KEY EXECUTIVE SEVERANCE PLAN OF
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
Amended effective November 18, 2024
ARTICLE I
PURPOSE OF THE PLAN
1.1Purpose. The Key Executive Severance Plan of Public Service Enterprise Group Incorporated (“Plan”) is maintained by the Company to provide severance benefits to certain key executive-level employees of the Company and its affiliates whose employment is terminated under the circumstances described herein.
1.2Amendments. The Plan was amended effective January 1, 2014 to provide that (i) for Eligible Employees who become Schedule B Participants after December 31, 2013, their Change in Control benefit under Section 5.2(b) of the Plan shall be equal to two times Annual Base Salary and Target Bonus, and (ii) for Eligible Employees who become Schedule A Participants after December 31, 2013, their Change in Control benefit under Section 5.2(b) of the Plan shall be equal to 1.5 times Annual Base Salary and Target Bonus. The Plan was further amended to provide that the for purposes of determining the nonqualified plan change in control benefit under Section 5.5(a) of the Plan, with respect to Eligible Employees who become Schedule A or Schedule B Participants after December 31, 2013, their employment shall be assumed to have continued for 1.5 or 2 additional years (for Schedule A Participants and Schedule B Participants, respectively). Finally, the Plan was amended to update the Schedule A Participant list.
The Plan was amended effective June 16, 2014 to (i) add a new schedule of eligible Participants, Schedule C Participants, (ii) to provide that there will be no additions to Schedule B Participants, (iii) to provide that other than a current Schedule B Participant, an Eligible Employee newly hired or promoted into a position reflected on Schedule B as of June 16, 2014, shall become a Schedule A Participant, and (iv) to update the Schedule A Participant list, the Schedule B Participant list and the Schedule C Participant list.
The Plan was amended effective July 14, 2014, to update the Schedule A Participant list and the Schedule C Participant list.
The Plan was amended effective February 17, 2015, to update the Schedule A Participant list, the Schedule B Participant list and the Schedule C Participant list.
The Plan was amended effective November 18, 2015, to update the Schedule A Participant list, the Schedule B Participant list and the Schedule C Participant list, and to include the language to comply with the Securities and Exchange Commission’s whistleblower protections.
The Plan was amended effective December 15, 2015, to update the Schedule A Participant list and the Schedule C Participant list.
The Plan was amended effective July 19, 2016, to update the Schedule A Participant list and the Schedule C Participant list. The Plan was amended to comply with the
Defense of Trade Secrets Act regarding the confidentiality provision. Finally, the Plan was amended to clarify that if an Eligible Employee is newly hired or promoted into a position reflected on Schedule B as of June 16, 2014, such Eligible Employee shall become a Schedule A Participant.
The Plan was amended effective November 14, 2016, to (i) revise the definition of Cause, (ii) align the severance benefits in Article IV, (iii) align the Change in Control benefits in Article V, (iv) update the Schedule A Participant list and the Schedule C Participant list, and (v) to make administrative clarifications. The Plan is intended to comply in operation and form with Section 409A of the Internal Revenue Code of 1986, as amended (“Code”). The timing and form of payment of benefits provided under the Plan will be deemed to be automatically modified, and a Participant’s rights under the Plan will be limited so as to conform to any requirements under Section 409A of the Code.
The Plan was amended effective February 20, 2017, to update the Schedule A Participant list.
The Plan was amended effective April 17, 2017, to update the Schedule A Participant list and the Schedule C Participant list.
The Plan was amended effective July 18, 2017 (unless otherwise noted) to update the Schedule A Participant list, the Schedule B Participant list and the Schedule C Participant list.
The Plan was amended effective November 20, 2017, to update the Schedule A Participant list, the Schedule B Participant list and the Schedule C Participant list.
The Plan was amended effective July 16, 2018, to update the Schedule A Participant list and the Schedule C Participant list and to make administrative clarifications.
The Plan was amended effective November 19, 2018, to update the Schedule A Participant list.
The Plan was amended effective February 18, 2019, to update the Schedule A Participant list and the Schedule C list, and to make administrative changes.
The Plan was amended effective April 15, 2019, to (i) remove the Participant lists (Schedules A – C) from the Plan, and (ii) provide that the Participant lists will be maintained by the Senior Vice President of Human Resources, Chief Human Resources Officer & Chief Diversity Officer.
The Plan was amended effective July 1, 2019, to provide that the definition of “Retirement Plan” includes Pension Plan of Public Service Enterprise Group Incorporated II and to make administrative clarifications.
The Plan was amended effective June 30, 2021 to (i) provide that a Selectline Participant or a Benefits 2000 Participant can elect coverage under the Retiree Medical Plan upon the expiration of COBRA continuation coverage, (ii) add Appendix A which provides benefits for Eligible Employees that are involuntarily terminated as a result of the Strategic Alternatives Review transaction(s), and (iii) provide that a Benefits 2000 Participant shall vest in their Company contributions under the Public Service Enterprise Group Incorporated Postretirement Supplemental Health Benefits Plan upon termination from employment.
The Plan was amended as of July 18, 2022: (i) to provide the severance benefits effective September 1, 2022, to the President and Chief Executive Officer (CEO) (and effective January 1, 2023, the Chair of the Board, President and CEO) shall receive in the event a termination without cause, (ii) to revise the method to calculate the cutback of Parachute Payments to avoid an excise tax exposure, and (iii) for administrative clarifications.
The Plan was amended effective April 16, 2024 to: (i) update eligibility language and clarify the situations where employees are eligible and not eligible for benefits, (ii) provide that employees are eligible for severance benefits under a voluntary Exit Incentive Program (“EIP”) under specified circumstances, (iii) remove references to the ER&T Plan, (iv) clarify that Participants may elect retiree dental coverage upon the expiration of subsidized COBRA coverage, (v) remove Appendix A as it self-expired, and (vi) make administrative clarifications.
The Plan is being amended effective November 18, 2024 to: (i) update the positions eligible for inclusion on Schedule A to include designated Section 16 Officer positions, except for an officer currently on Schedule B; and (ii) rename “Class” to “Schedule” to align with referenced terms of Schedule.
This amended and restated Plan document supersedes and replaces all prior Plan documents and applies to any termination of employment that occurs on or after the Effective Date.
ARTICLE II
DEFINITIONS
2.1“Accrued Obligation” shall have the meaning set forth in Sections 4.2 and 5.2 of the Plan.
2.2“Affiliate” means any corporation, trade or business if it or the Company are members of a controlled group of corporations, are under common control or are members of an affiliated service group within the meanings of Sections 414(b), 414(c) and 414(m), respectively, of the Code. The term “Affiliate” shall also include any other entity required to be aggregated with the Company pursuant to regulations under Section 414(o) of the Code.
2.3“Annual Base Salary” means the annual rate of base salary payable to a Participant for services performed for an Employer, as in effect immediately prior to the Participant’s Date of Termination.
2.4“Benefits 2000 Participant” means a Participant who is a participant in the Public Service Enterprise Group Incorporated Benefits 2000 Health and Welfare Benefits Plan.
2.5“Board” means the board of directors of the Company.
(a)For purposes of Article IV and Article V:
(i)Misconduct, gross negligence, theft, or fraud against the Company, including an isolated incident that is determined by the Committee’s delegate to be material misconduct or material gross negligence;
(ii)For “Performance Reasons,” as defined in Section 2.24 of the Plan;
(iii)Material violation of the Standards of Conduct or other Company policy;
(iv)Insubordination, including an isolated incident that is determined by the Committee’s delegate to be material insubordination;
(v)One or more significant acts of dishonesty;
(vi)Any act that is likely to have the effect of injuring the reputation, business, or business relationship of, the Company, its Board of Directors, Officers, or employees, or its affiliates or subsidiaries;
(vii)Violation of any fiduciary duty, including an isolated incident that is determined by the Committee’s delegate to be a material violation;
(viii)Breach of any duty of loyalty including an isolated incident that is determined by the Committee’s delegate to be a material breach;
(ix)Any breach of the restrictive covenants contained in the Plan or the release of claims described in Section 3.3;
(x)One or more acts of moral turpitude that constitute a violation of applicable law (included but not limited to a felony);
(xi)Conviction of a felony or plea of nolo contendere to a felony charge;
(xii)Pattern of behaviors that fail to meet the Company’s expectations described in “PSEG Values, Behaviors, and Leadership Competencies;” or
(xiii)Any other reason determined to be Cause by the Chief Executive Officer of the Company.
2.7“Change in Control” means the occurrence of any of the following events:
(a)Any “person” (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended (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 (i) of paragraph (c) below; or
(b)The following individuals cease for any reason to constitute a majority of the number of directors of the Company then serving: individuals who, on the Effective Date, constitute the Board 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 or nomination for election by the Company’s stockholders was approved or recommended by a vote of at least two-thirds of the directors then still in office who either were directors on the Effective Date 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 (i) 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 of its Affiliates, 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 (ii) 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 shareholders 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, 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.
2.8“Schedule A Participant” means a Participant designated as a Schedule A Participant by the Committee.
2.9“Schedule B Participant” means a Participant designated as a Schedule B Participant by the Committee.
2.10“Schedule C Participant” means a Participant designated as a Schedule C Participant by the Committee.
2.11“Code” means the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.
2.12“Committee” means the Organization and Compensation Committee of the Board or any successor of such Committee.
2.13“Company” means Public Service Enterprise Group Incorporated and any successors thereto.
2.14“Confidential Information” means all trade secrets, proprietary and confidential business information belonging to, used by, or in the possession of the Company or any of its Affiliates, including but not limited to information, knowledge or data related to business strategies, plans and financial information, mergers, acquisitions or consolidations, purchase or sale of property, leasing, pricing, sales programs or tactics, actual or past sellers, purchasers, lessees, lessors or customers, those with whom the Company or its Affiliates has begun negotiations for new business, costs, employee compensation, marketing and development plans, inventions and technology, whether such confidential information, knowledge or data is oral, written or electronically recorded or stored, except information in the public domain, information known by the Participant prior to employment with an Employer, and information received by the Participant from sources other than the Company or its Affiliates, without obligation of confidentiality.
2.15“Date of Termination” means, provided that the termination constitutes a Separation from Service, (i) the date of a Participant’s death, (ii) the date on which the termination of the Participant’s employment by an Employer for Cause or without
Cause, or (iii) the date on which the Participant terminates employment for Good Reason or without Good Reason, including Retirement and Disability.
2.16“Disability” means (i) if the Participant is a participant in the Final Average Pay Component of the Pension Plan, the Participant is eligible for a disability pension benefit; or (ii) if the Participant is a participant in the Cash Balance Component of the Pension Plan, the Participant is receiving benefits from the Company’s long-term disability plan.
