Exhibit 10.08


 


Equitable Resources, Inc.


 


2005 DIRECTORS’ DEFERRED
COMPENSATION PLAN


 


 


Amended and Restated December
15, 2005


 

















 


ARTICLE I


 


1.1          Purpose of Plan.


 


This
Equitable Resources, Inc. 2005 Directors’ Deferred Compensation Plan (the “2005 Plan”) hereby is created to provide an opportunity for
the members of the Board of Directors of Equitable Resources, Inc. (the “Board”) to defer payment of all or a portion of the fees to
which they are entitled as compensation for their services as members of the
Board. The 2005 Plan also shall administer the payment of stock units and
phantom stock awarded pursuant to the 1999 Equitable Resources, Inc. Non-Employee
Directors’ Stock Incentive Plan (the “NEDSIP”).


 


ARTICLE II


 


DEFINITIONS


 


When
used in this 2005 Plan and initially capitalized, the following words and
phrases shall have the meanings indicated:


 


2.1          “Account” means the total of a Participant’s Deferral Account and Phantom Stock
Account under the 2005 Plan.


 


2.2          “Beneficiary” means the person or persons designated or deemed to be designated by the
Participant pursuant to Section 7.1 of the 2005 Plan to receive benefits
payable under the 2005 Plan in the event of the Participant’s death.


 


2.3          “Change in Control” means any of the following events:


 


(a)           The sale or other disposition by the Company of
all or substantially all of its assets to a single purchaser or to a group of
purchasers, other than to a corporation with respect to which, following such
sale or disposition, more than eighty percent (80%) of, respectively, the then
outstanding shares of common stock and the combined voting power of the then
outstanding


 


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                voting securities entitled to vote generally in
the election of the Board of Directors is then owned beneficially, directly or
indirectly, by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the outstanding Company common
stock and the combined voting power of the then outstanding voting securities
immediately prior to such sale or disposition in substantially the same
proportion as their ownership of the outstanding Company common stock and
voting power immediately prior to such sale or disposition.


 


(b)           The acquisition in one or more transactions by
any person or group, directly or indirectly, of beneficial ownership of twenty
percent (20%) or more of the outstanding shares of Company common stock or the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of the Board; provided, however,
that any acquisition by (x) the Company or any of its subsidiaries, or any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any of its subsidiaries or (y) any person that is eligible, pursuant to
Rule 13d-1(b) under the Exchange Act (as such rule is in effect as of
February 25, 2004) to file a statement on Schedule 13G with respect
to its beneficial ownership of Company common stock and other voting securities
whether or not such person shall have filed a statement on Schedule 13G, unless
such person shall have filed a statement on Schedule 13D with respect to
beneficial ownership of fifteen percent (15%) or more of the Company’s voting
securities, shall not constitute a Change in Control;


 


(c)           The Company’s termination of its business and
liquidation of its assets;


 


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(d)           The reorganization, merger or consolidation of
the Company into or with another person or entity, by which reorganization,
merger or consolidation the persons who hold one hundred percent (100%) of the
voting securities of the Company prior to such reorganization, merger or
consolidation receive or continue to hold less than sixty percent (60%) of the
outstanding voting shares of the new or continuing corporation; or


 


(e)           If, during any two-year period, less than a
majority of the members of the Board are persons who were either
(i) nominated or recommended for election by at least two-thirds vote of
the persons who were members of the Board or Nominating Committee of the Board
at the beginning of the period, or (ii) elected by at least two-thirds
vote of the persons who were members of the Board at the beginning of the
period.


 


2.4          “Code” means the Internal Revenue Code of 1986, as amended.


 


2.5          “Committee” means the Compensation Committee of the Board.


 


2.6          “Company” means Equitable Resources, Inc. and any successor thereto.


 


2.7          “Deferral Account” means the recordkeeping account established on
the books and records of the Company to record a Participant’s deferral amounts
under Section 5.1 of the 2005 Plan, plus or minus any investment gain or loss
allocable thereto under Section 5.4 of the 2005 Plan.


 


2.8          “Directors’ Fees” means the fees that are paid by the Company to
members of the Board as compensation for services performed by them as members
of the Board.


 


2.9          “Enrollment Form” means the agreement to participate and related
elections filed by a Participant pursuant to Section 5.1 of the 2005 Plan, in
the form prescribed by the Committee,


 


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directing
the Company to reduce the amount of Directors’ Fees otherwise currently payable
to the Participant and credit such amount to the Participant’s Deferral Account
hereunder.


