CONNECTICUT NATURAL GAS CORPORATION
EMPLOYEE SAVINGS PLAN
TRUST AGREEMENT
This Trust Agreement is made as of this 1st day of January, 1993,
by and between CONNECTICUT NATURAL GAS CORPORATION, a corporation created
under the laws of the state of Connecticut having its principal office in
Hartford, Connecticut (the "Company") and PUTNAM FIDUCIARY TRUST COMPANY, a
Massachusetts trust company having its principal office in Boston,
Massachusetts (the "Trustee").
WITNESSETH:
1. ESTABLISHMENT OF PLAN. The Connecticut Natural Gas Corporation
Employee Savings Plan (the "Plan") has been adopted by the Company
and is intended to satisfy those provisions of the Internal
Revenue Code of 1986, as the same may be amended from time to time
(the "Code"), relating to qualified employer plans.
2. CREATION OF TRUST. There is hereby established a trust which
shall be known as the "Connecticut Natural Gas Corporation
Employee Savings Plan Trust." All money and such property as
shall be acceptable to the Trustee as shall from time to time be
paid or delivered to the Trustee in its capacity as such, all
investments made therewith and proceeds thereof and all earnings
and profits thereon, less the payments which at the time of
reference shall have been made by the Trustee, as authorized
herein, are referred to herein as the "Trust." The Trustee hereby
accepts the Trust created hereunder and agrees to perform the
provisions of this Agreement on its part to be performed. Subject
to the conditions and limitations set forth herein, the Trustee
shall be responsible for the property received by it as Trustee,
but shall not be responsible for the administration of the Plan or
for those assets of the Plan which have not been delivered to and
accepted by the Trustee. The Trustee shall not have any authority
or obligation to determine the adequacy of or to enforce the
collection from the Company of any contribution to the Trust.
The establishment of the Trust created by this Agreement shall not
be considered as giving any Plan member or any other person any
legal or equitable rights as against the Company or the Trustee or
the property, whether corpus or income, of the Trust unless such
right is specifically provided for in this Agreement, the Plan, or
by law, nor shall it be considered as giving any Plan member or
other employee the right to continue in the service of the
Company.
3. PURPOSES. The Plan and the Trust have been established for the
exclusive benefit of the eligible employees and their
beneficiaries. So far as possible this Agreement shall be
interpreted in a manner consistent with the intention of the
Company that the Trust satisfy those provisions of the Code
relating to qualified employees' trusts exempt from taxation under
Section 501(a) of the Code. It is specifically intended that the
Company shall have sole responsibility for maintaining the tax-
qualified status of the Plan and Trust. No property of the Trust
or contributions made by the Company pursuant to the terms of the
Plan shall revert to the Company or be used for any purpose other
than providing benefits to eligible employees or their
beneficiaries and defraying the expenses of the Plan and the
Trust, except that:
(a) Any amount contributed under the Plan by the Company by a
mistake of fact as determined by the Company shall be
returned to the Company, upon its request, within one year
after its payment to the Trust.
(b) Amounts contributed under the Plan by the Company are
contributed on the condition of their deductibility under
Section 404 of the Code, and upon the Company's written
notice to the Trustee, such contributions shall be returned
to the Company within one year after the Internal Revenue
Service disallows the deduction in writing.
(c) Earnings attributable to contributions returnable under
paragraph (a) or (b) shall not be returned to the Company,
and any losses attributable to those contributions shall
reduce the amount returned.
4. MANAGEMENT OF TRUST. It shall be the duty of the Trustee:
(a) to hold and, subject to the provisions of this Agreement, to
invest and to reinvest the assets of the Trust, and
(b) to make payments therefrom in accordance with the written
directions of the Plan Administrator (the "Administrator")
designated pursuant to the Plan to administer the Plan or its
delegate. The Administrator shall be the "plan
administrator" of the Plan as defined in Section 3(16)(A) of
the Employee Retirement Income Security Act of 1974
("ERISA"), and a "named fiduciary" within the meaning of
Section 402(a) of ERISA. Any action to be taken under the
terms of this Agreement by the Administrator may be taken by
the Plan's Administrative Committee, as a named fiduciary
under the Plan, or its delegate in accordance with the Plan
and the provisions of ERISA. The Administrator may direct
payments to be made from the Trust to any person, including
any member of the Administrator, or to the Company, or to any
paying agent designated by the Administrator, and in such
amounts as the Administrator may direct. Each such direction
of the Administrator shall be in writing and shall be deemed
to include a certification that any payment directed thereby
is one which the Administrator is authorized to direct, and
the Trustee may conclusively rely on such certification
without further investigation. Payments by the Trustee may
be made by its check to the order of the payee and mailed to
the payee at the address last furnished to the Trustee by the
Administrator or by the payee, or if no such address has been
furnished, to the payee in care of the Company. The Trustee
shall make disbursements in the amounts and in the manner
that the Administrator directs from time to time in writing.
The Trustee shall have no responsibility to ascertain any
direction's compliance with the terms of the Plan or of any
applicable law or the direction's effect for tax purposes or
otherwise; nor shall the Trustee have any responsibility to
see to the application of any disbursement. The Trustee
shall not be required to make any disbursement in excess of
the net realizable value of the assets of the Trust at the
time of the disbursement. The Trustee shall not be required
to make any disbursement in cash unless the Administrator has
provided a written direction as to the assets to be converted
to cash for the purpose of making the disbursement.
