Exhibit (10)(g)**Change-in-Control Agreement****Tier III**
 

 
**Contents**               Article 1. Establishment, Term, and Purpose  1        Article 2. Definitions  2        Article 3. Severance Benefits  8        Article 4. Other Terminations  11        Article 5. Noncompetition and Confidentiality  11        Article 6. Excise Tax Equalization Payment  13        Article 7. Dispute Resolution and Notice  14        Article 8. Successors and Assignment  14        Article 9. Miscellaneous  15 
 

 
**Change-in-Control Agreement**     THIS CHANGE-IN-CONTROL AGREEMENT (“Agreement”) is made, entered into, and is effective as of                    ,2004 (hereinafter referred to as the “Effective Date”), by and between                                        , a Michigan corporation,(hereinafter referred to as the “Employer”) and                                         (hereinafter referred to as the “Executive”).     WHEREAS, the Board of Directors of CMS Energy Corporation has approved entering intochange-in-control agreements with certain key executives as being necessary and advisable for thesuccess of CMS Energy Corporation;     WHEREAS, the Executive is currently employed at                                        , by the Employer in a key management positionas                                         ;     WHEREAS, the Board of Directors of CMS Energy Corporation wants to provide the Executive witha measure of financial security in the event of a change in control of CMS Energy Corporation; and     WHEREAS, both the Employer and the Executive are desirous that any proposal involving Changein Control as defined in this Agreement will be considered by the Executive objectively and withreference only to the business interests of CMS Energy Corporation and its shareholders.     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants and agreementsof the parties set forth in this Agreement and of other good and valuable consideration, thereceipt and sufficiency of which are hereby acknowledged, the parties hereto, intended to belegally bound, agree as follows:**Article 1. Establishment, Term, and Purpose**     This Agreement will commence on the Effective Date and shall continue in effect for three (3)full years through March ___, 2007. However, at the end of such three (3) year period and, ifextended, at the end of each additional year thereafter, the term of this Agreement shall beextended automatically for one (1) additional year, unless the Committee delivers written noticesix (6) months prior to the end of such term, or extended term, to the Executive, stating that theAgreement will not be extended. In such case, the Agreement will terminate at the end of the term,or extended term, then in progress. However, in the event of a Change in Control (as defined inSection 2.7 herein) of CMS Energy Corporation, the term of this Agreement shall automatically beextended for two (2) years from the date of the Change in Control if the current term of theAgreement has less than two (2) full years remaining until its expiration. Notwithstanding theforegoing, this Agreement shall automatically terminate and thereafter be of no force and effect atthe same time that the First Amended and Restated Employment Agreement, dated as of September 1,2003, between Executive and CMS Energy Corporation (“Employment Agreement”) is terminated pursuantto its Section 6. If the term of this Agreement is not extended or if the Agreement is terminated,the Employer is not obligated to pay any severance benefits under Section 3.2 for a Change inControl that happens after the
 

 
expiration of the term or after the termination of this Agreement.**Article 2. Definitions**     Whenever used in this Agreement, the following terms shall have the meanings set forth belowand, when the meaning is intended, the initial letter of the word is capitalized. **2.1** **“Affiliate”**shall have the meaning set forth in Rule 12B-2 promulgated underSection 12 of the Exchange Act.  **2.2** **“Base Salary”**means the greater of the Executive’s full annual rate of salary,whether or not any portion thereof is paid on a deferred basis, at: (i) the EffectiveDate of Termination, or (ii) at the date of the Change in Control. It does not includeany incentive compensation in any form, bonuses of any type or any other form of monetaryor nonmonetary compensation other than salary.  **2.3** **“Beneficial Owner”**shall have the meaning ascribed to such term in Rule 13d-3 ofthe General Rules and Regulations under the Exchange Act.  **2.4** **“Beneficiary”**means the persons or entities designated or deemed designated by theExecutive pursuant to Section 9.5 herein.  **2.5** **“Board”**means the Board of Directors of CMS Energy Corporation.  **2.6** **“Cause”**shall be determined solely by the Committee in the exercise of good faithand reasonable judgment, and shall mean the occurrence of any one or more of thefollowing: (a) The willful and continued failure by the Executive to substantiallyperform his or her duties of employment (other than any such failure resulting fromthe Executive’s Disability), after a written demand for substantial performance isdelivered to the Executive that specifically identifies the manner in which theCommittee believes that the Executive has not substantially performed his or herduties, and the Executive has failed to remedy the situation within a reasonableperiod of time specified by the Committee which shall not be less than 30 days; or  (b) The Executive’s arrest for committing an act of fraud, embezzlement,theft, or other act constituting a felony involving moral turpitude; or  (c) The willful engaging by the Executive in misconduct materially anddemonstrably injurious to CMS Energy Corporation or its Affiliates, monetarily orotherwise.However, for purposes of clauses (a) and (c), no act or failure to act on theExecutive’s part shall be considered “willful” unless done, or omitted to be done, bythe Executive not in good faith and without reasonable belief that his or her action or
 

