Document:

Exhibit 10a(4) 

	
 

	
 

	
 

	
Margaret M.
Pego, SPHR 

	
Human
Resources 

	
 

	
Vice
  President - Human Resources

	
80 Park
  Plaza, 21A, Newark, NJ 07102

	
 

	
tel:
  973.430.7243 fax: 973.643.6063

	
 

	
 

	
email:
  Margaret.Pego@pseg.com

	
 

	
 

	
 

	
 

	
 

	
 

	
PSEG

	
 

	
 

	
Services
  Corporation

	
 

	
 

	
 

	
 

	
December
  8, 2006

	
 

	
 

	
 

	
Mr. William Levis

	
 

	
 

	
106 Carlton Drive

	
 

	
 

	
Chaddsford, PA 19317

	
 

	
 

	
 

	
 

	
 

	
Dear Bill:

	
 

	
 

          We
are pleased to offer you the position of President and Chief Nuclear Officer of
PSEG Nuclear, LLC, a subsidiary of PSEG Power, LLC, effective January 1, 2007
(“DOE”). In this position, you
will be an employee of PSEG Power. While you are employed by PSEG Power, you
will devote substantially all of your business time and efforts to the performance of your duties
and use your best efforts in such endeavors. Your acceptance of this offer of employment constitutes your
representation that your execution and performance of the requirements of this position will not
be in violation of any other agreement to which you are a party. PSEG Power is
a subsidiary of Public Service Enterprise Group Incorporated (Enterprise or PSEG). You may be assigned to
another executive position of similar or greater responsibility by the Chief Executive Officer of Enterprise.

          You
will be paid a base salary of $500,000 and will be eligible for your first
salary review in December
2007. Salary reviews will be conducted annually thereafter.

          Within
45 days following your DOE, PSEG Power will make a cash payment to you in the amount of $500,000 (subject to
withholdings according to the IRS and Company policy). This bonus must be repaid, and you agree to repay it, if you
leave the Company (voluntarily
or are terminated for cause): within
five (5) years of your DOE. In addition, if your 2006 annual incentive payment from Exelon Corporation is less than
$230,000, you will receive a
lump sum payment equaling the difference between $230,000 and such amount within ninety days.

          You
will participate in PSEG’s Management Incentive Compensation Plan (MICP)
under the terms and conditions
of that Plan. Your target incentive award will be 60% of your base salary. You may, however, be eligible to
receive up to 90% of your base salary

	
 

	

	
 

	
1 “Cause” means
  (i) the willful or negligent dereliction of, and continued failure by you to
  perform your dutieswith PSEG Power (other than
  any such failure resulting from your incapacity due to physical or mental
  illness),after a written demand for performance is delivered to
  you by the President - PSEG Power, L.L.C., whichidentifies the
  manner in which he believes that you have not so performed your duties; (ii)
  any conductconstituting a felony or
  moral turpitude; (iii) fraud or embezzlement; or (iv) failure to comply with
  the Standards of Integrity.

dependent upon business
results. This may be adjusted from time to time in accordance with established plan procedures. There is no
guarantee of payment under the MICP, and any such payment will be contingent upon your establishment and successful
completion of goals and
objectives.

          You
will be a participant in the Long-Term Incentive Plan (LTIP) of Enterprise and
you will receive an initial
grant of 50,000 shares of Restricted Stock of Enterprise, subject to the approval of the Organization and
Compensation Committee of the Board. Under the LTIP, 20,000 shares will vest on the third anniversary of your DOE. The
remaining 30,000shares will
vest on the sixth anniversary of your DOE. All of the shares will vest in the
event of your death or total and
permanent disability or, if your employment is terminated without cause. You will be paid any dividends on the
shares in cash. In addition, long-term compensation opportunity is reviewed annually pursuant to the terms of
the LTIP. The first such review
will take place in the first quarter of 2007, and is expected to provide total
value of approximately $500,000.
In the years thereafter, the number and form of LTIP grants recommended in any given year will
appropriately reflect your responsibilities and ability to contribute to the long-term success of
Enterprise.

          You
are eligible for financial counseling on the same terms and conditions as
applied to other officers
of PSEG. You are also eligible to participate in the PSEG Deferred Compensation Plan For Certain Employees,
which allows you to defer all or a portion of your base pay and/or any incentive bonus you may receive in any given
year upon employment. You are
also eligible for an executive annual physical examination arranged through PSEG’s Medical Department. In
addition, you are eligible to receive thirty (30) vacation days with pay beginning January 2,
2007.

	
 

	
 

	
 

	
 

	
•

	
You are eligible for those
  benefits available to associates of PSEG Power with a similar date of hire generally,
  except as otherwise provided in this letter. In addition, you are eligible
  for the following: You will be eligible to participate in the Limited Supplemental Benefit Plan for Certain
  Employees of Public Service
  Enterprise Group and its Subsidiaries (“the Limited Plan”)if you remain employed by PSEG through
  January 16, 2013. Upon your retirement,
  The Limited Plan will provide a target supplemental pension. For example, if
  you complete 10 years of service with the Company upon your retirement, the
  Plan will provide retirement income equal to 40% of your final average
  earnings less the aggregate of 1) your actual pension provided by the Cash
  Balance Plan, b) your vested Exelon pension at your DOE and c) your primary
  Social Security benefit payable at normal retirement age. In addition, the
  Plan provides a supplemental death benefit equal to 150% of base compensation
  if death occurs while employed and before retirement.