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5. INVESTMENTS. Except as otherwise provided in Sections 6, 7 and 8
below, the Trustee shall invest and reinvest the assets of the
Trust and keep the same invested, without distinction between
principal and income, in stocks, bonds, stock options, option
contracts of any type, contracts for the immediate or future
delivery of financial instruments and other property, or other
securities or certificates of participation or shares of any
mutual investment company, trust or fund (including mutual funds
which are sponsored, underwritten or managed by affiliates of the
Trustee), or deposits in the Trustee which bear a reasonable rate
of interest, or annuity or investment contracts issued by an
insurance company, or other property of any kind, real or
personal, tangible or intangible, as it may deem advisable,
provided that the Trustee may hold assets of the Trust uninvested
from time to time if and to the extent that it may deem such to be
in the best interests of the Trust. Notwithstanding the
foregoing, unless an investment manager is appointed in accordance
with Section 8, or the service agreement between the Company and
the Trustee or its affiliate otherwise specifically provides, all
of the assets of the Trust shall be invested as the Administrator
directs in investment products sponsored, underwritten or managed
by affiliates of the Trustee, loans to Plan members (if the Plan
permits loans) or securities issued by the Company satisfying the
conditions of Section 6.
6. INVESTMENT FUNDS. The Administrator from time to time may direct
the Trustee to establish one or more separate investment accounts
within the Trust, each such separate account being hereinafter
referred to as an "Investment Fund." The Trustee shall transfer
to each such Investment Fund such portion of the assets of the
Trust as the Administrator or Plan members direct in accordance
with the specific provisions of the Plan and in the manner
provided in the service agreement between the Company and the
Trustee or its affiliate. The Trustee shall invest and reinvest
the assets which have been allocated to an Investment Fund in
accordance with the investment guidelines, objectives and
restrictions which have been established by the Administrator for
that Investment Fund and, in the case of an Investment Fund for
which an Investment Manager has been appointed, the specific
investment directions of such Investment Manager. If, and to the
extent, specifically authorized by the Plan, and provided in the
service agreement between the Company and the Trustee or its
affiliate, the Administrator may direct the Trustee to establish
an Investment Fund all of the assets of which shall be invested in
shares of stock of the Company, subject to the terms and
conditions of Section 7.
The Trustee shall be under no duty to question or review the
investment guidelines, objectives and restrictions established, or
the specific investment directions given, by the Administrator or
the Plan members for any Investment Fund or to make suggestions to
the Administrator in connection therewith. The Trustee shall not
be liable for any loss, or by reason of any breach, which arises
from the Administrator's or Plan members' exercise or non-exercise
of rights under this Section 6, or from any direction of the
Administrator or Plan members unless it is clear on the face of
the direction that the actions to be taken under the direction are
prohibited by the fiduciary duty rules of Section 404(a) of ERISA.
The Trustee shall incur no liability on account of investing the
assets of the Trust in accordance with investment elections of the
Administrator or Plan members so delivered to the Trustee.
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All interest, dividends and other income received with respect to,
and any proceeds received from the sale or other disposition of,
securities or other property held in an Investment Fund shall be
credited to and reinvested in such Investment Fund, and all
expenses of the Trust which are properly allocable to a particular
Investment Fund shall be so allocated and charged. The
Administrator may at any time direct the Trustee to eliminate any
Investment Fund or Funds, and the Trustee shall thereupon dispose
of the assets of such Investment Fund and reinvest the proceeds
thereof in accordance with the directions of the Administrator.
Pending investment in the Investment Funds in accordance with the
directions of the Administrator or the Plan members, the Trustee
shall invest assets of the Trust as provided in the service
agreement between the Company and the Trustee or its affiliate, or
if there is no such provision, the Trustee may invest assets of
the Trust, in whole or in part, at any time or from time to time,
in interest-bearing accounts or certificates of deposit (including
deposits in the Trustee which bear a reasonable interest rate),
treasury bills, commercial paper, money market funds (including
any such fund sponsored, underwritten or managed by one of its
affiliates), short-term investment funds or other short-term
obligations in its discretion, and the investment return thereon
shall be allocated among the Plan members whose assets have been
so invested and added to their respective investments in the
Investment Funds.
7. TRUST INVESTMENTS IN COMPANY STOCK. Trust investments pursuant to
this Section 7 shall be made only in securities constituting
"qualifying employer securities" within the meaning of Section
407(d)(5) of ERISA. Trust investments in such securities of the
Company ("Company Stock") shall be subject to the following terms
and conditions:
(a) ACQUISITION LIMIT. Pursuant to the Plan, the Trust may be
invested in Company Stock to the extent necessary to comply
with investment directions under Section 6 of this Agreement.
(b) FIDUCIARY DUTIES OF NAMED FIDUCIARIES. The Administrator as
named fiduciary shall continually monitor the suitability of
acquiring and holding Company Stock under the fiduciary duty
rules of Section 404(a)(1) of ERISA (as modified by Section
404(a)(2) of ERISA). The Trustee shall not be liable for any
loss, or by reason of any breach, which arises from the
direction of the Administrator with respect to the
acquisition and holding of Company Stock, unless it is clear
on the face of the direction that the actions to be taken
under the direction would be prohibited under ERISA. The
Company hereby appoints as named fiduciaries, solely with
respect to the voting of Company Stock held in the Trust and
the tender or retention of such Company Stock in response to
a tender offer, the eligible employees who are Plan members
in the Plan at the time in question. The Company shall be
responsible for determining whether, under the circumstances
prevailing at a given time, its fiduciary duty to Plan
members and beneficiaries under the Plan and ERISA requires
that the Company follow the advice of independent counsel as
to the voting and tender or retention of Company Stock.