 
omission was in the best interest of CMS Energy Corporation or its Affiliates. **2.7** **“Change in Control”**means a change in control of CMS Energy Corporation, and shallbe deemed to have occurred upon the first to occur of any of the following events: (a) Any Person is or becomes the Beneficial Owner, directly or indirectly,of securities of CMS Energy Corporation (not including in the securitiesbeneficially owned by such Person any securities acquired directly from CMS EnergyCorporation or its Affiliates) representing twenty-five percent (25%) or more ofthe combined voting power of CMS Energy Corporation’s then outstanding securities,excluding any Person who becomes such a Beneficial Owner in connection with atransaction described in clause (i) of paragraph (c) below; or  (b) The following individuals cease for any reason to constitute amajority of directors then serving: individuals who, on the Effective Date,constitute the Board and any new director (other than a director whose initialassumption of office is in connection with an actual or threatened electioncontest, including but not limited to a consent solicitation, relating to theelection of directors of CMS Energy Corporation) whose appointment or election bythe Board or nomination for election by CMS Energy Corporation’s stockholders wasapproved or recommended by a vote of at least two-thirds (2/3) of the directorsthen still in office who either were directors on the Effective Date or whoseappointment, election or nomination for election was previously so approved orrecommended; or  (c) The consummation of a merger or consolidation of CMS Energy Corporationor any direct or indirect subsidiary of CMS Energy Corporation with any othercorporation or other entity, other than: (i) any such merger or consolidation whichinvolves either CMS Energy Corporation or any such subsidiary and would result inthe voting securities of CMS Energy Corporation outstanding immediately priorthereto continuing to represent (either by remaining outstanding or by beingconverted into voting securities of the surviving entity or any parent thereof)**,**incombination with the ownership of any trustee or other fiduciary holding securitiesunder an employee benefit plan of CMS Energy Corporation or its Affiliates, atleast sixty percent (60%) of the combined voting power of the voting securities ofCMS Energy Corporation or the surviving entity or any parent thereof outstandingimmediately after such merger or consolidation and immediately following which theindividuals who comprise the Board immediately prior thereto constitute at least amajority of the board of directors of CMS Energy Corporation, the entity survivingsuch merger or consolidation or, if CMS Energy Corporation or the entity survivingsuch merger is then a subsidiary, the ultimate parent thereof; or (ii) a merger orconsolidation effected to implement a recapitalization of CMS Energy Corporation(or similar transaction) in which no Person is or becomes the Beneficial Owner,directly or indirectly, of securities of CMS Energy Corporation (not including inthe securities beneficially owned by such Person any securities acquired directlyfrom CMS
 

 
   Energy Corporation or its Affiliates) representing twenty-five percent (25%) ormore of the combined voting power of CMS Energy Corporation’s then outstandingsecurities; or  (d) Either (1) the stockholders of CMS Energy Corporation approve a plan ofcomplete liquidation or dissolution of CMS Energy Corporation, or (2) there isconsummated an agreement for the sale, transfer or disposition by CMS EnergyCorporation of all or substantially all of CMS Energy Corporation’s assets (or anytransaction having a similar effect). For purposes of clause (d)(2), (i) the sale,transfer or disposition of a majority of the shares of common stock of ConsumersEnergy Company shall constitute a sale, transfer or disposition of substantiallyall of the assets of CMS Energy Corporation and (ii) the sale, transfer ordisposition of subsidiaries or affiliates of CMS Energy Corporation, singly or incombinations, or their assets, only qualifies as a Change in Control if itsatisfies the substantiality test contained in that clause and the Board of CMSEnergy Corporation’s determination in that regard is final. In addition, forpurposes of clause (d)(2), the sale, transfer or disposition of assets has to be ina transaction or series of transactions closingwithin six months after theclosing of the first transaction in the series, other than with an entity in whichat least 60% of the combined voting power of the voting securities is owned bystockholders of CMS Energy Corporation in substantially the same proportions astheir ownership of CMS Energy Corporation immediately prior to such transaction ortransactions and immediately following which the individuals who comprise the Boardimmediately prior thereto constitute at least a majority of the board of directorsof the entity to which such assets are sold, transferred or disposed or, if suchentity is a subsidiary, the ultimate parent thereof.Notwithstanding the foregoing clauses (a), (c) and (d), a “Change in Control” shall notbe deemed to have occurred by virtue of the consummation of any transaction or seriesof integrated transactions closing within six months after the closing of the firsttransaction in the series immediately following which the record holders of the commonstock of CMS Energy Corporation immediately prior to such transaction or series oftransactions continue to have substantially the same proportionate ownership in anentity which owns all or substantially all of the assets of CMS Energy Corporationimmediately following such transaction or series of transactions. **2.8** **“Code”**means the United States Internal Revenue Code of 1986, as amended, and anysuccessors thereto.  **2.9** **“Committee”**means the Organization and Compensation Committee of the Board of CMSEnergy Corporation or any other committee appointed by the Board of CMS EnergyCorporation to perform the functions of the Organization and Compensation Committee.  **2.10** **“Disability”**means for all purposes of this Agreement, the incapacity of theExecutive, due to injury, illness, disease, or bodily or mental infirmity, which causesthe Executive not to engage in the performance of a substantial or material portion ofthe Executive’s usual duties of employment associated with such Executive’s
 

 
   position. Such Disability shall be determined based on competent medical advice. **2.11** **“Effective Date”**means the date of this Agreement as specified in the openingsentence of this Agreement.  **2.12** **“Effective Date of Termination”**means the date on which a Qualifying Terminationoccurs, as provided under Section 2.17 hereunder, which triggers the payment ofSeverance Benefits hereunder.  **2.13** **“Exchange Act”**means the United States Securities Exchange Act of 1934, asamended.  **2.14** **“Good Reason”**exists only on the date of a Change in Control or during thetwenty-four (24) months which follow a Change in Control and shall mean, without theExecutive’s express written consent, the occurrence of any one or more of the following: (a) The assignment to the Executive of duties materially inconsistentwith the Executive’s position (including status, offices, titles, and reportingrequirements), authority, or responsibilities as in effect on the Effective Date,or any action by the Employer which results in a diminution of the Executive’sposition, authority, duties, or responsibilities as constituted as of theEffective Date (excluding an isolated, insubstantial, and inadvertent action whichis remedied by the Employer promptly after receipt of notice thereof given by theExecutive); or  (b) Reducing the Executive’s Base Salary; or  (c) Reducing the Executive’s targeted annual incentive opportunity; or  (d) Failing to maintain the Executive’s participation in a long-termincentive plan in a manner that is consistent with the Executive’s position,authority, or responsibilities; or  (e) Failing to maintain the Executive’s amount of benefits under orrelative level of participation in employee benefit or retirement plans, policies,practices, or arrangements of a material nature available to employees of CMSEnergy Corporation and its Affiliates and in which the Executive participates asof the Effective Date; or  (f) A material breach of this Agreement by the Employer which is notremedied by the Employer within ten (10) business days of receipt of writtennotice of such breach delivered by the Executive to the Committee; or  (g) Any successor company fails or refuses to assume the obligations owedto Executive under this Agreement in their entirety, as required by Section 8.1hereunder; or  (h) The Executive is required to be based at a location in excess ofthirty-five (35) miles from the location of the Executive’s principal job locationor office
 

