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CMS Energy Corp, et al. – ‘10-K’ for 12/31/19 – ‘EX-10.10’

On:  Thursday, 2/6/20, at 8:59am ET   ·   For:  12/31/19   ·   Accession #:  811156-20-4   ·   File #s:  1-05611, 1-09513

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  As Of               Filer                 Filing    For·On·As Docs:Size

 2/06/20  CMS Energy Corp                   10-K       12/31/19  161:50M
          Consumers Energy Co

Annual Report   —   Form 10-K   —   Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   4.48M 
 2: EX-4.6      Instrument Defining the Rights of Security Holders  HTML    123K 
 3: EX-4.7      Instrument Defining the Rights of Security Holders  HTML     75K 
 5: EX-10.10    Material Contract                                   HTML    100K 
 6: EX-10.12    Material Contract                                   HTML     92K 
 7: EX-10.13    Material Contract                                   HTML    107K 
 4: EX-10.6     Material Contract                                   HTML    124K 
 8: EX-21.1     Subsidiaries List                                   HTML     77K 
 9: EX-23.1     Consent of Experts or Counsel                       HTML     42K 
10: EX-23.2     Consent of Experts or Counsel                       HTML     42K 
11: EX-31.1     Certification -- §302 - SOA'02                      HTML     48K 
12: EX-31.2     Certification -- §302 - SOA'02                      HTML     48K 
13: EX-31.3     Certification -- §302 - SOA'02                      HTML     48K 
14: EX-31.4     Certification -- §302 - SOA'02                      HTML     48K 
15: EX-32.1     Certification -- §906 - SOA'02                      HTML     45K 
16: EX-32.2     Certification -- §906 - SOA'02                      HTML     45K 
137: R1          Cover page                                          HTML    129K  
84: R2          Consolidated Statements Of Income                   HTML    169K 
25: R3          Consolidated Statements Of Comprehensive Income     HTML    106K 
126: R4          Consolidated Statements Of Comprehensive Income     HTML     71K  
                (Parenthetical)                                                  
138: R5          Consolidated Statements Of Cash Flows               HTML    168K  
85: R6          Consolidated Balance Sheets                         HTML    239K 
26: R7          Consolidated Balance Sheets (Parenthetical)         HTML     56K 
123: R8          Consolidated Statements Of Changes In Equity        HTML    200K  
143: R9          New Accounting Standards                            HTML     57K  
55: R10         Regulatory Matters                                  HTML    313K 
73: R11         Significant Accounting Policies                     HTML     87K 
161: R12         Contingencies And Commitments                       HTML    332K  
110: R13         Financings And Capitalization                       HTML    694K  
54: R14         Fair Value Measurements                             HTML    157K 
72: R15         Financial Instruments                               HTML    326K 
160: R16         Notes Receivable                                    HTML    127K  
109: R17         Plant, Property, and Equipment                      HTML    540K  
53: R18         Leases and Palisades Financing                      HTML    337K 
74: R19         Asset Retirement Obligations                        HTML    284K 
128: R20         Retirement Benefits                                 HTML   1.18M  
113: R21         Stock-Based Compensation                            HTML    250K  
24: R22         Income Taxes                                        HTML    505K 
79: R23         Earnings Per Share - CMS Energy                     HTML     77K 
127: R24         Revenue                                             HTML    327K  
112: R25         Other Income and Other Expense                      HTML    107K  
23: R26         Cash And Cash Equivalents                           HTML     84K 
78: R27         Reportable Segments                                 HTML    617K 
129: R28         Related Party Transactions - Consumers              HTML     60K  
111: R29         Variable Interest Entities                          HTML     56K  
106: R30         Asset Sales and Exit Activities                     HTML     57K  
158: R31         Quarterly Financial And Common Stock Information    HTML    220K  
                (Unaudited)                                                      
75: R32         Schedule II - Valuation and Qualifying Accounts     HTML    176K 
                and Reserves                                                     
57: R33         Schedule I - Condensed Financial Information of     HTML    224K 
                Registrant                                                       
107: R34         Significant Accounting Policies (Policy)            HTML    189K  
159: R35         Regulatory Matters (Tables)                         HTML    144K  
76: R36         Contingencies And Commitments (Tables)              HTML    226K 
58: R37         Financings And Capitalization (Tables)              HTML    475K 
108: R38         Fair Value Measurements (Tables)                    HTML    136K  
157: R39         Financial Instruments (Tables)                      HTML    304K  
119: R40         Notes Receivable (Tables)                           HTML    104K  
140: R41         Plant, Property, and Equipment (Tables)             HTML    503K  
80: R42         Leases and Palisades Financing - (Tables)           HTML    342K 
27: R43         Asset Retirement Obligations (Tables)               HTML    284K 
122: R44         Retirement Benefits (Tables)                        HTML   1.02M  
144: R45         Stock-Based Compensation (Tables)                   HTML    236K  
83: R46         Income Taxes (Tables)                               HTML    505K 
30: R47         Earnings Per Share - CMS Energy (Tables)            HTML     74K 
125: R48         Revenue (Tables)                                    HTML    310K  
139: R49         Other Income and Other Expense (Tables)             HTML    105K  
154: R50         Cash And Cash Equivalents (Tables)                  HTML     81K  
105: R51         Reportable Segments (Tables)                        HTML    604K  
43: R52         Related Party Transactions - Consumers (Tables)     HTML     52K 
62: R53         Variable Interest Entities (Tables)                 HTML     58K 
151: R54         Quarterly Financial And Common Stock Information    HTML    220K  
                (Tables)                                                         
102: R55         New Accounting Standards (Details)                  HTML     55K  
40: R56         Regulatory Matters (Schedule Of The Components Of   HTML    108K 
