintained for
each Participant to record all amounts credited on such Participant’s behalf as
Basic Salary Deferrals, earnings, gains and losses, if any, pursuant to
Section 3.02, and debits for administrative expenses allocated pursuant to
Section 6.01.

1.10 Basic Salary Deferrals means the amount of contributions credited on a
Participant’s behalf, and those deemed as Basic Salary Deferrals under
Section 3.01.

1.11 Beneficiary means the person, persons, or entity designated by the
Participant to receive the benefits credited to the Participant’s Accounts in
the event of the Participant’s death. In the absence of a designation, or in the
event such designated person or persons are not alive on the date payment is to
be made, the Beneficiary is the person, persons, or entity determined in
accordance with procedures established by the Plan Administrator. A Participant
may make a separate designation of Beneficiary for the additional death benefit
payable pursuant to Section 4.05, so long as the designation is clear, concise,
and unequivocal. In the event the Participant has not named a Beneficiary, the
Beneficiary will first be the beneficiary named in the Thrift Savings Plan;
second, the lawful spouse or Domestic Partner of the Participant at the time of
the distribution of the Participant’s Accounts; and third, any other person or
persons whom the Plan Administrator determines is the appropriate Beneficiary.

1.12 Board or Board of Trustees means the Board of Trustees of the Company.

1.13 Change in Administration Date means the date the portion of the applicable
Mandatory Deferral Portion or Optional Deferral Portion of an Incentive Award
granted under the Executive Incentive Plan is first administered and accounted
for as a liability under this Plan in accordance with the Executive Incentive
Plan.

 

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1.14 Change of Control means and shall be deemed to have occurred as of the date
of the first to occur of the following events:

(a) any Person or Group acquires stock of the Company that, together with stock
held by such Person or Group, constitutes more than 50% of the total fair market
value or total voting power of the stock of the Company. However, if any Person
or Group is considered to own more than 50% of the total fair market value or
total voting power of the stock of the Company, the acquisition of additional
stock by the same Person or Group is not considered to cause a Change of Control
of the Company. An increase in the percentage of stock owned by any Person or
Group as a result of a transaction in which the Company acquires its stock in
exchange for property will be treated as an acquisition of stock for purposes of
this subsection. This subsection applies only when there is a transfer of stock
of the Company (or issuance of stock of the Company) and stock in the Company
remains outstanding after the transaction;

(b) any Person or Group acquires (or has acquired during the 12-month period
ending on the date of the most recent acquisition by such Person or Group)
ownership of stock of the Company possessing 30% or more of the total voting
power of the stock of the Company;

(c) a majority of members of the Board is replaced during any 12-month period by
Directors whose appointment or election is not endorsed by a majority of the
members of the Board prior to the date of the appointment or election; or

(d) any Person or Group acquires (or has acquired during the 12-month period
ending on the date of the most recent acquisition by such Person or Group)
assets

 

5

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from the Company that have a total gross fair market value equal to or more than
40% of the total gross fair market value of all of the assets of the Company
immediately prior to such acquisition or acquisitions. For this purpose, gross
fair market value means the value of the assets of the Company, or the value of
the assets being disposed of, determined without regard to any liabilities
associated with such assets. However, no Change of Control shall be deemed to
occur under this subsection (d) as a result of a transfer to:

 

  (i) A shareholder of the Company (immediately before the asset transfer) in
exchange for or with respect to its stock;

 

  (ii) An entity, 50% or more of the total value or voting power of which is
owned, directly or indirectly, by the Company;

 

  (iii) A Person or Group that owns, directly or indirectly, 50% or more of the
total value or voting power of all the outstanding stock of the Company; or

 

  (iv) An entity, at least 50% of the total value or voting power of which is
owned, directly or indirectly, by a person described in clause (iii) above.

For these purposes, the term “Person” shall mean an individual, corporation,
association, joint stock company, business trust or other similar organization,
partnership, limited liability company, joint venture, trust, unincorporated
organization or government or agency, instrumentality or political subdivision
thereof (but shall not include the Employer, any underwriter temporarily holding
securities pursuant to an offering of such securities, any trustee or other
fiduciary holding securities under an employee benefit plan of the Employer, or
any company owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of voting stock of the
Company). The term “Group” shall

 

6

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have the meaning set forth in Rule 13d-5 of the Securities Exchange Act of 1934,
as amended. If any one Person, or Persons acting as a Group, is considered to
effectively control the Company as described in subsections (b) or (c) above,
the acquisition of additional control by the same Person or Persons is not
considered to cause a Change of Control.

1.15 Code means the Internal Revenue Code of 1986, as amended from time to time,
and any regulations issued thereunder. Reference to any section of the Code
shall include any successor provision thereto.

1.16 Company means Consolidated Edison Company of New York, Inc. or any
successor thereto by merger, purchase or otherwise; provided, however, that for
purposes of the definition of “Change of Control” and the definition of
“Potential Change of Control,” “Company” means the highest level holding company
of Consolidated Edison Company of New York, Inc. (or any successor thereto which
continues this Plan) which has publicly traded common stock.

1.17 Compensation means an Eligible Employee’s “Compensation” (as such term is
defined in the Thrift Savings Plan) determined without regard to the Statutory
Compensation Limitation (except as otherwise provided in Section 3.01).
Compensation shall be calculated on a monthly basis by dividing Compensation by
12 and determined prior to any reduction pursuant to a Participant’s election to
make (i) pre tax contributions under the Thrift Savings Plan, (ii) pre tax
contributions to a cafeteria plan under Section 125 of the Code or pre tax
contributions under Section 132(f) of the Code to a transportation reimbursement
account, or (iii) Basic Salary Deferrals or Supplemental Salary Deferrals to
this Plan.

1.18 Deemed Investment Option means the deemed rate of return with respect to
the investment funds as may from time to time be selected by the Plan
Administrator in accordance with Section 3.02.

 

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1.19 Deferred Compensation Agreement means the deferral and distribution
election form and agreement entered into between the Company and the Participant
pursuant to Sections 2.02 and 3.02 under which the Participant elects to reduce
his or her Compensation otherwise payable for a Plan Year and have that amount
contributed to the Plan by the Company or Affiliated Company as Basic Salary
Deferrals and Supplemental Salary Deferrals. Effective September 1, 2000, a
Deferred Compensation Agreement also means an individual employment agreement
between the Company, an Affiliated Company or Consolidated Edison, Inc. and a
Participant that provides for the deferral of receipt of compensation,
Contribution of the deferred Compensation to the Plan, and designation by the
Participant of his or her preferences with respect to allocation of the deferred
compensation among the available Deemed Investment Options as determined by the
Plan Administrator, in his or her sole discretion. Deferred Compensation
Agreement also means the deferral and distribution election form and agreement
entered into between the Company and the Participant pursuant to Sections 2.02
and 3.02 under which the Participants elects to defer all or part of his or her
Awards into this Plan. A Participant also designates his or her preferences with
regard to the allocation among the available Deemed Investment Options of the
aggregate of the Participant’s Basic Salary Deferrals, Supplemental Salary
Deferrals, Matching Company Contributions, Supplemental Matching Company
Contributions, Mandatory Bonus Deferral Contributions and Optional Bonus
Deferral Contributions, EIP Award Contributions, ATIP Award Contributions, LTIP
Award Contributions, Affiliated Company Bonus Plan Award Contributions made in
such Plan Year, if any as determined by the Plan Administrator, in his or her
sole discretion.

1.20 Dividend Equivalent Payments Contributions means the payments made on the
Restricted Stock Units awarded a Participant in a Deferred Compensation
Agreement.

 

8

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1.21 Dividend Equivalent Payments Contributions Account means the bookkeeping
account maintained for each Participant, who is entitled to a Dividend
Equivalent Contribution, to record all amounts credited on such Participant’s
behalf as Dividend Equivalent Contributions pursuant to Section 3.02, earnings,
gains and losses, if any, pursuant to Section 3.03, and debits for
administrative expenses allocated pursuant to Section 6.01.