2.17“Eligible Employee” means an individual who is designated as such in accordance with Section 3.1. An Eligible Employee shall not include a project employee.
2.18“Effective Date” of the amendment and restatement is April 16, 2024.
2.19“Employer” means the Company and each Affiliate, and any successors thereto.
(a)Any material reduction in the Participant’s Annual Base Salary, Target Bonus or Target Long-Term Incentive, other than reductions pursuant to a broad-based compensation reduction program or policy affecting the Participant and all similarly situated employees of the Employer;
(b)Any material adverse change in the Participant’s title, authority, duties, or responsibilities or the assignment to the Participant of any duties or responsibilities inconsistent in any respect with those customarily associated with the position of the Participant immediately prior to the Change in Control;
(c)The failure of any successor to the Company to assume this Plan in accordance with Section 11.5(b);
(d)Where the only comparable position offered to the Participant within the Employer following a Change in Control would otherwise meet the requirements of Subsections (a) and (b) of this Section 2.20 of the Plan, but would require the Participant to increase their one-way commuting distance from their principal residence by more than 50 miles; or
(e)Any other material breach of the terms of the Plan by the Company that either is not taken in good faith or, even if taken in good faith, is not remedied by the Company promptly after receipt of notice thereof from the Participant.
Notwithstanding the forgoing, for purposes of the Plan, the termination of a Participant’s employment with an Employer shall not be deemed to be for Good Reason unless such termination is affected in accordance with the following procedures. The Participant shall give the Employer a written notice (“Notice of Termination for Good Reason”) of the termination, setting forth in reasonable detail
the specific acts or omissions of the Employer that constitute Good Reason and the specific provision(s) of the Plan on which the Participant relies. Unless the Committee determines otherwise, a Notice of Termination for Good Reason by the Participant must be made within 60 days after the Participant first has actual knowledge of the act or omission (or the last in a series of acts or omissions) that the Participant alleges to constitute Good Reason, and the Employer shall have 30 days from the receipt of such Notice of Termination for Good Reason to cure the conduct cited therein. A termination of employment by the Participant for Good Reason shall be effective on the final day of such 30-day cure period unless prior to such time the Employer has cured the specific conduct asserted by the Participant to constitute Good Reason to the reasonable satisfaction of the Participant.
For purposes of the Plan, a Participant’s determination that an act or failure to act constitutes Good Reason shall be presumed to be valid unless such determination is decided to be unreasonable by the Committee or its delegate pursuant to Article IX.
2.21“Nonqualified Plan” means the Retirement Income Reinstatement Plan for Non-Represented Employees of Public Service Enterprise Group Incorporated.
2.22“Participant” means an Eligible Employee who has been designated by the Committee to participate in the Plan.
2.23“Pension Plan” means the retirement plan in which the Participant participates, which is either the Pension Plan of Public Service Enterprise Group Incorporated or Pension Plan of Public Service Enterprise Group Incorporated II.
2.24“Performance Reasons” means the Participant’s failure meet the expectations established for such Participant’s function in the Company as: (i) communicated to the Participant by their manager during any performance review, or (ii) may be communicated to the Participant otherwise by their manager from time to time either orally or in writing.
2.25“Plan” means this Key Executive Severance Plan of Public Service Enterprise Group Incorporated, as set forth herein and as may be amended, modified or supplemented from time to time.
2.26“Primary Work Location” means (1) the main PSEG work location where those in onsite and hybrid roles are assigned to report, or (2) for those in designated remote-local roles, the PSEG work address assigned by the Company, at its sole discretion, to the role as the reference point for the “local” designation, which will generally be a PSEG property.
2.27“Prior Equity Awards” means outstanding stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares and performance shares units.
2.28“Retiree Medical Plan” means the Public Service Enterprise Group Incorporated Medical Benefits Plan for Retired Employees.
2.29“Retirement” means a Separation from Service after the Participant has satisfied the eligibility requirements for early or normal retirement under the terms of the Pension Plan in which the Participant participates. Notwithstanding the foregoing, for the purposes of determining benefit entitlements under Article V of the Plan, Retirement shall not include any termination by an Employer without Cause or voluntary termination by the Participant for Good Reason that occurs on a date on which the Participant is Retirement eligible.
2.30“Selectline Participant” means a Participant who is a participant in the Public Service Enterprise Group Incorporated Selectline Benefits Plan.
2.31“Separation from Service” shall be deemed to have occurred if a Participant and the Company or any Affiliate reasonably anticipates, based on the facts and circumstances, that either:
(a)The Participant will not provide any additional services for the Company or an Affiliate after a certain date; or
(b)The level of bona fide services performed by the Participant after a certain date will permanently decrease to no more than 50 percent of the average level of bona fide services performed by the Participant over the immediately preceding 36 months.
If a Participant is absent from employment due to military leave, sick leave or any other bona fide leave of absence authorized by the Company or an Affiliate and there is a reasonable expectation that the Participant will return to perform services for the Company or an Affiliate, a Separation from Service will not occur until the later of: (i) the first date immediately following the date that is six months after the date that the Participant was first absent from employment; or (ii) the date the Participant no longer retains a right to reemployment, to the extent the Participant retains a right to reemployment with the Company or any Affiliates under applicable law or by contract. If a Participant fails to return to work upon the expiration of any military leave, sick leave or other bona fide leave of absence where such leave is for less than six months, the Separation from Service shall occur as of the date of the expiration of such leave, unless a greater period is provided for under applicable law.
2.32“Specified Employee” means any individual who is a key employee (as defined in Section 416(i) of the Code without regard to Section 416(i)(5) of the Code) of the Company at any time during the 12-month period ending on each December 31 (the “identification date”). If an individual is a key employee as of an identification date, the individual shall be treated as a Specified Employee for the 12-month period beginning on the April 1 following the identification date. Notwithstanding the foregoing, an individual shall not be treated as a Specified Employee unless any stock of the Company or an Affiliate is publicly traded on an established securities market or otherwise.
2.33“Target Bonus” means the Participant’s target annual bonus, if any, under the applicable annual incentive compensation plan of the Company for the fiscal year in which the Date of Termination occurs.
2.34“Target Long-Term Incentive” means the Participant’s target long-term incentive award, if any, under the applicable long-term incentive compensation plan of the Company.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.1Eligible Employees. Eligibility to participate in the Plan shall be limited to certain key executives of an Employer who (a) are not parties to individual employment, severance or change in control agreements that provide for severance benefits, and (b) are designated, by duly adopted resolution of the Committee, as Eligible Employees.
3.2Participation. An employee who becomes an Eligible Employee on or after January 1, 2014, shall be referred to as a Schedule C Participant. However, if an Eligible Employee is newly hired or promoted into a company designated Section 16 Officer position, except for an officer currently on Schedule B, the Eligible Employee shall be referred to as a Schedule A Participant. The Participant lists of Schedule A Participants, Schedule B Participants and Schedule C Participants shall be maintained by the Senior Vice President and Chief Human Resources Officer and Chief Diversity Officer. Effective January 1, 2023, the Chair of the Board, President and Chief Executive Officer shall be the only Schedule B Participant.
3.3Release of Claims. Notwithstanding anything in the Plan to the contrary, payment of any benefits under the Plan is expressly contingent upon the Participant’s execution and delivery to the Company, of a written agreement provided by the Company, wherein the Participant releases and discharges the Company and each of its Affiliates of any and all claims against the Company and its Affiliates related in any way to the Participant’s employment with an Employer and the termination of such employment.
3.4Committee Discretion. The Committee shall have the sole discretion to determine eligibility for benefits under the Plan.
ARTICLE IV
SEVERANCE BENEFITS IN GENERAL
4.1Eligible Terminations. Any of the following situations described in paragraphs (a) through (d) below shall be treated as eligible terminations for purposes of benefits under Article IV of the Plan, provided that the termination is not an ineligible termination under Section 4.2 and provided further that, in order for a termination to
be treated as an eligible termination of employment under the Plan, the termination must constitute a Separation from Service.
(a)If an Eligible Employee’s employment is involuntarily terminated by an Employer for any reason, subject to (c) below, other than (i) Cause, (ii) Performance Reasons, (iii) misconduct or (iv) violation of Company policy (as designated by the Company), the Participant shall be eligible for the benefits described in this Article IV.
(b)If an Eligible Employee terminates employment for Good Reason other than in connection with a change in employment on account of Performance Reasons, the Participant shall be eligible for the benefits described in this Article IV.
(c)An Eligible Employee shall be eligible for the benefits described in this Article IV if they terminate employment as a result of having been notified in writing of a termination of employment or the Eligible Employee’s position is no longer an officer position, initiated by the Employer (in its sole discretion) where all of the following apply:
(i)The Employer states in the termination notification that it has eliminated the Eligible Employee’s position;
(ii)Such position elimination results in:
•No available position being offered to the Eligible Employee within the Company or its Affiliates (collectively, “PSEG Group”); or
•The only available position(s) being offered to the Eligible Employee within the PSEG Group (1) would reduce the Eligible Employee’s base salary and/or target bonus percentage opportunity; and/or (2) would require the Eligible Employee to be assigned a new Primary Work Location which increases the Eligible Employee’s one-way commuting distance by more than 50 miles;
(iii)They remain employed through the last day of work designated by the Employer unless an earlier last day of work is approved in writing by the Employer;
(iv)They do not accept a position in the PSEG Group prior to receiving payment under the Plan; and
(v)They are not terminated by the Employer, in its sole discretion, for Cause, or even to the extent not comprising Cause, Performance Reasons, misconduct or violation of Company policy (as designated by the Company), prior to their designated last day of work.
(d)Even if not eligible for benefits under paragraphs (a) – (c) above, an Eligible Employee shall be eligible for benefits described in this Article IV if all of the following apply:
(i)They have been notified in writing by the Employer (in its sole discretion) that they have been invited to participate in a voluntary EIP approved in writing by the Senior Vice President of Human Resources, Chief Human Resources Officer & Chief Diversity Officer in accordance with applicable corporate governance practices;
(ii)They make an irrevocable election to participate in the voluntary EIP during the election window designated by the Employer;
(iii)They are notified in writing that they have been selected for termination by the Employer pursuant to the voluntary EIP;
(iv)They remain employed through the last day of work designated by the Employer unless an earlier last day of work is approved in writing by the Employer;
(v)They do not accept a position in the PSEG Group prior to receiving payment under the Plan; and
(vi)They are not terminated by the Employer, in its sole discretion, for Cause, or, even to the extent not comprising Cause, Performance Reasons, misconduct or violation of Company policy (as designated by the Company), prior to their designated last day of work.
