Document:

exv10w2

Exhibit 10.2

NISOURCE INC.

NONEMPLOYEE DIRECTOR

RETIREMENT PLAN

(As Amended and Restated Effective May 13, 2008)

 

 

NISOURCE INC.

NONEMPLOYEE DIRECTOR

RETIREMENT PLAN

(As Amended and Restated Effective May 13, 2008)

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	 	 	 	 	 	 
	ARTICLE I

	 	Purpose
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE II

	 	Definitions
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE III

	 	Administration
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE IV

	 	Eligibility for Retirement Benefits
	 	 	5	 
	 
	 	 	 	 	 	 
	ARTICLE V

	 	Amount of Retirement Benefit
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE VI

	 	Payment of Retirement Benefits
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE VII

	 	Payment in the Event of Death
	 	 	6	 
	 
	 	 	 	 	 	 
	ARTICLE VIII

	 	Payment in the Event of Separation From
Service Following a Change in Control
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE IX

	 	Unfunded Plan
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE X

	 	Certain Payments
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE XI

	 	Miscellaneous
	 	 	9	 

i 

 

NISOURCE INC.

NONEMPLOYEE DIRECTOR

RETIREMENT PLAN

(As Amended and Restated Effective May 13, 2008)

ARTICLE I

PURPOSE

     The NiSource Inc. Nonemployee Director Retirement Plan (the “Plan”) was established to assist
the Company in attracting and retaining individuals of superior talent, ability and achievement to
serve on its Board of Directors. The Plan was originally adopted effective January 1, 1991, and
was amended and restated effective January 1, 2002 to cover only Nonemployee Directors serving on
the Board of Directors on December 31, 2001, who elected to continue participation in the Plan on
and after June 1, 2002. The Plan later was amended and restated effective January 1, 2005 to
comply with Internal Revenue Code (the “Code”) Section 409A, and guidance and regulations
thereunder, with respect to benefits earned under the Plan from and after January 1, 2005.
Benefits under the Plan earned and vested prior to January 1, 2005 continue to be administered in
accordance with the Plan then in effect and without regard to Code Section 409A and regulations
thereunder.

     The Plan is now further amended and restated effective May 13, 2008, to freeze all future
accruals of benefits under the Plan and allow any Director in the Plan to make an irrevocable
election in accordance with certain transition relief under Section 409A of the Code, to receive
his or her accrued benefits under the Plan in cash or restricted stock units.

ARTICLE II

DEFINITIONS

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

     2.1 “Annual Retainer” means the amount paid by the Company to each Nonemployee Director as
annual compensation for Service as a Director and as a member of any committee of

 

 

the Board and as chairman of any such committee, which amount is exclusive of any Board or
committee meeting fees, or remuneration under other plans, agreements or policies.

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

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

     (a) Change in Ownership. A Change in Ownership of the Company occurs on the
date that any one person, or more than one Person Acting as a Group (as defined below),
acquires ownership of stock of the Company that, together with stock held by such person or
group, constitutes more than 50% of the total fair market value or total voting power of the
stock of the Company. However, if any one person or more than one Person Acting as a Group,
is considered to own more than 50% of the total fair market value or total voting power of
the stock of the Company, the acquisition of additional stock by the same person or persons
is not considered to cause a Change in Ownership of the Company (or to cause a Change in
Effective Control of the Company). An increase in the percentage of stock owned by any one
person, or Persons Acting as a Group, as a result of a transaction in which the Company
acquires its stock in exchange for property shall be treated as an acquisition of stock.
This subsection (a) applies only when there is a transfer of stock of the Company (or
issuance of stock of the Company) and stock in the Company remains outstanding after the
transaction.

     (b) Change in Effective Control. A Change in Effective Control of the Company
occurs on the date that either —

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

     (ii) a majority of members of the Board is replaced during any 12-month period
by directors whose appointment or election is not endorsed by a majority of the
members of the Board prior to the date of the appointment or election.

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

     Acquisition of additional control. If any one person, or more than one Person
Acting as a Group, is considered to effectively control the Company, the acquisition of

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additional control of the Company by the same person or persons is not considered to cause a
Change in Effective Control of the Company (or to cause a Change in Ownership of the
Company).

     (c) Change of Ownership of a Substantial Portion of Assets. A Change of
Ownership of a Substantial Portion of Assets occurs on the date that any one person, or more
than one Person Acting as a Group, acquires (or has acquired during the 12-month period
ending on the date of the most recent acquisition by such person or persons) assets from the
Company that have a total gross fair market value equal to or more than 40% of the total
gross fair market value of all of the assets of the Company immediately prior to such
acquisition or acquisitions. For this purpose, gross fair market value means the value of
the assets of the Company, or the value of the assets being disposed of, determined without
regard to any liabilities associated with such assets.

