THIRD AMENDMENT
TO THE
EMPLOYEES' RETIREMENT PLAN
OF
EASTERN UTILITIES ASSOCIATES
AND ITS AFFILIATED COMPANIES
WHEREAS, Eastern Utilities Associates (the "Employer") previously
established the Employees' Retirement Plan of Eastern Utilities Associates and
Its Affiliated Companies (the "Plan"); and
WHEREAS, the Employer amended and restated the Plan effective January
1, 1989; and
WHEREAS, the Employer has reserved the right to amend the Plan from
time to time under Section 12.1 of the Plan;
NOW, THEREFORE, in accordance with and pursuant to the foregoing, the
Plan is amended effective as of May 1, 1998 (except where indicated to the
contrary) as follows:
1. Section 1.3(a) is hereby amended by deleting the same in its entirety
and by substituting therefor the following:
"(a) for lump sum payments made under the Plan and the determination
of the Pension Make Whole Benefit under Addendum Number Four,
an interest rate equal to the average annual rate of interest
on 30-year Treasury securities in effect for t he first month
of the three month period immediately preceding the calendar
quarter in which the lump sum payment occurs, and a mortality
assumption determined under the "applicable mortality table"
(as defined in Section 417(e)(3)(A)(ii)(I) of the C ode);
provided, however, that lump sum payments under Section 6.4 or
8.6 made in the one-year period beginning on April 1, 1998
shall not be less than the present value determined using the
annual rate of interest on 30-year Treasury securities
published for the month of January of the Plan Year in which
the lump sum payment occurs, and a mortality assumption
determined under the "applicable mortality table" (as defined
in Section 417(e)(3)(A)(ii)(I) of the Code).
2. The following shall be substituted for the last sentence of
subparagraph (iii) of Section 3.3(a) of the Plan:
"For purposes of determining actuarial equivalence hereunder, the
interest assumption shall not be less than the greater of 5% per year
or the rate specified in Section 1.3(a)."
3. "Section 1.3(a)" shall be substituted for "Section 1.3" where the
latter appears in the last sentence of subparagraph (iv) of Section
3.3(a).
4. "Section 1.3(a)" shall be substituted for "Section 1.3" where the
latter appears in the last sentence of subparagraph (ix) of Section
3.3(a).
5. The following shall be added after the last sentence of the second
paragraph of Section 1.43 of the Plan:
"Solely for purposes of this paragraph, a Participant who receives
benefits under the Long-Term Disability Plan of EUA Service
Corporation and Its Affiliated Companies after completing 30 or more
years of vesting service shall be considered a n Active Participant
who retired prior to his Normal Retirement Date.
6. By substituting "$5,000" for "$3,500" where the latter appears in
Sections 6.4 and 8.6 of the Plan.
7. Effective as of the Montaup Divestiture Date (as defined in Addendum
Number Four below), the following new Addendum Number Four to the Plan
shall be added immediately following Addendum Number Three thereof:
ADDENDUM NUMBER FOUR
TO THE
EMPLOYEES' RETIREMENT PLAN
OF
EASTERN UTILITIES ASSOCIATES AND ITS AFFILIATED COMPANIES
CERTAIN CHANGES WITH RESPECT TO RETIREE ELIGIBLE PARTICIPANTS
EMPLOYED BY MONTAUP ELECTRIC COMPANY
This Addendum Number Four sets forth provisions relating specifically
to certain Employees employed by Montaup Electric Company (hereinafter referred
to as "Montaup") who are eligible to receive an Early Retirement Benefit from
the Plan. The provisions set forth in the Plan document shall govern
participation in the Plan and the calculation of benefits (including but not
limited to the benefit limitations set forth in Article IV of the Plan) for
these employees except as set forth below.