	
 

	
 

	
 

	
 

	
•

	
Upon retirement (not
  before age 55 with at least five years of service), you will be eligible for the same cost sharing
  provisions for retiree medical coverage as those employees not currently
  eligible for Benefits 2000 (employed prior to January 1996). To facilitate
  this benefit, upon your retirement, PSEG Power will make a lump sum payment
  equal to the present value of the normal employer contribution toward health
  and welfare benefits

2

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
in retirement, as if you
  were eligible for such benefits as a retiree. You will make the same
  contributions as those made by a similarly situated employee eligible for
  such benefits and employer contribution.

	
 

	
 

	
 

	
 

	
•

	
For the purpose of
  determining the duration of full-pay short-term temporary disability benefits, as of your DOE, you
  will be treated as if you had ten (10)years of service with PSEG.

A representative of the
Human Resources Department from Compensation and Benefits will meet with you at your convenience to explain
in more detail the provisions of the above plans. Please call Camille Valvano at 973-430-5879 to arrange this
meeting.

          The
Company will provide you with a full size American made automobile and shall
provide the related maintenance,
repairs, insurance and costs of operation thereof.

          You are eligible for reimbursement under the
Company’s relocation policy for any future assignment or position with PSEG that would require you to
relocate.  

          Your
employment with PSEG is at-will and therefore you may be discharged with or
without cause and with or without notice at any time. 

	
 

	
 

	
 

	
 

	
•

	
In the event that your
employment is terminated without cause, except as provided in the bullet below, you will be
eligible those benefits attributed to Key Managers under the Public Service Enterprise Group Incorporated Separation Allowance
Benefits Plan
for Non-Represented Employees, except for those benefits set forth in
Section 4.1 of the Plan. In lieu of those benefit sprescribed in Section 4.1, you will be
eligible for a payment equaling one year of your then base salary, plus that year’s target annual incentive 

	
 

	
 

	
 

	
 

	
•

	
In the event that your
  employment is terminated without cause or pursuant to the Change in Control provisions of the Key
  Executive Severance Plan of Public
  Service Enterprise Group, Inc., then the provisions of that Plan, in which you will be a Schedule B participant,
  will govern the severance to which
  you are entitled.

	
 

	
 

	
 

          During
the course of your employment, you will have access to and become familiar
with “Confidential Information”
as defined below. You agree that you will not, directly orindirectly, disclose or use any Confidential
Information, except as required in the course of your employment with PSEG Nuclear or its affiliates and subsidiaries
and consistent with their
interests. All files, records, documents, or recordings, electronic or
otherwise, containing or
relating to Confidential Information, whether prepared by you or otherwise coming into your possession, will
remain the exclusive property of PSEG Power or its affiliates and subsidiaries.

          As
used herein, the term “Confidential Information” means all trade secrets,
proprietary and confidential
business information belonging to, used by, or in the possession of PSEG Power or its affiliates and
subsidiaries, with respect to their respective business

3

strategies, plans and
financial information, purchase or sale of property, leasing, pricing sales
programs-or-tactics, actual ‘or
past sellers, purchasers, lessees, lessors or customers, those with whom PSEG Power or its affiliates and
subsidiaries has begun negotiations for new business, costs, employee compensation, marketing and development
plans, inventions and technology,
whether such Confidential Information is oral, written or electronically
recorded or stored, except
information in the public domain, information known to you prior to your employment with PSEG Power, and information
received by you from sources other than PSEG Power or its affiliates and subsidiaries, without obligation of
confidentiality. This obligation
survives the termination of your employment with PSEG Power, regardless of the reason for that termination.

          You
acknowledge and’ agree that in the event of a breach by you of any of the
confidentiality terms of this
Agreement, PSEG will suffer irreparable harm for which money damages are not an adequate remedy, and that,
in the event of such breach, PSEG will beentitled to obtain an order of a court of competent jurisdiction for
equitable relief from such breach,
including, but not limited to, temporary restraining orders and preliminary
and/or permanent injunctions
against the breach of such agreements by you. Finally, you agree that you will
execute a Non-Compete and Non-Solicitation Agreement in the form annexed
hereto, as a condition of you employment in your new position.  

          Notwithstanding
any provision of this letter to the contrary, if you are a “specified employee” as defined in Section 409A of the
Internal Revenue Code of 1986, as amended (“Code Section 409A”), you will not be entitled to any payments upon a
termination of your employment
until the earlier of (i) the date which is six months after your termination of employment for any reason other than
death or (ii) the date of your death. The provisions of this Section 8 will only .apply if, and to
the extent, required to comply with Code Section409A.