 


2.10        “Hardship Withdrawal” shall have the meaning set forth in Section 6.3
of the 2005 Plan.


 


2.11        “Investment Options” means the investment options described in Exhibit
A to the 2005 Plan into which a Participant may direct all or part of his or
her Deferral Account.


 


2.12        “Investment Return Rate” means:


 


(a)           In the case of an Investment Option named in
Exhibit A of a fixed income nature, the interest deemed to be credited as
determined in accordance with the procedures applicable to the same investment
option provided under the Equitable Resources, Inc. Employee Savings Plan,
originally adopted September 1, 1985, as amended (“Equitable
401(k) Plan”);


 


(b)           In the case of a Investment Option named in
Exhibit A of an equity investment nature, the increase or decrease in deemed
value and any dividends deemed to be credited as determined in accordance with
the procedures applicable to the same investment option provided under the
Equitable 401(k) Plan; or


 


(c)           In the case of the Equitable Resources Common
Stock Fund, the increase or decrease in the deemed value, and the reinvestment
in the Equitable Resources Common Stock Fund of any dividends deemed to be
credited, as determined in accordance with the procedures applicable to investments
in the Equitable Resources Common Stock Fund under the Equitable 401(k) Plan.


 


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2.13        “Irrevocable Trust” means a grantor trust that may be
established prior to the occurrence of a Change in Control of the Company to
assist the Company in fulfilling its obligations under this 2005 Plan but which
shall be established by the Company
in the event of a Change in Control of the Company. All amounts held in such
Irrevocable Trust shall remain subject to the claims of the general creditors
of the Company and Participants in this 2005 Plan shall have no greater rights
to any amounts held in any such Irrevocable Trust than any other unsecured
general creditor of the Company.


 


2.14        “Participant” means any non-employee member of the Board (i) who receives an award of
Phantom Stock under the NEDSIP and/or (ii) who elects to participate in the
2005 Plan for purposes of deferring his or her Directors’ Fees by filing an
Enrollment Form with the Committee pursuant to Section 5.1 of the 2005 Plan.


 


2.15        “Phantom Stock” means those shares of the common stock or stock
units of the Company:


 


(i)            awarded pursuant to the NEDSIP, and


 


(ii)           which will be distributed to eligible 2005 Plan
Participants in the form elected by the 2005 Plan Participant and on the date
specified in the Phantom Stock Agreement, which date is deemed to be
incorporated by reference herein.


 


2.16        “Phantom Stock Account” means the recordkeeping account established on
the books and records of the Company to record the number of shares of Phantom
Stock allocated to a Participant under the 2005 Plan.


 


2.17        “Phantom Stock Agreement” means any agreements and/or terms of award of
Phantom Stock under the NEDSIP pursuant to which Phantom Stock is or may be
payable.


 


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2.18        “2005 Plan” means this Equitable Resources, Inc. 2005 Directors’ Deferred
Compensation Plan, as amended from time to time.


 


2.19        “Plan Year” means the twelve-month period commencing each January 1 and ending on
December 31.


 


2.20        “Valuation Date” means the last day of each calendar quarter and
any other date determined by the Committee or specified herein.


 


ARTICLE III


 


ELIGIBILITY AND PARTICIPATION


 


3.1          Eligibility for Phantom Stock Account.


 


Eligibility
to participate in the 2005 Plan for purposes of the Phantom Stock Account under
Article IV of the 2005 Plan is limited to those non-employee members of the
Board who receive Phantom Stock pursuant to the terms of the NEDSIP. An
eligible Board member shall commence participation in the 2005 Plan for
purposes of the Phantom Stock Account on the date on which an award of Phantom
Stock is made pursuant to the terms of the NEDSIP.


 


3.2          Eligibility for Deferral Account.


 


Eligibility
to participate in the 2005 Plan for purposes of deferring Directors’ Fees under
Section 5.1 of the 2005 Plan is limited to non-employee members of the
Board. An eligible Board member shall commence participation in the 2005 Plan
for purposes of deferring Directors’ Fees as of the first day of the Plan Year
following the receipt of his or her Enrollment Form by the Committee in the
preceding calendar year or within 30 days of becoming a Participant if such
date occurs after the commencement of the Plan Year.


 


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3.3          Ineligible Participant.