4.2Ineligible Terminations.
(a)For the avoidance of any doubt, an otherwise Eligible Employee shall not be eligible for benefits under the Plan if:
(i)They are involuntarily terminated for Cause, or, even to the extent not comprising Cause, Performance Reasons, misconduct, or violation of Company policy (as designated by the Company);
(ii)Termination of employment is the result of the Eligible Employee’s death or Disability;
(iii)They voluntarily terminate employment, except as otherwise provided in connection with a voluntary EIP described in Section 4.1(d);
(iv)If a Participant experiences a cessation of employment in connection with a reduction in force or an Employer reorganization (as determined by the Committee) where the only position offered to the Participant within the Company and Affiliates would require the Participant to increase their one-way commuting distance by less than 50 miles, the Participant shall not be eligible for benefits described in this Article IV;
(v)They voluntarily terminate or cease working prior to the agreed last day of work, without prior written approval from the Employer;
(vi)They enter into a VSA with an Employer; or
(vii)The cessation of employment is:
(A)In connection with the sale of the Eligible Employee’s Employer, line or unit of business of the Employer within which their position is located, business function of the Employer within which their position is located, or the assets related to the
Employer, line or unit or business, or business function within which their position is located; and
(B)The Eligible Employee is offered employment with the purchaser within 90 days of the closing of the transaction in a position that has an annual rate of base salary that is at least 80 percent of the Eligible Employee’s annual rate of base salary immediately prior to the closing of the sale.
(b)Other situations in which an Employee’s employment shall not be treated as a termination from employment by the Employer, and therefore, they are not eligible for benefits under Section IV of the Plan, include, except to the extent they may constitute Good Reason:
(i)Acceptance of, or a transfer to, another position within the PSEG Group;
(ii)Reductions in compensation and/or target bonus percentage opportunity associated with an Employee’s current position;
(iii)Change of work location category (e.g., between remote non-local, remote local, hybrid, or onsite); and
(iv)Change in the required frequency of working onsite (e.g., PSEG locations including field location) or in-person interfacing with colleagues, clients, or customers (e.g., an Employee who was required to come into the office only on occasion and then must report onsite five days a week).
4.3Cash payment. The Company shall pay to the Participant a lump sum, in cash, the sum of (a) and (b):
(a)The Participant’s base salary through the Date of Termination to the extent not theretofore paid (hereinafter referred to as the “Accrued Obligations”); and
(b)An amount equal to the product of 1.0 times (0.5 times if the Participant were employed less than one year) the sum of the Participant’s Annual Base Salary and Target Bonus. Notwithstanding the foregoing, effective September 1, 2022, the President and CEO (and effective January 1, 2023, the Chair of the Board, President and CEO) will receive 2.0 times the sum of the Participant’s Annual Base Salary and Target Bonus.
4.4Long-Term Incentive Awards. The treatment of Prior Equity Awards shall be governed by the terms of the Long-Term Incentive Plan and the related award agreements.
4.5Annual Incentive Awards. The Participant shall receive a prorated annual incentive award pursuant to the performance incentive program, if applicable, for the calendar year in which the Participant’s Termination of Employment occurs. The award shall be calculated based solely on 100 percent of the target incentive award and prorated based on the number of calendar days of employment in the calendar year in which the Participant’s termination occurs through the Participant’s Date of Termination.
For purposes of this Section 4.5, calendar year shall mean 365 days.
Annual incentive awards with respect to the calendar year in which a Participant’s Date of Termination occurs will be paid at the same time as awards for such calendar year are paid to active employees of the Employer.
4.6Outplacement Services. Outplacement services approved by the Committee, which may include individual or group counseling and administrative assistance or workshops, shall be available beginning on the Participant’s Date of Termination or such earlier date designated by the Participant’s business unit leadership. Outplacement services shall continue to be available for the period up to 12 months and up to a maximum Company cost of $25,000.
4.7Educational Assistance. Educational assistance shall be provided in accordance with the Employer’s tuition program.
(a) Health for Selectline Participants.
(i)A Selectline Participant who has satisfied the eligibility requirements for medical/dental coverage under the Retiree Medical Plan/Retiree Dental Plan on the Date of Termination shall be eligible to elect coverage thereunder in accordance with the terms of the Retiree Medical Plan/Retiree Dental Plan.
(ii)A Selectline Participant who has not otherwise satisfied the eligibility criteria for participation in the Retiree Medical Plan/ Retiree Dental Plan prior to the Date of Termination, shall be eligible to elect coverage under the Retiree Medical Plan/Retiree Dental Plan as though such Selectline Participant has otherwise satisfied the eligibility requirements if:
(A)The Selectline Participant has attained age 50 and completed ten or more Years of Service as of the Date of Termination but the sum of the Selectline Participant’s age and Years of Service is less than 80; or
(B)The Selectline Participant has attained age 49 and completed 20 or more Years of Service as of the Date of Termination but the sum of the Selectline Participant’s age and Years of Service is less than 80.
Such coverage shall commence no earlier than the Selectline Participant’s Date of Termination. The Selectline Participant shall be charged the full cost of coverage under the Retiree Medical Plan/ Retiree Dental Plan.
(iii)If a Selectline Participant who is not eligible for, or does not elect,
coverage under the Retiree Medical Plan/Retiree Dental Plan, timely elects continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Employer shall pay the same portion of the cost of medical and/or dental coverage that it paid immediately prior to the Selectline Participant’s Date of Termination for active employees during the one-year period following the Selectline Participant’s Date of Termination. During the one-year period, the Participant shall pay the difference between the total cost of medical and/or dental coverage and the Employer’s portion of the cost. After the expiration of the one-year period, the Selectline Participant shall be charged the COBRA rate for medical and/or dental coverage for the remainder of the COBRA period. If the Participant does not timely elect COBRA medical and/or dental coverage, the Participant shall not be entitled to the benefit under this Subsection (iii). During the entire COBRA period, the Selectline Participant shall be responsible for the full cost of COBRA vision and hearing coverage, as applicable. If a Selectline Participant timely elects COBRA continuation coverage in lieu of coverage under the Retiree Medical Plan/ Retiree Dental Plan, they may, upon the expiration of COBRA continuation coverage, elect medical coverage under the Retiree Medical Plan/ Retiree Dental Plan provided that they meet the eligibility for such coverage at time of termination.
(iv)Health Coverage for Benefits 2000 Participants. If a Benefits 2000 Participant who is not eligible for, or does not elect, coverage under the Retiree Plan/Retiree Dental Plan, timely elects COBRA continuation medical and/or dental coverage, the Employer shall pay the same portion of the cost of medical and/or dental coverage that it paid immediately prior to the Participant’s Date of Termination for active employees during the one-year period following the Participant’s Date of Termination. During the one-year period, the Participant shall pay the difference between the total cost of medical and/or dental coverage and the Employer’s portion of the cost. After the expiration of the one-year period, the Benefits 2000 Participant shall be charged the COBRA rate for medical and/or dental coverage for the remainder of the COBRA period. If the Participant does not timely elect COBRA medical and/or dental coverage, the Participant shall not be entitled to the benefit under this Subsection (b). During the entire COBRA period, the Benefits 2000 Participant shall be responsible for the full cost of COBRA vision. If a Benefits 2000 Participant is a participant in the Public Service Enterprise Group Incorporated Postretirement Supplemental Health Benefits Plan, they shall vest in Company contributions upon termination from employment. If a Benefits 2000 Participant timely elects COBRA continuation coverage in lieu of coverage under the Retiree Medical Plan/ Retiree Dental Plan, they may, upon the expiration of COBRA continuation coverage, elect medical coverage under the Retiree Medical Plan/ Retiree Dental Plan
provided that they meet the eligibility for such coverage at time of termination.
4.9Other Benefits. A Participant shall not be entitled to any severance, separation or early retirement incentive pay or benefits other than as provided hereunder or under any qualified or nonqualified retirement plan or deferred compensation arrangement maintained by the Employer. Except as provided in the foregoing sentence, a Participant’s rights under any other employee benefit plans maintained by the Company or an Affiliate shall be determined in accordance with the provisions of such plans, including the Company’s right to amend or terminate such plans at any time.
ARTICLE V
SEVERANCE BENEFITS AFTER A CHANGE IN CONTROL
5.1Eligible Terminations After a Change in Control. If, within two years following the occurrence of a Change in Control, either (a) an Employer shall terminate a Participant’s employment for any reason other than for Cause, or (b) a Participant shall voluntarily terminate employment for Good Reason, the Participant shall be eligible for benefits described in this Article V of the Plan. Notwithstanding anything in the Plan to the contrary, a Participant shall not be entitled to benefits under the Plan if termination from employment is the result of death, Disability or the Participant voluntarily terminates employment, except for Good Reason and except as otherwise provided under the Plan.
If a Participant enters into a VSA with an Employer, such Participant shall not be eligible for benefits under the Plan.
5.2Cash Payment. The Company shall pay to the Participant, in a lump sum in cash, the aggregate of the amounts in (a) and (b) below:
(i)The Participant’s base salary through the Date of Termination; and
(ii)The product of (x) the Participant’s Target Bonus and (y) a fraction, the numerator of which is the number of days in the current calendar year through the Date of Termination, and the denominator of which is 365;
in each case to the extent not theretofore paid (the sum of the amounts described in clauses (i) and (ii) shall be hereinafter referred to as the “Accrued Obligations”); and
(b)Either (i), (ii) or (iii):
(i)In the case of a Schedule A Participant, the amount equal to the product of two times the sum of the Schedule A Participant’s Annual Base Salary and Target Bonus;
(ii)In the case of a Schedule B Participant, the amount equal to the product of three times the sum of the Schedule B Participant’s Annual Base Salary and Target Bonus; or
(iii)In the case of a Schedule C Participant, the amount equal to the product of one and one-half times the sum of the Schedule C Participant’s Annual Base Salary and Target Bonus.
5.3Long Term Incentive Awards. The treatment of Prior Equity Awards shall be governed by the terms of the Long-Term Incentive Plan and the related award agreements.