                Regulatory Assets and Liabilities) (Details)                     
59: R57         Regulatory Matters (Narrative) (Details)            HTML    236K 
155: R58         Regulatory Matters (Schedule Of The Components Of   HTML     53K  
                PSCR And GCR Over/(Under) Recoveries) (Details)                  
100: R59         Contingencies And Commitments (Contingencies And    HTML    131K  
                Commitments) (Details)                                           
39: R60         Contingencies And Commitments (Expected             HTML     60K 
                Remediation Cost By Year) (Details)                              
91: R61         Contingencies And Commitments (Guarantees)          HTML    124K 
                (Details)                                                        
135: R62         Financings and Capitalization (Summary of           HTML    228K  
                Long-Term Debt Outstanding) (Details)                            
118: R63         Financings And Capitalization (Major Long-Term      HTML     83K  
                Debt Transactions) (Details)                                     
34: R64         Financings And Capitalization (Narrative)           HTML     88K 
                (Details)                                                        
87: R65         Financings and Capitalization (Debt Maturities)     HTML     60K 
                (Details)                                                        
131: R66         Financings And Capitalization (Revolving Credit     HTML     78K  
                Facilities) (Details)                                            
114: R67         Financings and Capitalization (Forward Stock        HTML     55K  
                Contracts) (Details)                                             
32: R68         Financings and Capitalization (Preferred Stock of   HTML     58K 
                Subsidiary) (Details)                                            
93: R69         Fair Value Measurements (Assets And Liabilities     HTML     84K 
                Measured At Fair Value On A Recurring Basis)                     
                (Details)                                                        
66: R70         Fair Value Measurements - Narrative (Details)       HTML     65K 
44: R71         Financial Instruments (Schedule Of Carrying         HTML     98K 
                Amounts And Fair Values Of Financial Instruments)                
                (Details)                                                        
94: R72         Financial Instruments (Narrative) (Details)         HTML     65K 
145: R73         Financial Instruments (Summary Of Sales Activity    HTML     51K  
                For Investment Securities) (Details)                             
71: R74         Financial Instruments (Schedule Of Investment       HTML     52K 
                Securities) (Details)                                            
49: R75         Notes Receivable (Schedule Of Current And           HTML     69K 
                Non-Current Notes Receivable) (Details)                          
99: R76         Notes Receivable (Narrative) (Details)              HTML     77K 
150: R77         Notes Receivable (Schedule Of Allowance For Loan    HTML     57K  
                Losses) (Details)                                                
64: R78         Plant, Property, and Equipment (Schedule Of Plant,  HTML    164K 
                Property, and Equipment) (Details)                               
51: R79         Plant, Property, and Equipment (Schedule of         HTML     93K 
                Finite-Lived Intangible Assets by Major Class                    
                Table) (Details)                                                 
68: R80         Plant, Property, and Equipment (Public Utilities,   HTML     50K 
                Allowance for Funds Used During Construction,                    
                Schedule of Composite Rate Table) (Details)                      
45: R81         Plant, Property, and Equipment (Schedule of         HTML     51K 
                Finance Leases and Other Financing Obligations)                  
                (Details)                                                        
95: R82         Plant, Property, and Equipment (Schedule Of         HTML     56K 
                Depreciation And Amortization) (Details)                         
147: R83         Plant, Property, and Equipment (Public Utilities    HTML     52K  
                Property Plant and Equipment Schedule of Composite               
                Depreciation Rate Table) (Details)                               
69: R84         Plant, Property, and Equipment (Schedule Of         HTML     66K 
                Depreciation And Amortization Expense) (Details)                 
48: R85         Plant, Property, and Equipment (Schedule Of         HTML     58K 
                Estimated Amortization Expense For Intangibles)                  
                (Details)                                                        
98: R86         Plant, Property, and Equipment (Jointly Owned       HTML     62K 
                Regulated Utility Facilities) (Details)                          
148: R87         Leases and Palisades Financing - Assets and         HTML     87K  
                Liabilities of Lessee (Details)                                  
65: R88         Leases and Palisades Financing - Schedule of Lease  HTML     60K 
                Costs (Details)                                                  
52: R89         Leases and Palisades Financing - Schedule of        HTML     52K 
                Lessee Cash Flows (Details)                                      
38: R90         Leases and Palisades Financing - Minimum Annual     HTML    105K 
                Rental Commitments post Topic 842 (Details)                      
90: R91         Leases and Palisades Financing - Lessor Leases      HTML     82K 
                Narrative (Details)                                              
134: R92         Leases and Palisades Financing - Schedule of        HTML     58K  
                Future Payments to be Received (Details)                         
117: R93         Leases and Palisades Financing - Palisades          HTML     94K  
                Financing (Details)                                              
35: R94         Asset Retirement Obligations (Details)              HTML     85K 
89: R95         Retirement Benefits (Narrative) (Details)           HTML    165K 
133: R96         Retirement Benefits (Schedule Of SERP Trust         HTML     58K  
                Assets, ABO And Contributions) (Details)                         
115: R97         Retirement Benefits (Schedule Of Assumptions Used)  HTML     77K  