 


Notwithstanding
any other provisions of this 2005 Plan to the contrary, if the Committee
determines that the participation in the 2005 Plan by any Board member will
jeopardize the status of the 2005 Plan as exempt from the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), or
regulations thereunder, the Committee may, in its sole discretion, determine
that such Participant shall cease to be eligible to participate in the 2005 Plan.


 


ARTICLE IV


 


PHANTOM STOCK ACCOUNT


 


4.1          Phantom Stock Award.


 


As
of the date of any Phantom Stock award pursuant to the terms of the NEDSIP, the
Phantom Stock Account of a Participant eligible for such award shall be
credited with the number of Phantom Stock units as specified in such award. The
Company shall not be required to contribute any shares or other property to the
Irrevocable Trust for such awards.


 


4.2          Valuation of Phantom Stock Account; Deemed
Reinvestment of Dividends


 


As
of each Valuation Date, the value of a Participant’s Phantom Stock Account
shall equal (i) the value of the number of shares of Phantom Stock credited to
such account as of the last Valuation Date, plus (ii) the value of the number
of shares of Phantom Stock deemed to have been credited to such account as a
result of the deemed reinvestment of any dividends deemed to have been paid on
such Phantom Stock since the last Valuation Date. Any dividends paid on the
common stock of the Company shall be deemed to be paid on the Phantom Stock
under the 2005 Plan in an equal amount; provided, however, that to the extent
they are paid in a form other than additional shares of the common stock of the
Company, they shall be deemed to be immediately reinvested in such number of
shares of the common stock of the Company as are represented by


 


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the
aggregate amount of the dividends divided by the value of one share of the
common stock of the Company on the date the dividend is paid.


 


For
purposes of this 2005 Plan, the “value” of a share of Phantom Stock shall be
deemed to equal the closing price of a share of Company common stock as listed
on the New York Stock Exchange (“NYSE”) on any
date of reference. In the event that the date of reference is a date on which
the NYSE is not open for business, the value of a share of Phantom Stock shall
equal the average of the closing prices on the dates immediately preceding and
following the date of reference during which the NYSE was open for business. Notwithstanding
anything in this 2005 Plan to the contrary, the Company may adopt alternate
procedures for determining the value of Phantom Stock in the event Company
common stock ceases to be traded on the NYSE or to reflect the occurrence of a
Conversion Event described in Section 4.3.


 


For
purposes of determining the value of the Phantom Stock credited to a
Participant’s Phantom Stock Account as of any time of reference, each share of
Phantom Stock shall be deemed equivalent in value to one share of the outstanding
shares of common stock of the Company. For purposes of valuing a Participant’s
Phantom Stock Account upon the termination of his or her membership on the
Board, the Valuation Date shall be the business day coincident with the
termination of the Participant’s Board membership.


 


4.3          Adjustment and Substitution of Phantom Stock


 


In
the event of:  (a) a stock split (or
reverse stock split) with respect to the common stock of the Company; (b) the
conversion of the common stock of the Company into another form of security or
debt instrument of the Company; (c) the reorganization, merger or consolidation
of the Company into or with another person or entity; or (d) any other action
which would alter the number of, and/or shareholder rights of, holders of outstanding
shares of the common stock of the Company (collectively, a “Conversion
Event”), then, notwithstanding the fact that 2005 Plan Participants
have no rights to the shares of Company common stock represented by their


 


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Phantom
Stock Account nor to the shares of such Company common stock which may be
contributed by the Company to the Irrevocable Trust, the number of shares of
Phantom Stock then allocated to a Participant’s Phantom Stock Account shall be
deemed to be converted, to the extent possible, to reflect any such Conversion
Event to the same extent as the shares of holders of outstanding shares of
Company common stock would have been converted upon the occurrence of the
Conversion Event. On and after any such Conversion Event, this 2005 Plan shall
be applied, mutatis mutandis, as if the Participant’s
Phantom Stock Account was comprised of the cash, securities, notes or other
instruments into which the outstanding shares of Company common stock was
converted. Following the occurrence of a Conversion Event, the Board is
authorized to amend the 2005 Plan as it, in its sole discretion, determines to
be necessary or appropriate to address any administrative or operational
details presented by the Conversion Event which are not addressed in the 2005
Plan.


 


4.4          Shareholder Rights.


 


Except
as specifically provided herein, an award of Phantom Stock under the 2005 Plan
shall not entitle a Participant to voting rights or any other rights of a
shareholder of the Company.