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(c) EXECUTION OF PURCHASES AND SALES. To implement the
investment of new contributions, the Trustee shall purchase
Company Stock on the open market as soon as practicable
following the date on which the Trustee receives from the
Company in good order all information and documentation
necessary to effect the purchase. Redemptions and exchanges
of Company Stock shall be netted against purchases made in
accordance with the preceding sentence, and to the extent
necessary after such netting, the Trustee shall, as soon as
practicable following the date of such purchases, purchase or
sell Company Stock on the open market to accomplish such
redemptions and exchanges.
The Trustee may purchase or sell Company Stock from or to the
Company if the purchase or sale is for no more than adequate
consideration (within the meaning of Section 3(18) of ERISA)
and no commission is charged. To the extent that Company
contributions under the Plan are to be invested in Company
Stock, the Company may transfer Company Stock to the Trust in
lieu of cash. The number of shares so transferred shall be
determined by dividing the amount of the contribution by the
closing price of Company Stock on any national securities
exchange on the trading day immediately preceding the date as
of which the contribution is made.
The Trustee and the Company may, in an appendix to this
Section 7, agree upon such prescribed dates for purchases and
sales of Company Stock and such rules and conventions in
connection with such purchases and sales as they may find
mutually acceptable.
(d) SECURITIES LAW REPORTS. The Administrator shall be
responsible for filing all reports required under federal or
state securities laws with respect to the Trust's ownership
of Company Stock, including, without limitation, any reports
required under Section 13 or 16 of the Securities Exchange
Act of 1934, and shall immediately notify the Trustee in
writing of any requirement to stop purchases or sales of
Company Stock pending the filing of any report. The Trustee
shall provide to the Administrator such information on the
Trust's ownership of Company Stock as the Administrator may
reasonably request in order to comply with federal or state
securities laws.
(e) VOTING. Notwithstanding any other provision of this
Agreement, the provisions of this Section 7(e) shall govern
the voting of Company Stock. When the issuer of Company
Stock files preliminary proxy solicitation materials with the
Securities and Exchange Commission, the Company shall cause a
copy of all the materials to be simultaneously sent to the
Trustee, and the Trustee shall prepare a voting instruction
form based upon these materials. At the time of mailing of
notice of each annual or special stockholders' meeting of the
issuer of Company Stock, the Company shall cause a copy of
the notice and all proxy solicitation materials to be sent to
each Plan member, together with the foregoing voting
instruction form to be returned to the Trustee or its
designee. The form shall show the number of full and
fractional shares of Company Stock credited to the Plan
member's accounts, whether or not vested. For purposes of
this Section 7(e), the number of shares of Company Stock
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deemed credited to a Plan member's accounts shall be
determined as of the last preceding valuation date for which
an allocation has been completed and Company Stock has
actually been credited to Plan members' accounts. The
Company shall provide the Trustee with a copy of any
materials provided to Plan members and shall certify to the
Trustee that the materials have been mailed or otherwise sent
to Plan members.
Each Plan member shall have the right to direct the Trustee
as to the manner in which to vote that number of shares of
Company Stock credited to his accounts. Such directions
shall be communicated in writing or by facsimile or similar
means and shall be held in confidence by the Trustee and not
divulged to the Company, or any officer or employee thereof,
or any other person. Upon its receipt of directions, the
Trustee shall vote the shares of Company Stock credited to
the Plan member's account as directed by the Plan member.
The Trustee shall vote those shares of Company Stock not
credited to Plan members' accounts, and those shares of
Company Stock credited to the accounts of Plan members for
which no voting directions are received, as directed by the
Compensation and Fringe Benefits Committee of the Board of
Directors of the Company, which the Company hereby appoints
as a named fiduciary solely with respect to the voting of
such shares of Company Stock.
(f) TENDER OFFERS. Upon commencement of a tender offer for any
Company Stock, the Company shall notify each Plan member, and
use its best efforts to timely distribute or cause to be
distributed to Plan members the same information that is
distributed to shareholders of the issuer of Company Stock in
connection with the tender offer, and after consulting with
the Trustee shall provide at the Company's expense a means by
which Plan members may direct the Trustee whether or not to
tender the Company Stock credited to their accounts (whether
or not vested). The Company shall provide to the Trustee a
copy of any material provided to Plan members and shall
certify to the Trustee that the materials have been mailed or
otherwise sent to Plan members.
Each Plan member shall have the right to direct the Trustee
to tender or not to tender some or all of the shares of
Company Stock credited to his accounts. Directions from a
Plan member to the Trustee concerning the tender of Company
Stock shall be communicated in writing or by facsimile or
such similar means as is agreed upon by the Trustee and the
Company. The Trustee shall tender or not tender shares of
Company Stock as directed by the Plan member. The Trustee
shall not tender shares of Company Stock credited to a Plan
member's accounts for which it has received no directions
from the Plan members.
The Trustee shall tender that number of shares of Company
Stock not credited to Plan members' accounts determined by
multiplying the total number of such shares by a fraction, of
which the numerator is the number of shares of Company Stock
credited to Plan members' accounts for which the Trustee has
received directions from Plan members to tender (which
directions have not been withdrawn as of the date of this
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determination), and of which the denominator is the total
number of shares of Company Stock credited to Plan members'
accounts.