                (Details)                                                        
31: R98         Retirement Benefits (Schedule Of Net Benefit        HTML     77K 
                Costs) (Details)                                                 
92: R99         Retirement Benefits (Schedule Of Benefit            HTML    112K 
                Obligations In Excess Of Fair Value Of Plan                      
                Assets) (Details)                                                
152: R100        Retirement Benefits (Schedule Of Retirement         HTML     68K  
                Benefit Plan Assets (Liabilities)) (Details)                     
103: R101        Retirement Benefits (Schedule Of Accumulated And    HTML     56K  
                Projected Benefit Obligations) (Details)                         
41: R102        Retirement Benefits (Schedule Of Net Periodic       HTML     72K 
                Benefit Cost Not yet Recognized) (Details)                       
60: R103        Retirement Benefits (Schedule Of Allocation Of      HTML    104K 
                Plan Assets) (Details)                                           
153: R104        Retirement Benefits (Schedule Of Asset              HTML     57K  
                Allocations) (Details)                                           
104: R105        Retirement Benefits (Schedule Of Plan               HTML     51K  
                Contributions) (Details)                                         
42: R106        Retirement Benefits (Schedule Of Expected Benefit   HTML     73K 
                Payments) (Details)                                              
61: R107        Stock-Based Compensation (Narrative) (Details)      HTML     95K 
156: R108        Stock-Based Compensation (Schedule Of Restricted    HTML     91K  
                Stock Activity) (Details)                                        
101: R109        Stock-Based Compensation (Schedule Of Restricted    HTML     76K  
                Stock Granted) (Details)                                         
121: R110        Stock-Based Compensation (Schedule Of Share-Based   HTML     50K  
                Payment Award, Restricted Stock, Valuation                       
                Assumptions) (Details)                                           
142: R111        Stock-Based Compensation (Share-Based Compensation  HTML     53K  
                Arrangement By Share-Based Payment Award, Options,               
                Grants In Period, Weighted Average Grant Date Fair               
                Value) (Details)                                                 
82: R112        Stock-Based Compensation (Schedule Of Compensation  HTML     56K 
                Cost For Share-Based Payment Arrangements,                       
                Allocation Of Share-Based Compensation Costs By                  
                Plan) (Details)                                                  
29: R113        Income Taxes (Narrative) (Details)                  HTML     63K 
120: R114        Income Taxes (Schedule Of Effective Income Rate     HTML    104K  
                Reconciliation) (Details)                                        
141: R115        Income Taxes (Significant Components Of Income Tax  HTML     75K  
                Expense) (Details)                                               
81: R116        Income Taxes (Principal Components Of Deferred      HTML     87K 
                Income Tax Assets And Liabilities) (Details)                     
28: R117        Income Taxes (Loss And Credit Carryforwards)        HTML     67K 
                (Details)                                                        
124: R118        Income Taxes (Reconciliation Of Beginning And       HTML     57K  
                Ending Uncertain Tax Benefits) (Details)                         
136: R119        Earnings Per Share - CMS Energy (Basic And Diluted  HTML     87K  
                EPS Computations) (Details)                                      
70: R120        Revenue (Components of Operating Revenue)           HTML    131K 
                (Details)                                                        
47: R121        Revenue (Narrative) (Details)                       HTML     53K 
97: R122        Other Income and Other Expense (Details)            HTML     59K 
149: R123        Cash And Cash Equivalents (Schedule Of Cash And     HTML     63K  
                Cash Equivalents, Including Restricted Amounts)                  
                (Details)                                                        
67: R124        Reportable Segments (Details)                       HTML    158K 
46: R125        Related Party Transactions - Consumers (Details)    HTML     76K 
96: R126        Variable Interest Entities (Schedule Of Variable    HTML     48K 
                Interest Entities) (Details)                                     
146: R127        Variable Interest Entities (Narrative) (Details)    HTML     55K  
63: R128        Asset Sales and Exit Activities - Narrative         HTML     82K 
                (Details)                                                        
50: R129        Quarterly Financial And Common Stock Information    HTML     88K 
                (Details)                                                        
36: R130        Schedule I - Condensed Financial Information of     HTML     62K 
                Registrant (Narrative) (Details)                                 
88: R131        Schedule II - Valuation and Qualifying Accounts     HTML     65K 
                and Reserves (Details)                                           
132: R132        Schedule I - Condensed Financial Information of     HTML    105K  
                Registrant (Condensed Statements of Income)                      
                (Details)                                                        
116: R133        Schedule I - Condensed Financial Information of     HTML     91K  
                Registrant (Condensed Statements Of Cash Flows)                  
                (Details)                                                        
37: R134        Schedule I - Condensed Financial Information of     HTML    130K 
                Registrant (Condensed Balance Sheets) (Details)                  
77: R9999       Uncategorized Items - a2019form10-kxcmsenerg.htm    HTML     55K 
22: XML         IDEA XML File -- Filing Summary                      XML    309K 
33: XML         XBRL Instance -- a2019form10-kxcmsenerg_htm          XML  16.67M 
56: EXCEL       IDEA Workbook of Financial Reports                  XLSX    219K 
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130: ZIP         XBRL Zipped Folder -- 0000811156-20-000004-xbrl      Zip   1.99M  


