ex10-21.htm


    PEPCO
HOLDINGS, INC.

     

    NON-MANAGEMENT DIRECTORS
COMPENSATION PLAN

     

    1.           Purpose
of the Plan.

     

    The Pepco Holdings, Inc. Non-Management
Directors Compensation Plan (the “Plan”) has been established by Pepco Holdings,
Inc. (the “Company”) to compensate directors who are not employees of the
Company or any of its subsidiaries for their service as members of the Board of
Directors of the Company and to enable such directors to strengthen their common
interest with the shareholders of the Company by providing them with the
opportunity to increase their equity interest in the Company either through the
acquisition of Company common stock or through the acquisition of common stock
equivalents.

     

    2.           Definitions.

     

    (a)  “Board” means the Board
of Directors of the Company.

     

    (b)  “Common Stock” means the
common stock, par value $.01 per share, of the Company.

     

    (c)  “Deferred Compensation
Plan” means the Pepco Holdings, Inc. Executive and Director Deferred
Compensation Plan.

     

    (d)  "Fair Market Value"
means the closing price of the Common Stock as reported by the New York Stock
Exchange on the day of determination or, if the day of determination is not a
trading day or there are no trades on the day of determination, the last trading
day preceding the day of determination.

     

    (e)  “Governance Committee”
means the Corporate Governance/Nominating Committee of the Board.

     

    (f)  “Non-Management
Director” means a member of the Board who is not an employee of the Company or
any of its subsidiaries.

     

    3.           Shares
of Common Stock Subject to the Plan.

     

    (a)  Subject to the
provisions of paragraph (b) below, the aggregate number of shares of Common
Stock that may be issued under the Plan shall not exceed 500,000
shares.  Such shares may, as determined by the Company, be authorized
but unissued shares, treasury shares or shares purchased on the open
market.

     

    (b)  In the event of any
stock split, stock dividend, recapitalization, merger, consolidation,
reorganization, combination, or exchange of shares or other similar event
affecting the Common Stock, the number of shares of Common Stock reserved for
issuance under the Plan shall be proportionately adjusted to the extent required
to prevent dilution or enlargement of shares issuable under the Plan by reason
of such transaction.

     


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    4.           Administration
of the Plan.

     

    The Plan shall be administered by the
Governance Committee, which, except as otherwise expressly provided herein,
shall have the sole and complete authority to interpret the Plan and to make all
other determinations necessary for the Plan’s administration.  All
action taken by the Governance Committee in the interpretation and
administration of the Plan shall be final and binding on all
concerned.  The Governance Committee may designate officers and
employees of the Company to assist the Governance Committee in the
administration of the Plan by executing documents on behalf of the Company
relating to the administration of the Plan and by performing such ministerial
duties in connection with the administration of the Plan as are assigned to them
by the Governance Committee.

     

    5.           Annual
Retainer and Meeting Fees.

     

    Each Non-Management Director shall
receive as compensation for his or her services as a director an annual retainer
and a per-meeting fee, in each case in an amount and payable at such time as the
Board shall determine.  Each Non-Management Director who serves as the
chairman of a committee of the Board may receive as a fee for such services an
additional annual retainer in an amount and payable at such time as the Board
shall determine.  The Board, at its discretion, may elect to pay
prorated compensation to any Non-Management Director for services as a director
or committee chairman for any portion of a year.

     

    6.           Form
of Payment.

     

    (a) Each Non-Management Director who is
entitled to receive a retainer or fee under the Plan may elect, in respect of
all or any portion of the payment as specified by the Non-Management Director,
to receive, in lieu of a payment in cash, either (i) a number of whole shares of
Common Stock determined by dividing (A) the amount of the retainer or fee that
the Non-Management Director elects to receive in the form of Common Stock by (B)
the Fair Market Value of the Common Stock as of the date on which the retainer
or fee otherwise would be paid in cash (with cash issued for any fraction of a
share) or (ii) a credit of an amount equal to the amount otherwise payable in
cash to the Non-Management Director’s account under the Deferred Compensation
Plan (a “ DCP Deferral Election”).

