exv10w8



 







Exhibit 10.8




NISOURCE INC.




NONEMPLOYEE DIRECTOR




RETIREMENT PLAN




(As Amended and Restated Effective January 1, 2005)




 









 





NISOURCE INC.

NONEMPLOYEE DIRECTOR

RETIREMENT PLAN

(As Amended and Restated Effective January 1, 2005)




TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	 	 	 	 	 	 
	ARTICLE I

	 	Purpose
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE II

	 	Definitions
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE III

	 	Administration
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE IV

	 	Eligibility for Retirement Benefits
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE V

	 	Amount of Retirement Benefit
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE VI

	 	Payment of Retirement Benefits
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE VII

	 	Payment in the Event of Death
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE VIII

	 	Payment in the Event of Separation From
Service Following a Change in Control
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE IX

	 	Unfunded Plan
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE X

	 	Certain Payments
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE XI

	 	Miscellaneous
	 	 	8	 






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NISOURCE INC.

NONEMPLOYEE DIRECTOR

RETIREMENT PLAN

(As Amended and Restated Effective January 1, 2005)




ARTICLE I




PURPOSE




     The NiSource Inc. Nonemployee Director Retirement Plan (the “Plan”) was established to assist
the Company in attracting and retaining individuals of superior talent, ability and achievement to
serve on its Board of Directors. The Plan was originally adopted effective January 1, 1991, and
was amended and restated effective January 1, 2002 to cover only Nonemployee Directors serving on
the Board of Directors on December 31, 2001, who elected to continue participation in the Plan on
and after June 1, 2002.



     The Plan is now further amended and restated effective January 1, 2005, as set forth below, to
comply with Internal Revenue Code (the “Code”) Section 409A, and guidance and regulations
thereunder, with respect to benefits earned under the Plan from and after January 1, 2005.
Benefits under the Plan earned and vested prior to January 1, 2005 shall be administered in
accordance with the Plan then in effect and without regard to Code Section 409A and regulations
thereunder.



ARTICLE II




DEFINITIONS




     The following words and phrases shall have the meanings set forth below unless a different
meaning is required by the context:



     2.1 “Annual Retainer” means the amount paid by the Company to each Nonemployee Director as
annual compensation for Service as a Director and as a member of any committee of the Board and as
chairman of any such committee, which amount is exclusive of any Board or committee meeting fees,
or remuneration under other plans, agreements or policies.



     2.2 “Board” means the Board of Directors of the Company.



 









 





     2.3 “Change in Control” means the occurrence of either a “Change in Ownership,” “Change in
Effective Control” or a “Change of Ownership of a Substantial Portion of Assets,” as defined below:




     (a) Change in Ownership. A Change in Ownership of the Company occurs on the
date that any one person, or more than one Person Acting as a Group (as defined below),
acquires ownership of 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 one person or more than one Person Acting as a 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 persons
is not considered to cause a Change in Ownership of the Company (or to cause a Change in
Effective Control of the Company). An increase in the percentage of stock owned by any one
person, or Persons Acting as a Group, as a result of a transaction in which the Company
acquires its stock in exchange for property shall be treated as an acquisition of stock.
This subsection (a) 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) Change in Effective Control. A Change in Effective Control of the Company
occurs on the date that either —




     (i) any one person, or more than one Person Acting as a Group, acquires (or has
acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock of the Company possessing
35% or more of the total voting power of the stock of the Company; or




     (ii) 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.




In the absence of an event described in paragraph (i) or (ii), a Change in Effective Control
of the Company shall not have occurred.




     Acquisition of additional control. If any one person, or more than one Person
Acting as a Group, is considered to effectively control the Company, the acquisition of
additional control of the Company by the same person or persons is not considered to cause a
Change in Effective Control of the Company (or to cause a Change in Ownership of the
Company).




     (c) Change of Ownership of a Substantial Portion of Assets. A Change of
Ownership of a Substantial Portion of Assets occurs on the date that any one person, or more
than one Person Acting as a Group, acquires (or has acquired during the 12-month



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period ending on the date of the most recent acquisition by such person or persons)
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 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.




     Transfers to a related person. There is no Change in Control when there is a
transfer to an entity that is controlled by the shareholders of the Company immediately
after the transfer. A transfer of assets by the Company is not treated as a Change of
Ownership of a Substantial Portion of Assets if the assets are transferred 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 more than one Person Acting as a 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 paragraph (iii) next above.




            A person’s status is determined immediately after the transfer of Company
assets. For example, a transfer to a corporation in which the Company has no
ownership interest before the transaction, but which is a majority-owned subsidiary
of the Company after the transaction is not treated as a Change of Ownership of a
Substantial Portion of Assets of the Company.




     (v) Persons Acting as a Group. Persons shall not be considered to be
acting as a group solely because they purchase or own stock of the same corporation
at the same time or as a result of the same public offering. However, persons will
be considered to be acting as a group if they are owners of a corporation that
enters into a merger, consolidation, purchase or acquisition of stock, or similar
business transaction with the Company. If a person, including an entity, owns stock
in both corporations that enter into a merger, consolidation, purchase or
acquisition of stock, or similar transaction, such shareholder is considered to be
acting as a group with other shareholders in a corporation prior to the transaction
giving rise to the change and not with respect to the ownership interest in the
other corporation.



     2.4 “Committee” means the Corporate Governance Committee of the Board.



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     2.5 “Company” means NiSource Inc., a Delaware corporation, including its subsidiaries and any
successor organizations.



     2.6 “Director” means an individual who is a member of the Board on or after the Effective
Date.



     2.7 “Disability” means a condition that (i) causes a Director to be unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not
less than 12 months or (ii) causes a Director to be eligible to receive Social Security disability
payments.



     2.8 “Effective Date” means January 1, 2005.



     2.9 “Eligible Nonemployee Director” means a Nonemployee Director who meets the eligibility
requirements for retirement benefits under the Plan, as set forth in Article IV herein. “Eligible
Nonemployee Director” also shall include any Nonemployee Director eligible to receive retirement
benefits by virtue of a Change in Control, as set forth in Article VIII herein.



     2.10 “Nonemployee Director” means a Director who is not currently employed by the Company or
any subsidiary of the Company.



     2.11 “Plan” means the NiSource Inc. Nonemployee Director Retirement Plan, including any
amendments thereto.



     2.12 “Service” means a Director’s service on the Board as a Nonemployee Director.



     2.13 “Year of Service” means the 12-month period commencing with the first day of the calendar
month in which each annual meeting of the shareholders of the Company takes place, and throughout
which a Director served on the Board as a Nonemployee Director.



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ARTICLE III




ADMINISTRATION




     The Plan shall be administered by the Committee. The Committee shall have the authority to
interpret the Plan, and any such interpretation shall be final and binding upon all parties. The
Board or the Committee may amend or terminate the Plan at any time, provided that no such amendment
or termination shall adversely affect the amounts payable or vested under the Plan before the time
of such amendment or termination. The Company shall pay all distributions pursuant to the Plan and
all costs, charges and expenses related to the administration of the Plan.



ARTICLE IV




ELIGIBILITY FOR RETIREMENT BENEFITS




     4.1 Any Eligible Nonemployee Director (as described in Section 4.2 next below) who retires,
resigns or separates from Service on or after the Effective Date after having completed at least
five Years of Service, shall be eligible to receive a retirement benefit calculated in accordance
with Article V herein, and payable in accordance with Article VI herein.



     4.2 Any Nonemployee Director who was participating in the Plan on December 31, 2001, and (i)
made an irrevocable election, by written instrument delivered to the Committee between May 21, 2002
and July 1, 2002, to continue his or her participation in the Plan on and after July 1, 2002, or
(ii) failed to make a timely election to participate or terminate participation pursuant to (i)
next above, shall continue to participate in the Plan as an Eligible Nonemployee Director.



ARTICLE V




AMOUNT OF RETIREMENT BENEFIT




     Each Eligible Nonemployee Director shall be paid monthly payments in an amount equal to
one-twelfth (1/12) of the Annual Retainer in effect as of the effective date of his or her
retirement, resignation or separation from Service. The number of such payments shall equal the
lesser of: (i) 120 or (ii) the number of full months of Service on the Board as a
Nonemployee Director.



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ARTICLE VI




PAYMENT OF RETIREMENT BENEFITS




     Payment of retirement benefits to an Eligible Nonemployee Director under the Plan shall be
made in cash, and shall commence one month following the Director’s separation from Service for any
reason, or, if later, within such timeframe permitted under Code Section 409A, and guidance and
regulations thereunder. For this purpose, a Director’s separation from Service for Disability
shall be deemed to occur on the date that the Committee designates as the date on which the
definition of Disability under the Plan has been satisfied.



ARTICLE VII




PAYMENT IN THE EVENT OF DEATH




     In the event that an Eligible Nonemployee Director dies prior to the receipt of all retirement
benefits set forth in the Plan, the Company shall pay the present value of the remaining unpaid
retirement benefits owing to the Eligible Nonemployee Director under the Plan in one cash lump sum
within 60 calendar days following the date of death, or, if later, within such timeframe permitted
under Code Section 409A, and guidance and regulations thereunder. The interest rate to be used to
determine the present value of the unpaid retirement benefits shall be the six-month U.S. Treasury
Bill rate in effect on the date of death. Such payment shall he made to the surviving spouse of
the Eligible Nonemployee Director, if any. If there is no surviving spouse, then the payment shall
be made to the representative of the estate of the Eligible Nonemployee Director.