‘EX-10.10’   —   Material Contract


This Exhibit is an HTML Document rendered as filed.  [ Alternative Formats ]



 <!   C:   C: 
  Exhibit  

Exhibit 10.10

CMS INCENTIVE COMPENSATION PLAN FOR CMS ENERGY AND CONSUMERS ENERGY OFFICERS

I.
GENERAL PROVISIONS

1.1
Purpose. The purpose of the CMS Incentive Compensation Plan (“CMSICP” or “Plan”) is to:

(a)
Provide an equitable and competitive level of compensation that will permit CMS Energy and Consumers Energy to attract, retain and motivate Officers.

(b)
No payments to Officers in the form of incentive compensation shall be made unless pursuant to a plan approved by the Compensation and Human Resources Committee of the Board of Directors of CMS Energy and after express approval of the Committee. This plan shall be administered by the President and CEO of CMS Energy and the Benefit Administration Committee.

1.2
Effective Date. The initial effective date of the Plan is January 1, 2004. The Plan, as described herein, is amended and restated effective as of December 1, 2018 and January 16, 2020.

1.3
Definitions. As used in this Plan, the following terms have the meaning described below:

(a)
“Annual Award” means an annual incentive award granted under the CMSICP.

(b)
“Base Salary” means the base salary on January 1 of a Performance Year, except as impacted by a Change in Status as defined in Article V. For purposes of the Plan, an Officer’s Base Salary must be subject to annual review and annual approval by the Committee.

(c)
“Benefit Administration Committee" means the committee as appointed by the Chief Executive Officer and Chief Financial Officer of CMS Energy Corporation to act as the Plan Administrator in accordance with authority granted by the Board of Directors.

(d)
“CMS Energy” means CMS Energy Corporation.

(e)
“Code” means the Internal Revenue Code of 1986, as amended.

(f)
“Committee” means the Compensation and Human Resources Committee of the Board of Directors of CMS Energy.

(g)
“Company” means CMS Energy.



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(h)
“Consumers Energy” means Consumers Energy Company, a wholly owned subsidiary of CMS Energy.

(i)
“Deferred Annual Award” means the amount deferred pursuant to Section 4.2.

(j)
“Disability” means that a participant has terminated employment with the Company or Consumers Energy and is disabled, as that term is defined under Code Section 409A and any applicable regulations.

(k)
“Leave of Absence” for purposes of this Plan means a leave of absence that has been approved by the Company.

(l)
“Officer” means a United States of America employee of the Company or Consumers Energy in Salary Grade “E-3” or higher.

(m)
“Payment Event” means the time at which a Deferred Annual Award may be paid pursuant to Section 4.2.

(n)
“Payment Term” means the length of time for payment of a Deferred Annual Award under Section 4.2.

(o)
“Pension Plan” means the Pension Plan for Employees of Consumers Energy and Other CMS Energy Companies.

(p)
"Performance Goals" are the factors used by the Committee (on an absolute or relative basis) to establish goals to track business measures. The Committee shall use one or more of the following business criteria, which may be based on corporate-wide or subsidiary, division, operating unit or individual measures: net earnings; operating earnings or income; earnings growth; net income; cash flow (including operating cash flow, free cash flow, discounted cash flow return on investment, and cash flow in excess of cost of capital); earnings per share; earnings per share growth; stock price; total shareholder return; absolute and/or relative return on common shareholders equity; return on shareholders equity; return on capital; return on assets; economic value added (income in excess of cost of capital); independent customer satisfaction studies or indices; expense reduction; sales; or ratio of operating expenses to operating revenues. In addition, the Annual Incentive Plan may incorporate certain utility operating parameters such as safety, reliability and customer service. The established Performance Goals may be applied on a pre- or post-tax basis and may be adjusted to include or exclude objectively determinable components of any Performance Goal, including, without limitation, special charges such as restructuring or impairment charges, debt refinancing costs, extraordinary or noncash items, unusual, nonrecurring or one-time events affecting the Corporation or its financial statements or changes in law or accounting principles (each an “Adjustment Event”).



2


(q)
“Performance Year” means the calendar year prior to the year in which an Annual Award is made by the Committee.

(r)
“Plan Administrator” for Officer participants means the President and Chief Executive Officer of CMS Energy, under the general direction of the Committee. For all other participants and for purposes of administering Deferred Amounts under Section 4.2, the Plan Administrator is the Benefits Administration Committee appointed by the Chief Executive Officer and the Chief Financial Officer as authorized by the Board of Directors.

(s)
“Retirement” means that a Plan participant is no longer an active Officer and qualifies for a retirement benefit other than a deferred vested retirement benefit under the Pension Plan. For a participant ineligible for coverage under the Pension Plan and covered instead under the Defined Company Contribution Plan, retirement occurs when there is a Separation from Service on or after age 55 with 5 or more years of service.

(t)
“Separation from Service” means an Officer retires or otherwise has a separation from service from the Company as defined under Code Section 409A and any applicable regulations. The Plan Administrator will determine, consistent with the requirements of Code Section 409A and any applicable regulations, to what extent a person on a leave of absence, including on paid sick leave pursuant to Company policy, has incurred a Separation from Service. Notwithstanding the above, a Separation from Service will occur consistent with the Regulation 1.409A-1(h) when it is reasonably anticipated that the level of service provided by the Officer will be no more than 45% of the average level of bona fide service performed by the Officer over the immediately preceding 36 month period.

(u)
“Subsidiary” means any direct or indirect subsidiary of the Company.

1.4
Eligibility. Officers of CMS Energy and/or Consumers Energy who do not participate in a broad based incentive plan contingent upon objectives and performance unique to the Officers’ Subsidiary, affiliate, site and/or business unit, are eligible for participation in the CMSICP. An individual listed on the Company payroll records as a contract employee is not eligible for this Plan.