A Plan member who has directed the Trustee to tender some or
all of the shares of Company Stock credited to his accounts
may, at any time before the tender offer withdrawal date,
direct the Trustee to withdraw some or all of the tendered
shares, and the Trustee shall withdraw the directed number of
shares from the tender offer before the tender offer
withdrawal deadline. A Plan member shall not be limited as
to the number of directions to tender or withdraw that he may
give to the Trustee.
A direction by a Plan member to the Trustee to tender shares
of Company Stock credited to his accounts shall not be
considered a written election under the Plan by the Plan
member to withdraw or to have distributed to him any or all
of such shares. The Trustee shall credit to each account of
the Plan member from which the tendered shares were taken the
proceeds received by the Trustee in exchange for the shares
of Company Stock tendered from that account. Pending receipt
of directions through the Administrator from the Plan member
as to the investment of the proceeds of the tendered shares,
the Trustee shall invest the proceeds as the Administrator
shall direct.
(g) GENERAL. With respect to all rights other than the right to
vote, the right to tender, and the right to withdraw shares
previously tendered, the Trustee shall follow the directions
of the Plan member as to Company Stock credited to his
accounts, and if no such directions are received, the
directions of the Administrator. The Trustee shall have no
duty to solicit directions from Plan members. With respect
to all rights other than the right to vote and the right to
tender, in the case of Company Stock not credited to Plan
members' accounts, the Trustee shall follow the directions of
the Administrator. All provisions of this Section 7 shall
apply to any securities received as a result of a conversion
of Company Stock.
8. APPOINTMENT OF INVESTMENT MANAGERS. The Administrator from time
to time may appoint one or more Investment Managers (as that term
is defined in Section 3(38) of ERISA) to manage (including the
power to acquire and dispose of) all or any portion or portions of
the Trust. The Administrator may enter into such agreements
setting forth the terms and conditions of any such appointment as
it determines to be appropriate. The Administrator shall retain
the right to remove and discharge any Investment Manager. The
compensation of such Investment Managers shall be an expense
payable in accordance with Section 14. The Administrator shall
notify the Trustee of the appointment of any Investment Manager by
delivering to the Trustee an executed copy of the agreement under
which such Investment Manager was appointed together with a
written acknowledgment by such Investment Manager that it is
(a) a fiduciary with respect to the Plan,
(b) bonded as required by ERISA, and
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(c) either
(i) registered as an investment advisor under the
Investment Advisers Act of 1940, or
(ii) a bank as defined in said Act, or
(iii) an insurance company qualified to perform investment
management services under the laws of more than one
state of the United States.
The Trustee shall be entitled to rely upon such notice until such
time as the Administrator shall notify and direct the Trustee in
writing that another Investment Manager has been appointed in the
place and stead of the first-named Investment Manager, or in the
alternative, that the Investment Manager has been removed. In
each case where an Investment Manager is appointed, the
Administrator shall determine the assets of the Trust to be
allocated to the Investment Manager from time to time and shall
issue appropriate instructions to the Trustee with respect
thereto. The Trustee shall carry out the written instructions of
any Investment Manager with respect to the management and
investment of the assets then under control of such Investment
Manager and shall not incur any liability on account of its
compliance with such instructions. Purchase and sale orders may
be placed without the intervention of the Trustee and, in such
event, the Trustee's sole obligation shall be to make payment for
purchased securities and deliver those that have been sold when
advised of the transaction. The Trustee shall not incur any
liability on account of its failure to exercise any of the powers
delegated to any Investment Manager because of the failure of such
Investment Manager to give instructions for the management of the
assets under the control of such Investment Manager. The Trustee
shall be under no duty to question any Investment Manager, nor to
review any securities or other property acquired or retained at
the direction of any Investment Manager, nor to make any
suggestions to any Investment Manager in connection therewith.
The Trustee shall have no obligation to vote upon any securities
over which the Investment Manager has investment management
control unless the Trustee is instructed in writing by the
Investment Manager as to the voting of such securities within a
reasonable time before the time for voting thereof expires.
Each Investment Manager shall have the authority to exercise all
of the powers of the Trustee hereunder with respect to assets
under its control but only to the extent that such powers relate
to the investment of such assets.
9. INSURANCE CONTRACTS. If provided in the service agreement between
the Company and the Trustee or its affiliate, the Administrator
may direct the Trustee to receive and hold or apply assets of the
Trust to the purchase of individual or group insurance or annuity
contracts issued by any insurance company and in a form approved
by the Administrator, including contracts under which the contract
holder is granted options to purchase insurance or annuity
benefits. The Trustee shall be under no duty to question any
direction of the Administrator or to review the form of any such
policies or contracts or of the selection of the issuer thereof,
or to make suggestions to the Administrator with respect to the
form of such policies or contracts or to the issuer thereof. The
Administrator may direct the Trustee to exercise or may exercise
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directly the powers of the contract holder under any such policies
or contracts, and the Trustee shall exercise such powers only upon
the direction of the Administrator. The Trustee shall be fully
protected in acting in accordance with written directions of the
Administrator, and shall be under no liability for any loss of any
kind which may result by reason of any action taken or omitted by
it in accordance with any direction of the Administrator, or by
reason of inaction in the absence of written directions from the
Administrator. In the event that the Administrator directs that
any monies or property be paid or delivered to the contract holder
other than for the benefit of specific individual beneficiaries,
the Trustee agrees to accept such monies or property as assets of
the Trust subject to all the terms hereof.
