Document:

ex10-4.htm

Exhibit 10.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

  

  

	
  

	
Exhibit 10.4

 

MDU RESOURCES GROUP, INC.

LONG-TERM PERFORMANCE-BASED INCENTIVE PLAN

 

PERFORMANCE SHARE AWARD AGREEMENT

 

 

{    }

 

 

In accordance with the terms of the MDU Resources Group, Inc. Long-Term Performance-Based Incentive Plan (the "Plan"), pursuant to action of the Compensation Committee of the Board of Directors of MDU Resources Group, Inc. (the "Committee"), MDU Resources Group, Inc. (the "Company") hereby grants to you (the "Participant") Performance Shares (the "Award"), subject to the terms and conditions set forth in this Award Agreement (including Annexes A and B hereto and all documents incorporated herein by reference), as set forth below:

 

	 	
Target Award:

 

	
{    }Performance Shares (the "Target Award")

 

	 	
Performance Period:

 

	
{    } through

{    } (the "Performance Period")

 

	 	
Date of Grant:

 

	
{    }

	 	
Dividend Equivalents:

	
Yes

 

THESE PERFORMANCE SHARES ARE SUBJECT TO FORFEITURE AS PROVIDED HEREIN.  THIS AWARD AND AMOUNTS RECEIVED IN CONNECTION WITH THIS AWARD ARE ALSO SUBJECT TO FORFEITURE, RECAPTURE OR OTHER ACTION IN THE EVENT OF AN ACCOUNTING RESTATEMENT, AS PROVIDED IN THE PLAN.

 

The Participant, in consideration of this grant of Performance Shares, by affixing his signature hereto, specifically waives any rights he may have under the definition of Change in Control contained in Section 2.5 of the Plan, as it was in effect prior to November 12, 2009, and hereby consents to the use of the definition of Change in Control as amended November 12, 2009 in connection with any grants made pursuant to the Plan and still outstanding on the date hereof.

 

Further terms and conditions of the Award are set forth in Annexes A and B hereto, which are integral parts of this Award Agreement.

  

  

  

All terms, provisions and conditions applicable to the Award set forth in the Plan and not set forth in this Award Agreement are hereby incorporated herein by reference.  To the extent any provision hereof is inconsistent with a provision of the Plan; the provisions of the Plan will govern.  The Participant hereby acknowledges receipt of a copy of this Award Agreement, including Annexes A and B hereto, and a copy of the Plan and agrees to be bound by all the terms and provisions hereof and thereof.

 

	  	
MDU RESOURCES GROUP, INC.

	  	  	  
	  	  	  
	  	
By:

	  
	  	  	
Terry D. Hildestad

	  	  	
President and

	  	  	
Chief Executive Officer

Agreed:

 

 

________________________

Participant

 

  

  

  

 

ANNEX A

 

TO

 

MDU RESOURCES GROUP, INC.

LONG-TERM PERFORMANCE-BASED INCENTIVE PLAN

 

PERFORMANCE SHARE AWARD AGREEMENT

 

It is understood and agreed that the Award of Performance Shares evidenced by the Award Agreement to which this is annexed is subject to the following additional terms and conditions.

 

1.           Nature of Award.  The Target Award represents the opportunity to receive shares of Company common stock, $1.00 par value ("Shares") and Dividend Equivalents on such Shares.  The number of Shares that may be earned under this Award shall be determined pursuant to Section 2 hereof.  The amount of Dividend Equivalents that may be earned under this Award shall be determined pursuant to Section 4 hereof.  Except for Dividend Equivalents, which are paid in cash, Awards will be paid in Shares.

 

2.           Determination of Number of Shares Earned.

 

The number of Shares earned, if any, for the Performance Period shall be determined in accordance with the following formula:

 

# of Shares = Payout Percentage X Target Award

 

The "Payout Percentage" is based on the Company's total shareholder return ("TSR") relative to that of the Peer Group listed on Annex B (the "Percentile Rank") for the Performance Period, determined in accordance with the following table:

 

	
Percentile Rank

	
Payout Percentage

(% of Target Award)

	
90th or higher

	
200%

	
70th

	
150%

	
50th

	
100%

	
40th

	
10%

	
less than 40th

	
0%

If the Company achieves a Percentile Ranking between the 40th and 50th percentiles, the Payout Percentage shall be equal to 10%, plus 9% for each Percentile Rank whole percentage above the 40th percentile.  If the Company achieves a Percentile Ranking between the 50th and 90th percentiles, the Payout Percentage shall be equal to 100%, plus 2-1/2% for each Percentile Rank whole percentage above the 50th percentile.