5.4Health Care and Other Welfare Benefits. The Company shall pay the cost of the continued coverage of the Participant and/or the Participant’s family under the Company’s medical and dental employee benefit plans for 18 months after the Date of Termination provided that the Participant timely makes an election to continue such coverage in the Company’s medical and dental employee benefit plans under COBRA, subject to the requirements and limitations thereof. Unless otherwise limited by applicable law, thereafter, the Company shall pay the cost of the continued coverage of the Participant and/or the Participant’s family under the Company’s medical and dental employee benefit plans for an additional period of six months, in the case of a Schedule A Participant, or 18 months, in the case of a Schedule B Participant (for a Schedule C Participant, no additional period beyond the initial 18 months); provided however, that if the Participant becomes re-employed with another employer and is eligible to receive medical or dental benefits under another employer provided plan, the medical and dental benefits provided by the Company under this Plan shall be secondary to those provided under such other plan during the applicable period of eligibility. If the Participant does not timely elect COBRA coverage, the Participant shall not be entitled to the COBRA continuation benefit under this Section 5.4 of the Plan.
Unless otherwise limited by applicable law or by a third-party vendor contract, for two years after the Date of Termination in the case of a Schedule A Participant, three years after the Date of Termination in the case of a Schedule B Participant, or in the case of a Schedule C Participant, eighteen months after the Date of Termination (or for any Participant such longer period as may be provided by the terms of the appropriate plan, program, practice or policy), the Company shall continue benefits (other than medical and dental benefits) to the Participant and/or the Participant’s family at least equal to those which would have been provided to them in accordance with the welfare plans, programs, practices and policies maintained by the Company if the Participant’s employment had not been terminated or, if more favorable to the Participant, as in effect generally at any time thereafter with respect to other peer executives of the Employer and their families.
Unless otherwise limited by applicable law or by a third-party vendor contract, the Participant’s eligibility (but not the time of commencement of such benefits) for retiree benefits pursuant to the welfare plans, programs, practices and policies
maintained by the Company shall be determined as if the Participant had (A) remained employed until two years (in the case of a Schedule A Participant), three years (in the case of a Schedule B Participant), or eighteen months (in the case of a Schedule C Participant) after the Date of Termination, and (B) retired on the last day of such period.
5.5Nonqualified Pension Benefit. The Participant shall be paid, in a lump sum payment in cash, an amount equal to the excess of (a) – (b):
(a)The actuarial equivalent of the benefit under the Company’s applicable Pension Plan (utilizing the rate used to determine lump sums and, to the extent applicable, other actuarial assumptions no less favorable to the Participant than those in effect under the Pension Plan immediately prior to the Effective Date), any benefit under the Nonqualified Plan and, to the extent applicable, any other defined benefit retirement arrangement between the Participant and the Company (“Other Pension Benefits”) which the Participant would receive if the Participant’s employment continued for two, three or one and one-half additional years (for Schedule A Participants, Schedule B and Schedule C Participants, respectively) beyond the Date of Termination and, assuming that the Participant’s compensation for such deemed additional period was the Participant’s Annual Base Salary as in effect immediately prior to the Date of Termination and assuming a bonus in each year during such deemed additional period equal to the Target Bonus,
(b)The actuarial equivalent of the Participant’s actual benefit (paid or payable), if any, under the Pension Plan, the Nonqualified Plan and Other Pension Benefits as of the Date of Termination (utilizing the rate used to determine lump sums and, to the extent applicable, other actuarial assumptions no less favorable to the Participant than those in effect under the Pension Plan immediately prior to the effective date of the Change in Control).
5.6Deferred Compensation. Any compensation previously deferred (other than pursuant to a tax-qualified plan) by or on behalf of the Participant (together with any accrued interest or earnings thereon), whether or not then vested, shall become vested on the Date of Termination and shall be paid in accordance with the terms of the applicable deferred compensation plan, policy or practice under which it was deferred to the extent permitted by Section 409A of the Code.
5.7Outplacement Services. The Company shall, at its sole expense as incurred, provide the Participant with outplacement services suitable to the Participant’s position for a period not to exceed one year following the Date of Termination with a nationally recognized outplacement firm and up to a maximum Company cost of $25,000.
5.8Other Benefits. To the extent not theretofore paid or provided, the Company shall pay or provide to the Participant any other amounts or benefits required to be paid or provided or which the Participant is entitled to receive under any plan, program,
policy, practice, contract or agreement of the Company (or other Employer), including earned but unpaid stock and similar compensation, but excluding medical or dental benefits if the Participant is eligible for such benefits to be provided by a subsequent employer, and benefits payable under any severance plan or policy.
5.9Termination By Employer For Cause or By Participant Other Than For Good Reason. If, at any time after a Change in Control, either (a) an Employer shall terminate a participant’s employment for Cause or (b) the Participant shall voluntarily terminate employment other than for Good Reason, the Employer shall have no further payment obligations to the Participant other than for the Participant’s base salary through the Date of Termination. In such case, all such amounts shall be paid to the Participant in a lump sum in accordance with Section 6.1 of the Plan.
5.10Death. If a Participant’s employment terminates by reason of the Participant’s death after a Change in Control, all Accrued Obligations as of the time of death shall be paid to the Participant’s estate or beneficiary, as applicable, in a lump sum in cash in accordance with Section 6.1 of the Plan. The Participant’s estate or beneficiary shall be entitled to any Other Benefits in accordance with their terms. The treatment of Prior Equity Awards shall be governed by the terms of the Long-Term Incentive Plan and the related award agreements.
5.11Disability. If a Participant’s employment is terminated by reason of Disability after a Change in Control, all Accrued Obligations shall be paid to the Participant in a lump sum in cash in accordance with Section 6.1 of the Plan. The treatment of Prior Equity Awards shall be governed by the terms of the Long-Term Incentive Plan and the related award agreements.
5.12Retirement. If a Participant’s employment terminates as a result of Retirement after a Change in Control, the Participant shall be paid the Accrued Obligations in a lump sum in cash in accordance with Section 6.1 of the Plan and the Participant shall be entitled to any Other Benefits in accordance with their terms. The treatment of Prior Equity Awards shall be governed by the terms of the Long-Term Incentive Plan and the related award agreements.
ARTICLE VI
TIMING OF, LIMITATIONS ON AND ADJUSTMENTS TO PLAN PAYMENTS
6.1Time of Payments. Payments under the Plan shall be made to the Participant as follows:
(a)With respect to benefits, except those under Sections 4.4 and 5.10 of the Plan, payment to a Participant who is not a Specified Employee shall be made within the 60-day period following receipt of the executed waiver and release, but no later than 90 days following the Participant’s Date of Termination. However, if the period to consider and revoke the written agreement required to receive the benefits described in Articles IV and V of the Plan (i.e., the
waiver and release) spans two taxable years, in all events the payments will be made in the second taxable year within 30 days following the later of the end of the first taxable year or the date the executed release is received by the Company.
(b)With respect to benefits under Section 5.10 of the Plan, payment shall be made within the 60-day period following the Participant’s date of the Participant’s death.
(c)With respect to benefits under Section 4.4 of the Plan, payments shall be made to the Participant at the same time the payments are made to active employees.
(d)Notwithstanding anything to the contrary in the Plan, to the extent necessary to comply with Section 409A of the Code, payments to a Participant who is a Specified Employee shall be made within the 60-day period following the six- month anniversary of the Participant’s Date of Termination (other than by reason of death).
(e)All payments under the Plan that are reimbursements of covered expenses incurred by the Participant shall be made within the taxable year in which the expense is incurred.
6.2Payment Offsets. Notwithstanding anything in the Plan to the contrary, in the event a Participant is entitled to receive severance payments both under this Plan and under the terms of either (a) an individual change of control or employment agreement, (b) another severance pay plan or policy of an Employer or (c) any existing or future law or regulation, the benefits payable under this Plan shall be reduced by the amount of any severance benefits such Participant is entitled to receive under such individual agreement, plan, policy, law or regulation.
6.3Cap on Excess Parachute Payments; Gross-Up Payments. Notwithstanding anything in the Plan to the contrary, if (a) a Participant is a “disqualified individual” (as defined in Section 280G(c) of the Code) and (b) the severance benefits provided under Articles IV or V, as applicable, together with any other payments the Participant has the right to receive from an Employer, would constitute a “parachute payment” (as defined in Section 280G(b) of the Code) (“Parachute Payments”), the following provisions shall apply:
(a)The severance benefits under Articles IV or V shall not exceed an amount which, together with any other Parachute Payments, the Participant has a right to receive from the Employer, would be 3.0 times the Participant’s “base amount” minus $1.00 (as defined in Section 280G of the Code) so that no portion of the amounts received by the Participant shall be subject to the excise tax imposed under Section 4999 of the Code.
(b)The determination of whether any limitation on the severance benefits
payable under Articles IV or V is necessary shall be made by the Company’s independent auditor or such other certified public accounting firm as may be jointly designated by the Participant and the Company (the “Accounting Firm”), which shall provide detailed supporting calculations to the Participant and the Company. The determinations of the Accounting Firm shall be conclusive and binding on the Company and the Participant. All fees and expenses of the Accounting Firm shall be borne solely by the Company.
(c)If through error or otherwise, a Participant shall receive payments under the Plan, together with other Parachute Payments the Participant has the right to receive from an Employer, in excess of 3.0 times the Participant’s base amount minus $1.00, the Participant shall immediately repay the excess to the Employer upon notification from the Employer that an overpayment has been made. If the Participant fails to repay the excess to the Employer within 10 business days of the date of the Employer’s notification, the Participant will become liable to the Employer for an amount equal to two (2) times the excess amount.
6.4Compliance with Section 409A of the Code. The benefits provided under the Plan are intended to comply with the severance exemption under Treasury Regulation Section 1.409A-1(b)(9)(iii) or another exemption from Section 409A of the Code, and the Plan provisions shall be so construed, or else shall be construed to comply with Section 409A of the Code. In the event that benefits under the Plan are subject to Section 409A of the Code, and benefits are payable upon Separation from Service to a Specified Employee, benefits shall be delayed for six months to the extent necessary to comply with Section 409A of the Code. To the extent required to comply with Section 409A of the Code, the Company may modify the severance benefits payable hereunder.
6.5Tax Withholding. Notwithstanding any other provision of this Plan, the Company may withhold from any amounts payable under this Plan such Federal, state, local, employment or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
ARTICLE VII
RESTRICTIVE COVENANTS
7.1Confidentiality. As a condition to participation in the Plan, each Participant agrees to hold in a fiduciary capacity for the benefit of the Company and its Affiliates all Confidential Information which shall have been obtained by the Participant during the Participant’s employment by the Employer; except, however, that this Section 7.1 shall not apply to Confidential Information that is or becomes public knowledge, unless such Confidential Information became or becomes public knowledge due to acts of the Participant or representatives of the Participant in violation of this Section 7.1. Upon termination of the Participant’s employment, the Participant shall return to the Company all Confidential Information in their possession. After termination of the Participant’s employment with the Employer, the Participant shall
not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such Confidential Information to anyone other than the Company and those designated by it, except (a) otherwise publicly available information, (b) as may be necessary to enforce the Participant’s rights under the Plan or as necessary for the Participant to defend against a claim asserted directly or indirectly by the Company or its Affiliates, or (c) as may be compelled by service of a valid subpoena or other legal process (if the Participant is served with a valid subpoena or other legal process, the Participant must so notify the Company within three business days). Furthermore, nothing contained in this Plan violation of law to any Federal, state, or local governmental agency or entity including, but not limited to, the Securities and Exchange Commission, or making other disclosures that are protected under the whistleblower provisions of any law.