This Addendum Number Four is effective as of the Montaup Divestiture
Date, as defined in Section D.1.5. below. Notwithstanding the foregoing, the
Employer authorizes the Retirement Board (and its designees) to take all
necessary and proper actions prior to the Montaup Divestiture Date to implement
Addendum Number Four on the Montaup Divestiture Date. All capitalized terms in
this Addendum Number Four shall have the same meanings as set forth in the Plan
unless specifically indicated to the contrary below.
D.1.0. Application of Addendum. This Addendum shall apply to all Active
Participants employed by Montaup on October 16, 1997 who either: (i)
will have attained age fifty-five and completed at least ten Years of
Vesting Service not later than December 31, 1998 or (ii) will have a
combined age plus Years of Vesting Service at l east equal to eighty-
five during 1998, and in either case, such Active Participant (iii)
elected to retire no later than the Montaup Divestiture Date (or who
elects to retire on such later date with Montaup or an Affiliated
Employer as determined by the Board in its sole discretion) in
accordance with procedures established by the Retirement Board, and
(iv) did not receive (or elect to receive) severance benefits from the
Employer or an Affiliated Employer (hereinafter referred to as a
"Montaup Retiree").
D.1.1. Basic Pension Supplement. The monthly Early Retirement Benefit of a
Montaup Retiree shall be equal to such Participant's Early Retirement
Benefit under Section 4.2(a) of the Plan as of his or her Early
Retirement Date based on:
(a) such Retiree's Years of Credited Service on such date plus
five additional years of such service,
(b) such Retiree's age as of his or her birthday in 1998,
regardless of such Retiree's Early Retirement Date, plus
five additional years of age solely for purposes of
determining the appropriate early reduction factor, and
(c) such Retiree's reduction factor for commencement prior to
Normal Retirement Age shall be determined assuming that
such Retiree has satisfied the requirements for Special
Early Retirement under Section 4.4 of the Plan.
D.1.2. Income Supplement. A Montaup Retiree who elects to retire prior to
attaining age sixty-two shall receive a Income Supplement. The Income
Supplement shall be equal to a monthly benefit of $750 per month for
the period beginning on such Retiree's Early Retirement Date and ending
on the earlier of such Retiree's death or with the payment due for the
month before which the Retiree attains age sixty-two or otherwise
becomes entitled to receive a Social Security disability benefit. No
Income Supplement shall be payable to a Montaup Retiree who has
attained age sixty-two as of his or her Early Retirement Date.
D.1.3. Pension Make Whole Benefit. A Montaup Retiree also may be entitled to
a Pension Make Whole Benefit. The Pension Make Whole Benefit, when
expressed as a single sum amount, shall equal:
(1) the pre-tax amount of severance benefit the Montaup
Retiree would have been entitled to if Montaup had
involuntarily severed the Montaup Retiree's
employment (other than for cause), less
(2) the sum of the Montaup Retiree's Basic Pension
Supplement (as defined in Section D.1.1) and Income
Supplement (as defined in Section D.1.2), if any,
when expressed as an Actuarial Equivalent single
sum amount.
No Pension Make Whole Benefit shall be paid if the amount in (2) equals
exceeds the amount in (1) above. For purposes of this section, the Vice
President of Human Resources (or her designee) shall certify the amount
of severance benefits under (1) above.
D.1.4. Payment of Supplemental Benefits.
(a) Lump Sum Payment
A Montaup Retiree may elect to receive payment equal to
(1) the sum of the Basic Pension Supplement under
Section D.1.1, the applicable Income Supplement under
Section D.1.2., and the Pension Make Whole Benefit
under Section 1 .3, or (2) the sum of the applicable
Income Supplement under Section D.1.2. and the Pension
Make Whole Benefit under Section D.1.3., in the form of
a single lump sum payment. The amount of the lump sum
payment for the Basic Pension Supplement and the
applicable Income Supplement elected by a Montaup
Retiree as set forth in (1) or (2) of this Section
D.1.4.(a) shall be calculated in the manner set forth
in the Plan, as amended by the Third Amendment and as
it may be subsequently amended from time to time.