10. POWERS OF TRUSTEE. Subject to the foregoing provisions and
limitations, the Trustee is authorized and empowered:
(a) to sell at public auction or by private contract, redeem,
convey, transfer, exchange, pledge, or otherwise realize
upon, any securities, investments or other property forming a
part of the Trust, and for such purposes may execute such
instruments and writings and do such things as it shall deem
proper;
(b) to keep any or all securities or other property in the name
of some other person, nominee, firm or corporation or in its
own name without disclosing its fiduciary capacity, but the
books and records of the Trustee shall at all times show that
all such securities and other property are part of the Trust;
(c) except as otherwise provided in Sections 7 and 8, to the
extent that the Trustee receives direction from the
Administrator or the Plan members, as the case may be, to
vote upon any stock, bonds or other securities of any
corporation, association or trust at any time comprising the
Trust, or otherwise consent to or request any action on the
part of such corporation, association or trust, and to give
general or special proxies or powers of attorney, with or
without power of substitution, and to exercise any conversion
privileges, subscription rights or other options, to
participate in reorganizations, recapitalizations,
consolidations, mergers and similar transactions with respect
to such securities; to deposit such stocks or other
securities in any voting trust, or with any protective or
like committee, or with a trustee, or with depositories
designated thereby; and generally to exercise any of the
powers of an owner with respect to stocks or other securities
or property comprising the Trust which the Trustee deems to
be for the best interests of the Trust. The Trustee will not
vote such stock or other securities as to which it receives
no written directions;
(d) when instructed or directed by the Administrator, to borrow
money for the purposes of this Trust in such amounts and upon
such terms and conditions as the Administrator, in its
discretion, may approve, and for any amount so borrowed to
issue the promissory note of the Trustee and to secure the
repayment thereof by pledge, mortgage, or hypothecation of
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all or any part of the property of the Trust, and no person
loaning money to the Trustee shall be bound to see to the
application of the money loaned or to inquire into the
validity of any such borrowing;
(e) to make, execute, acknowledge and deliver any and all
instruments that it shall deem necessary or appropriate to
carry out the powers herein granted;
(f) to manage, administer, operate, lease for any number of
years, develop, improve, repair, alter, demolish, mortgage,
pledge, grant options with respect to, or otherwise deal with
any real property or interest therein at any time held by it,
and to cause to be formed a corporation or trust to hold
title to any such real property with the aforesaid powers,
all upon such terms and conditions as may be deemed
advisable;
(g) to renew or extend or participate in the renewal or extension
of any mortgage, upon such terms as may be deemed advisable,
and to agree to a reduction in the rate of interest on any
mortgage or to any other modification or change in the terms
of any mortgage or of any guarantee pertaining thereto, in
any manner and to any extent that may be deemed advisable for
the protection of the Trust or the preservation of the value
of the investment, to waive any default whether in the
performance of any covenant or condition of any mortgage or
in the performance of any guarantee, or to enforce any such
default in such manner and to such extent as may be deemed
advisable, to exercise and enforce any and all rights of
foreclosure, to bid in property on foreclosure, to take a
deed in lieu of foreclosure with or without paying a
consideration therefor and in connection therewith to release
the obligation on the bond secured by such mortgage; and to
exercise and enforce in any action, suit or proceedings at
law or in equity any rights or remedies in respect to any
such mortgage or guarantee;
(h) upon instruction by the Administrator, to transfer assets of
the Trust to itself as trustee of the Putnam Fiduciary Trust
Company GIC Fund or any other trust which has been qualified
under Section 401(a) and is exempt from tax under Section
501(a) of the Code, and which is maintained as a medium for
the collective investment of funds of pension, profit-sharing
or other employee benefit trusts, or to any other trustee of
such a trust, in which event such trust shall be deemed to be
a part of the Plan, and to withdraw any assets of the Trust
so transferred;
(i) when instructed or directed by the Administrator, to settle,
compromise or submit to arbitration any claims, debts, or
damages, due or owing to or from the Trust, to commence or
defend suits or legal proceedings and to represent the Trust
in all suits or legal proceedings in any court of law or
before any other body or tribunal; provided, however, that
the Trustee shall have no obligation to take any legal action
for the benefit of the Trust unless it shall have been first
indemnified for all expenses in connection therewith,
including counsel fees;
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(j) to lend to Plan members such amount or amounts, and upon such
terms and conditions, as the Administrator may direct in
accordance with the provisions of the Plan, if applicable;
(k) to employ such agents, consultants, custodians, depositories,
advisors, and legal counsel as may be reasonably necessary or
desirable in the Trustee's judgment in managing and
protecting the Trust and, subject to the provisions of
Section 14, to pay them reasonable compensation out of the
Trust;
(l) to cause any securities or other property which may at any
time form a part of the Trust to be issued, held or
registered in the individual name of the Trustee, or in the
name of its nominee (including any custodian employed by the
Trustee, any nominee of such a custodian, and any depository,
clearing corporation or other similar system), or in such
form that title will pass by delivery;
(m) to enter into stand-by agreements for future investment
either with or without a stand-by fee;
(n) to transfer any assets of the Trust to a custodian or sub-
custodian employed by the Trustee;
(o) when directed by the Administrator, to participate in a
securities lending program sponsored and administered by the
Trustee and, in connection therewith, the Trustee is
authorized to release and deliver securities and return
collateral received for loaned securities in accordance with
the provisions of such program;
(p) to write options on securities held or to otherwise
participate in so-called covered option writing; and
(q) to do all other acts in its judgment necessary or desirable
for the proper administration of the Trust, in accordance
with the provisions of the Plan and this Agreement, although
the power to do such acts is not specifically set forth
herein.