          If
you (or your representative) inform the Company that any provision of this
letter would cause you to
incur any additional tax or interest under Code Section 409A or any regulations or Treasury guidance promulgated
thereunder, the Company will consider in good faith reforming such provision, after consulting with you and
receiving your approval (which
will not be unreasonably withheld); provided that the Company agrees to
maintain, to the maximum extent
practicable, the original intent and economic benefit to you of the applicable provision without violating the
provisions of Code Section 409A.

          Any
and all disputes arising out of or relating to this your employment, other than
an unemployment or
workers’ compensation claim, will, at the demand of either you or PSEG Power, whether made before or after the
institution of any legal proceeding, be resolved through binding arbitration administered by the American Arbitration
Association (AAA) in accordance
with the Employment Dispute Resolution Rules of the AAA and with the United States Arbitration Act. The arbitration
will be conducted in Newark, New Jersey before one arbitrator. If the parties cannot agree on
the arbitrator within 30 days after the demand for arbitration then either party may request the
AAA to select an arbitrator, which selection will be deemed acceptable to both parties. To the
maximum extent practicable, the arbitration proceeding will be concluded within 180 days of filing the demand for
arbitration with the AAA. The
parties will share all costs and fees of the arbitration equally, unless
otherwise 

4

awarded by the arbitrator.
Each party agrees to keep all such disputes and arbitration proceedings strictly confidential ‘except for
disclosure of information required by law. Each party further agrees to abide by and perform any award rendered by the
arbitrator, and that a judgment
of a court of competent jurisdiction may be entered on the award.

          Your
employment is governed by the laws of New Jersey, without reference to any
conflict of law rules or
regulations. If a court finds
any provision of this letter to be invalid, unenforceable or void, such provision will be severed from this letter
and will not affect the validity
or enforceability of any other provision of set forth herein. Moreover, this
letter contains the entire
agreement of the parties relating to the subject matter hereof, and supersedes in its entirety any and all prior
agreements, understandings or representations relating to the subject matter discussed herein, other than the
non-compete and non-solicitation agreement attached. No modifications to this
agreement will be valid unless made
in writing and signed by both parties.

          As
part of PSEG Power’s requirement for a work force that is free from the
influence of foreign
chemical substances, this offer of employment is conditional upon your
successful completion of a
medical examination which will include definitive analysis of a freshly  voided
urine specimen for the presence of commonly abused drugs, including marijuana. This offer is also conditional upon a
satisfactory background investigation and reference check.

          If the foregoing is in accordance with your
understanding, please sign the enclosed copy of this letter and return it to me.

	
 

	
 

	
 

	
Sincerely,

	
 

	
 

	
 

	
/s/ Margaret M. Pego

	
 

	
 

	
 

	
Margaret M. Pego

	
 

	
Vice President – Human
  Resources

	
 

	
 

	
Agreed to this 12th day  

	
 

	
of December, 2006.

	
 

	
 

	
 

	
/s/ William Levis

	
 

	

	
 

Attachments: Non-Compete and
Non-Solicitation Agreement

Responsibilities of Corporate
Officers and Directors

5

1

NON-COMPETITION-SOLICITATION
AGREEMENT

          In
consideration of employment with Public Service Enterprise Group Incorporated,
or any subsidiary,
affiliate or successor-in-interest thereof (the “Company”), I agree to the following:

	
 

	
 

	
 

	
1.

	
Non-Compete

	
 

	
 

	
 

	
 

	
 

	
During my employment with
  the Company, I agree not to compete in any manner, either directly or
  indirectly, whether for compensation or otherwise, with the Company, or to assist any
  other person or entity, business or otherwise, to compete with the Company. Further, during
  my employment with the Company, I agree not to engage in other conduct, employment or business
  enterprise that is in conflict
  with, may present an actual conflict with, or may appear to be in conflict with or to present a conflict with,
  the Company without the prior written permission of the Company. Such permission shall be by granted by the
  President of Power or his superior only.

	
 

	
 

	
 

	
2.

	
Non-Solicitation

	
 

	
 

	
 

	
 

	
 

	
During my employment with
  the Company and for a period of 2 years following my employment with the Company, I agree
  either on my own behalf or on behalf of any other person or entity, business or otherwise, directly or
  indirectly, not: (i) to hire,
  solicit, or encourage to leave the employ of the Company any person who is then an employee of the Company;
  (ii) to solicit, entice away or divert any person or entity who was or is then a customer or supplier of the
  Company or any other person
  sharing a business relationship with the Company; or (iii) to solicit, entice away or divert any person or
  entity who was identified as a potential customer or supplier of the Company at the time I was an employee of
  the Company and with respect
  to which I participated, directly or actively, in providing, selling, attempting to sell, or
  delivering services of the Company.

	
 

	
 

	
 

	
3.

	
General

	
 

	
 

	
 

	
 

	
a.

	
This Agreement shall be
  governed by and in accordance with the laws of the State of New Jersey and is being executed in the
  State of New Jersey. The laws of New Jersey (including the choice of law rule of New Jersey) shall govern
  the validity and
  interpretation of this Agreement as well as the performance by me and the Company of our respective duties and
  obligations. Ally dispute or claim relating to this Agreement shall be brought in a court of competent
  jurisdiction in New Jersey,
  and I hereby agree and consent to personal jurisdiction in New Jersey.