Finally, nothing in this Plan prevents a Participant – nor should a Participant be held civilly or criminally liable under any law – if the Participant discloses a trade secret: (a) in confidence to a Federal, State or local government official, either directly or indirectly, or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; (b) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal or otherwise in confidence; (c) to the Participant’s attorney in connection with a lawsuit or arbitration alleging retaliation by an employer for reporting a suspected violation of law; or (d) in connection with a lawsuit or arbitration described in the immediately preceding subparagraph (c), provided the Participant: (i) files any document containing the trade secret under seal; and (ii) does not disclose the trade secret, except pursuant to a court order or an arbitrator’s order.
Unless and until a determination has been made in accordance with Section 7.4 that the Participant has violated this Section 7.1, an asserted violation of the provisions of this Section 7.1 shall not constitute a basis for deferring or withholding any amounts otherwise payable to the Participant under the Plan.
7.2Non-Compete. As a condition to participation in the Plan, each Participant agrees that in the event the Participant voluntarily terminates employment other than for Good Reason, for the period of one year from Date of Termination, the Participant will not, without the written consent of the Company, directly or indirectly own, manage, operate, join, control, become employed by, consult to or participate in the ownership, management, or control of any business which is in direct competition with the Company or its Affiliates. This Section 7.2 shall not apply to the extent that non-compete agreements are restricted or prohibited by applicable state law.
7.3Non-Solicitation. As a condition to participation in the Plan, each Participant agrees that, in the event the Participant voluntarily terminates employment other than for Good Reason, for the period of one year following the Date of Termination, the Participant will not, directly or indirectly, solicit or hire, or encourage the solicitation or hiring by any employer other than the Company or its Affiliates, for any position
as an employee, independent contractor, consultant or otherwise, any person who was a managerial or higher level employee of an Employer at any time during the term of the Participant’s employment by the Employer; provided, however, that this provision shall not apply with respect to the solicitation of any person after six months from the date on which such person’s employment by an Employer has terminated.
7.4Enforcement. In the event of a breach by the Participant of any of the covenants set forth in this Article VII, it is agreed that the Company shall suffer irreparable harm for which money damages are not an adequate remedy, and that, in the event of such breach, the Company shall be entitled 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 covenants by the Participant. In the event that the Company should initiate any legal action for the breach or enforcement of any of the provisions contained in this Article VII and the Company does not prevail in such action, the Company shall promptly reimburse the Participant the full amount of any court costs, filing fees, attorney’s fees which the Participant incurs in defending such action, and any loss of income during the period of such litigation.
Nothing in this Plan prohibits the Participant from reporting possible violations of Federal law or regulation to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of Federal law or regulation. The Participant does not need the prior authorization of the Law Department to make any such reports or disclosures, and is not required to notify the Company that such reports or disclosures have been made.
ARTICLE VIII
AMENDMENT AND TERMINATION
8.1Amendment. The Company may amend this Plan at any time, and from time to time, by action of the Committee; provided, however, that no amendment adopted after the effective date of a Change in Control shall have the effect of either (a) removing an individual from the list of Participants, (b) adding conditions for participation or the entitlement to receive benefits hereunder, (c) reducing the amount of benefits payable to a Participant, or (d) otherwise restricting a Participant’s right to receive benefits under the Plan, except as may otherwise be required to conform such payments to the requirements of Section 409A of the Code. The Committee delegates to the Senior Vice President of Human Resources, Chief Human Resources Officer & Chief Diversity Officer the authority to approve administrative amendments to the Plan.
8.2Termination. The Committee may terminate the Plan at any time prior to a Change in Control. The Plan may not be terminated after the effective date of a Change in Control.
ARTICLE IX
ADMINISTRATION
9.1Plan Administrator. The Plan shall be administered by the Committee, which shall have the duties and responsibilities for administering the Plan as are specifically set forth in this Article IX.
9.2Responsibilities of Committee.
(a)The Committee shall have responsibility for the day-to-day administration of the Plan. In addition, the Committee shall have the specific powers, duties, responsibilities and obligations specifically provided for herein.
(b)Subject to the express provisions of the Plan, the Committee shall have full and exclusive authority to interpret the Plan and to make all other factual determinations deemed necessary or advisable in the implementation and administration of the Plan, including but not limited to determinations with respect to the eligibility of Participants to receive benefits under the Plan and the status and rights of such Participants and all other persons affected hereunder. The Committee’s interpretation and construction of the Plan shall be conclusive and binding on all persons.
(c)The Committee shall have sole authority to adopt rules and regulations, which shall be administered by the Committee. In addition, the Committee shall have the discretionary authority to issue rulings and interpretations concerning the Plan and all matters arising thereunder, on a uniform and nondiscriminatory basis, provided the same shall not be contrary to or inconsistent with any provision of the Plan.
(d)As a condition of distributing any benefit under the Plan, the Committee may prescribe the use of such forms and require the furnishing of such information as the Committee may deem appropriate for administering the Plan.
9.3Allocation or Delegation of Duties and Responsibilities. In furtherance of its duties and responsibilities under the Plan, the Committee may:
(a)Employ agents to carry out non-fiduciary responsibilities;
(b)Employ agents to carry out fiduciary responsibilities;
(c)Consult with counsel, who may be counsel to the Company; and
(d)Delegate any of its duties and responsibilities hereunder to such officer or officers of the Company as the Committee shall designate; except, however, that the Committee may not delegate to any other person the designation of Eligible Employees under Section 3.1 or the authority to consider and
determine appeals of alleged adverse benefit determinations.
The Committee delegates to the Chief Executive Officer of the Company the responsibility and authority to interpret the terms of the Plan, including the benefits payable thereunder. Furthermore, the Committee delegates to the Senior Vice President of Human Resources, Chief Human Resources Officer & Chief Diversity Officer of the Company the authority to enter into a VSA with a Participant in lieu of providing benefits under the Plan.
9.4Expenses. Unless otherwise agreed to by the Company, no person acting as a fiduciary hereunder (who is an employee of an Employer) shall receive any compensation for services as such. Expenses incurred by fiduciaries in connection with the administration of the Plan shall be paid by the Company.
9.5Indemnification of Plan Administrator. The Company shall indemnify, to the fullest extent permitted by law, each person made or threatened to be made a party to any civil or criminal action or proceeding by reason of the fact that such person, or such person’s testator or intestate, was a member of the Committee, or a delegate of the Committee, acting in the capacity of Plan administrator.
9.6Reliance Upon Others. The Committee, any person to whom it may delegate such of its duties and powers as provided herein, and the officers and directors of the Company shall be entitled to rely conclusively upon and shall be fully protected in any action taken by them in good faith in reliance upon any tables, valuations, certificates, opinions, reports or other advice furnished to them by any duly appointed actuary, accountant, legal counsel (who may be counsel for the Company) or other specialist.
9.7Notification. All notices, reports and statements in connection with the Plan that are given, made, delivered or transmitted to a Participant shall be deemed duly given, made, delivered, or transmitted when mailed, by such schedule as the sender may deem appropriate, with postage prepaid and addressed to the Participant at the address last appearing on the records of the Employer with respect to this Plan. All notices, direct actions or other communications given, made, delivered or transmitted by a Participant to an Employer or Committee shall not be deemed to have been duly given, made, delivered, transmitted or received unless and until actually received by the Employer or Committee.
9.8Multiple Capacities. A person may serve in more than one fiduciary capacity with respect to the Plan.
ARTICLE X
CLAIMS PROCEDURE
10.1Submission of Claims. The initial claim by any Participant for benefits under this Plan shall be submitted in writing to the Committee (or its delegate) within 60 days after the occurrence of the termination of employment that the Participant claims to have
triggered entitlement to Plan benefits.
10.2Computation and Review of Claims. All benefits shall be computed by the Committee or its delegate. All claims shall be approved or denied by the Committee (or its delegate) as soon as practicable, but in no event later than 90 days after application by the Participant. The Committee may take an additional 90 days to review the claim, provided that the Participant is notified in writing within the initial 90-day period.
(a)Initial Denial of Claim - Any denial of a claim shall include:
(i)Reason or reasons for the denial;
(ii)Reference to pertinent Plan provisions on which the denial is based;
(iii)Description of any additional material or information necessary for the Participant to perfect the claim together with an explanation of why the material or information is necessary; and
(iv)Explanation of the Plan’s claim review procedure, described below.
(b)Review of a Denied Claim - A Participant shall have a reasonable opportunity to appeal a denied claim to the Committee (or its delegate) for a full and fair review. The Participant or a duly authorized representative shall have 60 days after receipt of written notification of the denial of claim in which to file an appeal with the Committee. The request for review shall be in writing and the Participant or a duly authorized representative shall submit written comments, documents, records and other information relating to the appeal. The Participant or a duly authorized representative may review, free of charge, pertinent Plan documents, records and other information relevant to the appeal.
(c)Committee Review - The Committee’s (or its delegate’s) review shall take into account all comments, documents, records and other information submitted by the Participant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.
(d)Written Decision - The Committee (or its delegate) shall issue a decision on the reviewed claim promptly but no later than 60 days after receipt of the review. The Committee may take an additional 60 days to review the claim, provided that the Participant is notified in writing within the initial 60-day period. The Committee’s decision shall be in writing and shall include:
(i)Reasons for the decision;
(ii)References to the Plan provisions on which the decision is based;
(iii)Statement that the Participant is entitled to receive, upon request, reasonable access to, and copies of, all documents, records and other
information relevant to the claim; and
(iv)Statement that the Participant is entitled to bring a civil suit under Section 502(a) of ERISA.
(e)Binding Effect - The Committee’s (or its delegate’s) decision shall be final and binding on the Participant and the Employer.
ARTICLE XI
GENERAL PROVISIONS
11.1Construction. This Plan shall be construed and enforced in accordance with and governed by the internal substantive laws (and not the laws relating to conflict of laws or choice of laws) of the State of New Jersey, except to the extent that such laws are preempted by Federal law.
11.2Unfunded Plan. The obligations of the Company under this Plan are not required to be funded in advance. Nothing contained in this Plan shall give an Eligible Employee or Participant any right, title or interest in any property of the Company or any of its Affiliates.