 
   immediately prior to a Change in Control except for required travel on theEmployer’s or CMS Energy Corporation’s business to an extent substantiallyconsistent with the Executive’s prior business travel obligations; or  (i) The Executive ceases being an executive officer of a company (otherthan by reason of death, Disability or Cause) whose common stock is publicly ownedif immediately prior to the Change in Control the Executive was an executiveofficer of a company whose common stock was publicly owned.For purposes of applying clauses (a) through (i) of this Agreement, the Executive’sRetirement shall not constitute a waiver of the Executive’s rights with respect to anycircumstance constituting Good Reason, and the Executive’s continued employment shallnot constitute a waiver of the Executive’s rights with respect to any circumstanceconstituting Good Reason or constitute Executive’s consent to the circumstancesconstituting Good Reason unless Executive has provided express written consent to thecircumstance that would otherwise constitute Good Reason under this Agreement.Finally, for purposes of implementing this Agreement, any claim by Executive that GoodReason exists shall be presumed to be correct unless the Committee determines by clearand convincing evidence that Good Reason does not exist, which evidence shall bepresented by the person disputing the claim that Good Reason exists. **2.15** **“Notice of Termination”**shall be provided for a Qualifying Termination and shallmean a written notice which shall indicate the specific termination provision in thisAgreement relied upon, and shall set forth in reasonable detail the facts andcircumstances claimed to provide a basis for termination of the Executive’s employmentunder the provision so indicated. The notice shall provide a specific date on which aQualifying Termination has occurred and is effective for purposes of this Agreement.  **2.16** **“Person”**shall have the meaning ascribed to such term in Section 3(a)(9) of theExchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” asprovided in Section 13(d).  **2.17** **“Qualifying Termination” means:** (a) An involuntary termination of the Executive’s employment by theEmployer on the date of a Change in Control or during the twenty-four (24) monthswhich follow a Change in Control for reasons other than death, Disability,Retirement, or Cause pursuant to a Notice of Termination delivered to theExecutive by the Employer; or  (b) A voluntary termination by the Executive for Good Reason on thedate of a Change in Control or during the twenty-four (24) months which follow aChange in Control pursuant to a Notice of Termination delivered to the Employerby the Executive.  (c) A termination for failure of the Executive to comply in materialrespects with CMS Energy’s Code of Conduct and Statement of Ethics Handbook (June
 

 
   2003 edition) or other corporate policies, as the handbook and those documentsmay be amended from time to time, does not satisfy the definition of aQualifying Termination under clauses (a) and (b). **2.18** **“Retirement”**shall have the meanings ascribed under the terms of the pension planapplicable to Executive and entitled “Pension Plan for Employees of Consumers EnergyCompany,” dated September 1, 2000, as amended, other than under Section 7 thereof, orunder the successor or replacement of such pension plan if it is then no longer ineffect.  **2.19** **“SERP”**shall mean the retirement plan applicable to Executive and entitled“Supplemental Executive Retirement Plan for Employees of CMS Energy/Consumers EnergyCompany,” dated May 1, 1998, as amended, or under the successor or replacement of suchretirement plan if it is then no longer in effect.  **2.20** **“Severance Benefits”**means the payment of Change-in-Control Severance Benefitsas provided in Article 3 herein.**Article 3. Severance Benefits** **3.1** **Right to Change-in-Control Severance Benefits.** (a) **Change-in-Control Severance Benefits.**The Executive shall be entitledto receive from the Employer Change-in-Control Severance Benefits, as described inSection 3.2 herein, if a Qualifying Termination of the Executive’s employmentsatisfying the definitions contained in Section 2.17(a) or (b) has occurred on thedate of a Change in Control of CMS Energy Corporation or within twenty-four (24)months immediately following a Change in Control of CMS Energy Corporation.Further, Executive’s Retirement under the pension plan and SERP shall notconstitute a waiver of the Executive’s rights with respect to receipt ofChange-in-Control Severance Benefits. Nor shall benefits received for Retirementunder the pension plan and SERP (or any replacement or successor plans thereto) beused as an offset to the level of Change-in-Control Severance Benefits owed toExecutive.  (b) **No Severance Benefits.**Other than in a situation involving aRetirement, the Executive shall not be entitled to receive Severance Benefitspursuant to this Agreement if the Executive’s employment with the Employer ends forreasons other than a Qualifying Termination.  (c) **Waiver and Release.**The Executive’s act of accepting payment ofSeverance Benefits payable under Section 3.2 of this Agreement shall constitute andis deemed an express waiver, release and discharge by Executive of any and allclaims for damages or other remedies, regardless of when they arose or when theyare discovered, against CMS Energy Corporation and its Affiliates arising out of orin any way connected with Executive’s employment relationship with them or thetermination of such employment relationship except for claims and
 