 


4.5          Statement of Phantom Stock Account.


 


As
soon as administratively feasible following the last day of each calendar
quarter, the Committee shall provide to each eligible Participant a statement
of the value of his or her Phantom Stock Account as of the most recent
Valuation Date.


 


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ARTICLE V


 


DEFERRAL ACCOUNT


 


5.1          Deferral of Directors’ Fees.


 


Any
non-employee member of the Board may elect to defer a specified percentage of
his or her Directors’ Fees under the 2005 Plan by submitting to the Committee a
written Enrollment Form. Such election shall be effective with respect to
Directors’ Fees paid for services performed by such Participant beginning the
first day of the Plan Year following the receipt by the Committee of the
Participant’s Enrollment Form in the preceding calendar year and shall remain
in effect for the Plan Year. A Participant may not withdraw his or her
Enrollment Form during the Plan Year.


 


5.2          Investment Direction.


 


A Participant may direct
that amounts deferred pursuant to his or her Enrollment Form be deemed to be
invested in one or more of the Investment Options listed in Exhibit A to the
2005 Plan (a “New Money Election”) and credited
with shares or units in each such Investment Option in the same manner as
equivalent contributions would be invested under the same Investment Options
available under the Equitable 401(k) Plan. Except as otherwise provided with
respect to directions to invest in the Equitable Resources Common Stock Fund (“Company Stock Fund”), a Participant may direct that amounts
previously credited to his or her Deferral Account and deemed invested in the
available Investment Options be transferred between and among the then
available Investment Options (a “Reallocation Election”).


 


Special
rules apply to directions to invest in the Company Stock Fund. No restrictions
are placed on New Money Elections. Accordingly, a Participant may make a New
Money Election to invest in the Company Stock Fund or to cease future investments
in such Fund in the same manner as any other Investment Option. Reallocation
Elections, however, may not direct
that


 


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amounts
previously credited to a Participant’s Deferral Account and which were directed
to be invested in the Company Stock Fund be transferred out
of such Fund and into another Investment Option.


 


Reallocation
Elections into the Company Stock Fund
are permitted. Accordingly, no restrictions apply to Reallocation Elections
directing that amounts previously credited to a Participant’s Deferral Account
and which were directed to be invested in an Investment Option other than the Company Stock Fund be
transferred out of such other Investment Option and into the Company Stock
Fund.


 


Except
as otherwise provided with respect to the Company common stock, regardless of
whether the investment direction is a New Money Election or a Reallocation
Election, a Participant’s Deferral Account shall only be deemed to be invested
in such Investment Options for purposes of crediting investment gain or loss
under Section 5.4 of the 2005 Plan and the Company shall not be required to
actually invest, on behalf of any Participant, in any Investment Option listed
on Exhibit A to the 2005 Plan. Notwithstanding the preceding sentence, the
Company may, but shall not be required to, elect to make contributions to an
Irrevocable Trust in an amount equal to the amounts deferred by Participants
and actually invest such contributions in the Investment Options elected by a
particular Participant; provided, however, that the Company shall
contribute shares of Company common stock to the Irrevocable Trust in an amount
equal to the aggregate number of shares of Company common stock represented by
Participant investment directions to the Company Stock Fund. Any such
contributions to an Irrevocable Trust and related investments shall be solely
to assist the Company in satisfying its obligations under this 2005 Plan and no
Participant shall have any right, title or interest whatsoever in any such
contributions or investments.


 


All investment elections
shall be made by written notice to the Committee in accordance with uniform
procedures established by the Committee; provided, however, that investment
directions


 


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to an Investment Option
must be in multiples of whole percents (1%) or whole dollars ($1.00). Any such
investment election shall be effective as of the Valuation Date immediately
following the date on which the written notice is received and shall remain in
effect until changed by the Participant. In the event that a Participant fails
to direct the investment of his or her account, the Committee shall direct such
Participant’s Deferral Account to an Investment Option named in Exhibit A of a
fixed income nature.


 


5.3          No Right to Investment Options.


 


Notwithstanding
anything in the 2005 Plan to the contrary, the Investment Options offered under
the 2005 Plan may be changed or eliminated at any time in the sole discretion
of the Benefits Investment Committee of the Company. Prior to the change or
elimination of any Investment Option under the 2005 Plan, the Committee shall
provide written notice to each Participant with respect to whom a Deferral
Account is maintained under the 2005 Plan and any Participant who has directed
any part of his or her Deferral Account to such Investment Option shall be
permitted to redirect such portion of his or her Deferral Account to another
Investment Option offered under the 2005 Plan.