1.22 Effective Date means January 1, 1994.

1.23 EIP means the 2005 Consolidated Edison Company of New York, Inc. Executive
Incentive Plan, as amended from time to time.

1.24 EIP Award Contributions means the amount of an applicable Participant’s EIP
Awards contributed to this Plan and credited on such Participant’s behalf
pursuant to Section 3.01.

1.25 EIP Award Contributions Account means the bookkeeping account maintained
from each applicable Participant to record all amounts contributed to this Plan
from his or her EIP Awards and credited on his or her behalf pursuant to
Section 3.01, earnings, gains and losses, if any pursuant to Section 3.03, and
debits for administrative expenses allocated pursuant to Section 6.01.

1.26 Eligible Employee means an employee of the Company whose Compensation for a
Plan Year exceeds the Statutory Compensation Limitation and who is eligible to
and is a participant in the Thrift Savings Plan, or any other key employee
designated by the Chief Executive Officer of the Company as eligible to
participate in the Plan. Eligible Employee also means a key employee of an
Affiliated Company that affirmatively adopts the Plan on behalf of one or more
of its employees; provided, however, that, such employee would otherwise meet
the eligibility requirements if he or she worked for the Company.

 

9

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1.27 ERISA means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

1.28 Executive Incentive Plan means the Consolidated Edison Company of New York,
Inc. Executive Incentive Plan as amended, from time to time.

1.29 Incentive Award means an Award granted to a Participant under the terms of
the Executive Incentive Plan, the EIP, the LTIP, the ATIP or an Affiliated
Company Bonus Plan.

1.30 LTIP means the Consolidated Edison, Inc. Long Term Incentive Plan, as
amended from time to time.

1.31 LTIP Award Contributions means the amount of an applicable Participant’s
LTIP Awards contributed to this Plan and credited on such Participant’s behalf
pursuant to Section 3.01.

1.32 LTIP Award Contributions Account means the bookkeeping account maintained
for each applicable Participant to record all amounts contributed to this Plan
from his or her LTIP Awards and credited on his or her behalf pursuant to
Section 3.01, earnings, gains and losses, if any pursuant to Section 3.03, and
debits for administrative expenses allocated pursuant to Section 6.01.

1.33 Mandatory Bonus Deferral Contributions means the amount of contributions
credited on a Participant’s behalf pursuant to Section 3.01.

1.34 Mandatory Bonus Deferral Account means the bookkeeping account maintained
for each Participant to record all amounts credited on such Participant’s behalf
under Section 3.01, earnings, gains and losses on those amounts pursuant to
Section 3.02, and debits for administrative expenses allocated pursuant to
Section 6.01.

1.35 Mandatory Deferral Portion means the “Mandatory Deferral Portion,” as such
term is defined in the Executive Incentive Plan or EIP (as applicable), of an
Incentive Award.

 

10

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1.36 Matching Company Contribution Account means the bookkeeping account
maintained for each Participant to record all amounts credited on such
Participant’s behalf under Section 3.01 and all amounts credited on such
Participant’s behalf under the Supplemental Thrift Plan as of March 31, 1999 or
such later date as of which such amounts are administered under this Plan,
earnings, gains and losses, if any, on those amounts pursuant to Section 3.02,
and debits for administrative expenses allocated pursuant to Section 6.01.

1.37 Matching Company Contributions means company matching contributions, as
such term is defined in the Thrift Savings Plan credited on a Participant’s
behalf under Section 3.01.

1.38 O&R

means Orange & Rockland Utilities, Inc.

1.39 Optional Bonus Deferral Contributions means the amount of contributions
credited on a Participant’s behalf pursuant to Section 3.01.

1.40 Optional Bonus Deferral Account means the bookkeeping account maintained
for each Participant to record all amounts credited on such Participant’s behalf
under Section 3.01, earnings, gains and losses on those amounts pursuant to
Section 3.02, and debits for administrative expenses allocated pursuant to
Section 6.01.

1.41 Optional Deferral Portion means the “Optional Deferral Portion,” as such
term is defined in the Executive Incentive Plan, of an Incentive Award.

1.42 Participant means (i) each Eligible Employee who has made an election
described in Section 2.02; (ii) each person who has made a deferral election
which has resulted in all or any portion of any of the Employee’s Incentive
Awards to be administered and accounted for as a liability under this Plan;
(iii) each other Eligible Employee who is credited with Matching

 

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Company Contributions or Supplemental Matching Company Contributions; (iv) each
Eligible Employee who has a written employment agreement under which such person
is granted an award of restricted stock units; and (v) such other Eligible
Employee who is covered by the provisions of Section 4.06.

1.43 Plan means the Consolidated Edison Company of New York, Inc. Deferred
Income Plan as set forth in this document and as amended from time to time.

1.44 Plan Administrator means the individual appointed by the Chief Executive
Officer of the Company to administer the Plan as provided in Article V.

1.45 Plan Year means the calendar year.

1.46 Potential Change of Control means an event which shall occur if:

(a) the Company enters into a definitive written agreement, the consummation of
which would result in the occurrence of a “Change “Event”;

(b) the Company or any Person (as defined in Section 1.14) publicly announces an
intention to take or to consider taking actions which, if consummated, would
constitute a “Change Event”; or

(c) any Person becomes the beneficial owner (as defined in Rule 13d- 3
promulgated under the Exchange Act), directly or indirectly, of securities of
the Company representing 15% or more of the then outstanding shares of Common
Stock of the Company or the combined voting power of the Company’s then
outstanding securities.

(d) For the purposes of this Section 1.46, a “Change Event” means an event which
shall occur if:

 

12

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  (i) any person, as defined in Section 3(a)(9) of the Exchange Act, as such
term is modified in Sections 13(d) and 14(d) of the Exchange Act (other than
(i) any employee plan established by any “Corporation” (which for these purposes
shall be deemed to be the Company and any corporation, association, joint
venture, proprietorship or partnership which is connected with the Company
either through stock ownership or through common control, within the meaning of
Sections 414(b) and (c) and 1563 of the Code), (ii) the Company or any of its
affiliates (as defined in Rule 12b-2 promulgated under the Exchange Act),
(iii) an underwriter temporarily holding securities pursuant to an offering of
such securities, or (iv) a corporation owned, directly or indirectly, by
stockholders of the Company in substantially the same proportions as their
ownership of the Company) (a “Person”), is or becomes the beneficial owner (as
defined in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities of the Company (excluding from the securities
beneficially owned by such Person any securities directly acquired from the
Company or its affiliates other than in connection with the acquisition by the
Company or its affiliates of a business) representing 20% or more of either the
then outstanding shares of Common Stock of the Company or the combined voting
power of the Company’s then outstanding voting securities;

 

  (ii)

during any period of up to two consecutive years individuals who, at the
beginning of such period, constitute the Board cease for any reason to
constitute a majority of the directors then serving on the Board, provided

 

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that any person who becomes a director subsequent to the beginning of such
period and whose appointment or election by the Board or nomination for election
by the Company’s shareholders was approved by at least two thirds of the
directors then still in office who either were directors at the beginning of
such period or whose appointment, election or nomination for election was
previously so approved (other than a director (i) whose initial assumption of
office is in connection with an actual or threatened election contest relating
to the election of the directors of the Company, as such terms are used in Rule
14a-11 of Regulation 14A under the Exchange Act; or (ii) who was designated by a
person who has entered into an agreement with the Company to effect a
transaction described in paragraph (a), (c) or (d) of this Section 1.46) shall
be deemed a director as of the beginning of such period;

 

  (iii)

consummation of a merger or consolidation of the Company with any other
corporation or approval of the issuance of voting securities of the Company in
connection with a merger or consolidation of the Company occurs (other than
(i) a merger or consolidation that would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity or any parent thereof), in combination with the ownership of
any trustee or other fiduciary holding securities under an employee benefit plan
of any Corporation, at least 51% of the combined voting power of the voting
securities of the Company or

 

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such surviving entity or any parent thereof outstanding immediately after such
merger or consolidation, or (ii) a merger or consolidation effected to implement
a recapitalization of the Company (or similar transaction) in which no Person is
or becomes the beneficial owner (as defined in paragraph (a) above), directly or
indirectly, of securities of the Company (not including in the securities
beneficially owned by such Person any securities acquired directly from the
Company or its affiliates other than in connection with the acquisition by the
Company or the affiliates of a business) representing 20 percent or more of
either the then outstanding shares of Common Stock of the Company or the
combined voting power of the Company’s then outstanding voting securities; or

 

  (iv) the stockholders of the Company approve a plan of complete liquidation or
dissolution of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company’s assets, other than a sale
or disposition by the Company of all or substantially all of the Company’s
assets to an entity, at least 65% of the combined voting power of the voting
securities of which are owned by persons in substantially the same proportions
as their ownership of the Company immediately prior to the sale.