No person dealing with the Trustee shall be required to take any
notice of this Agreement, but all persons so dealing shall be
protected in treating the Trustee as the absolute owner with full
power of disposition of all the monies, securities and other
property of the Trust, and all persons dealing with the Trustee
are released from inquiry into the decision or authority of the
Trustee and from seeing to the application of monies, securities
or other property paid or delivered to the Trustee.
11. LIQUIDATION OF ASSETS. Upon termination of the Trust as
provided herein, the Trustee shall not be required to make
any payments hereunder until it has received such
documentation as it shall consider necessary to establish
that the termination complies with applicable law, or to make
any payments in excess of the net realizable value of the
assets of the Trust at the time of such payment. The Trustee
shall not be required to make any payments in cash unless
there shall be in the Trust at the time an amount of cash
sufficient for the purpose. In case of a deficiency in cash,
the Trustee shall take such action as to the disposition of
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securities or other property forming a part of the Trust as
will provide the amount of cash for such payments. The
Trustee shall not be required to make any payment in cash
until the Administrator has provided direction as to the
assets to be converted to cash for the purpose of making such
payment.
12. DIRECTION BY COMPANY OR ADMINISTRATOR. The Company shall
certify to the Trustee the names and specimen signatures of
the Administrative Committee. The Company shall give prompt
notice to the Trustee of changes in the Administrative
Committee, and until such notice is received by the Trustee,
the Trustee shall be fully protected in assuming that the
Administrative Committee is unchanged and in acting
accordingly. The Administrative Committee may certify to the
Trustee the names of persons authorized to act for it in
relation to the Trustee and may designate a person,
corporation or other entity, whether or not affiliated with
the Company, to so act. Whenever the Trustee is required or
authorized to take any action hereunder pursuant to any
written direction or determination of the Company or the
Administrator, such direction or determination shall be
sufficient protection to the Trustee if contained in a
writing signed by any one or more of the persons authorized
to execute documents on behalf of the Company or the
Administrator, as the case may be, pursuant to the Plan. The
Trustee shall act, and shall be fully protected in acting, in
accordance with such orders, requests and instructions of the
Company or the Administrator. By such a writing the Company
or the Administrator, as the case may be, may ratify, approve
or confirm any action taken by the Trustee, and upon such
ratification, approval or confirmation the Trustee shall be
protected as though authorization or determination by the
Company or the Administrator had preceded such action. In
the absence of direction by the Company or the Administrator
as to any matter provided in this Agreement or the Plan, the
Trustee may in its discretion take such action as it deems
fit and proper with respect thereto after reasonable attempts
to secure Company or Administrator direction, provided,
however, that the Trustee shall not be obligated to take any
such action. The Trustee may deliver documents to the
Company or the Administrator by delivering the same, or by
mailing the same, postage prepaid, addressed to the Company
or the Administrative Committee, as the case may be, at its
principal place of business.
13. RECORDS AND ACCOUNTING. The Trustee shall keep adequate and
accurate accounts of investments, receipts, disbursements and
other transactions hereunder, and all accounts, books and
records relating thereto shall be open at all reasonable
times to inspection and audit by the Administrator and its
authorized representatives. The Trustee shall render to the
Company and the Administrator in writing, at least once each
twelve (12) months and at such times as required by the Plan
and, in any event, within ninety (90) days after its removal
or resignation as provided in Section 15 hereof, accounts of
its transactions under this Agreement, and the Administrator
may approve such accounts of the Trustee by an instrument in
writing delivered to the Trustee. In the absence of the
filing in writing with the Trustee by the Administrator of
exceptions or objections to any such account within one year
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after the receipt thereof, the Administrator shall be deemed
to have approved such account; and in such case, or upon the
written approval of the Administrator of any such account,
the Trustee, to the extent permitted by applicable law, shall
be released, relieved and discharged with respect to all
matters and things set forth in such account. The Trustee
shall from time to time make such other reports and furnish
such other information concerning the Trust (including
valuations of each Investment Fund established pursuant to
Section 6) to the Administrator as the Administrator may
reasonably request or as may be required by the Plan. The
Administrator shall arrange for each Investment Manager
appointed pursuant to Section 8, and each insurance company
issuing contracts held by the Trustee pursuant to Section 9,
to furnish the Trustee with such valuations and reports as
are necessary to enable the Trustee to fulfill its
obligations under this Section 13, and the Trustee shall be
fully protected in relying upon such valuations and reports.
In any proceeding instituted by the Trustee, the Company or
the Administrator or all of them with respect to any account
of the Trustee, only the Company, the Administrator and the
Trustee shall be necessary parties.
14. TRUSTEE'S COMPENSATION AND EXPENSES. The Trustee shall be
paid such reasonable compensation as provided in the service
agreement between the Company and the Trustee or its
affiliate. The compensation of the Trustee and any
reasonable expenses, including reasonable attorneys' fees and
the cost of any bond, surety or other security which may be
required of the Trustee by ERISA, incurred by the Trustee in
the performance of its duties, and all other proper charges
and disbursements of the Trustee may be paid by the Company
within thirty (30) days after so billed, and will
automatically be deducted from the Trust if, upon the
expiration of thirty (30) days, such fees are not separately
paid by the Company. All expenses (including taxes pursuant
to Section 21) of the Trust, other than those expenses which
are paid by the Company, which are allocable to an Investment
Fund established pursuant to Section 6 shall be charged to
such Investment Fund. All such expenses which are not so
allocable shall be charged against each of the Investment
Funds in the same proportion as the value of the assets held
in such Investment Fund bears to the value of the total
assets held in all of the Investment Funds. Any account
maintenance or administration fees applicable to any Plan
member's account which are not paid hereunder by the Company
shall be charged against the interest of the Plan member and,
in the case of a loan of a Plan member, if applicable, all
expenses (including taxes pursuant to Section 21) of the
Trust, other than those expenses which are paid by the
Company, which are allocable to such loan, shall be charged
against the interest of such Plan member under the Plan.