     

    (b) In order to be effective, a DCP
Deferral Election must be made prior to the year in which the retainer or fee is
to be paid, and after the beginning of the year in which the retainer or fee is
to be paid such election shall be irrevocable, except that if a individual first
becomes a Non-Management Director during a year, a DCP Deferral Election must be
made within 30 calendar days after the date the individual first becomes a
Non-Employee Director and such election shall apply only to payments made in
respect of service after the election is made.  Elections to receive
shares of Common Stock in lieu of cash may be made at any time prior to the date
on which the cash payment otherwise is to be made.  Notwithstanding
the above, no modification may be made to a DCP Deferral Election, even prior to
the beginning of the year in which the retainer or fee is to be paid, except in
strict compliance with Section 409A(a)(4) of the Internal Revenue
Code.

     


    
      
         


      

      
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    (c) The shares of Common Stock issued
under the Plan shall not be subject to forfeiture and shall be free of any and
all restrictions on transfer, except for any restrictions that may be required
by law.  Any such restrictions on transfer may be reflected in
appropriate legends on the certificates for the shares.

     

    7.           Limitations
on the Issuance of Shares.

     

    No shares of Common Stock shall be
issued under the Plan and no certificates representing shares of Common Stock
shall be delivered:

     

    (a) if any requisite approval or
consent of any governmental authority having jurisdiction over the issuance of
the shares shall not have been secured or if the issuance of shares of Common
Stock would violate any federal, state or local law, regulation or order that
may be applicable;

     

    (b) at any time that the Common Stock
is listed on a stock exchange, if the shares of Common Stock pursuant to the
award shall not have been effectively listed on such exchange, unless the
Company determines that such listing is not required; or

     

    (c) at any time that the Company
determines that the satisfaction of withholding tax or other withholding
liabilities is necessary or desirable, unless such withholding shall have been
effected.

     

    8.           No
Registration.

     

    The Company shall have no obligation to
register any of the shares of Common Stock issuable under this Plan under the
Securities Act of 1933, as amended, or under any state securities laws, but may
in its discretion elect to do so if it determines that such registration is
necessary or appropriate.

     

    9.           Taxes.

     

    Each Non-Management Director (or the
Non-Management Director’s beneficiary) shall be responsible for all applicable
taxes on payments made to the Non-Management Director under the Plan (or
beneficiary) regardless of the form of such payments.  The Company may
make appropriate arrangements to collect from any Non-Management Director (or
the Non-Management Director’s beneficiary) the taxes, if any, that the Company
may be required to be withheld by any government or government agency prior to
payment under the Plan.

     

    10.           No
Right to Continued Service

     

    Neither the eligibility to participate
in the Plan nor the receipt of any payment under the Plan shall confer upon any
Non-Management Director the right to continue to serve as a director of the
Company if validly removed or the right to be nominated for reelection as
director.

     


    
      
         


      

      
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    11.           No
Prohibition on Other Compensation

     

    Neither the existence of this Plan nor
any provision of this Plan shall preclude the Company from authorizing or
approving other plans or forms of compensation for directors of the
Company.

     

    12.           Expenses

     

    All reasonable expenses of
administering the Plan shall be paid by the Company.

     

    13.           Amendment
and Termination

     

    The Board may amend, suspend, or
terminate the Plan at any time; provided that no amendment shall be made without
shareholder approval if shareholder approval is required by law, regulation, or
securities exchange listing requirement.

     

    14.           Governing
Law

     

    The Plan shall be construed,
administered, and regulated in accordance with the laws of the State of Delaware
(excluding the choice of law provisions thereof) and any applicable requirements
of federal law.

     

    15.           Effectiveness
and Expiration of the Plan

     

    The Plan shall become effective January
1, 2005, and, unless terminated earlier by the Board, shall expire on December
31, 2014, after which no further payments may be made under the
Plan.

     

    IN WITNESS WHEREOF, the Company has
caused this Plan to be signed on this 3rd day of
November, 2008 which version reflects all modifications made to the Plan through
such date of execution.

     

    
      	 
      	 
      	 
      	
              PEPCO
      HOLDINGS, INC.

            
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
              By:

            	
              /s/
      D. R. WRAASE

            
	 
      	 
      	 
      	 
      	
              Chairman
      of the Board

                and
      Chief Executive Officer

            
	 
      	 
      	 
      	 
      	 
      
	
              ATTEST

            	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
              By:

            	
               /s/
      ELLEN S. ROGERS

            	 
      	 
      	 
      
	 
      	
              Secretary