11.3No Right to Continued Employment. Nothing contained herein shall be deemed to give any Eligible Employee or Participant the right to be retained in the employment of an Employer or to limit the rights of any Employer to discharge any Eligible Employee or Participant at any time, with or without notice and with or without Cause.
11.4Partial Invalidity. The invalidity or unenforceability of any term or provision, or any clause, or portion thereof, of this Plan shall in no way impair or affect the validity or enforceability of any other provision of this Plan, which shall remain in full force and effect.
11.5Successors and Assigns.
(a)This Plan shall inure to the benefit of and be binding upon the Company and its successors and assigns.
(b)The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform the Company’s obligations under the Plan in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.
(c)In no event shall a Participant assign their interests under the Plan to any other person without the prior written consent of the Committee.
11.6Waivers. Failure to strictly comply with any term, condition or requirement set forth
in the Plan shall not be deemed a waiver of such term, condition or requirement, nor shall any waiver of any such term, condition or requirement at any one time or times be deemed to result in a waiver of such term, condition or requirement at any other time or times.
11.7Gender and Number. The singular shall include the plural, unless indicated otherwise by the context.
11.8Headings. The headings of the Plan are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.
/s/ Sheila Rostiac 11/18/2024
Signature Date
DEFERRED COMPENSATION PLAN FOR CERTAIN EMPLOYEES
OF PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
AND ITS AFFILIATES
AMENDED AND RESTATED EFFECTIVE NOVEMBER 18, 2024
DEFERRED COMPENSATION PLAN FOR CERTAIN EMPLOYEES OF
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATEDAND ITS AFFILIATES
AMENDED EFFECTIVE NOVEMBER 18, 2024
1.PURPOSE. The original purpose of the Deferred Compensation Plan for Certain Employees of Public Service Enterprise Group Incorporated and Its Affiliates (“Plan”) is to provide a method to certain select and key employees of the Company and its Affiliates to defer compensation as provided herein. This Plan was formerly known as the Deferred Compensation Plan for Certain Employees of Public Service Electric and Gas Company. Effective November 18, 2024, the Plan provides for Core Contributions that cannot be made to the Public Service Enterprise Group Incorporated Thrift and Tax-Deferred Savings Plan (“Thrift Plan”) for certain select and key employees of the Company and its Affiliates.
2.AMENDMENT. This Plan was amended and restated, effective December 1, 2008, to allow a special one-time election to change certain prior deferral elections and make certain definitional changes related to Section 409A of the Code.
This Plan was amended and restated effective as of November 1, 2011 (with certain provisions effective January 1, 2012) to provide for in-service distributions and a lump sum payment upon the death of a Participant, to allow Participants to elect distribution of their Accounts on a specified date or a specified event, and certain other administrative changes.
This Plan was amended and restated effective January 1, 2019 to (1) remove the evergreen provision with respect to 2019 elections and prospective, and (2) make administrative clarifications.
This Plan was amended and restated effective November 20, 2023 to (i) align the definition of Beneficiary with the administration of the Plan, (ii) modify the definition of Disability, (iii) add a minimum and maximum deferral percentage, and (iv) remove historical references.
This Plan is being amended and restated effective November 18, 2024 to (i) provide that a select group of management and highly-compensated employees (including non-officers) shall be eligible for Core Contributions effective January 1, 2025, (ii) clarify the authority to amend the Plan, and (iii) make administrative clarifications.
3.DEFINITIONS OF TERMS USED IN THIS PLAN. As used in this Plan, the following words and phrases shall have the meanings indicated:
(a)“Account” - the Deferred Compensation Account described in Paragraphs 4 and 5 of this Plan.
(b)“Affiliate” – any organization which is a member of a controlled group of corporations (as defined in Code section 414(b), as modified by Code section 415(h)) which includes the Company; or any trades or businesses (whether or not incorporated) which are under common control (as defined
in Code section 414(c), as modified by Code section 415(h)) with the Company; or a member of an affiliated service group (as defined in Code section 414(m)) which includes the Company or any other entity required to be aggregated with the Company pursuant to regulations under Code section 414(o). The term affiliate shall also include such entities which shall be specifically designated by the Committee.
(c)“Assets” - all Compensation, Core Contributions and earnings/losses that have been credited to a Participant’s Account in accordance with Paragraph 6 of this Plan.
(d)“Beneficiary” - the individual(s) and/or entity(ies) designated by the Participant for their Brokerage Account.
(e)“Cash Balance Component” – the Cash Balance Component of the Pension Plans.
(f)“Change in Control” - the occurrence of any of the following events:
(i)any “person” (within the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended from time to time (the “Act”)) is or becomes the beneficial owner within the meaning of Rule 13d-3 under the 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 (A) of subparagraph (iii) below; or
(ii)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 of the Company (“Board”) 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 or nomination for 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 December 15, 1998 or whose appointment, election or
nomination for election was previously so approved or recommended; or
(iii)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
(iv)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.
(v)Notwithstanding the foregoing subparagraphs (i), (ii), (iii) and (iv), 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.
(g)“Code” – the Internal Revenue Code of 1986, as amended. A reference to a section of the Code shall also refer to any regulations and other guidance issued under that section.
(h)“Company” - Public Service Enterprise Group Incorporated.
(i)“Compensation” - the total remuneration paid to a Participant for services rendered to the Company or a Participating Affiliate, excluding the Company’s or Participating Affiliate’s cost for any public or private employee benefit plan, including this Plan, but including all elective contributions that are made by the Company or Participating Affiliate under Internal Revenue Code Sections 125 or 401(k). Compensation deferrable under this Plan shall specifically include any and all amounts transferred from the deferred compensation accounts of the Company’s Management Incentive Compensation Plan, the Management Incentive Compensation Plan of Public Service Electric and Gas Company and any prior deferred compensation plan of an Affiliate.
(j)“Core Contributions” - shall mean the Employer non-elective contribution equal to 4% of Eligible Compensation for Participants who elect the Core Contribution/401(k) Program.
(k)“Deferred Compensation” - the amount of Compensation deferred pursuant to Paragraph 4 of this Plan.
(l)“Disability” – shall have the meaning as such term has under the Company’s Long-Term Disability Plan (regardless of whether the Participant has such coverage).
(m)“Eligible Compensation” shall have the same meaning as the term “Compensation” has under the Thrift Plan, except that MICP and amount deferred to this Plan shall be included, and the IRS limit Section 401(a)(17) of the Code is not applicable. Eligible Compensation for any such year shall not exceed 150% of the Participant’s annual base salary in effect as of January 1 of that year.
(n)“EBPC” - the Employee Benefits Policy Committee of the Company.
(o)“Employer” – the Company and any Participating Affiliate.
(p)“ERISA” – The Employee Retirement Income Security Act of 1974, as amended. A reference to a section of ERISA shall also refer to any regulations and other guidance issued under that section.
(q)“ERISA Affiliate” – (a) any organization while it is a member of a controlled group of corporations (as defined in Code Section 414(b)) which includes the Company; or (b) any trades or businesses (whether or not incorporated) while they are under common control (as defined in Code Section 414(c)) with the Company.
(r)“Final Average Pay Component” the Final Average Pay Component of the Pension Plans.”
(s)“Investment Fund” - the fund or funds selected by the Company’s Thrift and Pension Investment Committee (“TPIC”) from time to time which shall serve as a means of measuring the increase or decrease of each Participant’s Account. The TPIC may, in its discretion, add or discontinue any Investment Fund available under the Plan. The TPIC shall cause to provide each affected Participant with the opportunity, without limiting or otherwise impairing any other right of such Participant regarding changes in investment directions, to redirect the allocation of their Account invested in any discontinued Investment Fund among the other Investment Funds available under the Plan, including any replacement investment vehicle.
(t)“MICP” – the Management Incentive Compensation Plan for Certain Employees of Public Service Enterprise Group Incorporated and its Affiliates.
(u)“O&CC” – the Organization and Compensation Committee of the Board of Directors of the Company.
(v)“Participant” - each employee of the Company or any Participating Affiliate as may be designated by the Chief Executive Officer of the Company.
(w)“Participating Affiliate” – any Affiliate of the Company which (a) adopts this Plan with the approval of the Company; (b) authorizes the Board of Directors and the Committee to act for it in all matters arising under or with respect to this Plan; and (c) complies with such other terms and conditions relating to this Plan as may be imposed by the Company.
(x)“Pension Plans” – the Pension Plan of Public Service Enterprise Group Incorporated and the Pension Plan of Public Service Enterprise Group Incorporated II.
(y)“Plan” – the Deferred Compensation Plan for Certain Employees of Public Service Enterprise Group Incorporated and its Affiliates (formerly known as the Deferred Compensation Plan for Certain Employees of Public Service Electric and Gas Company).
(z)“Reinstatement Plan” – the Retirement Income Reinstatement Plan for Non‑Represented Employees of Public Service Enterprise Group Incorporated and its Affiliates.
(aa)“Separation from Service” – Subject to paragraphs (i) and (ii), a Participant’s termination from employment with the Company and all ERISA Affiliates, whether by retirement or resignation from or discharge by the Company or an ERISA Affiliate.
(i)A Separation from Service shall be deemed to have occurred if a Participant and the Company or any ERISA Affiliate reasonably anticipate, based on the facts and circumstances, that either:
(A)the Participant will not provide any additional services for the Company or an ERISA Affiliate after a certain date; or
(B)the level of bona fide services performed by the Participant after a certain date will permanently decrease to no more than 50% of the average level of bona fide services performed by the Participant over the immediately preceding 36 months.
(ii)If a Participant is absent from employment due to military leave, sick leave, or any other bona fide leave of absence authorized by the Company or an Affiliate and there is a reasonable expectation that the Participant will return to perform services for the Company or an ERISA Affiliate, a Separation from Service will not occur until the latter of:
(A)the first date immediately following the date that is six months after the date that the Participant was first absent from employment; or
(B)the date the Participant no longer retains a right to reemployment, to the extent the Participant retains a right to reemployment with the Company or any ERISA Affiliates under applicable law or by contract.
If a Participant fails to return to work upon the expiration of any military leave, sick leave, or other bona fide leave of absence where such leave is for less than six months, the Separation from Service shall occur as of the date of the expiration of such leave.
(bb)“Specified Employee” – An individual who is a key employee (as defined in Code Section 416(i) without regard to Code Section 416(i)(5)) of the Company at any time during the 12-month period ending on each December 31 (the “identification date”). If an individual is a key employee as of an identification date, the individual shall be treated as a Specified Employee for the 12-month period beginning on the April 1 following the identification date. Notwithstanding the foregoing, an individual shall not be treated as a Specified Employee unless any stock of the Company or an ERISA Affiliate is publicly traded on an established securities market or otherwise.