 
   rights of Executive preserved under Section 3.2 of this Agreement and applicablerights to indemnification.  (d) **No Duplication of Severance Benefits**. If the Executive receivesChange-in-Control Severance Benefits under Section 3.2, any other severancebenefits received by employees not covered by this Agreement to which the Executiveis entitled will be subtracted from the Severance Benefits paid pursuant to thisAgreement. **3.2** **Description of Change-in-Control Severance Benefits.**In the event the Executivebecomes entitled to receive Change-in-Control Severance Benefits, as provided in Section3.1(a) herein, the Employer shall provide the Executive with the following: (a) A lump-sum amount paid within fifteen (15) calendar days followingdelivery to the Employer or delivery to the Executive, as applicable, of a Noticeof Termination, equal to the sum of the Executive’s unpaid Base Salary, accruedvacation pay, unreimbursed business expenses, and unreimbursed allowances owed tothe Executive through and including the Effective Date of Termination.  (b) A lump-sum amount, paid within fifteen (15) calendar days followingdelivery to the Employer or delivery to the Executive, as applicable, of a Noticeof Termination, equal to two (2) times the sum of the following: (A) theExecutive’s Base Salary and (B) the greater of the Executive’s: (i) annual targetbonus opportunity in the year in which the Qualifying Termination occurs or (ii)the actual annual bonus payment paid or due to be paid the Executive in respect ofthe year prior to the year in which the Qualifying Termination occurs.  (c) A lump-sum amount, paid within fifteen (15) calendar days followingdelivery to the Employer or delivery to the Executive, as applicable, of a Noticeof Termination, equal to the Executive’s then current target bonus opportunityestablished under the bonus plan in which the Executive is then participating, forthe plan year in which the Qualifying Termination occurs, adjusted on a pro ratabasis for the number of days that have elapsed to the Effective Date ofTermination during the bonus plan year in which the Qualifying Termination occurs.  (d) A lump-sum amount, paid within fifteen (15) calendar days followingdelivery to the Employer or delivery to the Executive, as applicable, of a Noticeof Termination, equal to one (1) times the sum of the following: (A) theExecutive’s Base Salary and (B) the greater of the Executive’s: (i) annual targetbonus opportunity in the year in which the Qualifying Termination occurs or (ii)the actual annual bonus payment paid or due to be paid the Executive in respect ofthe year prior to the year in which the Qualifying Termination occurs. Suchamount shall be consideration for the Executive entering into the noncompeteagreement as described in Section 5(a).  (e) Equivalent payment to Executive in a lump sum amount withinforty-five (45) calendar days following delivery of the Notice of Termination forcontinued
 

 
   medical coverage for a period of thirty-six (36) months. Such equivalent paymentshall be computed based on the same coverage level as in effect for Executiveunder the general health care plan available to all employees on the EffectiveDate of Termination by providing a lump sum payment of the Employer’s portion ofthe monthly COBRA premium in effect on the Effective Date of Termination timesthirty-six (36). Nothing herein amends or provides Executive any rights tohealth care coverage other than as provided in the applicable group health careplan. If the Executive has waived coverage under the applicable group healthcare plan, no equivalent payment shall be made under this Agreement.  (f) Immediate extension (as allowable by Section 6.10 of Article VI ofthe plan entitled “CMS Energy Corporation Performance Incentive Stock Plan,” datedDecember 3, 1999, as amended) by one year after the Effective Date of Terminationof the period for Executive to exercise any outstanding stock options or stockappreciation rights granted by the Committee to Executive pursuant to said ArticleVI. Otherwise, the terms of said plan shall govern and be applied.  (g) Immediate vesting and distribution to Executive (as allowable by thesecond sentence of Section 7.2(h) of Article VII of the plan entitled “CMS EnergyCorporation Performance Incentive Stock Plan,” dated December 3, 1999, as amended)within forty-five (45) days after delivery of the Notice of Termination of alloutstanding shares of restricted stock previously awarded to Executive pursuant tosaid Article VII. For any award of restricted stock to which there are futureperformance goals attached, the number of shares distributed to Executive shallassume that the goals have been achieved in full and the award fully earned basedon target performance without deductions or additions to the number of shares thenheld by Executive. For any award of restricted stock that is tenure based, thenumber of shares distributed to Executive shall assume that all requirements withrespect to tenure are satisfied by Executive. Otherwise, the terms of said planshall govern and be applied.  (h) For an Executive included in SERP, the Executive’s retirementbenefits under the SERP will become fully vested as of the Effective Date ofTermination and shall not be subject to further vesting requirements or to anyforfeiture provisions. In addition, said Executive shall be provided thefollowing: (i) an additional thirty-six (36) months of Preference Service (asdefined in SERP) for purposes of the SERP in accordance with Section III(1) ofSERP, subject, however, to the total of Preference Service plus Accredited Servicebeing limited to a maximum of thirty-five (35) years under SERP, and (ii) only theamounts paid to Executive pursuant to clauses (a), (b), (c) and (d) of thisSection 3.2 shall be considered a “severance payment under an employmentagreement” for purposes of computing Final Executive Pay under SERP. Since theExecutive is over the age of 55, the provisions of the last complete paragraph ofSection V(3) of SERP shall not be operative. The enhanced SERP benefits underthis Section 3.2(h) shall be in lieu of any Change-in-Control enhancementsprovided for in the SERP.
 