(b) Annuity Form of Benefit
A Montaup Retiree may elect to receive the Basic
Pension Supplement in Section D.1.1., the Pension Make
Whole Benefit in Section D.1.3, or both in any of the
annuity forms of payment set forth in Article VIII of
the Plan. For purposes of calculating available
annuities under Article VIII for the Pension Make Whole
Benefit, the single life annuity equivalent of the
Pension Make Whole Benefit shall be determined using
the actuarial factors applied in D.1.3.(2) above.
(c) Payment Contingent on Release Agreement
Payment of any of the benefits provided under this
Addendum Number Four are contingent upon the Employer
receiving from the Montaup Retiree an executed release
agreement satisfactory to the Employer. Payment of
these benefits shall commence not earlier than seven
days after receipt of such an executed agreement.
D.1.5. Montaup Divestiture Date. The Montaup Divestiture Date means the first
date on which all of the events set forth in Item I.A. of the
Memorandum of Understanding between Montaup Electric Company and the
Utility Workers' Union of America dated October 16, 1997 (hereafter
referred to as the "MOU") have occurred, as certified by the Chairman
of Eastern Utilities Associates (or his designee).
8. Effective as of the Montaup Divestiture Date (as defined in Addendum
Number Five below), the following new Addendum Number Five to the Plan
shall be added immediately following Addendum Number Four thereof:
ADDENDUM NUMBER FIVE
TO THE
EMPLOYEES' RETIREMENT PLAN
OF
EASTERN UTILITIES ASSOCIATES AND ITS AFFILIATED COMPANIES
CERTAIN CHANGES WITH RESPECT TO PARTICIPANTS EMPLOYED BY
MONTAUP ELECTRIC COMPANY
This Addendum Number Five sets forth provisions relating specifically
to certain Employees employed by Montaup Electric Company (hereinafter referred
to as "Montaup") who are eligible to receive a Termination of Service Benefit
from the Plan. The provisions set forth in the Plan document shall govern
participation in the Plan and the calculation of benefits (including but not
limited to the benefit limitations set forth in Article IV of the Plan) for
those employees except as set forth below.
This Addendum Number Five is effective as of the Montaup Divestiture
Date, as defined in Section D.1.2. below. Notwithstanding the foregoing, the
Employer authorizes the Retirement Board (and its designees) to take all
necessary and proper actions prior to the Montaup Divestiture Date to implement
Addendum Number Five on the Montaup Divestiture Date. All capitalized terms in
this Addendum Number Five shall have the same meanings as set forth in Article
I of the Plan unless specifically indicated to the contrary below.
D.1.0. Application of Addendum. This Addendum shall apply to all Participants
employed by Montaup on October 16, 1997 who are not covered by the
provisions of Addendum Number Four (hereinafter referred to as a
"Vested Montaup Participant").
D.1.1. Lump Sum Payment
In addition to the forms of payment permitted under Article VIII of the
Plan, a Vested Montaup Participant may elect to receive payment of all
vested amounts accrued under the Plan in the form of a single lump sum
payment. The amount of the lump sum payment paid to a Vested Montaup
Participant shall be calculated in the manner set forth in the Plan, as
amended by the Third Amendment and as it may be subsequently amended
from time to time.
D.1.2. Montaup Divestiture Date. The Montaup Divestiture Date means the first
date on which all of the events set forth in Item I.A. of the
Memorandum of Understanding between Montaup Electric Company and the
Utility Workers' Union of America dated October 16, 1997 (hereafter
referred to as the "MOU") have occurred, as certified by the Chairman
of Eastern Utilities Associates (or his designee).
IN WITNESS WHEREOF, EASTERN UTILITIES ASSOCIATES has caused this
instrument to be executed and delivered on its behalf by the undersigned on
this 20th day of April, 1998.
ATTEST: EASTERN UTILITIES ASSOCIATES
By: /s/Donald G. Pardus
/s/Clifford J. Hebert, Jr.
Clifford J. Hebert, Jr. Its: Chairman
Secretary
(Corporate Seal)