1.5
Administration of the Plan.

(a)
The Plan is administered by the President and Chief Executive Officer of CMS Energy under the general direction of the Committee.

(b)
Each year, normally in January, but no later than March 30th of the Performance Year, the Committee will approve the established Performance Goals for the Performance Year.



3


(c)
The Committee, no later than March 1st of the calendar year following the Performance Year, will review for approval proposed Annual Awards for the total of all CMSICP Officer participants, as recommended by the President and CEO of CMS Energy. All proposed Annual Awards shall be approved by the Committee. Before the payment of any Annual Awards, the Company’s outside auditors and the Committee will certify in writing that the established Performance Goals were in fact satisfied.

(d)
The Committee reserves the right to modify the established Performance Goals with respect to unforeseeable circumstances or otherwise exercise discretion with respect to proposed Annual Awards as it deems necessary to maintain the spirit and intent of the CMSICP, provided that if such discretion increases the Annual Award it does not exceed the computed performance factor by more than 20%. The Committee also reserves the right in its discretion to not pay Annual Awards for a Performance Year. All decisions of the Committee are final.

II.
CORPORATE PERFORMANCE GOALS

2.1
In General. Each year, the Committee uses Performance Goals to determine the Annual Award measures. A table shall be created by the Compensation Committee for the current year Performance Goals.

2.2
Plan Performance Factor. The plan performance factor used to calculate an Annual Award is based on the results of the corporate established Performance Goals and is capped at two times the standard award amount. The Plan Performance Factor is established in a table relating specific performance results to specific plan Performance Goals. This table shall be created by the Committee for each Performance Year.

III.
ANNUAL AWARD FORMULA

3.1
Annual Awards. Annual Awards for each eligible Officer will be based upon a percentage of the Officer’s Base Salary for the Performance Year times the Plan performance factor for the year as determined under 2.2 above. The standard award percentage for each eligible Officer will be approved annually by the Committee for each Performance Year. The total amount of a CMSICP participant Officer’s Annual Award shall be computed according to the annual award formula set forth in Section 3.2. An Officer’s standard award amount is equal to the Officer’s Annual Award computed using a plan performance factor of 100%.

3.2
Calculation of Award. Annual Awards for Officer CMSICP participants will be calculated and made as follows:

Annual Award = Base Salary times
Standard Award Percentage times Plan Performance Factor



4


In addition, each Annual Award for Officers of Consumers Energy Company may be modified based on the results achieved for the Consumers Energy Annual Employee Incentive Compensation Plan. If the Consumers Energy Annual Employee Incentive Compensation Plan does not pay out an operational award for the same Performance Year, then the Annual Award, if any, earned under this Plan will be reduced by 10%. If the Consumers Energy Annual Employee Incentive Compensation Plan pays out an operational award for the same Performance Year based on achievement of some of the established objectives, but not at the maximum award percentage, then there is no modification of awards under this Plan. If however, the Consumers Energy Annual Employee Incentive Compensation Plan pays out an operational award at the maximum award percentage for the same Performance Year based on achievement of the established objectives, then the Annual Award, if any, earned under this Plan will be increased by up to 10%, provided, however, that no such increase will cause the Annual Award to exceed the maximum of two times the standard award amount, or exceed the maximum payout.

IV.
PAYMENT OF ANNUAL AWARDS

4.1
Cash Annual Award. All Annual Awards for a Performance Year will be paid in cash after certification by the outside auditors of the Company and the Committee that the established Performance Goals have been satisfied, but not later than March 15th of the calendar year following the Performance Year provided that the Annual Award for a particular Performance Year has not been deferred voluntarily pursuant to Section 4.2. The amounts required by law to be withheld for income and employment taxes will be deducted from the Annual Award payments. All Annual Awards become the obligation of the company on whose payroll the Officer is enrolled at the time the Committee makes the Annual Award.

4.2
Deferred Annual Awards.

(a)
The payment of all or any portion (rounded to an even multiple of 10%) of a cash Annual Award may be deferred voluntarily at the election of an individual Plan participant in salary grades E-1 - E-9. Any such deferral will be net of any applicable FICA or FUTA taxes. A separate irrevocable election must be made prior to the Performance Year. Any Annual Award made by the Committee after termination of employment of a participant or retirement of a participant will be paid in accordance with any deferral election made within the enrollment period.

(b)
At the time the participant makes a deferral election he or she must select the payment options (including the Payment Event as set forth at (c) below and the Payment Term as set forth at (d) below) applicable to the Deferred Annual Award for the Performance Year, as well as any earnings or income attributable to such amounts. The payment options elected will apply only to that year’s Deferred Annual Award and will not apply to any previous Deferred Annual Award or to any subsequent Deferred Annual Award. Any participant who elects to defer all


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or a portion of an Annual Award and who fails to select a Payment Event or a Payment Term will be presumed to have elected a Payment Event of Separation from Service in accordance with paragraph (c)(i) below and/or a Payment Term of a single sum.

(c)
The Payment Event elected can be either:

(i)
Separation from Service for any reason other than death. Payment will be made, or begin, in the later of: (1) January of the year following the year of the Separation from Service; or (2) the seventh month after the month of the Separation from Service. Later installments, if any, will be paid in January of the succeeding years. Effective for amounts deferred in 2019 and succeeding years, payment will be made, or begin, in the seventh month after the month of Separation from Service. Later installments, if any, will be paid in the same month of the succeeding years;

(ii)
Payment upon attainment of a date certain that is more than 1 year after the last day of the applicable Performance Year. Later installments, if any, will be paid in the same month of the succeeding years; or

(iii)
The earlier of (i) or (ii) above.