 


5.4          Crediting of Investment Return.


 


Each
Participant’s Deferral Account shall be credited with deemed investment gain or
loss at the Investment Return Rate as of each Valuation Date, based on the
average daily balance of the Participant’s Deferral Account since the
immediately preceding Valuation Date, but after such Deferral Account has been
adjusted for any contributions or distributions to be credited or deducted for
such period. Until a Participant or his or her Beneficiary receives his or her
entire Deferral Account, the unpaid balance thereof shall be credited with
investment gain or loss at the Investment Return Rate, as provided in this
Section 5.4 of the 2005 Plan.


 


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5.5          Valuation of Deferral Account.


 


As
of each Valuation Date, a Participant’s Deferral Account shall equal (i) the
balance of the Participant’s Deferral Account as of the immediately preceding
Valuation Date, plus (ii) the Participant’s deferred Directors’ Fees since the
immediately preceding Valuation Date, plus or minus (iii) investment gain or
loss credited as of such Valuation Date pursuant to Section 5.4 of the 2005
Plan, and minus (iv) the aggregate amount of distributions, if any, made from
such Deferral Account since the immediately preceding Valuation Date. For
purposes of valuing a Participant’s Deferral Account upon the termination of
the Participant’s membership on the Board, the Valuation Date shall be the
business day coinciding with the date of the termination of the Participant’s
Board membership.


 


5.6          Statement of Deferral Account.


 


As
soon as administratively feasible following the last day of each calendar
quarter, the Committee shall provide to each Participant a statement of the
value of his or her Deferral Account as of the most recent Valuation Date.


 


ARTICLE VI


 


PAYMENT OF BENEFITS


 


6.1          Payment of Phantom Stock Account.


 


On
the date provided for payment pursuant to the terms of a Phantom Stock
Agreement, which date is deemed to be incorporated by reference herein, the
Company shall pay or distribute to the Participant or, in the event of the
Participant’s death, to his Beneficiary, either an amount equal to the value of
the Participant’s Phantom Stock Account then payable, or the number of shares
of Company common stock then payable, whichever form is elected by the
Participant if so provided in the award, based on awards credited to the
Participant’s Phantom Stock Account


 


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pursuant
to Section 4.1 of the 2005 Plan, as determined in accordance with
Article IV of the 2005 Plan, less any income tax withholding required
under applicable law.


 


6.2          Payment of Deferral Account.


 


Thirty
(30) days following a Participant’s termination of membership on the Board and
in accordance with the election provided in Section 6.4 of the 2005 Plan,
and without regard to whether the Participant is entitled to payment of his or
her Phantom Stock Account, the Company shall pay to the Participant or, in the
event of the Participant’s death, to his Beneficiary, an amount equal to the value of the Participant’s Deferral Account, as determined
in accordance with Article V of the 2005 Plan, less any income tax withholding
required under applicable law. Except as otherwise provided in the following sentence,
such payment shall be made in cash in the form elected by the Participant
pursuant to Section 6.4 of the 2005 Plan. Notwithstanding the preceding
sentence, to the extent the Participant had directed that any portion of his
Deferral Account be invested in the Company Stock Fund, the Company shall
distribute such portion in such number of shares of Equitable Resources Common
Stock as would be represented by an equal amount invested in the Company Stock
Fund under the Company 401(k) Plan.


 


6.3          Hardship Withdrawal from Deferral Account.


 


In
the event that the Committee, in its sole discretion, determines upon the
written request of a Participant in accordance with uniform procedures
established from time to time by the Committee, that the Participant has
suffered an unforeseeable emergency, the Company may pay to the Participant in
a lump sum as soon as administratively feasible following such determination,
an amount necessary to meet the emergency, but not exceeding the aggregate
balance of such Participant’s Deferral Account as of the date of such payment
(a “Hardship Withdrawal”). Any such
Hardship Withdrawal shall be subject to any income tax withholding required
under applicable law. The Participant shall provide to the Committee such
evidence as


 


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the
Committee may require to demonstrate that such emergency exists and financial
hardship would occur if the withdrawal were not permitted.