(cc)“Thrift Plan” – the Public Service Enterprise Group Incorporated Thrift and Tax Deferred Savings Plan.
4.ELECTION AS TO THE AMOUNT OF COMPENSATION THAT IS TO BE DEFERRED. A Participant may elect to defer any portion of their Compensation otherwise payable for services rendered for their Employer.
(a)Timing of Elections – Any election to defer must be made in the manner prescribed by the Committee or its designee. All elections to defer must be made in the calendar year prior to the year that the services giving rise to the compensation are performed. Provided, however, that elections to defer performance-based compensation may be made up to the date that is six-months before the end of the related performance period, as long as a) the performance period is at least 12 months in length, b) the Participant performed services continuously from the date the performance criteria were established through the date the deferral election is made and c) at the time the deferral election is made, the performance-based compensation is not both i) substantially certain to be paid and ii) readily ascertainable. A Participant may change (in the manner prescribed by the Committee), not later than the date than the last date that an election to defer may be made, the amount of Compensation to be deferred by them with respect to the next succeeding calendar year or performance period.
A Participant may make separate elections as to the deferral of base salary and bonus. The Participant’s election must be in whole percentages from 10% to 90% for base salary and 10% to 100% for bonus.
In the calendar year that a Participant first becomes eligible to participate in this Plan, such Participant may elect to defer Compensation for part of that calendar year but only if such election is made within thirty (30) days after the Participant first becomes eligible to participate in this Plan or any other plan required under Section 409A of the Code to be aggregated with this Plan. Except as otherwise specifically provided for herein, Compensation
may be deferred prospectively only, and the amount of Compensation to be deferred may be changed only with respect to future calendar years.
(b)Special One-Time Election to Change Distribution Elections with respect to 2005, 2006, 2007 or 2008 Deferrals – Not later than December 31, 2008, Participants who had elected to defer compensation during 2005, 2006, 2007 or 2008 may, by written notice in a form approved by the Committee, elect to change the distribution elections with respect to any such deferrals.
(c)Deferral Elections with Respect to 2012 – 2018 Deferrals – A Participant’s 2011 deferral election shall not carryover to 2012. A Participant who wishes to defer for 2012 must make a deferral election. If no election is made, the Participant shall be deemed to have elected not to defer for 2012. A Participant’s election to defer for 2012 or a later year shall carryover to future years unless the Participant makes a change for the next succeeding year.
(d)Deferral Elections with Respect to 2019 and Future Years – A Participant’s 2018 deferral election shall not carryover to 2019. A Participant who wishes to defer for 2019 or a later year must make an affirmative deferral election. If no election is made, the Participant shall be deemed to have elected not to defer for that particular year. A Participant’s election to defer for one year shall not carryover to the subsequent year.
5.CORE CONTRIBUTIONS. This Paragraph 5 shall be effective January 1, 2025.
(a)Eligibility for Core Contributions. An Employee shall be eligible for Core Contributions under this Plan if the Employee is (i) a MAST Employee who is a select group of management or highly-compensated employee as determined by the Company to be eligible, (ii) not eligible for Pay Credits under the Cash Balance Component or accruals under the Final Average Pay Component, (iii) not eligible for a benefit under the Reinstatement Plan, and (iv) receives a MICP bonus, defers compensation to this Plan and/or has Eligible Compensation greater than the IRS limit under Section 401(a)(17) of the Code for that year.
(b)Amount of Core Contributions. A Participant who meets the criteria in Paragraph 5(a) shall be eligible for Core Contributions equal to the excess of (1) over (2) where:
(1) Is the amount of the Core Contributions to which the Participant would be entitled under the Thrift Plan for the pay period if such Core Contributions were computed by applying the definition of Eligible Compensation under this Plan; and
(2) Is the amount of the Core Contributions to which the Participant receives under the Thrift Plan for that pay period.
(c) Distribution. The portion of a Participant’s Account attributable to Core Contributions shall be distributed to the Participant upon Separation from Service, subject to six-month delay under Section 409A of the Code, if applicable. For the purposes of this Paragraph 5(c), a Participant shall not be deemed to have experienced a Separation from Service if they are transferred to the employ of an employer that is an Affiliate of the Company.
(d) Distribution Upon Death. In the event of a Participant’s death prior to the date that the Participant receives distribution of their Account attributable to Contributions, such amount shall be distributed to the Participant’s Beneficiary(ies) in a lump sum within 90 days following the Participant’s death.
6.HOW THE ACCOUNT IS TO BE MAINTAINED.
(a)Establishment of Account - The Committee shall cause to be established an Account for each Participant who elects to defer Compensation to the Plan and for each Participant who is credited with a Core Contribution. Each Participant’s Account shall be credited with an amount equal to the Deferred Compensation which would have otherwise been payable to them and for the amount of the Core Contributions.
(b)Earnings Credits on Assets in the Account – Each Participant, except Participants whose active employment with an Employer terminated prior to January 1, 2000, may direct investment of their Account among the Investment Funds (in the manner established by the Committee) in multiples of one percent; provided, however, that the Committee shall not be obligated to effectuate any such investment direction. In the case of (i) Participants whose active employment by an Employer terminated prior to January 1, 2000 and (ii) a Participant who fails to provide a designation of Investment Funds, such Participants shall be deemed to have designated 100% of their Accounts to be invested in the Investment Fund that determines income accrual with reference to the prime commercial lending rate of JPMorgan Chase Bank (formerly, the Chase Manhattan Bank). Effective July 1, 2011, the prime commercial lending rate of JPMorgan Chase Bank shall be capped at 120% applicable federal long-term rate. For the avoidance of any doubt, a Participant may not invest their Account in the Company Stock fund.
A Participant may change their investment election daily. Each Participant’s Account shall be valued daily equal.
(c)Title to and Beneficial Ownership of Assets - The Plan shall be unfunded. The Company shall not be required to segregate any amounts credited to any Participant’s Account, which shall be established merely as an accounting convenience. Title to and beneficial ownership of any Assets, whether Deferred Compensation or earnings credited to a Participant’s Account pursuant to Subparagraphs 6(a) and (b) hereof, shall at all times remain in the Company, and no Participant nor Beneficiary shall have any interest whatsoever in any specific assets of the Company. All Assets shall at all times remain solely the property of the Company subject to the claims of its general creditors.
7.DISTRIBUTION OF DEFERRED COMPENSATION FROM THE ACCOUNT
(a)Election as to the Commencement and Timing of the Distribution of 2011 and Prior Year Deferrals.
(i)Commencement - By election on the form designated by and filed with the Committee at the same time they elect to defer compensation under Paragraph 4, a Participant, may elect to have distribution from their account commence (i) on the 30th day after the date they cease to be employed by an Employer or, in the alternative, (ii) on January 15th of any calendar year following Separation from Service elected by the Participant, but in any event no later than the latter of (A) the January of the year following the year of the Participant’s 70th birthday or (B) the January following Separation from Service or (iii) pursuant to the terms of any written employment agreement applicable to the Participant. Notwithstanding the forgoing, however, for any Participant who is a Specified Employee, distribution of their account may not occur earlier than six months following their Separation from Service.
(ii)Timing - By election on the form designated by and filed with the Committee at the same time they elect to defer compensation under Paragraph 4, a Participant may elect to receive the distribution of their Account in the form of (A) one lump-sum payment, (B) annual distributions over a five-year period or (C) annual distributions over a 10-year period. A Participant may change such election by filing a subsequent election form, but any such change shall apply only to future deferrals. In the event a lump-sum payment is made under this Plan, the Assets credited to a Participant’s Account, including earnings at the rate provided in
Subparagraph 6(b) of this Plan to the date of distribution, shall be paid to the Participant on the date determined under Subparagraph 7(a) of this Plan. In the case of a distribution over a period of years, the Company shall pay to the Participant on the date determined under Subparagraph 7(a) of this Plan and on the yearly anniversaries of such date, annual installments of the unpaid balance of the Assets in the Participant’s Account, including earnings on the unpaid balance at the rate provided in Subparagraph 6(b) of this Plan to the date of distribution. The amount of each installment shall be determined by multiplying the then unpaid balance, plus accrued earnings, in the Participant’s Account by a fraction, the numerator of which is one and the denominator of which is the number of annual installments remaining to be paid.
(b)Election as to the Commencement and Timing of the Distribution of 2012 and Beyond Deferrals. By election in the manner prescribed by the Committee, at the same time they elect to defer compensation under Paragraph 4, a Participant, may elect to have distribution of each year’s deferrals and associated earnings occur on the date or event specified in Subparagraphs (i), (ii) or (iii). For the avoidance of any doubt, a Participant’s distribution election shall apply to future years unless the Participant makes a subsequent election.
Distribution Elections with Respect to 2012 through 2018. A Participant’s 2011 distribution election shall not carryover to 2012. A Participant who defers 2012 base salary and/or bonus must make a distribution election. If no election is made, the Participant’s deferrals shall be distributed in the form of a lump sum six months following Separation from Service. A Participant’s distribution election for 2012 or for a later year through 2018 shall carryover to future years unless the Participant makes a change for the next succeeding year; provided however, that no distribution election shall carryover for future years after 2018. Notwithstanding the carryover of a distribution election that would otherwise apply during the period 2012 through 2018, a Participant’s election to have deferrals distributed under Section 7(b)(iii) shall not carry over to a subsequent year. If the Participant elects to have deferrals distributed under Section 6(b) (iii) for a given year and then fails to make an election for the subsequent year, the Participant’s deferrals shall be paid in a lump sum six months following Separation from Service.
Distribution Elections with Respect to 2019 and Future Years. A Participant’s 2018 distribution election shall not carryover to 2019. A Participant who defers 2019 base salary and/or bonus must make an
affirmative distribution election for 2019. If no election is made, the Participant shall be deemed to have elected distribution for 2019 in the form of a lump sum six months following Separation from Service. A distribution election must be affirmatively submitted by the Participant for each future year beginning with 2019 in accordance with Subparagraphs 7(b) (i), (ii) or (iii) below. If no distribution election is timely made for a particular year, the Participant shall be deemed to have elected distribution in the form of a lump sum six months following Separation from Service.