 
 (i) For purposes of (1) Retirement, (2) SERP and (3) benefits notexpressly discussed in clauses (a) through (h) of this Section 3.2, but which areavailable to the general employee population or available only to officers andimplemented with contracts with third parties, the benefit plan descriptionscovering all employees and the retirement plan and SERP plan descriptions andcontracts with third parties covering officers in place at the time of theEffective Date of Termination control Executive’s treatment under those plans andcontracts. For any other benefits only available to officers, if those benefitsare not expressly discussed in clauses (a) through (h) of this Section 3.2, thosebenefits are terminated for Executive as of the Effective Date of Termination.**Article 4. Other Terminations** **4.1** **Termination for Retirement.**If the Executive’s employment with the Employer isterminated by reason of his Retirement, the Executive’s benefits shall be determined inaccordance with the Employer’s retirement and SERP plans, survivor’s benefits, insurance,and other applicable programs then in effect.  **4.2** **Termination for Cause Under this Agreement or Pursuant to Section 6 of theEmployment Agreement or by Employer or the Executive for Other Than Good Reason.**If theExecutive’s employment is terminated either: (a) by the Employer for Cause as defined inSection 2.6 of this Agreement; or (b) under the circumstances specified in Section 6 ofthe Employment Agreement, the Employer shall pay the Executive the compensation providedin Section 7 of the Employment Agreement. The terms of the benefit plan descriptions,compensation plan descriptions and contracts with third parties covering officers shallcontrol the disposition to Executive and timing of all other amounts to which theExecutive may be entitled, and neither the Employer nor CMS Energy Corporation nor any ofits Affiliates shall have any further obligations to the Executive thereunder as a resultof the existence of this Agreement. No other severance benefits of any type shall bemade available to Executive. Notwithstanding the above, if the Executive’s employmentterminates pursuant to this Section 4.2, the Executive shall be bound by the provisionscontained in Article 5(a), 5(b), 5(c), 5(d), and 5(e) hereof.  **4.3** **Notice of Termination**. Any termination of the Executive’s employment in accordancewith Section 4.2 of this Agreement shall be communicated by Notice of Terminationdelivered to the other party, which shall include a specific date on which thetermination has occurred and is effective.**Article 5. Noncompetition and Confidentiality**     During the term of this Agreement and also in the event the Executive becomes entitled toreceive Change-in-Control Severance Benefits as provided in Section 3.2 herein, the following shallapply:
 

 
 (a) **Section 8 of the Employment Agreement.**All the provisions of Section 8of the Employment Agreement shall apply.  (b) **Confidentiality.**In addition to the confidentiality provisionscontained in Section 8(c) of the Employment Agreement, the Employer has advised theExecutive and the Executive acknowledges that it is the policy of CMS EnergyCorporation and its Affiliates to maintain as secret and confidential all ProtectedInformation (as defined below), and that Protected Information has been and will bedeveloped at substantial cost and effort to CMS Energy Corporation and itsAffiliates. The Executive shall not at any time, directly or indirectly, divulge,furnish, or make accessible to any person, firm, corporation, association, or otherentity (other than as may be required in the regular course of the Executive’semployment), nor use in any manner, either during the term of employment or aftertermination, for any reason, any Protected Information, or cause any suchinformation of CMS Energy Corporation and its Affiliates to enter the publicdomain.    For purposes of this Agreement, “Protected Information” means trade secrets,confidential and proprietary business information of CMS Energy Corporation andits Affiliates and any other information of CMS Energy Corporation and itsAffiliates, including, but not limited to, customer lists (including potentialcustomers), sources of supply, processes, plans, materials, pricing information,internal memoranda, marketing plans, internal policies, and products and serviceswhich may be developed from time to time by CMS Energy Corporation and itsAffiliates and their agents or employees, including the Executive; provided,however, that information that is in the public domain (other than as a result ofa breach of this Agreement), approved for release by CMS Energy Corporation or itsAffiliates or lawfully obtained from third parties who are not bound by aconfidentiality agreement with CMS Energy Corporation or its Affiliates, is notProtected Information. Notwithstanding the foregoing, nothing in this subsectionis to be construed as prohibiting Executive from freely providing information to astate or federal agency, legislative body or one of its committees or a court withjurisdiction when Executive is requested or required to do so by such entity.  (c) **Cooperation.**Executive agrees to fully and unconditionally cooperatewith CMS Energy Corporation and its Affiliates and their attorneys in connectionwith any and all lawsuits, claims, investigations, or similar proceedings that havebeen or could be asserted at any time arising out of or related in any way toExecutive’s employment or activities on behalf of CMS Energy Corporation and itsAffiliates.  (d) **Nondisparagement.**At all times, the Executive agrees not to disparageCMS Energy Corporation or its Affiliates or otherwise make comments harmful totheir reputations. While receiving any payments pursuant to this Agreement or theEmployment Agreement, Executive further agrees not to testify or act in anycapacity as a paid or unpaid expert witness, advisor or consultant on behalf of anyperson, individual, partnership, firm, corporation or any other person or entitythat has or may have any claim, demand, action, suit, cause of action, or
 

 
   judgment against CMS Energy Corporation or its Affiliates, or from agreeing to doso after the payments under this Agreement have ceased. Further, CMS EnergyCorporation and its Affiliates agree not to disparage Executive or otherwise makecomments harmful to Executive’s reputation. Notwithstanding the foregoing,nothing in this Section prohibits Executive or representatives of CMS EnergyCorporation or its Affiliates from testifying truthfully under oath in anyjudicial, administrative or legislative proceedings or in any arbitration,mediation or other similar proceedings.**Article 6. Excise Tax Equalization Payment** **6.1** **Excise Tax Equalization Payment.**In the event that the Executive becomes entitledto Severance Benefits or any other payment or benefit under this Agreement, or under theEmployment Agreement, or under any other agreement, plan or arrangement for whichExecutive is eligible with (1) the Employer, (2) any Person whose actions result in aChange in Control, or (3) CMS Energy Corporation or any of its Affiliates (all of suchpayments and benefits collectively referred to as the “Total Payments”), and if all orany part of the Total Payments will be subject to the tax (the “Excise Tax”) imposed bySections 280G and 4999 of the Code (or any similar tax that may hereafter be imposed),the Employer shall pay to the Executive in cash an additional amount (the “Gross-UpPayment”) such that the net amount retained by the Executive after deduction of anyExcise Tax upon the Total Payments and any federal, state, and local income tax,penalties, interest, and Excise Tax upon the Gross-Up Payment provided for by thisSection 6.1 (including FICA and FUTA), shall be equal to the Total Payments. Suchpayment shall be made by the Employer to the Executive within forty-five (45) calendardays following the Effective Date of Termination.    For purposes of determining the amount of the Gross-Up Payment, the Executive shall bedeemed to pay federal income taxes at the highest marginal rate of federal incometaxation in the calendar year in which the Gross-Up Payment is to be made, and state andlocal income taxes at the highest marginal rate of taxation in the state and locality ofthe Executive’s residence on the Effective Date of Termination, net of the maximumreduction in federal income taxes which could be obtained from deduction of such stateand local taxes.  **6.2** **Subsequent Recalculation.**In the event the Internal Revenue Service adjusts thecomputation under Section 6.1 herein so that the Executive did not receive the greatestnet benefit, the Employer shall reimburse the Executive for the full amount necessary tomake the Executive whole, plus interest on the reimbursed amount at 120% of the rateprovided in section 1274(b)(2)(B) of the Code. In the event that the Excise Tax isfinally determined to be less than the amount taken into account hereunder in calculatingthe Gross-Up Payment, the Executive shall repay the Employer within thirty (30) businessdays following the time that the amount of such reduction in the Excise Tax is finallydetermined, the portion of the Gross-Up Payment attributable to such reduction (plus thatportion of the Gross-Up Payment attributable to the Excise Tax and federal, state andlocal income and employment taxes imposed on the Gross-Up Payment being repaid by theExecutive) to the extent that such repayment
 