Notwithstanding the foregoing, no “Change Event” shall be deemed to have
occurred if there is consummated any transaction, or series of integrated
transactions, immediately following which the record holders of the Common Stock
immediately prior to such transaction, or series of integrated transactions,
continue to have substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of the Company immediately
following such transaction or series of integrated transactions.

 

15

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1.47 Restricted Stock Cash Value Contributions means the cash value of the
restricted stock units awarded to a Participant in an agreement. The amount of
the Restricted Stock Cash Value Contribution is determined by the terms and
conditions of the particular agreement.

1.48 Restricted Stock Cash Value Contributions Account means the bookkeeping
account maintained for each applicable Participant to record amounts credited on
such Participant’s behalf under Section 3.01 earnings, gains and losses on those
amounts, pursuant to Section 3.03, and debits for administrative expenses
allocated pursuant to Section 6.01.

1.49 Retirement means a Separation from Service either (a) under circumstances
in which the Participant is eligible to receive a an early retirement or normal
retirement pension benefit under a defined benefit plan maintained by the
Company or an Affiliated Company or (b) in the case of any Participant who is
employed after age 60 and who is not eligible to receive an early retirement or
normal retirement pension benefit under any defined benefit plan, on or after
the Participant’s 65th birthday.

1.50 Section 409A means Section 409A of the Code and the applicable rulings and
regulations promulgated thereunder.

1.51 Separation from Service means with respect to a Participant, a “separation
from service” with the Company as determined under the default provisions in
Treasury Regulation Section 1.409A-1(h).

1.52 Specified Employee means a specified employee of the Company as determined
under the Company’s established methodology for determining “specified
employees” under Section 409A on the date on which a Participant incurs a
Separation from Service.

 

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1.53 Statutory Compensation Limitation means the limitation set forth in
Section 401(a)(17) of the Code as in effect each year for the Thrift Savings
Plan.

1.54 Statutory Limitations means the limitations set forth in Section 401(a)(17)
and Section 402(g)(1) of the Code.

1.55 Supplemental Matching Company Contributions Account means the bookkeeping
account maintained for each Participant to record all amounts credited on such
Participant’s behalf under Section 3.01 and all amounts credited on such
Participant’s behalf under the Supplemental Thrift Plan as of March 31, 1999 or
such later date as of which such amounts are administered under this Plan,
earnings, gains and losses, if any, on those amounts pursuant to Section 3.02,
and debits for administrative expenses allocated pursuant to Section 6.01.

1.56 Supplemental Matching Company Contributions means the amount of
contributions credited on a Participant’s behalf under Section 3.01.

1.57 Supplemental Salary Deferral Account means the bookkeeping account
maintained for each Participant to record all amounts credited on such
Participant’s behalf under Section 3.01, earnings, gains and losses on those
amounts pursuant to Section 3.02, and debits for administrative expenses
allocated pursuant to Section 6.01.

1.58 Supplemental Salary Deferrals means the amount of contributions credited on
a Participant’s behalf under Section 3.01.

1.59 Supplemental Thrift Plan means the Supplemental Thrift Savings Plan of
Consolidated Edison Company of New York, Inc. as effective on March 31, 1999.

1.60 Thrift Savings Plan means The Con Edison Thrift Savings Plan as amended
from time to time.

 

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1.61 Unforeseeable Emergency means an “unforeseeable emergency” within the
meaning of Section 409A(a)(2)(B)(ii). The Plan Administrator shall determine
whether the circumstances presented by the Participant constitute an
unanticipated emergency consistent with the requirements of Section 409A.

1.62 Valuation Date means the last day of each calendar month, commencing with
the calendar month in which the Effective Date occurs, and any other date
designated as a Valuation Date by the Plan Administrator.

ARTICLE II

PARTICIPATION

 

2.01 Participation

An Eligible Employee shall become a Participant in the Plan on the earliest of:

(a) the date the Eligible Employee first has Basic Salary Deferrals or
Supplemental Salary Deferrals credited on his or her behalf under the Plan
pursuant to Sections 2.02 and 3.01;

(b) the date the Eligible Employee first has a Matching Company Contribution or
Supplemental Matching Company Contributions credited on such individual’s behalf
under the Plan pursuant to Section 3.01;

(c) the date the Eligible Employee first has Mandatory Bonus Deferral
Contributions or Optional Bonus Deferral Contributions administered and
accounted for as a liability under the Plan pursuant to Section 3.01;

(d) the date set forth in an Eligible Employee’s Deferred Contribution
Agreement; and

 

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(e) the date an Eligible Employee first has Incentive Award Contributions
credited on his or her behalf under the Plan pursuant to Section 3.01.

 

2.02 Deferred Compensation Agreements

(a) Any Eligible Employee who wishes to have salary reduction contributions
credited on his or her behalf to a Basic Salary Deferral Account under the Plan
in a Plan Year or who wished to have any portion of an Incentive Award
contributed to an Incentive Award Account under the Plan in a Plan Year shall,
during the deferral enrollment period which shall occur in the Plan Year prior
to the Plan Year to which the deferral relates, complete, execute and file with
the Plan Administrator an irrevocable Deferred Compensation Agreement
authorizing Basic Salary Deferrals under this Plan for such Plan Year in
accordance with the provisions of paragraph (c)(i) below and Section 3.01. The
Deferred Compensation Agreement may also authorize Supplemental Salary Deferrals
under this Plan in accordance with the provisions of paragraph (c)(ii) below and
Section 3.01 for such Plan Year if (i) the Eligible Employee is an officer of
the Company or is designated by the Chief Executive Officer of the Company as
eligible to make Supplemental Salary Deferrals and (ii) the Eligible Employee
authorizes on such Deferred Compensation Agreement the Basic Salary Deferrals
permitted to be made to this Plan. The Deferred Compensation Agreement may also
authorize the contribution of all or a portion of an Incentive Award under this
Plan for such Plan Year in accordance with the provisions of paragraph
(c) (iii) below and Section 3.01.

(b) Notwithstanding the provisions of paragraph (a) above, subject to approval
by the Plan Administrator, in its sole discretion, an individual who becomes an
Eligible

 

19

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Employee and wishes to have salary reduction contributions credited on his or
her behalf to a Basic Salary Deferral Account in the calendar year such
individual first becomes an Eligible Employee must, no later than 30 days
following the date such individual becomes an Eligible Employee (provided such
Eligible Employee does not participate in any other Company “account balance
plan,” as such term is defined under Section 409A), complete, execute and file
with the Plan Administrator an irrevocable Deferred Compensation Agreement
authorizing Basic Salary Deferrals under this Plan for such Plan Year in
accordance with the provisions of paragraph (c)(i) below and Section 3.01. Such
Deferred Compensation Agreement may also authorize Supplemental Salary Deferrals
under this Plan in accordance with the provisions of paragraph (c)(ii) below and
Section 3.01 for such Plan Year if (i) the Eligible Employee is an officer of
the Company or is designated by the Chief Executive Officer of the Company as
eligible to make Supplemental Salary Deferrals and (ii) the Eligible Employee
authorizes on the Deferred Compensation Agreement the Basic Salary Deferrals
permitted to be made to this Plan. Such Deferred Compensation Agreement may also
authorize Incentive Award contributions under this Plan in accordance with the
precision so paragraph (c)(ii) below and Section 3.01 for such Plan Year.