(i)For each year, a Participant may elect to have distribution of that year’s deferrals and associated earnings under Subparagraph 6(b), commence six months following Separation from Service. Distribution shall be made or commence within the 60-day period following the date that is the date six months following Separation from Service. A Participant may elect to receive such distribution in the form of (A) one lump-sum payment, or (B) annual installments over a three to 15 year period. In the case of a distribution over a period of years, the Company shall pay to the Participant on the date determined under this Subparagraph 7(b) (i) and on the yearly anniversaries of such date, annual installments of the unpaid balance of that year’s deferrals, including earnings on the unpaid balance at the rate provided in Subparagraph 6(b) of this Plan to the date of distribution. The amount of each installment shall be determined by multiplying the then unpaid balance of that year’s deferrals, plus accrued earnings, the numerator of which is one and the denominator of which is the number of annual installments remaining to be paid.
(ii)For each year, a Participant may elect to have distribution of that year’s deferrals, and associated earnings under Subparagraph 6(b), paid or commence on a date that is indicated by the Participant as a number of years following Separation from Service, provided that such specified number of years is at least six months following Separation from Service. Distribution shall be made or commence within the 60-day period following the date that the Participant elects. A Participant may elect to receive such distribution in the form of (A) one lump-sum payment, or (B) annual installments over a three to 15 year period. In the case of a distribution over a period of years, the Company shall pay to the Participant on the date determined under this Subparagraph 7(b) (ii) and on the yearly anniversaries of such date, annual installments of the unpaid balance of that year’s deferrals, including earnings on the unpaid balance, at the rate provided in Subparagraph 6(b) of this Plan to the date of distribution. The amount of each installment shall be determined by multiplying the then unpaid balance of that year’s deferrals, plus
accrued earnings, the numerator of which is one and the denominator of which is the number of annual installments remaining to be paid.
(iii)For each year’s deferrals and associated earnings, a Participant may elect to receive distribution of that year’s deferrals on a specified date that is no earlier than three years following the beginning of the year giving rise to the deferrals. The Participant does not have to incur a Separation from Service to receive distribution under this Subparagraph (7)(b)(iii). Distribution shall be made in a lump sum within 90 days following the date elected by the Participant.
In the event that the Participant incurs a Separation from Service prior to the date the elected under this subsection (iii), distribution of those deferrals and associated earnings shall not be made upon Separation from Service, but rather shall be within 90 days following the date elected by the Participant under this subsection (iii).
(c)Changes in Distribution Elections.
(i)Participants may, by notice filed with the Company prior to December 31st of any year, make changes of distribution elections on a prospective basis. However, beginning in 2019, a distribution election must be affirmatively submitted by the Participant for each year. If no distribution election is timely made for a particular year beginning with 2019, the Participant shall be deemed to have elected distribution in the form of a lump sum six months following Separation from Service.
(ii)Participants may, by notice filed with the Company, make changes of distribution elections with respect to prior deferred compensation as long (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. With respect to 2012 and beyond deferrals, installment payments shall be treated as one payment.
(iii)Special One-Time Election - Participants may, by notice filed with the Company prior to December 31, 2008, make a one-time election to change any distribution election previously made with respect to compensation deferred during 2005, 2006, 2007 or 2008.
(d)Distribution in Case of Certain Disability - In the event of a Participant’s Disability prior to a calendar year elected by the Participant under Subparagraph 7(a) or Subparagraph (b) of this Plan for distribution to commence, distribution of the Participant’s Account shall commence in the month following the month in which the Participant terminates employment for Disability, in accordance with the Participant’s election under Subparagraph 7(a) or Subparagraph (b) of this Plan as to the form of distribution.
(e)Distribution in Case of Death.
(i)Distribution of 2011 and Prior Years Deferrals. In the event of a Participant’s death, the balance of the Participant’s Account shall be distributed to the Participant’s Beneficiary(ies) over a period of not more than five (5) years, in accordance with the Participant’s election (in the manner prescribed by the Committee) for distribution in case of death. Any change in the period over which such payments are made shall only apply to future deferrals. Such distribution shall be made in a manner consistent with Subparagraph 7(a) of this Plan and shall commence in the month of January of the year after the year of the Participant’s death, on a date within said month to be determined by the Committee in its sole discretion. Additional annual payments for distributions made over a period of more than one year shall be made on the yearly anniversaries of such date. In the event of a Participant’s death after distribution of their Account has commenced, any election under this Subparagraph 7(e) (i) shall not extend the time of payment of their Account beyond the time when distribution would have been completed if they had lived.
(ii)Distribution of 2012 and Beyond Deferrals. In the event of a Participant’s death prior to the date that the Participant commenced receiving of a specific year’s deferrals and associated earnings, such amount shall be distributed to the Participant’s Beneficiary (ies) in a lump sum within 90 days following the Participant’s death.
In the event of the Participant’s death after they commenced distribution of a year’s deferrals and associated earnings in the form of installments, the balance of such year’s deferrals and associated earnings shall be distributed to the Participant’s Beneficiary(ies) in a lump sum within 90 days following the Participant’s death.
(f)Request for Change in Distribution on Account of an Unforeseeable Emergency - A Participant, Beneficiary or a legal representative may request an acceleration of any payments from a Participant’s Account by making such request in the manner prescribed by the Committee. The
Committee, or its delegate, may, in its sole discretion, grant such request only if the Committee, or its delegate, determines that an emergency beyond the control of the Participant, Beneficiary or legal representative exists and which would cause such Participant, Beneficiary or legal representative severe financial hardship if the payment of such benefits were not approved. Any such distribution for hardship shall be limited to the amount needed to meet such emergency plus the amount of any tax liability resulting from the distribution. A Participant who makes a hardship withdrawal may not reenter this Plan for 12 months after the date of withdrawal. Any distribution under this Subparagraph 7(f) shall be made on the 15th day after the Committee, or its delegate, grants such request for hardship withdrawal.
(g)Employment not Terminated if Transferred to an Affiliate - For the purposes of this Paragraph 7, a Participant shall not be deemed to have experienced a Separation from Service if they are transferred to the employ of an employer that is an Affiliate of the Company.
(h)Company may Distribute in Lump-Sum if Distributable Amount Less Than $5,000 - The Company reserves the right to make a lump-sum distribution, notwithstanding any other provision of this Plan, if the total Assets in the Participant’s Account in this Plan and in the Participant’s accounts in all other plans required under the Section 409A of the Code to be aggregated with this Plan, are $5,000 or less at any time after the Participant ceases to be employed by the Company.
(i)Failure to make a Distribution Election.
(i)2011 and Prior Years Deferrals. If, with respect to any election to defer compensation for 2011 or any prior year, a Participant fails to make a proper election with respect to the distribution of such deferred compensation, such amount will be distributed in a lump sum on the thirtieth day following the Participant’s Separation from Service.
(ii)Deferrals for 2012 through 2018. If, with respect to any election to defer compensation for 2012 or any subsequent year through 2018, a Participant fails to make a proper election with respect to the distribution of such deferred compensation, such amount will be distributed in accordance with the prior year’s election (but not any election in place for a year prior to 2012). In the event that no valid election is on file, such amount will be distributed in a lump sum on the date specified in Subparagraph 7(b) (i).
(iii)2019 and Beyond Deferrals. If, with respect to any election to defer compensation for 2019 or any subsequent year, a Participant fails to
make a proper election with respect to the distribution of such deferred compensation, such amount will be distributed in a lump sum six months following Separation from Service.
(j)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).
(k)For the avoidance of any doubt, this Paragraph 7 does not apply to the distribution of the Account related to Core Contributions.
8.ASSIGNMENT. No benefit under the Plan shall in any manner or to any extent be assigned, alienated, or transferred by any Participant or Beneficiary under the Plan or subject to attachment, garnishment or other legal process.
9.PLAN DOES NOT CONSTITUTE AN EMPLOYMENT AGREEMENT. This Plan shall not constitute a contract for the continued employment of any Participant by the Company. The Company reserves the right to modify a Participant’s compensation at any time and from time to time as it considers appropriate and to terminate their employment for any reason at any time notwithstanding this Plan.
10.AMENDMENT OR TERMINATION OF THE PLAN BY THE COMPANY. The Company may, in its sole discretion and by action of its Board of Directors or the O&CC, amend, modify or terminate this Plan at any time, provided, however, that no such amendment, modification or termination shall adversely affect the right of a Participant in respect of Deferred Compensation or Core Contributions previously earned by them which has not been paid, unless such Participant or their legal representative shall consent to such change; and no such amendment, modification or termination shall entitle any Participant to an acceleration of any distributions from this Plan. Provided, further, that notwithstanding any other provision of this Plan, upon the occurrence of a Change in Control, the earnings credit calculated pursuant to Paragraph 6 may not be reduced below the prime commercial lending rate described in Subparagraph 6(b). The EBPC shall have the authority to make administrative amendments to this Plan.
11.WHAT CONSTITUTES NOTICE. Any notice to a Participant, Beneficiary or legal representative hereunder shall be given either by delivering it or by depositing it in the United States mail, postage prepaid, addressed to their last known address. Any notice to the Company or the Committee hereunder (including the filing of election and designation forms) shall be given either by delivering it, or depositing it in the United States mail, postage prepaid, to the Company’s Corporate Secretary, Public Service Enterprise Group Incorporated, 80 Park Plaza, T4B Newark, New Jersey 07102.
12.ADVANCE DISCLAIMER OF ANY WAIVER ON THE PART OF THE COMPANY. Failure by the Company to insist upon strict compliance with any of the terms, covenants or conditions hereof shall not be deemed a waiver of any such term, covenant or condition, nor shall any waiver or relinquishment of any right or power hereunder at any one or more times be deemed a waiver or relinquishment of any such right or power at any other time or times.
13.EFFECT ON INVALIDITY OF ANY PART OF THE PLAN. The invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provision.
14.PLAN BINDING ON ANY SUCCESSOR OWNER. Except as otherwise provided herein, this Plan shall inure to the benefit of and be binding upon the Company, its successors and assigns, including but not limited to any corporation which may acquire all or substantially all of the Company’s assets and business or with or into which the Company may be consolidated or merged.
15.LAWS GOVERNING THIS PLAN. Except to the extent federal law applies, this Plan shall be governed by the laws of the State of New Jersey. This Plan is specifically intended to comply with the provisions of The American Jobs Creation Act of 2004 (the “AJCA”) and Section 409A of the Code and it shall automatically incorporate all applicable restrictions of the AJCA, the Code and its related regulations, and the Company will amend the Plan to the extent necessary to comply with those requirements. The timing under which a Participant will have a right to receive any payment under this Plan will be deemed to be automatically modified, and a Participant’s rights under the Plan limited to conform to any requirements under, the AJCA, the Code and its related regulations.
16.MISCELLANEOUS. The masculine pronoun shall mean the feminine wherever appropriate.
/s/ Sheila Rostiac 11/18/2024
Signature Date