  

  

  

If the Company’s TSR for the Performance Period is negative, the number of shares otherwise earned, if any, for the Performance Period will be reduced.  The amount of the reduction, as determined by the Committee in its sole discretion, will range from a 50% reduction to a 100% reduction (down to zero) of the number of shares otherwise earned.

 

The Percentile Rank of a given company's TSR is defined as the percentage of the Peer Group companies' returns falling at or below the given company's TSR.  The formula for calculating the Percentile Rank follows:

 

	
  

	
Percentile Rank = (n - r + 1)/n x 100

 

	
  

	
Where:

 

	
  

	
n =

	
total number of companies in the Peer Group, including the Company

 

	
  

	
r =

	
the numeric rank of the Company's TSR relative to the Peer Group, where the highest return in the group is ranked number 1

 

 

To illustrate, if the Company's TSR is the third highest in the Peer Group comprised of 26 companies, its Percentile Rank would be 92.  The calculation is: (26 - 3 + 1)/26 x 100 = 92.

 

The Percentile Rank shall be rounded to the nearest whole percentage.

 

If the common stock of a company in the Peer Group ceases to be traded during the Performance Period, the company will be deleted from the Peer Group.  Percentile Rank will be calculated without regard to the return of the deleted company.

 

Total shareholder return is the percentage change in the value of an investment in the common stock of a company from the initial investment made on the last trading day in the calendar year preceding the beginning of the performance period through the last trading day in the final year of the performance period.  It is assumed that dividends are reinvested in additional shares of common stock at the frequency paid.

 

All Performance Shares that are not earned for the Performance Period shall be forfeited.

 

3.           Issuance of Shares.  Subject to any restrictions on distributions of Shares under the Plan, and subject to Section 6 of this Annex A, the Shares earned under the Award, if any, shall be issued to the Participant as soon as practicable (but no later than the next March 10) following the close of the Performance Period.

 

4.           Dividend Equivalents.  Dividend Equivalents shall be earned with respect to any Shares issued to the Participant pursuant to this Award.  The amount of Dividend Equivalents earned shall be equal to the total dividends declared on a Share between the Date of Grant of this Award and the last day of the Performance Period, multiplied by the number of Shares issued to the Participant pursuant to the Award Agreement.  Any Dividend Equivalents earned shall be paid in cash to the Participant when the Shares to which they relate are issued or as soon as practicable thereafter, but no later than the next March 10 following the close of the Performance

  

  

  

Period.  If the Award is forfeited or if no Shares are issued, no Dividend Equivalents shall be paid.

 

5.           Termination of Employment.

 

(a)           If the Participant's employment with the Company is terminated (1) for "Cause" (as defined below) at any time or (2) for any reason other than "Cause" before the Participant, as of the effective date of termination, has reached age 55 and completed 10 "Years of Service" (as defined below), all Performance Shares (and related Dividend Equivalents) shall be forfeited.

 

(b)           If the Participant's employment with the Company is terminated for any reason other than "Cause" after the Participant, as of the effective date of termination, has reached age 55 and completed 10 "Years of Service" (1) during the first year of the Performance Period, all Performance Shares (and related Dividend Equivalents) shall be forfeited; (2) during the second year of the Performance Period, determination of the Company's Percentile Rank for the Performance Period will be made by the Committee at the end of the Performance Period, and Shares (and related Dividend Equivalents) earned, if any, will be paid based on the Payout Percentage, prorated for the number of full months elapsed from and including the month in which the Performance Period began to and including the month in which the termination of employment occurs; and (3) during the third year of the Performance Period, determination of the Company's Percentile Rank for the Performance Period will be made by the Committee at the end of the Performance Period, and Shares (and related Dividend Equivalents) earned, if any, will be paid based on the Payout Percentage without prorating.