	
 

	
 

	
 

	
 

	
b.

	
This Agreement shall not
  in any way be construed as to change, alter or modify the employment-at-will relationship between
  me and the Company. 

2

	
 

	
 

	
 

	
 

	
c.

	
If any
  provision or clause of this Agreement, or portion thereof, shall be held by
  any court or other tribunal of competent jurisdiction to be illegal, void or
  unenforceable in such jurisdiction, the remainder of such provisions shall
  not thereby be affected and shall be given full effect, without regard to the
  invalid portion. It
  is agreed that it is the intention of the parties to this Agreement
  that if any court construes any provision or clause of this Agreement, or
  any. portion thereof, to be illegal, void or unenforceable because of the
  duration of such provision or the area or matter covered thereby, such court
  shall reduce the duration, area, or matter of such provision and, in its
  reduced form, such provision shall then be enforceable and shall be enforced.
  

	
 

	
 

	
 

	
 

	
d.

	
I agree that
  if subsequent to execution of this Agreement I am transferred to or accept
  another position with any company affiliated with the Company, this Agreement
  shall continue in effect and shall be deemed as having been automatically
  assigned to such entity. Further, no change in assignment, position,
  department, division, unit or location to which I am assigned shall in any
  way affect
  the obligations under this Agreement. This Agreement shall not be
  affected by any change in name of the Company, or any consolidation, merger,
  acquisition or addition or deletion, and shall be automatically assigned to
  any successor company of the Company, and continue in effect thereafter in accordance with its terms. 

	
 

	
 

	
 

	
 

	
e.

	
This
  Agreement shall inure to the benefit of the Company’s successors or assigns
  and, as far as legally possible, shall be binding upon my heirs, legal
  representations and assigns. 

	
 

	
 

	
 

	
 

	
f.

	
This
  Agreement shall survive termination of my employment with the Company
  irrespective of the reasons therefor. 

	
 

	
 

	
 

	
 

	
g.

	
I
  acknowledge that: (i) I have read and understand this agreement; (ii) I fully
  understand the limitations which it imposes on me; (iii) I have had the
  opportunity to review this Agreement with the counsel of my choice; and (iv)
  I have signed and entered into this Agreement voluntarily and of my own free
  will. 

Acknowledged,
accepted and agreed this 8th day of December, 2006. 

	
 

	
 

	
Signature of
  Employee:

	
/s/ William
  LevisExhibit 10a(5)

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

2007 EQUITY COMPENSATION PLAN FOR OUTSIDE DIRECTORS

	
 

	
 

	
I.

	
PURPOSE

          The
purpose of this Public Service Enterprise Group Incorporated 2007 Equity
Compensation Plan for Outside Directors is to advance the interests of the
Company and its stockholders by assisting the Company in attracting and
retaining individuals of superior talent, ability and achievement to serve on
its Board of Directors. 

          It
is intended that the Plan will be interpreted and administered to prevent
taxation under Section 409A of the Code. Any provision of or amendment to this
Plan that would cause any amount to be taxable under Section 409A with respect
to any individual is void and without effect. Any election by any partici­pant,
and any administrative action by the Committee that would cause any amount to
be taxable under Section 409A with respect to any individual is void and
without effect under the Plan. In the event that a Participant fails to make a
Section 409A-compliant payment election, the Plan’s default payment provisions,
as set forth in Subsection V.G and Article VIII, shall apply. It is further
intended that the Plan will be amended in accordance with present and future
guidance issued by the Treasury Department under Section 885 of the American
Jobs Creation Act of 2004.

	
 

	
 

	
II.

	
DEFINITIONS

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

	
 

	
 

	
 

	
 

	
a)

	
Annual
  Meeting: The Annual Meeting of Stockholders of the
  Company.

	
 

	
 

	
 

	
 

	
b)

	
Board:
  The Board of Directors of the Company.

	
 

	
 

	
 

	
 

	
c)

	
Code:
  The Internal Revenue Code of 1986, as amended.

	
 

	
 

	
 

	
 

	
d)

	
Committee:
  Those persons who are members of the Board but who are not Outside Directors.

	
 

	
 

	
 

	
 

	
e)

	
Common Stock:
  The Common Stock without nominal or par value of the Company.

	
 

	
 

	
 

	
 

	
f)

	
Company:
  Public Service Enterprise Group Incorporated, a corporation organized and
  existing under the laws of the State of New Jersey, or its successor or
  successors.

2

	
 

	
 

	
 

	
 

	
g)

	
Disability:
  Any physical or mental condition of a permanent nature which, in sole
  reasonable judgment of the Committee, renders an Outside Director incapable
  of performing the duties of a member of the Board.

	
 

	
 

	
 

	
 

	
h)

	
Effective
  Date: Upon approval by stockholders at the 2007
  Annual Meeting of Stockholders.