(c) A Deferred Compensation Agreement for a Plan Year shall be in writing and be
properly completed upon a form approved by the Plan Administrator or his or her
designee, who shall be the sole judge of the proper completion thereof. Such
Deferred Compensation Agreement shall specify:

 

  (i) the Participant’s election to have his or her Compensation reduced by 6%
(or such other percentage as specified for such purpose by the Plan
Administrator), and credited on his or her behalf to the Plan as Basic Salary
Deferrals;

 

20

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  (ii) the percentage of the Participant’s Compensation to be reduced and
credited on the Participant’s behalf to the Plan by the Company as Supplemental
Salary Deferrals. Such percentage shall be in multiples of 1% and shall not
exceed 50% unless the Plan Administrator specifies some other percentage for
such purpose;

 

  (iii) the percentage (in multiples of 1% up to 100%) of Dividend Equivalent
Payments or Incentive Award payments credited to the Participant’s Account in
this Plan for such Plan Year;

 

  (iv) the Participant’s preferences for allocating contributions credited for
such Plan Year among the Deemed Investment Options;

 

  (v) if applicable, the specific payment commencement date for any In-Service
Distribution permitted in accordance with Section 4.01(a), which date shall not
be earlier than the end of the Plan Year to which such deferral relates; and

 

  (vi) an election, if any, of the form of payment upon the Participant’s
Separation from Service as provided in Section 4.02(b).

(d) Any Deferred Compensation Agreement made by an Eligible Employee shall be
effective only with respect to Compensation to be earned in the Plan Year(s)
following the date on which the Deferred Compensation Agreement is effective.

 

21

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Basic Salary Deferrals, Supplemental Salary Deferrals, Matching Company
Contributions, Supplemental Matching Company Contributions, Mandatory Bonus
Deferral Contributions, Optional Bonus Deferral Contributions, Dividend
Equivalent Payments Contributions, Restricted Stock Cash Value Contributions,
EIP Award Contributions, ATIP Award Contributions, LTIP Award Contributions,
Affiliated Company Bonus Plan Award Contributions and any other contributions
that the Plan Administrator may determine from time to time as eligible for this
Plan are to be credited in the Plan Year to which such Deferred Compensation
Agreement relates. The terms of an Eligible Employee’s Deferred Compensation
Agreements may differ from Plan Year to Plan Year.

(e) Notwithstanding the foregoing, if a Participant receives a hardship
withdrawal of pretax contributions from the Thrift Savings Plan or any other
plan which is maintained by the Company and which meets the requirements of
Section 401(k) of the Code (or any successor thereof) and is precluded from
making contributions to such plan for at least 12 months after receipt of the
hardship withdrawal, the Participant’s Deferred Compensation Agreement, if any,
shall be cancelled for the remainder of the Plan Year in which the Participant
receives the hardship withdrawal distribution from the Thrift Savings Plan. Any
Compensation payment which would have been deferred pursuant to the
Participant’s Deferred Compensation Agreement but for the application of this
paragraph (e) shall be paid to the Participant as if the Participant had not
entered into the Deferred Compensation Agreement.

 

22

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2.03 Agreements that Qualify as Deferred Compensation Agreements

An Eligible Employee who has entered into an agreement providing for the award
of restricted stock units and has elected to defer some or all of his or her
dividend equivalent payments, his or her restricted stock units cash value or
both into the Plan will be subject to the terms and conditions set forth in his
or her agreement to the extent such terms and conditions are not inconsistent
with the Plan. If there are inconsistencies between the Plan and an agreement,
the Plan Administrator will have the sole discretion to make final and binding
decisions with regard to those contributions that have been set aside in the
Plan. In all cases, such decisions shall be consistent with the requirements of
Section 409A.

2.04 Termination of Participation

Except for an Officer’s or designated Participant’s right to a death benefit
upon his or her retirement as set forth in Section 4.06 below, a Participant’s
participation in the Plan shall terminate when the total vested portion of the
Participant’s Accounts under the Plan is distributed to the Participant or on
the Participant’s behalf.

ARTICLE III

ACCOUNTS

3.01 Amount of Contributions to be Credited

For any Plan Year, the amount of contributions to be recorded on the books of
the Company on behalf of a Participant shall be equal to the sum of the Basic
Salary Deferrals, Supplemental Salary Deferrals, Matching Company Contributions,
Supplemental Matching Company Contributions, Mandatory Bonus Deferral
Contributions, Optional Bonus Deferral Contributions, Dividend Equivalent
Contributions Restricted Stock Cash Value Contributions, EIP Contributions, ATIP
Contributions, LTIP Contributions, Affiliated Company Bonus

 

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Contributions and any other contributions allowed by the Plan Administrator
determined under the following paragraphs. In addition, the amounts credited on
a Participant’s behalf under the Supplemental Thrift Plan shall be recorded on
the books of the Company on behalf of such Participant as set forth below.

(a) Basic Salary Deferrals. The amount of Basic Salary Deferrals for a Plan Year
shall be equal to the designated percentage of Compensation elected by the
Participant in the Participant’s Deferred Compensation Agreement, provided that
the reduction in the Participant’s Compensation for Basic Salary Deferrals
elected by the Participant shall be made only with respect to Compensation
payable in the Plan Year beginning after the date the Participant’s Deferred
Compensation Agreement becomes effective. Except as provided in Section 3.01,
Basic Salary Deferrals are permitted under this paragraph (a) only with respect
to the Participant’s Compensation for which pre tax contributions could not be
contributed to the Thrift Savings Plan because of the Statutory Limitations. For
Plan Years beginning on or after January 1, 2001, a Participant must elect to
defer at least 6% of his or her Compensation earned in such Plan Year as a Basic
Salary Deferral. Amounts in excess of 6% may be deferred as Supplemental Salary
Deferrals to the extent such Participant is eligible to make Supplemental Salary
Deferrals.

(b) Supplemental Salary Deferrals. The amount of Supplemental Salary Deferrals
for a Plan Year shall be equal to the designated percentage of Compensation
elected by the Participant in the Participant’s Deferred Compensation Agreement
in accordance with Section 2.02, provided that the reduction in the
Participant’s Compensation corresponding to the Supplemental Salary Deferrals

 

24

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elected by the Participant shall be made only with respect to Compensation
earned and payable in the Plan Year after the date the Participant’s Deferred
Compensation Agreement becomes effective or, if the Participant so elects on the
Participant’s Deferred Compensation Agreement, only with respect to the
Participant’s Compensation for which pre-tax contributions could not be
contributed to the Thrift Savings Plan because of the Statutory Limitations. If
the reduction in the Participant’s Compensation corresponding to the
Supplemental Salary Deferrals elected by the Participant reduces the
Participant’s Compensation below one twelfth of the Statutory Compensation
Limitation, a portion of such Supplemental Salary Deferrals shall be matched by
Matching Company Contributions under Section 3.02. Such matched Supplemental
Salary Deferrals shall be deemed Basic Salary Deferrals for all other provisions
of this Plan.