(d)
Payment Term. At the time of electing to defer an Annual Award, the participant must also elect how he or she wishes to receive any such payment from among the following options (the participant may elect a separate Payment Term for each Payment Event elected):

(i)
Payment in a single sum upon occurrence of the Payment Event.

(ii)
Payment of a series of annual installment payments over a period from two (2) years to fifteen (15) years following the Payment Event. Each installment payment shall be equal to a fractional amount of the balance in the account the numerator of which is one and the denominator of which is the number of installment payments remaining. Although initially such installment payments will be identical, actual payments may vary based upon investment performance. For example, a series of 5 installment payments will result in a payout of 1/5 of the account balance in the first installment, 1/4 of the account balance (including investment gains or losses since the first installment date) in the second installment, etc.

(e)
Changes to Payment Options. Once a payment option has been elected, subsequent changes which would accelerate the receipt of benefits from the Plan are not permitted, except that the Plan Administrator may at its discretion accelerate payments to the extent permitted by Code Section 409A and applicable regulations. A subsequent election to change the payment options related to a


6


Payment Event, in order to delay a payment or to change the form of a payment, can only be made when all of the following conditions are satisfied:

(i)
such election may not take effect until at least 12 months after the date on which the election is made;

(ii)
the payment(s) with respect to which such election is made is deferred for a period of not less than 5 years from the date such payment would otherwise have been made (or, in the case of installment payments under Section 4.2(d)(ii) with regard to amounts deferred (and the related earnings) prior to January 1, 2016, 5 years from the date the first installment was scheduled to be paid); and

(iii)
such election must be made not less than 12 months before the date the payment was previously scheduled to be made (or, in the case of installment payments under Section 4.2(d)(ii) with regard to amounts deferred (and the related earnings) prior to January 1, 2016, 12 months before the first installment was scheduled to be paid), if the participant’s previous commencement date was a specified date.

Effective January 1, 2016, the right to a series of installment payments is to be treated as a right to a series of separate payments to the extent permissible under Code Section 409A and any applicable regulations. When making a subsequent election with respect to the payment of any post-December 31, 2015 deferral, the participant may make a separate election with respect to each separate payment, provided that such election must result in all of the applicable Performance Year’s deferral with related earnings being paid in a single sum or in a series of annual payments over a period from two (2) to fifteen (15) consecutive years.

(f)
Investments. At the time of electing to voluntarily defer payment, the participant must elect how the Deferred Annual Award will be treated by the Company or Consumers Energy. To the extent that any amounts deferred are placed in a rabbi trust with an independent record keeper, a participant who has previously deferred amounts under this Plan will automatically have his or her existing investment profile apply to this deferral also. All determinations of the available investment options by the Plan Administrator are final and binding upon participants. A participant may change the investment elections at any time prior to the payment of the benefit, subject to any restrictions imposed by the Plan Administrator, the plan record keeper or by any applicable laws and regulations. A participant not making an election will have amounts deferred treated as if in a Lifestyle Fund under the Savings Plan for Employees of Consumers Energy and other CMS Energy Companies (the “Savings Plan”) applicable to the participant’s age 65, rounded up, or such other investment as determined by the Benefit Administration Committee. All gains and losses will be based upon the performance of the investments selected by the participant from the date the deferral is first credited


7


to the nominal account. If the Company elects to fund its obligation as discussed below, then investment performance will be based on the balance as determined by the record keeper.

(g)
The amount of any Deferred Annual Award is to be satisfied from the general corporate funds of the company on whose payroll the Plan participant was enrolled prior to the payout beginning and are subject to the claims of general creditors. This is an unfunded nonqualified deferred compensation plan. To the extent the Company or Consumers Energy, as applicable, elects to place funds with a trustee to pay its future obligations under this Plan, such amounts are placed for the convenience of the Company or Consumers Energy, remain the property of the Company or Consumers Energy and the participant shall have no right to such funds until properly paid in accordance with the provisions of this Plan. For administrative ease and convenience, such amounts may be referred to as participant accounts, but as such are a notional account only and are not the property of the participant. Such amounts remain subject to the claims of the creditors of the Company or Consumers Energy.

(h)
Payment in the Event of an Unforeseeable Emergency. The participant may request that payments commence immediately upon the occurrence of an unforeseeable emergency as that term is defined in Code Section 409A and any applicable regulations. Generally, an unforeseeable emergency is a severe financial hardship resulting from an illness or accident of the participant or the participant’s spouse or dependent, loss of the participant’s property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the participant. A distribution on account of unforeseeable emergency may not be made to the extent that such emergency is or may be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the participant’s assets (without causing severe financial hardship), or by cessation of deferrals under this arrangement, the Savings Plan or other arrangements. Distributions because of an unforeseeable emergency shall not exceed the amount permitted under Section 409A and accordingly are limited to the amount reasonably necessary to satisfy the emergency need (after use of insurance proceeds, liquidation of assets, etc.) plus an amount to pay taxes reasonably anticipated as a result of the distribution. In the event any payment is made due to an unforeseeable emergency, all deferral elections for the current Performance Year will cease and the participant will not be eligible to make any deferral elections under this Plan for the following Performance Year. For any participant receiving a hardship withdrawal under the Savings Plan, all deferral elections under this Plan for the current Performance Year will cease and the participant will not be eligible to make any deferral elections under this Plan for the following Performance Year.



8


4.3
Payment in the Event of Death.

(a)
A participant may name the beneficiary of his or her choice on a beneficiary form provided by the Company or record keeper, and the beneficiary shall receive, within 90 days of the participant’s death, in a single sum, all payments credited to the participant in the event that the participant dies prior to receipt of Deferred Annual Awards. If a beneficiary is not named or does not survive the participant, the payment will be made to the participant’s estate. In no event may any recipient designate a year of payment for an amount payable upon the death of the participant.

(b)
A participant may change beneficiaries at any time, and the change will be effective as of the date the plan record keeper or Company accepts the form as complete. Neither the Company nor Consumers Energy will be liable for any payments made before receipt and acceptance of a written beneficiary request.

V.
CHANGE OF STATUS

Payments in the event of a change in status will not be made if no Annual Awards are made for the Performance Year.

5.1
Pro-Rata Annual Awards. A new Officer participant, whether hired or promoted to the position, or an Officer promoted to a higher salary grade during the Performance Year will receive a pro rata Annual Award based on the percentage of the Performance Year in which the Officer is in a particular salary grade. An Officer participant whose salary grade has been lowered, but whose employment is not terminated during the Performance Year will receive a pro rata Annual Award based on the percentage of the Performance Year in which the Officer is in a particular salary grade.

5.2
Termination. An Officer participant whose employment is terminated pursuant to a violation of the Company code of conduct or other corporate policies will not be considered for or receive an Annual Award.

5.3
Resignation. An Officer participant who resigns prior to payment (during or after a Performance Year) will not be eligible for an Annual Award. If the resignation is due to reasons such as a downsizing or reorganization, or the ill health of the Officer or ill health in the immediate family, the Officer may petition the Plan Administrator and may be considered, in the discretion of the Plan Administrator, for a pro rata Annual Award. The Plan Administrator’s decision to approve or deny the request for a pro rata Annual Award shall be final.

5.4
Death, Disability, Retirement, Leave of Absence. An Officer participant whose status as an active employee is changed during the Performance Year due to death, Disability, Retirement, or Leave of Absence will receive a pro rata Annual Award. An Officer participant whose employment is terminated following the Performance Year but prior


9


to payment due to death, Disability or Retirement will continue to be eligible for an Annual Award for the Performance Year. Any such payment or Annual Award payable due to the death of the Officer participant will be made to the named beneficiary, or if no beneficiary is named or if the beneficiary doesn’t survive the Officer participant, then to the Officer participant’s estate no later than March 15 following the applicable Performance Year. Notwithstanding the above, an Officer participant who retires, is on Disability or Leave of Absence and who becomes employed by a competitor of CMS Energy or Consumers Energy or their subsidiaries or affiliates prior to award payout will forfeit all rights to an Annual Award, unless prior approval of such employment has been granted by the Committee. A “competitor” shall mean an entity engaged in the business of (1) selling (a) electric power or natural gas at retail or wholesale within the State of Michigan or (b) electric power at wholesale within the market area in which an electric generating plant owned by a subsidiary or affiliate of CMS Energy is located or (2) developing an electric generating plant within the State of Michigan or a market area in which an electric generating plant owned by a subsidiary or affiliate of CMS Energy is located.

5.5
Clawback.

(a)
If, due to a restatement of CMS Energy’s or an affiliate’s publicly disclosed financial statements or otherwise, an Officer is subject to an obligation to make a repayment or return of benefits to CMS Energy or an affiliate pursuant to a clawback provision contained in this Plan, a supplemental executive retirement plan, the Performance Incentive Stock Plan, or any other benefit plan (a “benefit plan clawback provision”) of the Company, the Committee may determine that it shall be a precondition to the payment of any award under this Plan, that the Officer fully repay or return to the Company any amounts owing under such benefit plan clawback provision (taking into account the requirements of Code Section 409A, to extent applicable). Any and all awards under this Plan are further subject to any provision of law, which may require the Officer to forfeit or return any benefits provided hereunder, in the event of a restatement of the Company’s publicly disclosed accounting statements or other illegal act, whether required by Section 304 of the Sarbanes-Oxley Act of 2002, Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, federal securities law (including any rule or regulation promulgated by the Securities and Exchange Commission), any state law, or any rule or regulation promulgated by the applicable listing exchange or system on which the Company lists its traded shares.

(b)
To the degree any benefits hereunder are not otherwise forfeitable pursuant to the preceding sentences of this Section 5.5, the Board or a Committee delegated authority by the Board (“delegated Committee”), may require the Officer to return to the Company or forfeit any amounts granted under this Plan, if:

1.
the grant of such compensation was predicated upon achieving certain financial results which were subsequently the subject of a substantial


10


accounting restatement of the Company’s financial statements filed under the securities laws (a “financial restatement”),

2.
a lower payout or Annual Award (“reduced financial results”), would have occurred based upon the financial restatement, and

3.
in the reasonable opinion of the Board or the delegated Committee, the circumstances of the financial restatement justify such a modification of the Annual Award. Such circumstances may include, but are not limited to, whether the financial restatement was caused by misconduct, whether the financial restatement affected more than one period and the reduced financial results in one period were offset by increased financial results in another period, the timing of the financial restatement or any required repayment, and other relevant factors.

Unless otherwise required by law, the provisions of this Subsection (b) relating to the return of previously paid Plan benefits shall not apply unless a claim is made therefore by the Company within three years of the payment of such benefits.