	
 

	
 

	
 

	
 

	
i)

	
Exchange Act:
  The Securities and Exchange Act of 1934, as amended, or as it may be amended
  from time to time.

	
 

	
 

	
 

	
 

	
j)

	
NYSE:
  The New York Stock Exchange, Inc.

	
 

	
 

	
 

	
 

	
k)

	
Outside
  Director: A member of the Board on or after the
  Effective Date who never has been employed by the Company or any of its
  affiliates.

	
 

	
 

	
 

	
 

	
l)

	
Participant:
  An Outside Director who receives a Stock Unit Award under this Plan.

	
 

	
 

	
 

	
 

	
m)

	
Plan:
  This Public Service Enterprise Group Incorporated 2007 Equity Compensation
  Plan for Outside Directors, as it may be amended from time to time.

	
 

	
 

	
 

	
 

	
n)

	
Securities
  Act: The Securities Act of 1933, as amended, or as
  it may be amended from time to time.

	
 

	
 

	
 

	
 

	
o)

	
Service:
  A Director’s service as a member of the Board.

	
 

	
 

	
 

	
 

	
p)

	
Stock Unit
  Award: An award, representing the right to receive
  shares of Common Stock upon termination of service as an Outside Director,
  subject to the provisions of Article IV hereof.

	
 

	
 

	
 

	
 

	
q)

	
Year of
  Service: The annual period commencing on May 1st
  of each year and ending at the earlier of the succeeding April 30th
  or the next Annual Meeting of Stockholders. For any person first elected a
  member of the Board after May 1st of any year, his/her first Year
  of Service shall commence upon his/her election as a Director and shall end
  at the earlier of the succeeding April 30th or the next Annual
  Meeting of Stockholders.

	
 

	
 

	
III.

	
SHARES SUBJECT TO THE PLAN

          200,000
shares of Common Stock are reserved to satisfy awards of Stock Units pursuant
to the terms of this Plan. Such shares may be acquired directly from the
Company or, at the discretion of the Company, purchased on the open market by
the Company or its agent. 

3

	
 

	
 

	
IV.

	
STOCK UNIT AWARDS

	
 

	
 

	
 

	
 

	
A.

	
Upon the
  commencement of each Year of Service as a member of the Board, each Outside
  Director shall be granted an award of Stock Units in an amount as shall be
  established from time to time by the Board of Directors. The date of grant
  shall be the first business day of May. With respect to an Outside Director
  first elected as a director after May 1 of any year, the date of such Outside
  Director’s initial award grant under this Plan shall be the first business
  day of the month next following the Outside Director’s initial election as a
  member of the Board.

	
 

	
 

	
 

	
 

	
B.

	
The number
  of Stock Units to be awarded on any particular date of grant shall be equal
  to the amount of the award grant (expressed in dollars) divided by the
  closing price of the Common Stock on the NYSE on the date of grant as
  provided in Section IV.A, rounded up to the next whole share. 

	
 

	
 

	
 

	
 

	
C.

	
If a
  Participant fails to complete the Year of Service with respect to which a
  Stock Unit Award has been granted, other than on account of Disability or
  death, such Stock Unit Award and any earnings thereon shall be prorated to
  reflect the portion of the Year of Service actually served by the
  Participant. 

	
 

	
 

	
 

	
 

	
D.

	
No stock
  certificates shall be issued in connection with any Stock Unit Award and the
  Stock Unit Awards shall be evidenced by bookkeeping account in the name of
  the Participant maintained by the Company. The Company shall not be required
  to segregate any amounts credited to these Stock Unit Award accounts, which
  shall be established merely as an accounting convenience. Amounts credited to
  the Stock Unit Award accounts shall at all times remain solely the property
  of the Company subject to the claims of its general creditors and available
  for the Company’s use for whatever purpose desired. Stock Unit Award accounts
  shall be credited with dividend equivalents at a rate equal to such dividends
  as may be declared by the Company on the Common Stock. Such dividends
  equivalents shall be invested as additional Stock Units as of the last business day
  of each quarter at a share price equal to closing price of the Common Stock
  on the NYSE on the date the transaction is credited. 

	
 

	
 

	
 

	
 

	
E.

	
Until
  distribution of shares of Common Stock from the Plan, neither a Participant
  nor any other person shall have any right to commute, sell, assign, transfer,
  pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate,
  alienate or convey the amounts, if any, payable hereunder, or any part
  thereof, which are, and all rights to which are expressly declared to be,
  unassignable and non-transferable. No part of the amounts payable shall,
  prior to actual payment, be subject to seizure, attachment, garnishment or
  sequestration for the payment of any debts, judgments, alimony or separate
  maintenance owed by a Participant or any other person, be transferable by
  operation of law in the event of a Participant’s or any other person’s
  bankruptcy or insolvency. 