(c) Matching Company Contributions. The amount of Matching Company Contributions
for a Plan Year shall be equal to the sum of the Basic Salary Deferrals and
Supplemental Salary Deferrals made on the Participant’s behalf for the Plan Year
multiplied by the rate at which Matching Company Contributions are made under
the Thrift Savings Plan; provided, however, that such amount shall not exceed
the result of (i) minus (ii) as follows:

 

  (i) the product of (A), (B) and (C) as follows:

 

  A. is an amount equal to the Participant’s Compensation for the Plan Year;

 

  B. is the maximum percentage of “Compensation” (as such term is defined under
the Thrift Savings Plan) with respect to which Matching Company Contributions
under the Thrift Savings Plan may be made; and

 

25

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  C. is the rate at which Matching Company Contributions are made under the
Thrift Savings Plan; and

 

  (ii) is the actual amount of the Matching Company Contributions made by the
Company on behalf of the Participant under the Thrift Savings Plan for such Plan
Year.

(d) Supplemental Matching Company Contributions. The Chief Executive Officer of
the Company may authorize that Supplemental Matching Company Contributions be
made for a Plan Year, which shall be allocated in such amounts and to such
Participants as the Chief Executive Officer of the Company shall determine in a
manner consistent with Section 409A.

(e) Mandatory Bonus Deferral Contributions. The amount of Mandatory Bonus
Deferral Contributions for a Plan Year shall be equal to the value on the Change
of Administration Date of any portion of the Mandatory Deferral Portion of an
Incentive Award granted under the Executive Incentive Plan that is administered
and accounted for as a liability under this Plan in accordance with the
Executive Incentive Plan.

(f) Optional Bonus Deferral Contributions. The amount of Optional Bonus Deferral
Contributions for a Plan Year shall be equal to the value on the Change of
Administration Date of any portion of the Optional Deferral Portion of an
Incentive Award granted under the Executive Incentive Plan that is administered
and accounted for as a liability under this Plan in accordance with the
Executive Incentive Plan.

 

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(g) Dividend Equivalent Contributions. The amount of Dividend Equivalent
Contributions for a Plan Year will be equal to the dividend payments
attributable to the number of restricted stock units paid on the dividend
payment dates during the Plan Year that have been deferred in accordance with
the applicable Participant’s Deferred Compensation Agreement.

(h) Restricted Stock Cash Value Contributions. The amount of a Restricted Stock
Cash Value Contribution for a Plan year will be determined based on the
agreement of the affected Participant.

(i) EIP Award Contributions. The amount of an EIP Incentive Award for a Plan
Year will be equal to the amount of the Participants EIP Incentive Award he or
she elects to defer into the Plan in accordance with the applicable
Participant’s Deferred Compensation Agreement.

(j) ATIP Award Contributions. The amount of an ATIP Incentive Award for a Plan
Year will be equal to the amount of the Participant’s ATIP Incentive Award he or
she elects to defer into this Plan in accordance with the applicable
Participant’s Deferred Compensation Agreement.

(k) LTIP Award Contributions. The amount of an LTIP Incentive Award for a Plan
Year will be equal to the amount of the Participant’s LTIP Incentive Award he or
she elects to defer into the Plan in accordance with the applicable
Participant’s Deferred Compensation Agreement.

(l) Affiliated Company Bonus Plan Award Contributions. The amount of an
Affiliated Company Bonus Plan Incentive Award for a Plan Year will be equal to
the amount of the Participant’s Affiliated Group Bonus Plan Award he or she
elects to defer into the Plan in accordance with the applicable Participant’s
Deferred Compensation Agreement.

 

27

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3.02 Accounting for Contributions

The contributions recorded on the books of the Company shall be credited to a
Participant’s Basic Salary Deferral Account and Supplemental Salary Deferral
Account, respectively, at the same time as they would have been credited to the
Participant’s account under the Thrift Savings Plan had such contributions been
made under the Thrift Savings Plan.

 

  (i) The contributions recorded on the books of the Company pursuant to
Section 3.01(c) above shall be credited to a Participant’s Matching Company
Contribution Account at the same time as they would have been credited to the
Participant’s account under the Thrift Savings Plan had such contributions been
made under the Thrift Savings Plan.

 

  (ii) The contributions recorded on the books of the Company pursuant to
Section 3.01(d) above shall be credited to a Participant’s Supplemental Matching
Company Contribution Account at the time designated for such purpose by the
Chief Executive Officer of the Company.

 

  (iii) The contributions recorded on the books of the Company shall be credited
to a Participant’s Mandatory Bonus Deferral Account, Optional Bonus Deferral
Account, Dividend Equivalent Payments Contributions Account, Restricted Stock
Cash Value Contributions Account, EIP Award Contributions Account, ATIP Award
Contributions Account, LTIP Award Contributions Account and Affiliated Company
Bonus Plan Award Contributions Account on the date such contributions are first
administered and accounted for as a liability under this Plan.

 

28

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  (iv) As of April 1, 1999, or the date thereafter on which it is
administratively practicable as determined by the Plan Administrator, the
contributions recorded on the books of the Company on account of amounts
credited under the Supplemental Thrift Plan shall be credited to a Participant’s
Matching Company Contribution Account.

Unless the Plan Administrator determines otherwise, no future Basic Salary
Deferrals or Supplemental Salary Deferrals by a Participant shall be permitted
and no future Matching Company Contributions or Supplemental Matching Company
Contributions shall be made on behalf of such Participant if such Participant is
no longer an Eligible Employee.

3.03 Accounts and Rate of Return

(a) Accounts shall be credited with earnings, gains and losses, if any, of the
Deemed Investment Options selected by the Plan Administrator, with such
allocation among the Deemed Investment Options as the Plan Administrator
selects. However, a Participant shall designate on each Deferred Compensation
Agreement his or her preferences with regard to the allocation among the Deemed
Investment Options of the aggregate of his or her contributions made pursuant to
the Deferred Compensation Agreement or to be credited in the Plan Year to which
the Deferred Compensation Agreement relates. A Participant may designate a
preference with respect to the allocation in any one of the Deemed Investment
Options or may designate any combination in such multiples as specified by the
Plan Administrator. The amounts credited on a Participant’s behalf under the
Supplemental Thrift Plan

 

29

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shall be allocated to the Deemed Investment Option selected for the
Participant’s Company Matching Contributions for the Plan Year commencing
January 1, 1999. The amounts credited on a Participant’s behalf under the
Executive Incentive Plan as of March 31, 1999 and transferred to this Plan in
accordance with the Executive Incentive Plan shall be allocated to the Deemed
Investment Option selected for the Participant’s Mandatory and Optional Bonus
Deferral Contributions, respectively, for the Plan Year transferred. The Plan
Administrator may from time to time make additional Deemed Investment Options
available as a performance measure under this Plan and may determine that any
Deemed Investment Option that it has previously established be terminated as a
performance measure under this Plan.

(b) A Participant may elect to change his or her preferences with respect to the
allocation among the Deemed Investment Options for a Plan Year for the aggregate
of future Contributions in that Plan Year at such times and in accordance with
such procedures specified by Plan Administrator.

(c) With regard to the aggregate of a Participant’s existing Accounts, a
Participant may designate a preference to transfer balances among the available
Deemed Investment Options at such times and in accordance with such procedures
specified by the Plan Administrator. Any transfers must be made in such
multiples as specified by the Plan Administrator. The Plan Administrator may
impose such additional rules and limitations upon transfers between Deemed
Investment Options as the Plan Administrator may consider necessary or
appropriate.

(d) The Participant, on behalf of himself or herself and his or her Beneficiary,
assumes all risk in connection with any decrease in value of the funds which are
invested or which continue to be invested in accordance with the provisions of
the Plan.

 

30

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(e) Notwithstanding any other provision of the Plan, the Plan Administrator
shall have sole and absolute discretion with regard to the investment returns
credited to a Participant’s Accounts.

3.04 Vesting of Accounts

(a) A Participant is at all times be fully vested in the Participant’s Basic
Salary Deferral Account, Supplemental Salary Deferral Account, Mandatory Bonus
Deferral Account, Optional Bonus Deferral Account (including amounts transferred
from the Executive Incentive Plan), Dividend Equivalent Contributions Account,
EIP Award Contributions Account, ATIP Award Contributions Account, LTIP Award
Contributions Account, Affiliated Company Bonus Plan Award Contributions Account
and other deferral accounts established by the Plan Administrator.