(c)
The Board or delegated Committee shall also have the discretion to require a clawback in the event of a mistake or accounting error in the calculation of a benefit or an award that results in a benefit to an eligible individual to which he/she was not otherwise entitled. The rights set forth in this Plan concerning the right of the Company to a clawback are in addition to any other rights to recovery or damages available at law or equity and are not a limitation of such rights.

VI.
MISCELLANEOUS

6.1
Impact on Benefit Plans. Payments made under the Plan will be considered as earnings for the Supplemental Executive Retirement Plans but not for purposes of the Employees’ Savings Plan, Pension Plan, or other Officer benefit programs.

6.2
Impact on Employment. Neither the adoption of the Plan nor the granting of any Annual Award under the Plan will be deemed to create any right in any individual to be retained or continued in the employment of the Company or any corporation within the Company’s control group.

6.3
Termination or Amendment of the Plan. The Board of Directors of CMS Energy may amend or terminate the Plan at any time. Upon termination, any Deferred Annual Award accrued under the Plan will remain in the Plan and be paid out in accordance with the payment options previously selected. The Plan Administrator is authorized to make any amendments that are deemed necessary or desirable to comply with any applicable laws, regulations or orders or as may be advised by counsel or to clarify the terms and operation of the Plan. The Company may terminate the Plan and accelerate payment of any deferred benefits under the Plan if it acts consistent in all respects with


11


the requirements of Code Section 409A and any applicable regulations with respect to when a terminated plan may accelerate payment to a participant.

6.4
Governing Law. The Plan will be governed and construed in accordance with the laws of the State of Michigan.

6.5
Dispute Resolution. Any disputes related to the Plan must be brought to the Plan Administrator. The Plan Administrator is granted full discretionary authority to apply the terms of the Plan, make administrative rulings, interpret the Plan and make any other determinations with respect to the Plan. If the Plan Administrator makes an adverse determination and the participant disagrees with or wishes to appeal the determination, the participant must appeal the decision to the Plan Administrator, in writing and not later than 60 days from when the determination was mailed to the participant. If the participant does not timely appeal the original determination, the participant has no further rights under the Plan with respect to the matter presented in the claim. If the participant appeals the original determination and that appeal does not result in a mutually agreeable resolution, then the dispute shall be subject to final and binding arbitration before a single arbitrator selected by the parties to be conducted in Jackson, Michigan, provided the participant makes such request for arbitration in writing within 30 days of the final decision by the Plan Administrator. The arbitration will be conducted and finished within 90 days of the selection of the arbitrator. The parties shall share equally the cost of the arbitrator and of conducting the arbitration proceeding, but each party shall bear the cost of its own legal counsel and experts and other out-of-pocket expenditures. The arbitrator must use an arbitrary and capricious standard of review when considering any determinations and findings by the Plan Administrator.

VII.
AMENDMENT TO REFLECT CODE SECTION 409A

7.1
Code Section 409A. This Plan has been amended, effective as of January 1, 2005, to comply with the requirements of Code Section 409A. To the extent counsel determines additional amendments may be reasonable or desirable in order to comply with Code Section 409A, and any other applicable rules, laws and regulations, such changes shall be authorized with the approval of the Plan Administrator.



12

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-K’ Filing    Date    Other Filings
Filed on:2/6/20
1/16/20
For Period end:12/31/19
12/1/18
1/1/16
12/31/1510-K,  5
1/1/054
1/1/04
 List all Filings 


21 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/08/24  CMS Energy Corp.                  10-K       12/31/23  160:41M
 2/14/23  Consumers Energy Co.              424B2                  2:454K                                   Toppan Merrill/FA
 2/13/23  Consumers Energy Co.              424B5                  1:448K                                   Toppan Merrill/FA
 2/09/23  CMS Energy Corp.                  10-K       12/31/22  152:41M
 1/04/23  Consumers Energy Co.              424B2                  2:442K                                   Toppan Merrill/FA
 1/03/23  Consumers Energy Co.              424B5                  1:439K                                   Toppan Merrill/FA
 8/02/22  Consumers Energy Co.              424B2                  2:456K                                   Toppan Merrill/FA
 8/01/22  Consumers Energy Co.              424B5                  1:451K                                   Toppan Merrill/FA
 2/10/22  CMS Energy Corp.                  10-K       12/31/21  163:43M
 8/03/21  Consumers Energy Co.              424B2                  1:558K                                   Toppan Merrill/FA
 8/02/21  Consumers Energy Co.              424B5                  1:553K                                   Toppan Merrill/FA
 6/28/21  CMS Energy Corp.                  424B2                  1:714K                                   Toppan Merrill/FA
 6/24/21  CMS Energy Corp.                  424B5                  1:718K                                   Toppan Merrill/FA
 2/11/21  CMS Energy Corp.                  10-K       12/31/20  154:42M
12/03/20  Consumers Energy Co.              424B2                  1:537K                                   Toppan Merrill/FA
12/02/20  Consumers Energy Co.              424B5                  1:531K                                   Toppan Merrill/FA
11/20/20  CMS Energy Corp.                  424B2                  1:643K                                   Toppan Merrill/FA
11/19/20  CMS Energy Corp.                  424B5                  1:637K                                   Toppan Merrill/FA
10/23/20  CMS Energy Corp.                  S-3ASR     10/23/20    5:592K                                   Toppan Merrill/FA
 9/28/20  Consumers Energy Co.              424B2                  1:631K                                   Toppan Merrill/FA
 9/23/20  Consumers Energy Co.              424B5                  1:629K                                   Toppan Merrill/FA
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