 


For
purposes of this Section 6.3, an “unforeseeable emergency” shall mean a severe
financial hardship to the Participant or Beneficiary resulting from an illness
or accident of the Participant or Beneficiary, the Participant’s or Beneficiary’s
spouse, or the Participant’s or Beneficiary’s dependent (as defined in Section 152(a)
of the Code), loss of the Participant’s or Beneficiary’s property due to
casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant or
Beneficiary. The amount of a Hardship Withdrawal may not exceed the amount the
Committee reasonably determines to be necessary to meet such emergency needs
(including taxes incurred by reason of a taxable distribution) after taking
into account the extent that such emergency is or may be relieved through
reimbursement or compensation from insurance or otherwise, by liquidation of
the Participant’s assets, to the extent the liquidation of such assets would
not cause severe financial hardship, or by the cessation of future deferrals under
the 2005 Plan.


 


The
form of payment of the Hardship Withdrawal shall be a lump sum cash payment. For
purposes of reducing a Participant’s Deferral Account and adjusting the
balances in the various Investment Options in which such reduced Deferral Account
is deemed to be invested to reflect such Hardship Withdrawal, amounts
represented by such Hardship Withdrawal shall be deemed to have been withdrawn
first, on a pro rata basis, from that portion of his Deferral Account deemed to
be invested in Investment Options other than
the Equitable Common Stock Fund (the “Non Stock Investments”)
and, second, to the extent the Hardship Withdrawal cannot be fully satisfied by
a deemed withdrawal of the Non Stock Investments, from the portion deemed
invested in the Company Stock Fund.


 


Notwithstanding
the preceding, to the extent the Participant had directed that any portion of
his Deferral Account be invested in the Company Stock Fund, the Company shall
distribute such


 


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portion
in such number of shares of Equitable Resources Common Stock based on the value
at the date of distribution.


 


6.4          Form of Payment.


 


(a)           In General. A Participant may elect to receive that portion of his or her Account
payable hereunder in one of the following forms:


 


(i)            Annual payments of a fixed amount which shall
amortize the value of the Account over a period of five, ten, or fifteen years
(together, in the case of each annual payment, with interest and dividends
credited thereto after the payment commencement date pursuant to Section 5.4 of
the 2005 Plan); or


 


(ii)           A lump sum.


 


Such
an election must be made in writing in accordance with uniform procedures
established by the Committee at the time of filing the Enrollment Form with
respect to the Plan Year. In the event a Participant fails to make a
distribution election within the time period prescribed, his or her Account
shall be distributed in the form of a lump sum. Payment of the Deferral Account
may not, in any event, commence earlier than (i) separation from service, (ii)
disability, as defined in Section 409A of the Code and the regulations
thereunder, or (iii) death.


 


(b)           Distribution of Company Common Stock. In the event the Company is required to
distribute some or all of a Participant’s Account in shares of Equitable
Resources Common Stock in accordance with 2005 Plan Sections 6.1 and/or 6.2,
the aggregate amount of such shares shall be distributed in the same manner as
the Participant elected in subsection (a). To the extent the Participant
elected an installment form of payment, the number of shares of Equitable
Common Stock to be distributed in each installment shall be determined by
multiplying (i) the aggregate number of shares of Equitable Resources Common
Stock deemed credited to the Participant’s Account as of the installment
payment date by (ii) a fraction, the numerator of which is one and


 


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the
denominator of which is the number of unpaid installments, and by rounding the
resulting number down to the next whole number.


 


6.5          Payments to Beneficiaries.


 


In
the event of a Participant’s death prior to the Participant’s termination of
membership on the Board, the Participant’s Beneficiary shall receive payment of
the Phantom Stock Account (if any) in the form provided in the Phantom Stock
Agreement and/or Participant’s Deferral Account ninety (90) days following the
Participant’s death in the form elected by the Participant pursuant to Section
6.4 of the 2005 Plan, less any income tax withholding required under applicable
law. If no such election was made by the Participant, the Participant’s
Beneficiary shall receive payment of the Participant’s Account in the form of a
lump sum. In the event of the Participant’s death after commencement of
installment payments under the 2005 Plan, but prior to receipt of his or her
entire Account, the Participant’s Beneficiary shall receive the remaining
installment payments at such times as such installments would have been paid to
the Participant until the Participant’s entire Account is paid.