 
   results in a reduction in the Excise Tax and a dollar-for-dollar reduction in theExecutive’s taxable income and wages for purposes of federal, state and local income andemployment taxes, plus interest on the amount of such repayment at 120% of the rateprovided in section 1274(b)(2)(B) of the Code.**Article 7. Dispute Resolution and Notice** **7.1** **Dispute Resolution.**Any dispute or controversy between the parties arising under or inconnection with this Agreement shall be settled by final and binding arbitration afterfirst being submitted in writing to the Committee for attempted resolution. If that doesnot result in mutually agreeable resolution, the arbitration proceeding shall be conductedbefore a single arbitrator selected by the parties to be conducted in Jackson, Michigan.The arbitration will be conducted in accordance with the rules of the American ArbitrationAssociation then in effect and be finished within ninety (90) days after the selection ofthe arbitrator. The arbitrator shall not have authority to fashion a remedy that includesconsequential, exemplary or punitive damages of any type whatsoever, and the arbitrator ishereby prohibited from awarding injunctive relief of any kind, whether mandatory orprohibitory. Judgment may be entered on the award of the arbitrators in any court havingcompetent jurisdiction. The parties shall share equally the cost of the arbitrator and ofconducting the arbitration proceeding, but each party shall bear the cost of its own legalcounsel and experts and other out-of-pocket expenditures.  **7.2** **Notice.**Any notices, requests, demands, or other communications provided for bythis Agreement shall be in writing and sent by registered or certified mail to theExecutive at the last address he or she has filed in writing with the Employer or, in thecase of the Employer, at One Energy Plaza, Jackson, Michigan 49201, Attention: CorporateSecretary. Notices, requests, demands or other communications may also be delivered bymessenger, courier service or other electronic means and are sufficient if actuallyreceived by the party for whom it is intended.**Article 8. Successors and Assignment** **8.1** **Successors.**Any successor (whether direct or indirect, by purchase, merger,reorganization, consolidation, acquisition of property or stock, liquidation, orotherwise) to the business of CMS Energy Corporation or purchaser of all or substantiallyall of the assets of CMS Energy Corporation shall be required to expressly assume andagree to perform under this Agreement in the same manner and to the same extent that theEmployer would be required to perform if no such succession had taken place. Failure toobtain such assumption and agreement prior to the effectiveness of any such succession orasset sale shall entitle the Executive to the Change-in-Control Severance Benefitsspecified in Section 3.2 of this Agreement. The effective date of the succession or thesale shall be deemed the date of delivery to Executive of the Notice of Termination forpurposes of administering Section 3.2. Regardless of whether such agreement isexecuted, this Agreement shall be binding
 

 
   upon any successor in accordance with the operation of law. **8.2** **Assignment by the Executive.**This Agreement shall inure to the benefit of and beenforceable by the Executive’s personal or legal representatives, executors,administrators, successors, heirs, distributees, devisees, and legatees. If theExecutive dies while any amount would still be payable to him or her hereunder had he orshe continued to live, all such amounts, unless otherwise provided herein, shall be paidin accordance with the terms of this Agreement to the Executive’s Beneficiary. If theExecutive has not named a Beneficiary, then such amounts shall be paid to the Executive’sdevisee, legatee, or other designee, or if there is no such designee, to the Executive’sestate.**Article 9. Miscellaneous** **9.1** **Employment Status.**The employment of the Executive by the Employer is “at will”and may be terminated by either the Executive or the Employer at any time, subject toapplicable law. Further, Executive has no right to be an officer of CMS EnergyCorporation or any of its Affiliates and serves as an officer entirely at the discretionof the Board.  **9.2** **Entire Agreement.**This Agreement supersedes any prior agreements or understandings,oral or written, between the parties hereto, with respect to the subject matter hereof,and constitutes the entire agreement of the parties with respect thereto. Withoutlimiting the generality of the foregoing sentence, and except for the EmploymentAgreement which remains in full force and effect unless expressly modified or amendedherein, this Agreement completely supersedes, cancels, voids and renders of no furtherforce and effect any and all other employment agreements, change in control agreements,and other similar agreements, communications, representations, promises, covenants andarrangements, whether oral or written, between the Employer and Executive and between theExecutive and CMS Energy Corporation or any of its Affiliates that may have taken placeor been executed prior to the Effective Date of this Agreement and which may address thesubject matters contained herein. Executive expressly agrees that only the first twosentences of Section 9 of the Employment Agreement shall survive the execution of thisAgreement and the balance of Section 9 after those first two sentences is superseded inits entirety by this Agreement and no longer has any legal force and effect whatsoever.Executive forever releases the Employer, CMS Energy Corporation, and its affiliates fromthe duty to comply with the superseded provisions of Section 9.  **9.3** **Severability.**In the event that any provision or portion of this Agreement shall bedetermined to be invalid or unenforceable for any reason, the remaining provisions ofthis Agreement shall be unaffected thereby and shall remain in full force and effect.  **9.4** **Tax Withholding.**The Employer may withhold from any benefits payable under thisAgreement any authorized deductions and all federal, state, city, or other taxes as maybe required pursuant to any law or governmental regulation or ruling.
 