15. RESIGNATION OR REMOVAL OF TRUSTEE. The Trustee may resign at
any time upon sixty (60) days' written notice to the Company,
and the Company may remove the Trustee at any time upon sixty
(60) days' written notice to the Trustee; provided, however,
that the parties may by written instrument waive such notice.
The Trustee reserves the right at any time to resign
immediately if the Company transfers the Plan's
administration to a recordkeeper other than the recordkeeper
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designated in the service agreement between the Company and
the Trustee or its affiliate, a copy of which is attached
hereto, without the Trustee's prior written consent, by
delivering to the Company a notice of resignation certified
by the Trustee. The Trustee further reserves the right at
any time to resign immediately by delivering to the Company a
notice of resignation certified by the Trustee if the assets
of the Trust are not invested in investment products which
are sponsored, underwritten or managed by affiliates of the
Trustee, unless the service agreement between the Company and
the Trustee or its affiliates otherwise specifically
provides. If the Trustee shall resign, be removed or for any
other reason cease to be Trustee, the Company shall appoint a
successor Trustee or Trustees to whom the Trustee, upon
receipt of acceptance by such successor, shall promptly
deliver all of the assets of the Trust less any unpaid fees
or expenses. Subject to the foregoing provisions, any
resignation or removal of the Trustee or appointment of a new
Trustee shall be by instrument in writing and shall become
effective on the date therein specified. Any successor
Trustee shall have the same powers and duties as the
succeeded Trustee, subject to such changes as the Company may
then determine. Upon request of such successor Trustee or
Trustees, the Company and the Trustee ceasing to act shall
execute and deliver such instruments of conveyance and
further assurance and do such things as may reasonably be
required for more fully and certainly vesting and confirming
in such successor Trustee or Trustees all the right, title
and interest of the retiring Trustee in and to the assets of
the Trust. The Trustee is authorized, however, to reserve
such sums of money as may be reasonable for payment of its
compensation and expenses (including legal fees) in
connection with the settlement of its account or otherwise,
and any balance of such reserve remaining after payment of
such compensation and expenses shall be promptly paid over to
the successor Trustee or Trustees.
16. DUTIES OF TRUSTEE. The Trustee shall discharge its duties
with respect to the Trust solely in the interests of the Plan
members and their beneficiaries and with the care, skill,
prudence and diligence under the circumstances then
prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an
enterprise of like character and with like aims. The duties
of the Trustee shall be only those specifically undertaken by
the Trustee pursuant to this Trust Agreement. The Trustee
shall have no responsibility for the administration of the
Plan (including, but not limited to, the determination of
Plan participation rights of employees of the Company, the
determination of benefits of members of the Plan and the
maintenance of individual accounts of members of the Plan).
Except as otherwise provided by ERISA, in no event shall the
Trustee be responsible for any act or omission of any other
fiduciary of the Plan. The Trustee shall have no liability
for the acts or omissions of any predecessors and successors
in office.
17. INDEMNIFICATION. The Company hereby agrees to indemnify and
hold harmless the Trustee from and against any losses,
damages, liabilities, claims, costs or expenses (including
reasonable attorneys' fees) which the Trustee may incur by
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reason of this Trust Agreement, (including, without
limitation, by reason of the Trustee's making benefit
payments pursuant to fraudulent or unauthorized instructions)
excepting only losses, damages, liabilities, claims, costs or
expenses arising from the Trustee's negligence or willful
misconduct. A waiver by the Trustee of any signature
guarantee requirement relating to the investments held
hereunder shall not be construed as negligence or willful
misconduct on the part of the Trustee.
18. AMENDMENT OR TERMINATION. The Company reserves the right at
any time and from time to time to amend, in whole or in part,
any or all of the provisions of, or to terminate, this
Agreement by delivering to the Trustee a copy of an amendment
or a notice of termination certified by an officer of the
Company; provided, that no such amendment which affects the
rights, duties or responsibilities of the Trustee may be made
without its consent, and provided further that no such
amendment shall authorize or permit any part of the corpus or
income of the Trust to be used for or diverted to purposes
other than those set forth in Section 3. Any such amendment
shall be effective upon delivery to the Trustee unless a
different effective date is specifically stated and any such
amendment may be made retroactively as shall be permitted
under applicable law. Upon termination of this Agreement, the
Trustee, upon direction of the Administrator shall liquidate
the Trust to the extent required for distribution and, after
the final account of the Trustee has been approved and
settled, shall distribute the balance of the Trust remaining
in its hands as directed by the Administrator or in the
absence of such direction, as may be directed by a judgment
or decree of a court of competent jurisdiction. Following
any such termination the powers of the Trustee hereunder
shall continue as long as any of the assets of the Trust
remain in its hands, but only as to those assets which during
such time remain in the Trust.