     Transfers to a related person. There is no Change in Control when there is a
transfer to an entity that is controlled by the shareholders of the Company immediately
after the transfer. A transfer of assets by the Company is not treated as a Change of
Ownership of a Substantial Portion of Assets if the assets are transferred to —

     (i) a shareholder of the Company (immediately before the asset transfer) in
exchange for or with respect to its stock;

     (ii) an entity, 50% or more of the total value or voting power of which is
owned, directly or indirectly, by the Company;

     (iii) a person, or more than one Person Acting as a Group, that owns, directly
or indirectly, 50% or more of the total value or voting power of all the outstanding
stock of the Company; or

     (iv) an entity, at least 50% of the total value or voting power of which is
owned, directly or indirectly, by a person described in paragraph (iii) next above.

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

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

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purchase or acquisition of stock, or similar transaction, such shareholder is
considered to be acting as a group with other shareholders in a corporation prior to
the transaction giving rise to the change and not with respect to the ownership
interest in the other corporation.

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

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

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

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

     2.8 “Effective Date” means January 1, 2005.

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

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

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

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

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

ARTICLE III

ADMINISTRATION

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

     Notwithstanding the foregoing, effective May 13, 2008 (the “Freeze Date”), no further
contributions shall be made to the Plan, and no further benefits will accrue on behalf of any
Director after the Freeze Date.

ARTICLE IV

ELIGIBILITY FOR RETIREMENT BENEFITS

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

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

5

 

ARTICLE V

AMOUNT OF RETIREMENT BENEFIT

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

ARTICLE VI

PAYMENT OF RETIREMENT BENEFITS

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

     Notwithstanding the foregoing, each Director who served on the Board on May 13, 2008, may make
a special one-time election no earlier than May 13, 2008, and no later than December 31, 2008, to
receive payment of his or her benefits in cash in 2009 or as a grant of restricted stock units
under the NiSource Inc. Nonemployee Director’s Stock Incentive Plan (the “DSIP”). If the Director
elects to receive restricted stock units, the restricted stock units will be paid in accordance
with the terms of the DSIP.

ARTICLE VII

PAYMENT IN THE EVENT OF DEATH

     In the event that an Eligible Nonemployee Director dies prior to the receipt of all retirement
benefits set forth in the Plan, the Company shall pay the present value of the remaining unpaid
retirement benefits owing to the Eligible Nonemployee Director under the Plan in one cash lump sum
within 60 calendar days following the date of death, or, if later, within

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such timeframe permitted under Code Section 409A, and guidance and regulations thereunder.
The interest rate to be used to determine the present value of the unpaid retirement benefits shall
be the six-month U.S. Treasury Bill rate in effect on the date of death. Such payment shall he
made to the surviving spouse of the Eligible Nonemployee Director, if any. If there is no
surviving spouse, then the payment shall be made to the representative of the estate of the
Eligible Nonemployee Director.

ARTICLE VIII

PAYMENT IN THE EVENT OF SEPARATION FROM SERVICE

FOLLOWING A CHANGE IN CONTROL

     In the event that an Eligible Nonemployee Director who served on the Board on the effective
date of a Change in Control separates from Service within two years following the effective date of
a Change in Control, such Director shall receive his or her retirement benefits under the Plan in
the form of a cash lump sum payment in an amount equal to the present value of the retirement
benefits such Director is eligible to receive under the Plan.

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

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

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

ARTICLE IX

UNFUNDED PLAN

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

ARTICLE X

CERTAIN PAYMENTS

     Whenever a Nonemployee Director who is entitled to receive a payment under the Plan is a
person under legal disability or a person not adjudicated incompetent but who, by reason of illness
or mental or physical disability, is, in the opinion of the Committee, unable to manage properly
his or her affairs, then such payments shall be paid in one of the fo1lowing ways, as the Committee
deems advisable: (i) to such person directly; (ii) to the legally appointed guardian or
conservator of such person for his or her exclusive benefit; or (iii) in such other manner for the
exclusive benefit of such person as the Committee considers advisable. Any payment made in
accordance with the provisions of this Article X shall be a complete discharge of any liability of
the Company for the making of such payment under the Plan.

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ARTICLE XI

MISCELLANEOUS

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

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

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

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

     IN WITNESS WHEREOF, the Company has caused this amended and restated Plan to be signed on this
24th  day of February, 2009, effective May 13, 2008.

	 	 	 	 	 
	 	NISOURCE INC.

 	 
	 	By:  	/s/ Robert C. Campbell
 	 
	 	Its: 	Senior Vice President, Human Resources 	 
	 	 	 	 
	 

9exv10w3

Exhibit 10.3

NISOURCE INC.

DIRECTORS’ CHARITABLE GIFT PROGRAM

	1.	 	PURPOSE OF THE PROGRAM
	 
	 	 	Under the NiSource Inc. Directors’ Charitable Gift Program (Program), NiSource Inc.
(Company) will make a donation on behalf of each eligible Director, in the Director’s name,
to the eligible tax-exempt organization(s) (Donee(s)) selected by the Director. The purpose
of the Program is to acknowledge the service of the Company’s Directors, to recognize the
interest of the Company and its Directors in supporting worthy charitable organizations and
institutions of higher learning and to enhance the Company’s ability to continue to attract
and retain highly qualified individuals to serve as Directors.
	 