 
 **9.5** **Beneficiaries.**The Executive may designate one (1) or more persons or entities asthe primary and/or contingent beneficiaries of any amounts to be received under thisAgreement. Such designation must be in the form of a signed writing on a form providedby the Employer. The Executive may make or change such designation at any time.  **9.6** **Payment Obligation Absolute.**Except as provided in the last sentence of thisparagraph, the Employer’s and CMS Energy Corporation’s obligations to make the paymentsand provide the benefits to Executive specified herein shall be absolute andunconditional, and shall not be affected by any circumstances, including, withoutlimitation, any offset, counterclaim, recoupment, defense, or other right which theEmployer, CMS Energy Corporation or any of its Affiliates may have against the Executiveor anyone else. All amounts payable by the Employer hereunder shall be paid withoutnotice or demand. Each and every payment made hereunder by the Employer shall be final,but subject to the provisions of the next sentence. If the Executive should seek tobypass arbitration and litigate about this Agreement or the subject matters addressedherein in a state or federal court, Executive agrees (i) at least 10 days prior to filingin court to tender back to the Employer all cash consideration paid to Executive underthis Agreement and the Employment Agreement prior thereto and (ii) any payments dueExecutive under this Agreement and the Employment Agreement after said tender shall besuspended until said litigation is finally resolved.    The Executive shall not be obligated to seek other employment in mitigation of theamounts payable or arrangements made under any provision of this Agreement, and theobtaining of any such other employment shall in no event effect any reduction of theEmployer’s obligations to make the payments and arrangements required to be made underthis Agreement and the Employment Agreement.  **9.7** **Contractual Rights to Benefits.**Subject to approval and ratification by theCommittee, this Agreement establishes and vests in the Executive a contractual right tothe benefits to which he or she is entitled hereunder. However, nothing herein containedshall require or be deemed to require, or prohibit or be deemed to prohibit, the Employerto segregate, earmark, or otherwise set aside any funds or other assets, in trust orotherwise, to provide for any payments to be made or required hereunder.  **9.8** **Modification.**This Agreement shall not be varied, altered, modified, canceled,changed, or in any way amended except by mutual agreement of the parties in a writteninstrument executed by the parties hereto or their legal representatives.  **9.9** **Counterparts.**This Agreement may be executed in one (1) or more counterparts, eachof which shall be deemed to be an original, but all of which together will constitute oneand the same Agreement. Signatures transmitted via facsimile shall be regarded by theparties as original signatures.  **9.10** **Applicable Law.**This Agreement shall be governed and construed in accordance withthe laws of the State of Michigan, without regard to its conflicts of laws principles.
 

 
     INWITNESS WHEREOF, the parties have executed this Agreement as of this___ day of                    , 2004.                   EXECUTIVE:                   By:     Signature:                 Its:      Printed Name:                 
 

 
**Addendum to Tier III Change-in-Control Agreement.****Whereas**the Board of Directors of CMS Energy Corporation approved entering into change in controlagreements with certain key employees; and**Whereas**                     and the Executive have entered into a Change-in-Control (the “Agreement”)dated                     , 200___ pursuant to that authority; and**Whereas**the Agreement requires that any modification or alteration may only be made by mutualagreement of the parties in a written instrument executed by the parties or their legalrepresentatives; and**Whereas**the parties mutually agree to modify the Agreement to comply with Internal Revenue CodeSection 409A (“Code Section 409A”) under the short term deferral rules.**Now Therefore**the parties agree to modify the Change-in-Control Agreement to comply with therequirements of Section 409A to qualify as a short term deferral by making the following changes tothe Agreement:**I.**Section 2.14 **“Good Reason”**is modified as follows:**“Good Reason”**exists only on the date of a Change in Control or during the twenty-four(24) months which follow a Change in Control and shall mean, without the Executive’sexpress written consent, the occurrence of any one or more of the following: (a) The assignment to the Executive of duties materially inconsistentwith the Executive’s position (including status, offices, titles, and reportingrequirements), authority, or responsibilities as in effect on the Effective Date,or any action by the Employer which results in a material diminution of theExecutive’s position, authority, duties, or responsibilities as constituted as ofthe Effective Date (excluding an isolated, insubstantial, and inadvertent actionwhich is remedied by the Employer promptly after receipt of notice thereof givenby the Executive); or  (b) Materially reducing the Executive’s Base Salary; or  (c) Materially reducing the Executive’s targeted annual incentiveopportunity; or  (d) A material failure to maintain the Executive’s participation in along-term incentive plan in a manner that is consistent with the Executive’sposition, authority, or responsibilities; or
 

 
 (e) A material failure to maintain the Executive’s amount of benefitsunder, or relative level of participation in, employee benefit or retirementplans, policies, practices, or arrangements of a material nature available toemployees of CMS Energy Corporation and its Affiliates and in which the Executiveparticipates as of the date of a Change in Control, provided however that any suchchange must result in a material negative change to the employee in the employmentrelationship; or  (f) A material breach of this Agreement by the Employer which is notremedied by the Employer after receipt of written notice of such breach deliveredby the Executive to the Committee; or  (g) Any successor company fails or refuses to assume the obligations owedto Executive under this Agreement in their entirety, as required by Section 8.1hereunder; or  (h) The Executive is required to be based at a location in excess ofthirty-five (35) miles from the location of the Executive’s principal job locationor office immediately prior to a Change in Control except for required travel onthe Employer’s or CMS Energy Corporation’s business to an extent substantiallyconsistent with the Executive’s prior business travel obligations.For purposes of applying clauses (a) through (hi) of this Agreement, the Executive’sRetirement shall not constitute a waiver of the Executive’s rights with respect to anycircumstance constituting Good Reason, and the Executive’s continued employment shallnot constitute a waiver of the Executive’s rights with respect to any circumstanceconstituting Good Reason or constitute Executive’s consent to the circumstancesconstituting Good Reason unless Executive has provided express written consent to thecircumstance that would otherwise constitute Good Reason under this Agreement.Notwithstanding the above, the Executive must provide notice to the Employer of theexistence of Good Reason not more than 90 days after the initial existence of thecircumstance that constitutes Good Reason as set forth above and provide a period of 30days for the Employer to remedy the circumstance giving rise to Good Reason and thusnot have to pay the Change in control severance benefits as provided for under Section3.2. All provisions and interpretations relating to good Reason are to be appliedconsistent with Section 409A and the applicable Treasury regulations at Section1.409A-1(n)(2) or its successor.
 