ARTICLE VIII




PAYMENT IN THE EVENT OF SEPARATION FROM SERVICE

FOLLOWING A CHANGE IN CONTROL




     In the event that an Eligible Nonemployee Director who served on the Board on the effective
date of a Change in Control separates from Service within two years following the



6









 







effective date of a Change in Control, such Director shall receive his or her retirement
benefits under the Plan in the form of a cash lump sum payment in an amount equal to the present
value of the retirement benefits such Director is eligible to receive under the Plan.



     If, within two years following the effective date of a Change in Control, an Eligible
Nonemployee Director who served on the Board on the effective date of the Change in Control,
separates from Service on the Board prior to the time when such Director has served on the Board
for five full years, such Director shall be entitled to receive a cash lump sum payment in an
amount equal to 75% of the present value of the retirement benefits such Director would have been
entitled to receive under the Plan had such Director served on the Board for five full years prior
to separation from Service.



     For purposes of this Article VIII, the interest rate to be used to determine the present value
of the unpaid retirement benefits shall be the six-month U.S. Treasury Bill rate in effect on the
date of separation from Service. Payments of retirement benefits under this Article VIII shall be
made within 60 calendar days following the date of separation from Service on the Board, or, if
later, within such timeframe permitted under Code Section 409A, and guidance and regulations
thereunder.



     In the event that the Committee determines that any payment, whether paid or payable or
distributed or distributable pursuant to the Plan would be subject to the excise tax imposed by
Code Section 4999, or any interest or penalty with respect to such excise tax (such excise tax
together with any interest or penalties thereon are hereinafter referred to collectively as the
“Excise Tax”), the Nonemployee Director subject to the Excise Tax shall be paid an additional
payment (a “Gross-Up Payment”) in an amount such that, after the payment by such Nonemployee
Director of all taxes (together with any interest or penalties imposed with respect to such taxes),
including any Excise Tax imposed upon the Gross-Up Payment, such Nonemployee Director retains an
amount of the Gross-Up Payment equal to the Excise Tax imposed upon the payment of retirement
benefits under the Plan.



7









 





ARTICLE IX




UNFUNDED PLAN




     The Plan shall be a noncontributory, nonqualified and unfunded plan. Retirement benefit
payments under the Plan shall represent an unsecured, general obligation of the Company, and shall
be paid by the Company from its general operating assets. No special fund or trust shall be
required to be created by the Company to fund the obligations under the Plan, nor shall any notes
or securities be issued with respect to any retirement benefits under the Plan.



ARTICLE X




CERTAIN PAYMENTS




     Whenever a Nonemployee Director who is entitled to receive a payment under the Plan is a
person under legal disability or a person not adjudicated incompetent but who, by reason of illness
or mental or physical disability, is, in the opinion of the Committee, unable to manage properly
his or her affairs, then such payments shall be paid in one of the following ways, as the Committee
deems advisable: (i) to such person directly; (ii) to the legally appointed guardian or
conservator of such person for his or her exclusive benefit; or (iii) in such other manner for the
exclusive benefit of such person as the Committee considers advisable. Any payment made in
accordance with the provisions of this Article X shall be a complete discharge of any liability of
the Company for the making of such payment under the Plan.



ARTICLE XI




MISCELLANEOUS




     11.1 Neither the establishment of the Plan, nor any action taken hereunder, shall in any way
obligate: (i) the Company to nominate a Nonemployee Director for reelection or to continue to
retain a Nonemployee Director, or (ii) a Nonemployee Director to agree to be nominated for
reelection or to continue to serve on the Board.



     11.2 Subject to the provisions of Article III hereof, the Plan may not be terminated by the
Company upon any merger or consolidation with, or acquisition of the Company by, any other entity,
but shall be binding upon and inure to the benefit of the successors and assigns of
the Company, and the heirs, executors, administrators, and assigns of each Eligible
Nonemployee Director.



8









 





     11.3 The Plan shall not affect in any way the rights of any Eligible Nonemployee Director
under any other deferred compensation plan or agreement between such Director and the Company.



     11.4 The provisions of the Plan shall be construed and interpreted according to the laws of
the State of Indiana, except as preempted by federal law.



     IN WITNESS WHEREOF, the Company has caused this amended and restated Plan to be signed on this
2nd day of December, 2005.



	 	 	 	 	 
	 	 	NISOURCE INC.
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	By:	 	/s/ Michael W. O’Donnell
	 

	 	 	 	Michael W. O’Donnell
	 
	 	 	 	 
	 

	 	Its:	 	Executive Vice President and Chief
Financial Officer
	 

	 	 	 	 






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