	2.	 	ELIGIBILITY
	 
	 	 	All persons serving as Directors of the Company as of February 16, 2006, other than
Directors who are current or former employees of the Company or any of its subsidiaries,
shall be eligible to participate in the Program through December 31, 2008. All Directors
who join the Company’s Board of Directors after that date shall not be eligible to
participate in the Program. No Director shall be eligible to participate in the program
after December 31, 2008.
	 
	3.	 	DONATION AMOUNT

	 	(a)	 	While serving as a Director before May 13, 2008, the donation amount for a
Director will be determined based on the Director’s completed years of Board service,
in accordance with the following schedule.

	 	 	 	 	 
	Completed Years	 	Cumulative
	of Service	 	Donations
	Less than 5
	 	$	0	 
	5-9
	 	$	125,000	 
	10 or more
	 	$	250,000	 

	 	 	 	Notwithstanding this schedule, a Director who has completed at least five years of
service will be treated as having served for 10 or more years if he or she
terminates Board service as a result of death, disability or mandatory retirement.
	 
	 	(b)	 	Effective May 13, 2008, any Eligible Director who has not satisfied his or
her donations, regardless of the number of years of service on the Board, may make
donation in any amounts but in aggregate will not exceed $125,000. No donations will
be made, however, after December 31, 2008.

Amended May 13, 2008

1

 

	4.	 	RECOMMENDATION OF DONATION
	 
	 	 	At any time after a Director becomes eligible to participate in the Program, he or she may
make a written recommendation to the Company, on a form provided by the Company for this
purpose, designating the Donee(s) which he or she recommends as the recipient(s) of the
Company donation to be made on his or her behalf. A Director may revise or revoke any such
recommendation prior to payment of the donation by signing a new recommendation form and
submitting it to the Company. Each eligible Director may choose one Donee or several
Donees to receive a Company donation, provided that each Donee must be recommended to
receive a donation of at least $25,000.
	 
	5.	 	DONEES
	 
	 	 	To be eligible to receive a donation, a recommended organization must be a charitable
organization or an accredited United States institution of higher learning and such
charitable organization or institution of higher learning must initially, and at the time a
donation is to be made, qualify to receive tax-deductible donations under the Internal
Revenue Code. An organization or institution will be approved unless it is determined, in
the exercise of good faith judgment, that a donation to the organization or institution
would be detrimental to the best interests of the Company. A Director’s private foundation
is not eligible to receive donations under the Program.
	 
	6.	 	TIMING OF DONATION
	 
	 	 	Each donation made on a Director’s behalf will be made by the Company as soon as is
practicable after the Company receives the Director’s recommendation, the Director
completes the requisite number of years of service, and the Company confirms the
eligibility of the Donee, or at such later date as the Director may specify. In no event,
however, will the Company make a donation after December 31, 2008, on behalf of a Director.
	 
	7.	 	FUNDING AND PROGRAM ASSETS
	 
	 	 	The Company currently intends not to fund the Program. However, if in the future the
Company elects to fund the Program in any manner, neither the Directors nor their
recommended Donee(s) shall have any rights or interests in any assets of the Company
identified for such purpose. Nothing contained in the Program shall create, or be deemed to
create, a trust, actual or constructive, for the benefit of a Director or any Donee
recommended by a Director to receive a donation, or shall give, or be deemed to give, any
Director or recommended Donee any interest in any assets of the Program or the Company.

2

 

	8.	 	AMENDMENT OR TERMINATION
	 
	 	 	The Board of Directors of the Company, may at any time, without the consent of the
Directors participating or eligible to participate in the Program, amend, suspend or
terminate the Program. Notwithstanding the foregoing, the Program shall terminate
effective December 31, 2008, such that no Director shall be able to participate in the
Program after December 31, 2008, and no donations may be made on behalf of a Director after
December 31, 2008.
	 
	9.	 	ADMINISTRATION
	 
	 	 	The Program shall be administered by the officers of the NiSource Charitable Foundation or
any other employees of the Company or its subsidiaries designated by the Chairman of the
Company (Committee). The Committee shall have plenary authority in its discretion, but
subject to the provisions of the Program, to prescribe, amend and rescind rules,
regulations and procedures relating to the Program. The determinations of the Committee on
the foregoing matters shall be conclusive and binding on all interested parties.
	 
	10.	 	GOVERNING LAW
	 
	 	 	The Program shall be construed, enforced and administered according to the laws of the
State of Indiana, other than the conflicts of law provisions thereof.
	 
	11.	 	EFFECTIVE DATE
	 
	 	 	The effective date of the amended and restated Program is May 13, 2008. The recommendation
of any individual Director will be effective when he or she completes and submits to the
Committee a written recommendation on the form provided for that purpose.
	 
	12.	 	SUPERSEDES PREVIOUS PROGRAM
	 
	 	 	The terms of this Program supersede the terms of a similar program that was adopted in 1994
by a predecessor to the Company (Previous Program). Donations made by the Company’s
predecessor on behalf of a particular Director under the Previous Program shall count
against that Director’s cumulative donations under section 3 of this Program.

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