	
 

	
 

	
 

	
 

	
 

	
Provided,
  however, that, in the event that a domestic
  relations order of any State is received by the Plan and thereafter
  determined to be a Qualified Domestic Relations Order (QDRO) within the
  meaning of Code section 414(p), the portion

4

	
 

	
 

	
 

	
 

	
 

	
of the
  Account of the Participant to which such QDRO is directed shall be
  apportioned as specified in such QDRO, valued as of the business day
  preceding the date specified in such QDRO. Upon notice to the Committee that
  a QDRO is being sought with respect to a Participant’s Account, no
  distribution shall be made to a Participant until such time as the status of
  the QDRO is determined. The alternate payee of the Participant’s Account
  shall thereafter participate in the Plan in accordance with its terms, except
  such person shall not have the rights or benefits provided in Subsection IV.A.
  If a QDRO is issued and the amount awarded the alternate payee exceeds the
  value of the Participant’s Account, the amount apportioned shall be limited
  to the amount then in the account. If a QDRO so provides, benefits may be
  paid to an alternate payee before they would otherwise be distributable under
  the Plan, and no such distribution to an alternate payee shall be treated as
  a distribution to the Participant for purposes of Article V.

	
 

	
 

	
 

	
 

	
F.

	
No
  Participant shall have any of the rights of a stockholder (including the
  right to vote and to receive dividends and other distributions) with respect
  to Stock Units unless and until shares of Common Stock are actually issued in
  his/her name. 

	
 

	
 

	
 

	
 

	
G.

	
In the event
  of any stock dividend, stock split, combination or exchange of shares, merger,
  consolidation, spin-off or other distribution (other than normal cash
  dividends) of Company assets to shareholders, or any other change affecting
  the Common Stock, such adjustments, if any, as are appropriate to reflect
  such change shall be made with respect to outstanding Stock Unit Awards.

	
 

	
 

	
 

	
 

	
H.

	
Upon a
  Change in Control of the Company all outstanding Stock Unit Awards shall be
  considered as having met the requirements of Section IV.C. For the purposes
  of this Plan, “Change in Control” shall mean the occurrence of any of the
  following events:

	
 

	
 

	
 

	
 

	
 

	
 

	
a)

	
any “person”
  (within the meaning of Section 13(d) of the Exchange Act is or becomes the
  beneficial owner within the meaning of Rule 13d-3 under the Exchange Act (a
  “Beneficial Owner”), directly or indirectly, of securities of the Company
  (not including in the securities beneficially owned by such person any
  securities acquired directly from the Company or its affiliates) representing
  25% or more of the combined voting power of the Company’s then outstanding
  securities, excluding any person who becomes such a Beneficial Owner in
  connection with a transaction described in clause (1) of paragraph (c) below;
  or

	
 

	
 

	
 

	
 

	
 

	
 

	
b)

	
the
  following individuals cease for any reason to constitute a majority of the
  number of directors then serving: individuals who, on December 15, 1998,
  constitute the Board of Directors and any new director (other than a director
  whose initial assumption of office is in connection with an actual or
  threatened election contest, including but not limited to a consent
  solicitation. relating to the election of directors of the Company) whose
  appointment or election by the Board of Directors or nomination for 

5

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
election by
  the Company’s stockholders was approved or recommended by a vote of at least
  two-thirds (2/3) of the directors then still in office who either were
  directors on April 17, 2007 or whose appointment, election or nomination for
  election was previously so approved or recommended; or

	
 

	
 

	
 

	
 

	
 

	
 

	
c)

	
there is
  consummated a merger or consolidation of the Company or any direct or
  indirect wholly owned subsidiary of the Company with any other corporation
  other than (1) a merger or consolidation which would result in the voting
  securities of the Company outstanding immediately prior to such merger or
  consolidation continuing to represent (either by remaining outstanding or by
  being converted into voting securities of the surviving entity or any parent
  thereof), in combination with the ownership of any trustee or other fiduciary
  holding securities under an employee benefit plan of the Company or any
  subsidiary of the Company, at least 75% of the combined voting power of the
  securities of the Company or such surviving entity or any parent thereof
  outstanding immediately after such merger or consolidation, or (2) a merger
  or consolidation effected to implement a recapitalization of the Company (or
  similar transaction) in which no person is or becomes the Beneficial Owner,
  directly or indirectly, of securities of the Company representing 25% or more
  of the combined voting power of the Company’s then outstanding securities; or

	
 

	
 

	
 

	
 

	
 

	
 

	
d)

	
the
  stockholders of the Company approve a plan of complete liquidation or
  dissolution of the Company or there is consummated an agreement for the sale
  or disposition by the Company of all or substantially all of the Company’s
  assets, other than a sale or disposition by the Company of all or
  substantially all of the Company’s assets to an entity, at least 75% of the
  combined voting power of the voting securities of which are owned by
  stockholders of the Company in substantially the same proportions as their
  ownership of the Company immediately prior to such sale.

	
 

	
 

	
 

	
 

	
 

	
Notwithstanding
  the foregoing subparagraphs (a), (b), (c) and (d), a “Change in Control”
  shall not be deemed to have occurred by virtue of the consummation of any
  transaction or series of integrated transactions immediately following which
  the record holders of the Common Stock of the Company immediately prior to
  such transaction or series of transactions continue to have substantially the
  same proportionate ownership in an entity which owns all or substantially all
  of the assets of the Company immediately following such transaction or series
  of transactions.