 

(c)           For purposes of the Award Agreement, the term "Cause" shall mean the Participant's fraud or dishonesty that has resulted or is likely to result in material economic damage to the Company or a Subsidiary, or the Participant's willful nonfeasance if such nonfeasance is not cured within ten days of written notice from the Company or a Subsidiary, as determined in good faith by a vote of at least two-thirds of the non-employee directors of the Company at a meeting of the Board at which the Participant is provided an opportunity to be heard.  For purposes of the Award Agreement, the term "Years of Service" shall mean the years a Participant is employed by the Company and/or a Subsidiary.

 

6.           Tax Withholding.  Pursuant to Article 16 of the Plan, the Committee shall have the power and the right to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any Federal, state and local taxes (including the Participant's FICA obligations) required by law to be withheld with respect to the Award.  The Committee may condition the delivery of Shares upon the Participant's satisfaction of such withholding obligations.  The Participant may elect to satisfy all or part of such withholding requirement by tendering previously-owned Shares or by having the Company withhold Shares having a Fair Market Value equal to the minimum statutory withholding that could be imposed on the transaction (based on minimum statutory withholding rates for Federal, state, and local tax purposes, as applicable, including payroll taxes, that are applicable to such supplemental taxable income).  Such election shall be irrevocable, made in writing, signed by the Participant, and shall

  

  

  

be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.

 

7.           Ratification of Actions.  By accepting the Award or other benefit under the Plan, the Participant and each person claiming under or through him or her shall be conclusively deemed to have indicated the Participant's acceptance and ratification of, and consent to, any action taken under the Plan or the Award by the Company, its Board of Directors, or the Committee.

 

8.           Notices.  Any notice hereunder to the Company shall be addressed to its office, 1200 West Century Avenue, P.O. Box 5650, Bismarck, North Dakota 58506; Attention: Corporate Secretary, and any notice hereunder to the Participant shall be addressed to him or her at the address specified on the Award Agreement, subject to the right of either party to designate at any time hereafter in writing some other address.

 

9.           Definitions.  Capitalized terms not otherwise defined herein or in the Award Agreement shall have the meanings given them in the Plan.

 

10.           Governing Law and Severability.  To the extent not preempted by Federal law, the Award Agreement will be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflicts of law provisions.  In the event any provision of the Award Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Award Agreement, and the Award Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

 

11.           No Rights to Continued Employment.  The Award Agreement is not a contract of employment.  Nothing in the Plan or in the Award Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate the Participant's employment at any time, for any reason or no reason, or confer upon the Participant the right to continue in the employ of the Company or a Subsidiary.

  

  

  

ANNEX B

 

TO

 

MDU RESOURCES GROUP, INC.

LONG-TERM PERFORMANCE-BASED INCENTIVE PLAN

 

PERFORMANCE SHARE AWARD AGREEMENT

 

PEER GROUP COMPANIES

 

 

Alliant Energy Corporation

Berry Petroleum Company

Black Hills Corporation

Comstock Resources, Inc.

Dycom Industries, Inc.

EMCOR Group Inc.

Encore Acquisition Company

EQT Corporation

Granite Construction Incorporated

Martin Marietta Materials, Inc.

National Fuel Gas Company

Northwest Natural Gas Company

NSTAR

OGE Energy Corp.

ONEOK, Inc.

Quanta Services, Inc.

Questar Corporation

SCANA Corporation

Southwest Gas Corporation

St. Mary Land & Exploration Company

Swift Energy Company

U.S. Concrete, Inc.

Vectren Corporation

Vulcan Materials Company

Whiting Petroleum CorporationUnassociated Document

    
      Exhibit
10.1

       

    

    AGREEMENT REGARDING
RETIREMENT

     

    AGREEMENT effective as of
April 1, 2010 (the “Effective
Date”), between THE INTERPUBLIC GROUP OF COMPANIES, INC. (“Interpublic”) and JOHN J.
DOONER (“Executive”).

     

    WITNESSETH:

    

    WHEREAS, Interpublic and
Executive are parties to an Employment Agreement made as of January 1, 1994, and
amended by Supplemental Agreements made as of July 1, 1995, September 1, 1997,
January 1, 1999, April 1, 2000, November 7, 2002, March 31, 2003, and November
12, 2003 (collectively, the “Employment Agreement”); and

     

    WHEREAS, Paragraph 4.02 of the
Employment Agreement provides that Executive may at any time give written notice
to Interpublic specifying a termination date not less than 12 months after the
date on which such notice is given, and Paragraph 4.03 of the Employment
Agreement requires that Executive continue to perform his duties thereunder
until his termination date at his salary in effect on the date that notice of
such termination is given; and

     

    WHEREAS, Executive intends to
retire, effective March 31, 2011; and

     

    WHEREAS, Executive and
Interpublic wish to set forth the terms of his employment for the period from
April 1, 2010 through March 31, 2011;

     

    NOW, THEREFORE, in
consideration of the mutual promises set forth herein and in the Agreement, the
parties hereto, intending to be legally bound, agree as follows:

     

    1.           Incorporation by
Reference.  All provisions of the Employment Agreement are
hereby incorporated herein by reference and shall remain in full force and
effect except to the extent such provisions are expressly modified by this
Agreement.

     

    2.           Service as Chairman and
Subsequent Transition.  In accordance with Paragraph 4.03 of
the Employment Agreement, Executive shall continue to be employed and provide
services thereunder until March 31, 2011, at his salary in effect on the date
hereof; provided, however, that his duties shall be modified as
follows:

     

    a.           Effective
as of the close of business March 31, 2010, Executive shall cease to be the
Chief Executive Officer of the McCann Worldgroup (“McCann”).  From
April 1, 2010 through December 31, 2010, Executive shall serve as Executive
Chairman of McCann.

     

    b.           Effective
as of the close of business December 31, 2010, Executive shall cease to be the
Executive Chairman of McCann.  From January 1, 2011 through March 31,
2011, Executive shall continue to assist Interpublic and McCann in the
transition of leadership responsibilities to McCann’s new leadership team and
shall be available to perform such additional duties as Interpublic or McCann
may from time to time assign to him.  The parties anticipate that
during this period, Executive will not be working for Interpublic or McCann on a
full-time basis, but that the level of services that he performs will be more
than 20 percent of the average level of services that he performed over the
immediately preceding 36 months.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    If
Executive is requested to provide any services to McCann or Interpublic after
March 31, 2011, the parties shall negotiate in good faith to establish mutually
acceptable terms of engagement.

     

    3.           Retention and Retirement
Payments.  In consideration of the contributions that he has
made over a long career with McCann and Interpublic, and Executive’s commitment
to ensure that the transition to new leadership at McCann is successful,
Executive shall be eligible to receive the following compensation and benefits,
subject to the approval of the Compensation Committee of Interpublic’s Board of
Directors, and provided that he remains employed by McCann or Interpublic, and
performs the duties required hereunder, through the earlier of (i) March
31, 2011, or (ii) the scheduled payment date:

     

    a.           Executive
shall be eligible to receive an award pursuant to the Executive Incentive Plan
(“EIP”) for calendar
year 2010.  Such award shall be paid on or before March 15,
2011.  Executive shall not be eligible for an EIP award for calendar
year 2011.

     

    b.           Effective
March 31, 2011, Executive shall vest in all then-outstanding Interpublic stock
options.  Each option shall be exercisable until the earlier of
(a) March 31, 2014, or (b) the tenth anniversary of the grant
date.

     

    c.           Effective
March 31, 2011, the restrictions on all Restricted Stock previously granted to
Executive shall be lifted.

     

    d.           Subject
to achievement of the applicable performance criteria, Executive shall be
entitled to receive shares or cash in settlement of Executive’s 2008 Performance
Share Award, granted under the Interpublic Group of Companies, Inc. 2006
Performance Incentive Plan (the “PIP”).  Such shares
or cash shall be delivered to Executive on March 31, 2011.