19. ADDITIONAL PARTICIPATING COMPANIES. Any affiliate or
subsidiary of the Company may, with the consent of the
Company, become a participating employer by action of the
board of directors of such affiliate or subsidiary to adopt
the Trust as a trust for the benefit of its employees. Each
such additional participating employer shall be deemed the
"Company" hereunder and shall have and exercise all the
rights, powers, and duties thereof with respect to the Trust
as applied to itself and its employees and that part of the
Trust which represents the interest of members employed by
it; provided, however, that each such additional
participating employer hereby delegates all such rights,
powers, and duties, including amendment or termination of the
Trust, to Connecticut Natural Gas Corporation acting alone,
except as such additional participating employer may exercise
the same for itself with the approval of Connecticut Natural
Gas Corporation.
20. SPENDTHRIFT PROVISION. Except as otherwise provided in the
Plan, to the maximum extent permitted by law, beneficial
interests in the Trust of members or former members under the
Plan or their beneficiaries shall not be assignable nor
subject to alienation, sale, transfer, pledge, encumbrance,
mortgage, attachment, execution, levy or receivership, nor
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shall they pass to any trustee in bankruptcy or be reached or
applied by any legal process for the payment of any
obligations of any such person; provided, however, that
nothing herein shall prevent a member from assigning his
interest in the Trust as security for the repayment of any
loan made to him from the Trust pursuant to the Plan, and
further provided that nothing herein shall prevent the
Trustee from making payments in accordance with a Qualified
Domestic Relations Order, as that term is defined in Code
Section 414(p). Any attempt at any other assignment,
alienation, sale, transfer, pledge, encumbrance, mortgage,
attachment, execution or levy shall be void and
unenforceable.
21. PAYMENT OF TAXES. The Trustee may pay out of the Trust (or
the appropriate Investment Fund or Funds) any and all taxes
of any and all kinds, including without limitation property
taxes and income taxes levied or assessed under existing or
future laws upon or in respect of the Trust or any monies,
securities or other property forming a part thereof or the
income therefrom subject to the terms of any agreements or
contracts made with respect to trust investments which make
other provision for such tax payments. The Trustee may
assume that any taxes assessed on or in respect of the Trust
or its income are lawfully assessed unless the Administrator
shall in writing advise the Trustee that in the opinion of
counsel for the Company such taxes are or may be unlawfully
assessed. In the event that the Administrator shall so
advise the Trustee, the Trustee will, if so requested in
writing by the Administrator contest the validity of such
taxes in any manner deemed appropriate by the Company or its
counsel but at the expense of the Trust; or the Company may
contest the validity of any such taxes at the expense of the
Trust and in the name of the Trustee; and the Trustee agrees
to execute all documents, instruments, claims, and petitions
necessary or advisable in the opinion of the Company or its
counsel for the refund, abatement, reduction or elimination
of any such taxes. At the direction of the Administrator the
Trustee shall collect all income tax to be withheld from any
benefit payments from the Trust and shall report and pay over
such taxes to the Internal Revenue Service, except for
payments made directly by an insurer to a Plan member or
beneficiary under an annuity or insurance contract, if
applicable.
22. SUCCESSOR TO COMPANY OR TRUSTEE. Any successor to all or a
major part of the business of the Trustee, by whatever form
or manner resulting, shall ipso facto succeed to all the
rights, powers and duties hereunder of the Trustee. Any
successor to all or a major part of the business of the
Company, by whatever form or manner resulting, may continue
the Plan and Trust by executing appropriate amendments
thereto, and thereupon such successor shall ipso facto
succeed to all the rights, powers and duties hereunder of the
Company.
23. CONSTRUCTION. In any question of interpretation or other
matter of doubt, the Trustee, the Administrator and the
Company may rely upon the opinion of counsel for the Company
or any other attorney at law designated by the Company with
the approval of the Trustee. The provisions of this
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Agreement shall be construed, administered and enforced
according to the laws of the United States and, to the extent
permitted by such laws, by the laws of the Commonwealth of
Massachusetts. All contributions to the Trust shall be
deemed to be made in the Commonwealth of Massachusetts.
24. IMPOSSIBILITY OF PERFORMANCE. In case it becomes impossible
for the Company, the Administrator or the Trustee to perform
any act under this Trust Agreement, that act shall be
performed which in the judgment of the Administrator will
most nearly carry out the intent and purpose of the Plan and
Trust. All parties to this Agreement or in any way interested
in the Trust shall be bound by any acts performed under such
condition.
25. DEFINITION OF WORDS. Feminine or neuter pronouns shall be
substituted for those of the masculine form, and the plural
shall be substituted for the singular, in any place or places
herein where the context may require such substitution or
substitutions.
26. TITLES. The titles of sections are included only for
convenience and shall not be construed as part of this
Agreement or in any respect affecting or modifying its
provisions.
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27. EXECUTION OF AGREEMENT. This Agreement may be executed in
any number of counterparts and each fully executed
counterpart shall be deemed an original.
IN WITNESS WHEREOF these presents have been signed and sealed for and
in behalf of the Company and the Trustee by their duly authorized
officers as of the 1st day of January, 1993.
CONNECTICUT NATURAL GAS
CORPORATION
S/ Barbara Reick By: S/ Frank Livingston
-------------------------------- ------------------------------
Witness Title: Vice President
Date: 1/4/93
PUTNAM FIDUCIARY TRUST COMPANY
S/ Janice Mullally By: S/ W.M. Byrnes
-------------------------------- -------------------------------
Witness Title: Sr. V.P.
Date: 1/11/93
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