 
**II.** Section 2.15 **“Notice of Termination”**shall be amended to add the following sentence at theend:Notwithstanding the above, the date of the Qualifying Termination will be the date the Executiveexperiences a separation from service with the service recipient, as that term is defined underIRC Section 409A and any applicable regulations.               Accepted by Company:     Accepted by Executive:                                                        Date:       Date:                     
 

 
Addendum to Tier III (DC SERP)Change-in-Control Agreement.**Whereas**the Board of Directors of CMS Energy Corporation approved entering into change in controlagreements with certain key employees; and**Whereas**                     and the Executive have entered into a Change-in-Control (the “Agreement”)dated                     , 200___ pursuant to that authority; and**Whereas**the Agreement requires that any modification or alteration may only be made by mutualagreement of the parties in a written instrument executed by the parties or their legalrepresentatives; and**Whereas**the parties mutually agree to modify the Agreement to comply with Internal Revenue CodeSection 409A (“Code Section 409A”) under the short term deferral rules.**Now Therefore**the parties agree to modify the Change-in Control Agreement to comply with therequirements of Section 409A to qualify as a short term deferral by making the following changes tothe Agreement:**I.** Section 2.14 **“Good Reason”**is modified as follows:**“Good Reason”**exists only on the date of a Change in Control or during the twenty-four(24) months which follow a Change in Control and shall mean, without the Executive’sexpress written consent, the occurrence of any one or more of the following: (a) The assignment to the Executive of duties materially inconsistentwith the Executive’s position (including status, offices, titles, and reportingrequirements), authority, or responsibilities as in effect on the Effective Date,or any action by the Employer which results in a material diminution of theExecutive’s position, authority, duties, or responsibilities as constituted as ofthe Effective Date (excluding an isolated, insubstantial, and inadvertent actionwhich is remedied by the Employer promptly after receipt of notice thereof givenby the Executive); or  (b) Materially reducing the Executive’s Base Salary; or  (c) Materially reducing the Executive’s targeted annual incentiveopportunity; or  (d) A material failure to maintain the Executive’s participation in along-term incentive plan in a manner that is consistent with the Executive’sposition, authority, or responsibilities; or
 

 
 (e) A material failure to maintain the Executive’s amount of benefitsunder, or relative level of participation in, employee benefit or retirementplans, policies, practices, or arrangements of a material nature available toemployees of CMS Energy Corporation and its Affiliates and in which the Executiveparticipates as of the date of a Change in Control, provided however that any suchchange must result in a material negative change to the employee in the employmentrelationship; or  (f) A material breach of this Agreement by the Employer which is notremedied by the Employer after receipt of written notice of such breach deliveredby the Executive to the Committee; or  (g) Any successor company fails or refuses to assume the obligations owedto Executive under this Agreement in their entirety, as required by Section 8.1hereunder; or  (h) The Executive is required to be based at a location in excess ofthirty-five (35) miles from the location of the Executive’s principal job locationor office immediately prior to a Change in Control except for required travel onthe Employer’s or CMS Energy Corporation’s business to an extent substantiallyconsistent with the Executive’s prior business travel obligations.For purposes of applying clauses (a) through (h) of this Agreement, the Executive’sRetirement shall not constitute a waiver of the Executive’s rights with respect to anycircumstance constituting Good Reason, and the Executive’s continued employment shallnot constitute a waiver of the Executive’s rights with respect to any circumstanceconstituting Good Reason or constitute Executive’s consent to the circumstancesconstituting Good Reason unless Executive has provided express written consent to thecircumstance that would otherwise constitute Good Reason under this Agreement.Notwithstanding the above, the Executive must provide notice to the Employer of theexistence of Good Reason not more than 90 days after the initial existence of thecircumstance that constitutes Good Reason as set forth above and provide a period of 30days for the Employer to remedy the circumstance giving rise to Good Reason and thusnot have to pay the Change in control severance benefits as provided for under Section3.2. All provisions and interpretations relating to good Reason are to be appliedconsistent with Section 409A and the applicable Treasury regulations at Section1.409A-1(n)(2) or its successor.
 

 
**II.** Section 2.15 **“Notice of Termination”**shall be amended to add the following sentence at theend:   Notwithstanding the above, the date of the Qualifying Termination will be the date the Executiveexperiences a separation from service with the service recipient, as that term is defined underIRC Section 409A and any applicable regulations. **III.** Section 3.2(h) shall be amended as follows: (h) For an Executive included in DC SERP, the Executive’s retirement benefits under the DCSERP will become fully vested as of the Effective Date of Termination and shall not besubject to further vesting requirements or to any forfeiture provisions. In addition, saidExecutive shall be provided an additional contribution to the DC SERP equal to three timesthe amount the Company would contribute on behalf of the Executive to the Deferred CompanyContribution Plan and the DC SERP Plan for the current year based on the base salary andbonus as determined pursuant to clause (b) of this Section 3.2.               Accepted by Company:     Accepted by Executive:                                                        Date:        Date: