fourthamendnicorinc97ltinc.htm


    Nicor Inc.

    Form 8-K

    Exhibit 10.7

     

    



    FOURTH
AMENDMENT TO

    NICOR
INC. 1997

    LONG-TERM
INCENTIVE PLAN

    


    


    This Fourth Amendment to the Nicor Inc.
1997 Long-Term Incentive Plan (the “Plan”) is effective as of January 1, 2008,
by amending the Plan in the following particulars:

    


    1.           By
substituting the following for Section 10(d):

    


    
      	
               
      

            	
              “(d)

            	
              Change in
      Control.  For purposes of the Plan, “Change in Control”
      means the occurrence of a “change in the ownership,” a “change in the
      effective control” or a “change in the ownership of a substantial portion
      of the assets” of an entity, as determined in accordance with this
      subsection 10(d).  In determining whether an event shall be
      considered a “change in the ownership,” a “change in the effective
      control” or a “change in the ownership of a substantial portion of the
      assets” of an entity, the following provisions shall
  apply:

            


    

     

    
      	
                                               
      (i)  

            	
              A
      “change in the ownership” of the Company shall occur on the date on which
      any one person, or more than one person acting as a group (within the
      meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
      1934, as amended (a “Person”)), acquires ownership of the equity
      securities of the Company that, together with the equity securities held
      by such Person, constitutes more than 50% of the total fair market value
      or total voting power of the Company, as determined in accordance with
      Treas. Reg. §1.409A-3(i)(5)(v).  If a Person is considered
      either to own more than 50% of the total fair market value or total voting
      power of the equity securities of the Company, or to have effective
      control of the Company within the meaning of subsection 10(d)(ii), and
      such Person acquires additional equity securities of the Company, the
      acquisition of additional equity securities by such Person shall not be
      considered to cause a “change in the ownership” of the
      Company.

            


    

     

    
      	
                                                
      (ii)  

            	
              A
      “change in the effective control” of the Company shall occur on either of
      the following dates:

            


    

     

    
      	
                                                                      
      (A)  

            	
              The
      date on which any Person, acquires (or has acquired during the 12-month
      period ending on the date of the most recent acquisition by such Person)
      ownership of stock of the Company possessing 30% or more of the total
      voting power of the Company’s equity securities, as determined in
      accordance with Treas. Reg. §1.409A-3(i)(5)(vi).  If a Person is
      considered to possess 30% or more of the total voting power of the
      Company’s equity securities, and such


            


    

     

    
      
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                  Person
      acquires additional stock of the Company, the acquisition of additional
      stock by such Person shall not be considered to cause a “change in the
      effective control” of the Company;
or

                


        

         

      

    

    
      	
                                                                     
      (B)  

            	
              The
      date on which a majority of the 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 before the date of the
      appointment or election, as determined in accordance with Treas. Reg.
      §1.409A-3(i)(5)(vi).

            


    

     

    
      	
                                                 
      (iii)  

            	
              A
      “change in the ownership of a substantial portion of the assets” of the
      Company shall occur on the date on which any one Person acquires (or has
      acquired during the 12-month period ending on the date of the most recent
      acquisition by such Person) assets 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 before such
      acquisition or acquisitions, as determined in accordance with Treas. Reg.
      §1.409A-3(i)(5)(vii).  A transfer of assets shall not be treated
      as a “change in the ownership of a substantial portion of the assets” when
      such transfer is made to an entity that is controlled by the holders of
      the Company’s equity securities, as determined in accordance with Treas.
      Reg. §1.409A-3(i)(5)(vii)(B).

            


    

     

    
      	
                                                 
      (iv)  

            	
              Notwithstanding
      the foregoing, the following acquisitions shall not constitute a Change in
      Control: (A) an acquisition by the Company or entity controlled by the
      Company, or (B) an acquisition by an employee benefit plan (or related
      trust) sponsored or maintained by the Company or any entity controlled by
      the Company.

            


    

     

    
      	
                                                
      (v)  

            	
              For
      purposes of this subsection 10(d), (A) the term “Company” shall mean Nicor
      Inc. and shall include any Successor to Nicor Inc.; and (B) the term
      “Successor to Nicor Inc.” shall mean any corporation, partnership, joint
      venture or other entity that succeeds to the interests of Nicor Inc. by
      means of a merger, consolidation, or other restructuring that does not
      constitute a Change in Control.”

            


    

     

    


     

    2.           By
renumbering the existing Section 9 as Section 9.1; and by adding the following
as a new Section 9.2 of the Plan:

     

    “9.2       Code Section
409A.  To the extent that the Committee determines that any
Award granted under the Plan is subject to Section 409A of the Code, the Award


     

    
      
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    Agreement
evidencing such Award shall incorporate the terms and conditions required by
Section 409A of the Code.  To the extent applicable, the Plan and
Award Agreements shall be interpreted in accordance with Section 409A of the
Code and Department of Treasury regulations and other interpretive guidance
issued thereunder.  Notwithstanding any provision of the Plan to the
contrary, in the event that the Committee determines that any Award may be
subject to Section 409A of the Code and related Department of Treasury guidance,
the Committee may adopt such amendments to the Plan and the applicable Award
Agreement or adopt other policies and procedures (including amendments, policies
and procedures with retroactive effect), or take any other actions, that the
Committee determines are necessary or appropriate to (a) exempt the Award from
Section 409A of the Code and/or preserve the intended tax treatment of the
benefits provided with respect to the Award, or (b) comply with the requirements
of Section 409A of the Code and related Department of Treasury guidance and
thereby avoid the application of any penalty taxes under such
Section.”

     

    


    
 

                                             
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