Exhibit 10.3


 


Orange and Rockland Utilities, Inc.

Annual Team Incentive Plan (ATIP) Policy

January 2004

(supersedes January 2003)


 


Purpose:


 


To set forth the details of the Annual Team Incentive Plan (ATIP) for
management employees.  All management
employees participate in the ATIP. 
Their awards are based on the Company’s specified financial and
operational performance.


 


Application:


 


This policy applies to all full-time and part-time management
employees.  It also applies to employees
who transfer to or from an affiliate of the Company during the plan year.


 


Award Determination and Payment:


 


The ATIP award is based on the achievement of the Company’s specified
financial and operational goals.  Each
salary band is assigned a target award.


 


The award is split between a fixed team-based award of 60 percent and a
variable individual award of 40 percent. Each employee is eligible to receive
from 0 to 150 percent of the target award based on the individual’s
contribution.


 


The award is included in the employee’s annual base pay used in the
calculation of an employee’s pension benefit.


 


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Policies:


 


	
  1.

  	
   

  	
  An employee transferring from an affiliate of the Company during the
  plan year will be eligible for an award based on the full plan year unless
  other provisions have been made by the affiliate.

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  An award will not be paid to an employee who transfers to an
  affiliate of the Company, unless the affiliate has not made provisions for
  the employee to be included in its award program.

  
	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  An external hire joining the Company during the year will have
  his/her award prorated to reflect full months of actual service during the
  year.

  
	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  A part-time employee will also be eligible for an award that will be
  calculated on his/her annual base earnings exclusive of overtime payments.

  
	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  If an employee becomes disabled or takes a leave of absence for more
  than 90 calendar days, the employee’s award will be prorated based on the
  number of full months of active service during the year.

  
	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  An award will not be paid to an employee who leaves prior to
  December 31st of the plan year due to resignation,
  termination or retirement.

  
	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  The target award percentage for the year will be based on the
  employee’s band at year-end.

  
	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  An employee who receives an unsatisfactory performance review is not
  eligible for an award.

  



 


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Responsibilities and Authorities:


 


	
  1.

  	
   

  	
  The Board of Directors will evaluate and approve the Company’s
  performance criteria.

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  The Board of Directors will evaluate and approve the Company’s
  achievement of specified financial and operational goals.

  
	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Without limiting the Board’s ability to prescribe reasonable
  compensation, the Board may, at its discretion and in consultation with the
  Chief Executive Officer, adjust ATIP awards to reflect strategic and other
  factors affecting business operations and results, although in the absence of
  extraordinary circumstances it is not expected that such adjustment would
  exceed plus or minus 25 percent.

  
	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  The Board may also make other adjustments it deems appropriate, based
  on an employee’s performance.

  



 


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