	
 

	
 

	
V.

	
DISTRIBUTIONS

	
 

	
 

	
 

	
 

	
 

	
A.

	
Upon the
  termination of a Participant’s service as an Outside Director, the Company
  shall issue to the Participant certificates for shares of Common Stock equal
  to the number of whole Stock Units in his/her account without any legend or
  restriction of any kind in accordance with such Participant’s distribution 

6

	
 

	
 

	
 

	
 

	
 

	
elections
  hereunder. Any remaining fractional Stock Units shall be paid in cash based
  upon the closing price of the Common Stock on the NYSE on the day prior to
  the date of distribution.

	
 

	
 

	
 

	
 

	
B.

	
By written
  notice to the Plan filed with the Company’s Secretary, a Participant may
  elect to have distribution of his/her Stock Unit Award account commence: (1)
  on the 30th day following the date of termination of the
  Participant’s Service, (2) on the 15th day of January next
  following the date of termination of the Participant’s Service or (3) on the
  15th day of January of any calendar year following termination of
  the Participant’s Service, but not later than the January following the
  Participant’s 72nd birthday, unless the Participant is still a
  Director at such time, in which case distribution shall commence on the 30th
  day following the date the Participant ceases to be a Director. Any such
  election, or any change in such election (by such subsequent written notice
  to the Secretary of the Company), shall apply only to future awards. In the
  event no election is made as to the commencement of distribution, such
  distribution shall commence on the 30th day following the date the
  Participant ceases to be a Director of the Company.

	
 

	
 

	
 

	
 

	
C.

	
By written
  notice to the Plan filed with the Company’s Secretary, a Participant may
  elect to receive the distribution of his/her Stock Unit Award account in the
  form of (1) one lump-sum payment, or (2) annual distributions over a period
  selected by the Participant of up to ten years. In the event a lump-sum
  payment is made under the Plan, the amount then standing to the Participant’s
  credit in his/ her Stock Unit Award account shall be paid to the Participant
  on the date determined under Section V.B. In the case of a distribution over
  a period of years, the Company shall pay to the Participant, commencing on
  the date determined under Section V.B, annual installments from the amount
  then standing to his or her credit in his or her Stock Unit Award account,
  including earnings credits on the unpaid balance to the date of distribution.
  The amount of each installment shall be determined by dividing the then
  unpaid balance, plus earnings credits, in the Participant’s Stock Unit Award
  account by the number of installments remaining to be paid. If a Participant
  does not make an election as to the manner of distribution of his or her
  Stock Unit Award account, such distribution shall be made in the form of a
  lump sum.

	
 

	
 

	
 

	
 

	
D.

	
In the event
  of a Participant’s death, the balance of the Participant’s Stock Unit Award
  account shall be distributed to the Participant’s Beneficiary(ies) in a
  lump-sum payment within 30 days following the Participant’s death. A
  Participant may change Beneficiary designations by filing a subsequent notice
  with the Secretary of the Company. If a Participant does not make a
  Beneficiary designation, or if the Beneficiary has predeceased the
  Participant, such distribution shall be made as a lump-sum to his/her estate.

	
 

	
 

	
 

	
 

	
E.

	
Participants
  may, (i) by notice filed with the Company prior to December 31st
  of any year, make changes of distribution elections on a prospective basis;
  and (ii) 

7

	
 

	
 

	
 

	
 

	
 

	
by notice
  filed with the Company, make changes of distribution elections with respect
  to prior deferred compensation as long as (A) any such new distribution
  election is made at least one year prior to the date that the commencement of
  the distribution would otherwise have occurred and (B) the revised
  commencement date is at least five years later than the date that the
  commencement of the distribution would otherwise have occurred; provided that
  such an election may not defer payment beyond the later of the January
  following the Participant’s 72nd birthday or the Participant’s
  termination of service as a director. For the purposes of this subsection
  V.E, if a Participant has elected a distribution in installments, each
  installment shall be deemed a separate election.

	
 

	
 

	
 

	
 

	
F.

	
Notwithstanding
  any other provision of the Plan, if the Board, by vote of the Outside
  Directors, other than the Participant making the claim, shall determine in
  its sole discretion that the time of payment of a Participant’s Stock Unit
  Award account should be advanced because of protracted illness or other undue
  hardship, then the Board may advance the time or times of payment (whether
  before or after the date of Participant’s termination of service as a
  Director) of an amount or amounts needed to meet the emergency in accordance
  with the requirements of Code Section 409A and the regulations promulgated
  thereunder. 

	
 

	
 

	
 

	
 

	
G.

	
Distribution
  in Case of Certain Tax Events – If, with respect to
  any Participant, the Plan fails to meet the requirements of the Code with
  respect to the deferral of tax liability, the Company may accelerate
  distribution from a Participant’s Account amounts sufficient to meet such
  Participant’s resulting Federal, State, Local and/or Foreign tax liability
  (including any interest and penalties).

	
 

	
 

	
VI.

	
FURTHER CONDITIONS

	
 

	
 

	
 

	
 

	
A.

	
Unless the
  shares of Common Stock to be distributed pursuant to the Plan have been
  registered with the Securities and Exchange Commission under the Securities
  Act prior to issuance, the Participant receiving such shares must represent
  in writing to the Company that such shares of Common Stock are being acquired
  for investment purposes only and not with a view towards the further resale
  or distribution thereof and must supply to the Company such other
  documentation as may be required by the Company, unless in the opinion of
  counsel to the Company such representation, agreement or documentation is not
  necessary to comply with the Securities Act.

	
 

	
 

	
 

	
 

	
B.

	
The Company
  shall not be obligated to deliver any shares of Common Stock until they have
  been listed on each securities exchange on which the shares of Common Stock
  may then be listed or until there has been qualification under or compliance
  with such state or federal laws, rules or regulations as the Company may deem
  applicable. The Company shall use reasonable efforts to obtain such listing,
  qualification and compliance.

8

	
 

	
 

	
 

	
 

	
C.

	
The
  Committee may make such provisions and take such steps as it may deem
  necessary or appropriate for the withholding of any taxes that the Company is
  required by any law or regulation of any governmental authority, whether
  federal, state or local, domestic or foreign, to withhold in connection with
  the award of Stock Units or the distribution of any Common Stock, including,
  but not limited to (i) the withholding of delivery of certificates for shares
  of Common Stock until the Participant reimburses the Company for the amount
  the Company is required to withhold with respect to such taxes, (ii) the
  canceling of any number of shares of Common Stock issuable in an amount
  sufficient to reimburse the Company for the amount it is required to so
  withhold or (iii) withholding the amount due from any such Participant’s
  other compensation.

	
 

	
 

	
VII.

	
ADMINISTRATION

          The
Plan shall be administered by the Committee, which shall establish rules and
regulations regarding the administration and operation of the Plan. 

	
 

	
 

	
VIII.

	
TERMINATION, MODIFICATION AND AMENDMENT

          Although
the Company anticipates that it will continue the Plan for an indefinite period
of time, there is no guarantee that the Company will continue the Plan or will
not terminate the Plan at any time in the future. Accordingly, the Company, by
the Board of Directors, reserves the right to discontinue its sponsorship of
the Plan or to terminate the Plan (or both), at any time, by the action of the
Board of Directors. In general, upon the termination of the Plan, the affected
Participants shall receive payment of their benefits in accordance with the
terms of Article V. However, the Company may, in its discretion, terminate the
entire Plan and pay each Participant a single lump-sum distribution of his or
her entire Account Balance, in the event that the Company satisfies any of the
following:

          (a)
such distributions are made between 12 and 24 months following the termination
of the Plan, and the Company does not adopt a new plan which would be
aggregated with this Plan under IRS guidance under Code Section 409A at any
time within the five years following the Plan termination. 

          (b)
the Plan is terminated within the 30 days preceding or the 12 months following
a Change in Control, all payments are made within 12 months of the date of
termination, and all substantially similar arrangements sponsored by the
Company are terminated as well.

          (c)
the Plan is terminated within 12 months of a corporate dissolution, as defined
in IRS guidance under Code Section 409A, and lump sum payments are made in the
latest of (i) the year of the termination, (ii) the year in which amounts are
no longer subject to a substantial risk of forfeiture; or (iii) the first year
in which payment is administratively practicable.

The
termination of the Plan shall not adversely affect any Participant or
Beneficiary who has become entitled to the payment of any benefits under the
Plan as of the date of termination.

9

	
 

	
 

	
IX.

	
NOT A CONTRACT FOR CONTINUED SERVICE

          Nothing
contained in the Plan or in any restricted stock agreement executed pursuant
hereto shall be deemed to confer upon any Outside Director to whom Stock Unit
Awards are or may be awarded hereunder any right to remain a member of the
Board or in any way limit the right of the Board or the Stockholders to
terminate or fail to renominate or reelect any such Outside Director as a
member of the Board.

	
 

	
 

	
X.

	
MISCELLANEOUS

	
 

	
 

	
 

	
 

	
A.

	
The costs
  and expenses of administering the Plan shall be borne by the Company and
  shall not be charged against any award or to any Outside Director receiving
  an award.

	
 

	
 

	
 

	
 

	
B.

	
This Plan
  and actions taken in connection herewith shall be governed and construed in
  accordance with the laws of the State of New Jersey.

	
 

	
 

	
 

	
 

	
C.

	
The captions
  and section numbers appearing in this Plan are inserted only as a matter of
  convenience. They do not define, limit or describe the scope or intent of the
  provisions of this Plan. In this Plan, words in the singular number include
  the plural and in the plural include the singular; and words of the masculine
  gender include the feminine and the neuter, and when the sense so indicates,
  words of the neuter gender may refer to any gender.

	
 

	
 

	
 

	
 

	
D.

	
Whenever the
  time for payment or performance hereunder shall fall on a weekend or public
  holiday, such payment or performance shall be deemed to be timely if made on
  the next succeeding business day.

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