(b) A Participant shall vest in the Matching Company Contributions made on the
Participant’s behalf and earnings thereon at the same time and to the same
extent as such Participant is vested in Matching Company Contributions under the
Thrift Savings Plan.

(c) A Participant shall vest in the Supplemental Matching Company Contributions
made on the Participant’s behalf and earnings thereon in accordance with
Section 3.02 under the vesting schedule established for such contributions by
the Plan Administrator.

 

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(d) A Participant is vested in his or her Restricted Stock Cash Value Account in
accordance with the applicable vesting schedule set forth in the Participant’s
award agreement.

3.05 Individual Accounts

The Plan Administrator shall maintain, or cause to be maintained, records
showing the individual balances of each Participant’s Accounts and the vested
portion thereof. At least once a year, each Participant shall be furnished with
a statement setting forth the value of the Participant’s Accounts.

ARTICLE IV

PAYMENT OF BENEFITS

4.01 Commencement of Payment and Timing of Distributions

(a) In Service Distributions. Effective as of January 1, 2004, except as
provided in Sections 4.02 or 4.03, payment of any portion of a Participant’s
Accounts, other than the Basic Salary Deferral Account and Matching Company
Contribution Account, for a reason other than the Participant’s Separation from
Service, shall commence as follows:

 

  (i) in accordance with the Participant’s election in the applicable Deferred
Compensation Agreement, with respect to payment of a Participant’s Supplemental
Salary Deferral Account attributable to Supplemental Salary Deferrals made on
the Participant’s behalf for a Plan Year and earnings, gains and losses thereon;

 

  (ii)

in accordance with the Participant’s election relating to the Mandatory Deferral
Portion of any Incentive Award granted under the Executive

 

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Incentive Plan, with respect to payment of a Participant’s Mandatory Bonus
Deferral Account attributable to Mandatory Bonus Deferral Contributions relating
to such Mandatory Deferral Portion and earnings, gains and losses thereon;

 

  (iii) in accordance with the Participant’s election relating to the Optional
Deferral Portion of any Incentive Award granted under the Executive Incentive
Plan, with respect to payment of a Participant’s Optional Bonus Deferral Account
attributable to Optional Bonus Deferral Contributions relating to such Optional
Deferral Portion and earnings, gains and losses thereon;

 

  (iv) in accordance with the Participant’s election in effect under the
Executive Incentive Plan, immediately prior to the transfer of any Incentive
Award granted under such Executive Incentive Plan with respect to payment of
such amounts transferred on the Participant’s behalf which were credited under
the Executive Incentive Plan prior to April 1, 1999 and earnings, gains and
losses thereon;

 

  (v) in accordance with the Participant’s election in effect under an award
agreement or a Deferred Compensation Agreement, with respect to Dividend
Equivalent Contributions and/or Restricted Stock Cash Value Contributions and
earnings, gains and losses; and

 

  (vi) in accordance with the Participant’s election in the applicable Deferred
Compensation Agreement, with respect to payment of a Participants Incentive
Award and earnings, gains and losses thereon.

 

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Except as provided in Sections 4.02 or 4.03, payment of a Participant’s Basic
Salary Deferral Account and Matching Company Contribution Account shall not be
made before the Participant’s Separation from Service.

(b) Distributions Upon Separation from Service. Except as provided in Sections
4.02 or 4.03, and subject to Section 4.07, payment of a Participant’s Accounts
payable on account of the Participant’s Separation from Service shall commence
as follows:

 

  (i) if payment of a Participant’s Accounts is to be made in the form of a lump
sum, such payment shall be made 60 days following the Participant’s Separation
from Service or, at the election of the Participant, in a Deferred Compensation
Agreement under Section 2.02, no later than the fifteenth calendar year
following the Participant’s Separation from Service; or

 

  (ii) if payment of a Participant’s Accounts is to be made in the form of
installments pursuant to the Participant’s election in accordance with
Section 4.02, such payments shall commence on the January 1 following the
Participant’s Separation from Service or, at the election of the Participant, in
a Deferred Compensation Agreement under Section 2.02, not later than the tenth
January 1 following the Participant’s Separation from Service.

4.02 Method or Form of Payment

(a) Payment of any portion of a Participant’s Accounts payable prior to a
Participant’s Separation from Service shall be made in the form of a single lump
sum.

(b) Subject to Section 4.07, upon a Participant’s Separation from Service:

 

  (i) unless a Participant elects otherwise in accordance with subparagraph
(iii) below, payment of the Participant’s Accounts payable on account of such
Participant’s Separation from Service shall be made in the form of a single lump
sum;

 

34

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  (ii) a Participant may elect that payment of the Participant’s Accounts
attributable to the amounts credited to Participant’s Mandatory Bonus Deferral
Account and Optional Bonus Deferral Account from the Executive Incentive Plan,
which were credited thereunder prior to April 1, 1999 and for which Participant
had elected an annuity benefit payable under the Executive Incentive Plan, be
paid in the form of annual cash installments for a period of years not to exceed
ten;

 

  (iii) a Participant may elect at the time of making a Deferred Compensation
Agreement under Section 2.02 that if a Participant’s total Accounts balances
exceeds the limit set forth under Section 402(g) of the Code for the applicable
year at the time payment commences, payment of the Participant’s Accounts
payable on account of such Participant’s Separation from Service, shall be made
in the form of annual or quarterly cash installments for a period of years, not
to exceed fifteen, in lieu of a single lump sum; and

 

  (iv)

during an installment payment period, the Participant’s Accounts shall continue
to be credited with earnings, gains and losses as provided in Section 3.02. The
first installment shall be made following the January 1 coincident with or next
following the Participant’s Separation from Service.

 

35

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Subsequent installments, if any, shall be paid following the beginning of the
following calendar year and each subsequent year of the installment period. The
amount of each installment shall equal the sum of the balance in the
Participant’s Accounts as of the Valuation Date coincident with or immediately
preceding the date of such installment’s distribution divided by the number of
remaining installments (including the installment being determined).

4.03 Payment Upon Death

If a Participant dies before payment of the entire vested balance of the
Participant’s Accounts, an amount equal to the unpaid portion thereof as of the
Valuation Date coincident with or immediately preceding the Participant’s date
of death shall be payable in one lump sum to the Participant’s Beneficiary 60
days following the Participant’s death.

4.04 Payment Upon the Occurrence of a Change of Control

Unless a Participant has elected an earlier distribution date in a Deferred
Compensation Agreement effective prior to the date a Change of Control occurs,
upon the occurrence of a Change of Control, the Participant shall automatically
receive, in a single lump sum 30 days following the date the Change of Control
occurs, the entire balance credited to the Participant’s Accounts (regardless of
any election made by the Participant in his or her Deferred Compensation
Agreement).

4.05 Payment Upon Unforeseeable Emergency

The Participant may request, in such manner as the Plan Administrator shall
prescribe, to withdraw from his Accounts such amount as is necessary to meet an
Unforeseeable Emergency. The Plan Administrator shall have the sole and absolute
discretion to grant or deny such a

 

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request. In determining whether the Unforeseeable Emergency distribution request
should be approved, the Plan Administrator shall make such determinations
consistent with the requirements of Section 409A. If an Unforeseeable Emergency
distribution is made to a Participant, deferral elections under any Deferred
Compensation Agreement will be cancelled. A new Deferred Compensation Agreement
may be entered into by the Participant for the Plan Year following the Plan Year
in which the Unforeseeable Emergency distribution is made, in a manner
consistent with Section 409A.

4.06 Additional Death Benefit

An Eligible Employee who is an officer of the Company or is designated by the
Chief Executive Officer of the Company as eligible for additional death benefits
under this Section 4.06 shall be covered by an additional death benefit over and
above any death benefit payable pursuant to Section 4.03. If an Eligible
Employee who is an officer or a designated Participant dies prior to a
Separation from Service for any reason other than Retirement, the Participant’s
beneficiary shall receive an amount equal to such Participant’s salary, in a
lump sum, within 60 days of the Participant’s death. Upon the Participant’s
Retirement, such additional death benefit coverage shall continue in effect
after the date of Retirement. Upon the Participant’s death, the benefit shall be
paid in a lump sum, to the Beneficiary last designated by the Participant within
60 days following such Participant’s death. For the purposes of this
Section 4.06, salary shall mean the Participant’s annual base rate of pay on the
date of death or, if earlier, the date of Retirement, including any pre-tax
contributions to the Thrift Savings Plan, the Company’s FLEX Plan, and deferrals
made pursuant to Section 3.01 hereof, and excluding overtime, bonuses, variable
or incentive pay, or any other special payments.

 

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4.07 Six-month Delay for Specified Employees

Notwithstanding anything herein to the contrary, if a Participant is a Specified
Employee, any payment under this Plan that is deemed to be a “deferral of
compensation” subject to Section 409A shall be paid on the fifteenth business
day after the date that is six months following such Participant’s Separation
from Service, provided, however, that a payment delayed pursuant to the
preceding clause shall commence earlier in the event of the Participant’s death
prior to the end of such six-month period.

4.08 Subsequent Redeferral

The Plan Administrator may permit a Participant to defer the payment of his or
her Accounts to a date later than the date specified in the Deferred
Compensation Agreement by filing a written request with the Plan Administrator.
Such a change election shall not take effect until at least twelve months after
the date on which it is made and shall be effective only if (a) the election is
filed with the Plan Administrator before the Participant’s Separation from
Service; (b) the election does not accelerate the timing or payment schedule of
any distribution; (c) the payment commencement date in the change election is
not less than five years after the date the distribution would otherwise have
commenced without regard to such election; (d) the Plan Administrator approves
such election; and (e) the election is made at least twelve months prior to the
date the distribution would have commenced. A Participant’s distribution
election shall become irrevocable upon the Participant’s Separation from
Service.

4.09 Transition Rule Election

Pursuant to Internal Revenue Service Notice 2005-1, Q&A-19(c), as extended by
the Internal Revenue Service, a Participant, who has not incurred a Separation
from Service prior to December 31, 2008, may modify or make new elections
regarding distribution of his or her Account(s), at such time and in such form
as the Plan Administrator shall designate; provided, however, that no such
distribution election may affect payments that the Participant would otherwise
receive in 2008 or cause payments to be made in 2008.

 

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ARTICLE V

PLAN ADMINISTRATION

5.01 Responsibility for Account Determination

The Accounts credited on behalf of a Participant or Beneficiary under this Plan
shall be determined either by the Plan Administrator, as provided in
Section 5.02 below, or such other party as is authorized under the terms of any
grantor trust.

5.02 Duties of Plan Administrator

The Plan Administrator shall calculate, in accordance with Article IV, the
Accounts credited on behalf of each Participant or Beneficiary under the Plan.
To the extent a Participant’s or Beneficiary’s vested Account balance is payable
from the Plan, the Plan Administrator shall have full discretionary authority to
make any legal or factual determinations, resolve any question which shall arise
under the Plan as to any person’s eligibility for benefits, the calculation of
benefits, the form, commencement date, frequency, duration of payment or the
identity of the Beneficiary. Such question shall be resolved by the Plan
Administrator under rules uniformly applicable to all person(s) or employee(s)
similarly situated.

5.03 Procedure for Payment of Benefits Under the Plan

With respect to any benefit to which a Participant or Beneficiary is entitled
under this Plan, the Plan Administrator (a) shall direct the commencement of
benefit payments hereunder in accordance with the applicable procedures
established by the Company and/or the Plan Administrator regarding the
disbursement of amounts from the general funds of the Company and (b) shall
arrange, in conjunction with any other applicable plan, for the payment of
benefits under this Plan and/or any other applicable plan.

 

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ARTICLE VI

GENERAL PROVISIONS

6.01 Funding

(a) All amounts payable in accordance with this Plan shall constitute a general
unsecured obligation of the Company. Such amounts shall be paid out of the
general assets of the Company, to the extent not paid from the assets of any
trust established pursuant to paragraph (b) below. The Plan Administrator may
determine that any administrative costs relating to the Plan shall be allocated
to Participants’ Accounts, and such Accounts shall be reduced by the allocated
costs. The payment of a Participant’s Accounts shall be an obligation of the
Affiliated Company that employs the Participant on the date of his or her
Separation from Service.

(b) The Company may establish a grantor trust for the benefit of Participants in
the Plan. Notwithstanding the foregoing sentence, the Company shall, upon a
Potential Change of Control, (1) establish a grantor trust for the benefit of
the Participants if one is not already in existence and (2) assure that the
funds in such trust are at least equal to the sum of the Participant’s Accounts,
as well as any other liabilities of the Plan in excess of such Accounts, if any,
incurred as of the date of the Potential Change of Control. The assets placed in
such trust shall be held separate and apart from other Company funds and shall
be used for the purposes set forth in the Plan and the applicable trust
agreement, subject to the following conditions:

 

  (i) the creation of such trust shall not cause the Plan to be other than
“unfunded” for purposes of Title I of ERISA;

 

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  (ii) the Company shall be treated as “grantor” of such trust for purposes of
Section 677 of the Code;

 

  (iii) the agreement of such trust shall provide that its assets may be used
upon the insolvency or bankruptcy of the Company to satisfy claims of the
Company’s general creditors and that the rights of such general creditors are
enforceable by them under federal and state law;

 

  (iv) without in any way limiting the choice of assets thereunder, such trust
may invest in life insurance policies; and

 

  (v) the establishment, operation and funding of the trust shall comply with
applicable law, including, without limitation, Section 409A.

6.02 Discontinuance and Amendment

The Company reserves the right, by action of the Board of Trustees, to
discontinue the crediting of benefits under the Plan at any time; and further
reserves the right, by action of the Board of Trustees or the Plan
Administrator, to modify or amend the Plan, in whole or in part, at any time.
However, no modification, amendment, or discontinuance shall adversely affect
the right of any Participant to receive the benefits credited under the Plan as
of the date of such modification, amendment or discontinuance, and no
modification or amendment by action of the Plan Administrator shall have a
material effect on the benefits payable under the Plan.

 

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6.03 Termination of Plan

The Company reserves the right, by action of the Board of Trustees, to terminate
the Plan at any time, provided, however, that no termination shall be effective
retroactively. As of the effective date of termination of the Plan:

(a) the benefits of any Participant or Beneficiary whose benefit payments have
commenced shall continue to be paid; and

(b) no further Basic Salary Deferrals, Supplemental Salary Deferrals, Mandatory
Bonus Deferral Contributions, Optional Bonus Deferral Contributions, Other
Deferral Contributions, Matching Company Contributions or Supplemental Matching
Company Contributions EIP Award Contributions, ATIP Award Contributions, LTIP
Award Contributions or Affiliation Company Bonus Plan Award Contributions shall
be credited on behalf of any Participant whose benefits have not commenced, and
such Participant and the Participant’s Beneficiary shall retain the right to
benefits hereunder. Earnings, gains and losses shall continue to be credited in
accordance with Section 3.02 until payment of a Participant’s Accounts has been
made under the terms of the Plan in effect immediately prior to the date the
Plan is terminated.

All other provisions of this Plan shall remain in effect.

Distributions upon termination or partial termination of this Plan shall be made
in a manner consistent with Section 409A.

6.04 Plan Not a Contract of Employment

This Plan is not a contract of employment, and the terms of employment of any
Participant shall not be affected in any way by this Plan or related
instruments, except as

 

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specifically provided therein. The establishment of this Plan shall not be
construed as conferring any legal rights upon any person for a continuation of
employment, nor shall it interfere with the rights of the Company to discharge
any person and to treat such person without regard to the effect which such
treatment might have upon such person under this Plan. Each Participant and all
persons who may have or claim any right by reason of the Participant’s
participation in this Plan shall be bound by the terms of this Plan and all
agreements entered into pursuant thereto.

6.05 Facility of Payment

In the event that the Plan Administrator shall find that a Participant is unable
to care for his or her affairs because of illness or accident or because the
Participant is a minor or has died, the Plan Administrator may, unless a claim
shall have been made therefor by a duly appointed legal representative, direct
that any benefit payment due the Participant, to the extent not payable from a
grantor trust, be paid on the Participant’s behalf to the Participant’s spouse,
a child, a parent or other blood relative, a person with whom the Participant
resides, or a legal guardian, and any such payment so made shall be a complete
discharge of the liabilities of the Company and the Plan therefor.

6.06 Withholding Taxes

The Company shall have the right to deduct from each payment to be made under
the Plan any required withholding taxes.

6.07 Nonalienation

Subject to any applicable law, no benefit under the Plan shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, and any attempt to do so shall be void, nor shall any
such benefit be in any manner liable for or subject to garnishment, attachment,
execution or levy, or liable for or subject to the debts, contracts,
liabilities, engagements or torts of the person entitled to such benefits.

 

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6.08 Assumption of Liabilities

Notwithstanding any Plan provision to the contrary, at the discretion and
direction of the Board of Trustees, the Plan may assume liabilities with respect
to benefits accrued by a Participant under a plan maintained by such
Participant’s former employer, and upon such assumption such liabilities shall
become the obligation of the Company.

6.09 Section 409A

This Plan is intended to satisfy the applicable requirements of Section 409A and
shall be performed and interpreted consistent with such intent. If the Plan
Administrator determines, in good faith, that any provision of this Plan does
not satisfy such requirements or could otherwise cause any person to recognize
additional taxes, penalties or interest under Section 409A, the Plan
Administrator shall modify, to the maximum extent practicable, the original
intent of the applicable provision without violation of the requirements of
Section 409A (“Section 409A Compliance”), and, notwithstanding any provision
herein to the contrary, the Plan Administrator shall have broad authority to
amend or to modify the Plan, without advance notice to or consent by any person,
to the extent necessary or desirable to ensure Section 409A Compliance. Any
determinations by the Plan Administrator shall be final and binding on all
parties.

6.10 Claims and Review Procedure

(a) Applications for benefits and inquiries concerning the Plan (or concerning
present or future rights to benefits under the Plan) must be submitted in
writing to the Plan Administrator. An application for benefits must be submitted
and signed by the Participant or, in the case of a benefit payable after his or
her death, by his or her Beneficiary, or a duly authorized legal representative.

 

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(b) In the event that an application for benefits is denied in whole or in part,
the Plan Administrator will notify the applicant in writing of the denial and of
the right to review of the denial. The written notice will set forth, in a
manner calculated to be understood by the applicant, specific reasons for the
denial, specific references to the provisions of the Plan on which the denial is
based, a description of any information or material necessary for the applicant
to perfect the application, an explanation of why the material is necessary, and
an explanation of the review procedure under the Plan. The written notice from
the Plan Administrator will be given to the applicant within a reasonable period
of time, not more than 90 days, after the Plan Administrator received the
initial application, unless special circumstances require further time for
processing and the applicant is advised of the need and reason for the extension
within the first 90-day period. The applicant will also be informed of the date
by which the Plan Administrator expects to render the decision. In no event will
the initial decision be given more than 180 days after the Plan Administrator
received the application. The Plan Administrator has the authority to act with
respect to any appeal from a denial of benefits or a determination of benefit
rights.

(c) An applicant whose application for benefits was denied in whole or part, or
the applicant’s duly authorized representative, may appeal the denial by
submitting to the Plan Administrator a request for a review of the application
within 60 days after receiving written notice of the denial from the Plan
Administrator. The Plan Administrator will give the applicant or his or her
representative an opportunity to

 

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review pertinent materials, other than legally privileged documents, in
preparing the request for a review. The request for a review must be in writing
and addressed to the Plan Administrator. The request for a review shall set
forth all of the grounds on which it is based, all facts in support of the
request and any other matters that the applicant deems pertinent. The Plan
Administrator may require the applicant to submit such additional facts,
documents or other materials as it may deem necessary or appropriate in making
its review.

(d) The Plan Administrator will act on each request for a review within 60 days
after receipt, unless special circumstances require further time for processing
by the Plan Administrator and the applicant is advised of the need and reason
for the extension. In no event will the decision on review be rendered more than
120 days after the Plan Administrator received the request for a review. The
Plan Administrator will give prompt written notice of its decision to the
applicant. In the event that the Plan Administrator confirms the denial of the
application for benefits in whole or in part, the notice will set forth, in a
manner calculated to be understood by the applicant, the specific reasons for
the decision and specific references to the provisions of the Plan on which the
decision is based.

(e) The Plan Administrator has discretionary authority to administer the plan,
including interpreting the terms, determining eligibility for, entitlement to
and amount of benefits under the Plan, determining any facts and resolving any
questions relevant to administration of the Plan and remedying and correcting
any ambiguities, inconsistencies or omissions in the Plan. Any action taken by
the Plan Administrator pursuant to such discretionary authority shall be
conclusive and binding on all participants, beneficiaries and others.

 

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The Plan Administrator shall adopt such rules, procedures and interpretations of
the Plan as deemed necessary or appropriate in carrying out the Plan
Administrator responsibilities under this Section.

(f) No legal action for benefits under the Plan may be brought unless and until
the claimant has submitted a written application for benefits in accordance with
paragraph (a), has been notified by the Plan Administrator that the application
is denied, has filed a written request for a review of the application in
accordance with paragraph (c), and has been notified in writing that the Plan
Administrator has affirmed the denial of the application; provided, however,
that legal action may be brought after the Plan Administrator has failed to take
any action on the claim within the time prescribed by paragraphs (b) and
(d) above.

6.11 Construction

(a) The Plan is intended to constitute an unfunded deferred compensation
arrangement maintained for a select group of management or highly compensated
employees within the meaning of Sections 201(2), 301(a)(3), and 401(a)(1) of
ERISA, and all rights under this Plan shall be governed by ERISA. Subject to the
preceding sentence, the Plan shall be construed, regulated and administered
under the laws of the State of New York; to the extent such laws are not
superseded by applicable federal law.

 

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(b) The illegality of any particular provision of this document shall not affect
the other provisions and the document shall be construed in all respects as if
such invalid provision were omitted.

(c) 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
thereof.

6.12 Adoption by Affiliated Companies

(a) Any Affiliated Company may adopt this Plan with the consent of the Company.
Upon the effective date of the Plan with respect to an Affiliated Company that
adopts the Plan, such adopting Affiliated Company delegates all fiduciary and
administrative responsibilities (including the appointment and removal of
fiduciaries) under the Plan to the Company, the Chief Executive Officer of the
Company and the Plan Administrator of the Plan.

(b) Any Affiliated Company that has adopted the Plan may withdraw its adoption
of the Plan at any time without affecting other Participants in the Plan by
delivering to the Plan Administrator a certified copy of resolutions of the
board of directors of the Affiliated Company to that effect. The Company may, in
its absolute discretion, terminate the participation in the Plan of any
Affiliated Company at any time such Affiliated Company fails to discharge its
obligations under the Plan.

(c) Any grantor trust established pursuant to Section 6.01 of the Plan may
provide that separate sub trusts shall be created to fund the benefits of the
Participants of each Affiliated Company that has adopted the Plan, that assets
held in a sub trust with respect to the obligations of an Affiliated Company
shall be available only to satisfy the liabilities of such Affiliated Company
under the Plan and that any assets

 

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held in a sub trust with respect to the obligations of an Affiliated Company
under the Plan will be subject to the claims of only that Affiliated Company’s
general creditors under federal and state law in the event of such Affiliated
Company’s insolvency.

 

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