     

    e.           Effective
March 31, 2011, Executive shall vest in his 2009 Performance Cash Award, granted
under the PIP.  The amount payable under such 2009 Performance Cash
Award shall be determined based on 2009 and 2010 performance, with a performance
rating for 2011 of 0%.  By way of example, if Executive’s performance
ratings for 2009 and 2010 are at target, the amount payable under the 2009
Performance Cash Award would be equal to two-thirds (2/3) of the target
amount.  The cash (if any) payable under the 2009 Performance Cash
Award shall be paid within 60 days after March 31, 2011.

     

    f.           Executive’s
coverage elected under Interpublic’s benefit plans shall end on March 31, 2011,
unless Employee chooses to extend such coverage as allowed by
COBRA.   Thereafter, Executive shall be eligible to continue
participation in the Executive Medical Plus Plan (“EMPP”) until the end of the
“maximum required period” of continuation coverage under Section 602(2)(A) of
the Employee Retirement Income Security Act of 1974, as amended (the “COBRA Period”), which
Executive and Interpublic anticipate will be September 30,
2012.  Following the end of the COBRA Period, Executive shall be
eligible to participate in Interpublic’s Retiree Medical Plan. Executive’s
coverage under the plans described in this Paragraph 3.f shall be contingent on
Executive paying (I) the full COBRA premiums for such continued coverage
during the COBRA Period and (II) the applicable contribution under the
Retiree Medical Plan for the period after the COBRA period.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    g.           Because
Executive is a “specified employee” (within the meaning of Treas. Reg.
§ 1.409A-1(i)), payments under the Executive Special Benefit Agreements
(“ESBAs”) between
Executive and Interpublic shall begin in the seventh month that starts after
Executive’s separation from service, in accordance with the terms of the
ESBAs.  Based on Executive’s scheduled separation date of March 31,
2011, Executive and Interpublic anticipate that payments will start in October
2011.

     

    h.           Executive
shall be entitled to benefits under the Interpublic Retirement Account Plan, the
Interpublic Savings Plan, and the special deferred compensation arrangement
described in the “Nonqualified Deferred Compensation Arrangements” section of
Interpublic’s definitive proxy statement filed on April 30,
2009.  Such benefits shall be calculated and paid in accordance with
the applicable plan documents.  No provision of this Agreement shall
be construed to enhance or diminish Executive’s rights under the plans
referenced in this Paragraph 3.h.

     

    i.           After
March 31, 2011, Interpublic shall have no further obligation to make premium
payments towards Executive’s individual term life insurance policy.

     

    All
payments under this Agreement shall be subject to applicable tax withholdings,
as determined by Interpublic.  In addition, Executive shall be solely
responsible for paying all required taxes on all payments and other compensation
(including imputed compensation) and benefits provided under this Agreement,
without regard to whether taxes are withheld or the amount
withheld.

     

    4.           Entire
Agreement.  This Agreement sets forth the entire understanding
between McCann, Interpublic, and Executive concerning Executive’s
retirement.  Executive shall not be entitled to any compensation,
benefits, or other remuneration that is not described in Paragraph 2 or 3,
above.

     

    5.           Section
409A.  This Agreement shall be construed, administered, and
interpreted in accordance with the requirements of Section 409A.  If
Interpublic or Executive determines that any provision of this Agreement is or
might be inconsistent with the requirements of Section 409A, the parties shall
attempt in good faith to agree on such amendments as may be necessary or
appropriate to avoid causing Executive to incur adverse tax consequences under
Section 409A.  No provision of the Agreement, as amended hereby, shall
be interpreted or construed to transfer any liability for failure to comply with
Section 409A from Executive or any other individual to Interpublic or any of its
affiliates.

     

    IN WITNESS WHEREOF,
Interpublic, by its duly authorized officer, and Executive have caused
this Amendment to the Agreement to be executed.

     

    
      	
              The
      Interpublic Group of Companies, Inc.

            	
              Executive

            
	 	 
	
              BY:      /s/ Timothy
      Sompolski                  
      
               Timothy
      Sompolski

                             Executive
      Vice
      President
             
      Chief
      Human Resources Officer

            	
                  /s/ John J.
      Dooner                       
      

                    John
      J. Dooner

            
	 	 
	
              DATE:     3/8/10                                            

            	
              DATE:       3/1/10

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