 


6.6          Limited Account Size; Lump Sum Payment.


 


In
the event that the value of a Participant’s Account is not greater than $10,000
as of the Valuation Date immediately preceding the commencement of payment to the
Participant under the 2005 Plan (or such other amount permitted by law to be
distributed), or the balance of the Participant’s Account payable to any
Beneficiary is not greater than $10,000 as of the Valuation Date immediately
preceding the commencement of payment to the Participant’s Beneficiary under
the 2005 Plan (or such other amount permitted by law to be distributed), the
Committee may inform the Company and the Company, in its discretion, may choose
to pay the benefit in the form of a lump sum, notwithstanding any provision of
the 2005 Plan or an election of a Participant under Section 6.4 of the 2005
Plan to the contrary, provided that the requirements of


 


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Prop.
Treas. Reg. §1.409A-3(h)(2)(iv), or any successor regulation, are also
satisfied with respect to such payment.


 


ARTICLE VII


 


BENEFICIARY DESIGNATION


 


7.1          Beneficiary Designation.


 


Each
Participant shall have the sole right, at any time, to designate any person or
persons as his or her Beneficiary to whom payment may be made of any amounts
which may become payable in the event of his or her death prior to the complete
distribution to the Participant of his or her Account. Any Beneficiary
designation shall be made in writing in accordance with uniform procedures
established by the Committee. A Participant’s most recent Beneficiary
designation shall supersede all prior Beneficiary designations. In the event a
Participant does not designate a Beneficiary under the 2005 Plan, any payments
due under the 2005 Plan shall be made first to the Participant’s spouse; if no
spouse, then in equal amounts to the Participant’s children; if no children,
then to the Participant’s estate.


 


ARTICLE VIII


 


ADMINISTRATION


 


8.1          Committee.


 


The
Committee shall have sole discretion to: 
(i) designate non-employee directors eligible to participate in the 2005
Plan; (ii) interpret the provisions of the 2005 Plan; (iii) supervise the
administration and operation of the 2005 Plan; and (iv) adopt rules and
procedures governing the 2005 Plan.


 


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8.2          Investments.


 


The
Benefits Investment Committee of the Company shall have the sole discretion to
choose the Investment Options available under the 2005 Plan and to change or
eliminate such Investment Options, from time to time, as it deems appropriate.


 


8.3          Agents.


 


The
Committee may delegate its administrative duties under the 2005 Plan to one or
more individuals, who may or may not be employees of the Company.


 


8.4          Binding Effect of Decisions.


 


Any
decision or action of the Committee with respect to any question arising out of
or in connection with the eligibility, participation, administration,
interpretation, and application of the 2005 Plan shall be final and binding
upon all persons having any interest in the 2005 Plan.


 


8.5          Indemnification of Committees.


 


The
Company shall indemnify and hold harmless the members of the Committee and the
Benefits Investment Committee and their duly appointed agents under Section 8.3
against any and all claims, losses, damages, expenses, or liabilities arising
from any action or failure to act with respect to the 2005 Plan, except in the
case of gross negligence or willful misconduct by any such member or agent of
the Committee or Benefits Investment Committee.


 


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ARTICLE IX


 


AMENDMENT AND TERMINATION OF PLAN


 


9.1          Amendment.


 


The
Company (or its delegate) may at any time, or from time to time, modify or
amend any or all of the provisions of the 2005 Plan. Where the action is to be
taken by the Company, it shall be accomplished by written action of the Board
at a meeting duly called at which a quorum is present and acting throughout. Where
the action is to be taken by a delegate of the Company, it shall be
accomplished pursuant to any procedures established in the instrument
delegating the authority. Regardless of whether the action is taken by the
Company or its delegate, no such modification or amendment shall have the
effect of reducing the value of any Participant’s Account under the 2005 Plan
as it existed as of the day before the effective date of such modification or
amendment, without such Participant’s prior written consent. Written notice of
any modification or amendment to the 2005 Plan shall be provided to each
Participant under the 2005 Plan.


 


9.2          Termination.


 


The
Company, in its sole discretion, may terminate this 2005 Plan at any time and
for any reason whatsoever by written action of the Board at a meeting duly
called at which a quorum is present and acting throughout; provided that such
termination shall not have the effect of reducing the value of any Participant’s
Account under the 2005 Plan as it existed on the day before the effective date
of the termination of the 2005 Plan without such Participant’s prior written
consent. The Valuation Date for purposes of determining the value of
Participants’ Accounts upon termination of the 2005 Plan shall be the date
prior to the date of the termination of the 2005 Plan.


 


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ARTICLE X


 


MISCELLANEOUS


 


10.1        Funding.


 


The
Company’s obligation to pay benefits under the 2005 Plan shall be merely an
unfunded and unsecured promise of the Company to pay money in the future. Except
as otherwise provided in Section 5.2, prior to the occurrence of a Change
in Control, the Company, in its sole discretion, may elect to make
contributions to an Irrevocable Trust to assist the Company in satisfying all
or any portion of its obligations under the 2005 Plan. Regardless of whether
the Company elects to or otherwise contributes to an Irrevocable Trust, 2005
Plan Participants, their Beneficiaries, and their heirs, successors and
assigns, shall have no secured interest or right, title or claim in any
property or assets of the Company.


 


Notwithstanding
the foregoing, upon the occurrence of an event resulting in a Change in
Control, the Company shall make a contribution to an Irrevocable Trust in an
amount which, when added to the then value of any amounts previously contributed
to an Irrevocable Trust to assist the Company in satisfying all or any portion
of its obligations under the 2005 Plan, shall be sufficient to bring the total
value of assets held in the Irrevocable Trust to an amount not less than the
total value of all Participants’ Accounts under the 2005 Plan as of the
Valuation Date immediately preceding the Change in Control; provided that any
such funds contributed to an Irrevocable Trust pursuant to this Section 10.1
shall remain subject to the claims of the Company’s general creditors and
provided, further, that such contribution shall reflect any Conversion Event
described in Section 4.3. Upon the occurrence of the Change in Control of the
Company, all deferrals to the 2005 Plan shall cease, any adjustments required
by Section 4.3 shall be made and the Company shall provide to the trustee of
the Irrevocable Trust all 2005 Plan records and other information necessary for
the trustee to make payments to Participants under the 2005 Plan in accordance
with the terms of the 2005 Plan.


 


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10.2        Nonassignability.


 


No
right or interest of a Participant or Beneficiary under the 2005 Plan may be
assigned, transferred, or subjected to alienation, anticipation, sale, pledge, encumbrance
or other legal process or in any manner be liable for or subject to the debts
or liabilities of any such Participant or Beneficiary, or any other person.


 


10.3        Legal Fees and Expenses.


 


It
is the intent of the Company that no Participant be required to incur the
expenses associated with the enforcement of his or her rights under this 2005
Plan by litigation or other legal action because the cost and expense thereof
would substantially detract from the benefits intended to be extended to the Participant
hereunder. Accordingly, if after a Change in Control it should appear that the
Company has failed to comply with any of its obligations under this 2005 Plan,
or in the event that the Company or any other person takes any action to
declare this 2005 Plan void or unenforceable, or institutes any litigation
designed to deny, or to recover from, the Participant the benefits intended to
be provided to such Participant hereunder, the Company irrevocably authorizes
such Participant to retain counsel of his or her choice, at the expense of the
Company as hereafter provided, to represent such Participant in connection with
the initiation or defense of any litigation or other legal action, whether by
or against the Company or any director, officer, stockholder or other person
affiliated with the Company in any jurisdiction. The Company shall pay and be
solely responsible for any and all attorneys’ and related fees and expenses
incurred by such Participant as a result of the Company’s failure to perform
under this 2005 Plan or any provision thereof; or as a result of the Company or
any person contesting the validity or enforceability of this 2005 Plan or any
provision thereof.


 


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10.4        No Acceleration of Benefits.


 


Notwithstanding
anything to the contrary herein, there shall be no acceleration of the time or
schedule of any payments under the 2005 Plan, except as may be provided in
regulations under Section 409(A) of the Code.


 


10.5        Captions.


 


The
captions contained herein are for convenience only and shall not control or
affect the meaning or construction hereof.


 


10.6        Governing Law.


 


The
provisions of the 2005 Plan shall be construed and interpreted according to the
laws of the Commonwealth of Pennsylvania.


 


10.7        Successors.


 


The
provisions of the 2005 Plan shall bind and inure to the benefit of the Company,
its affiliates, and their respective successors and assigns. The term
successors as used herein shall include any corporate or other business entity
which shall, whether by merger, consolidation, purchase or otherwise, acquire
all or substantially all of the business and assets of the Company or a
participating affiliate and successors of any such corporation or other
business entity.


 


10.8        No Right to Continued Service.


 


Nothing
contained herein shall be construed to confer upon any Participant the right to
continue to serve as a member of the Board or in any other capacity.


 


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