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EXHIBIT 1
FOURTH AMENDMENT TO
EMPLOYEES SAVINGS PLAN OF
COMMONWEALTH ENERGY SYSTEM
AND SUBSIDIARY COMPANIES.
AS AMENDED AND RESTATED AS OF JANUARY 1, 1993.
WHEREAS, the Employees Savings Plan of Commonwealth Energy System and
Subsidiary Companies (the Plan) was originally established effective September
1, 1962, amended from time to time, was restated in its entirety as of
December 1, 1975 as of January 1, 1979, as of May 11, 1981, as of January 1,
1984, as of January 1, 1985, as of January 1, 1989 and as of January 1, 1993;
and
WHEREAS, Section 14.01 of the Plan gives Commonwealth Energy System (the
System) the right to further amend the Plan;
NOW, THEREFORE, in consideration of the premises and of the covenants
contained herein, the System does hereby covenant and agree that the Plan
shall be amended in accordance with the following provisions.
1. Effective January 1, 1997, Section 2.29 of the Plan is amended to read as
follows:
"2.29 Highly Compensated Employee. Effective as of January 1, 1997,
means, for the current Plan Year, any employee who performed services for
a Participating Company or any other entity referred to in Section
2.291(ii) during the Plan Year; and was at any time during the Plan Year
or during the preceding 12 month period a 5% Owner, as that term is
defined in Section 416(i)(1)(B) of the Code and the regulations there-
under; or received Compensation in excess of $80,000 for the preceding 12
month period (or such amount as indexed in accordance with Section 415(d)
of the Internal Revenue Code for the applicable Plan Year)."
2.291 The following will apply in determining Highly Compensated
Employees:
(i) A former Employee who does not perform services for a
Participating Company or any other entity referred to in Section
2.291(ii) during the current Plan Year shall be included as a Highly
Compensated Employee for the current Plan Year if he was a Highly
Compensated Employee upon his termination of employment or at any time
after attaining age 55.
(ii) The determination as to who is a Highly Compensated Employee
shall be made after determining within the controlled group (as deferred
in Sections 414(b) and 414(c) of the Code) and after application of the
special rules in Section 414(m), (n) and (o) of the Code."
2. Effective as of the dates set forth in Section 2.42 as revised herein,
Section 2.42 of the Plan is amended to read as follows:
"2.42 "Participating Company" means the System and its subsidiaries,
namely Cambridge Electric Light Company, Commonwealth Gas Company, Canal
Electric Company, COM/Energy Services Company, Commonwealth Electric
Company, Advanced Energy Systems, Inc. (effective December 12, 1996),
COM/Energy Marketing, Inc. (effective May 23, 1997) and COM/Energy
Technologies, Inc. (effective September 5, 1997) and any other corpora-
tions or systems of which more than fifty (50%) of the voting stock or
voting shares is or hereafter may be owned by the System and which, with
the consent of the Board of Trustees, has become a party to the Plan and
has adopted the trust agreement, each or any of them, as the case may be.
3. Effective January 1, 1998, Section 3.02 of the Plan is amended to read as
follows:
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"3.02 Other Employees. Any Employee, except an Employee who is
classified as a "Temporary Employee", who is not a Member of the Plan as
of December 31, 1997 shall be eligible to become a Member of the Plan on
January 1,1998. Any Employee who is hired after December 31, 1997,
except an Employee who is classified as a "Temporary Employee", shall be
eligible to become a Member on the first day of the second month
following the date he completes his initial Hour of Service.
Any Employee, who is classified as a "Temporary Employee" shall be
eligible to become a Member of the Plan as of the first day of the
calendar month next following his completion of one year of Eligibility
Service."
4. Effective January 1, 1998, Section 4.03 of the Plan is amended to add the
following paragraph:
"Effective January 1, 1998, the Savings Plan Board (or its delegate)
shall maintain a separate Rollover Account for all Members eligible under
Section 5.17. All such Members shall be fully vested in their Rollover
Account at all times."
5. Effective January 1, 1998, Section 5.06 of the Plan is amended as
follows:
"5.06 Transfer Between Investment Funds. A Member, Inactive Member or
Former Member may elect to transfer the Asset Balance of his Accounts in
whole percentage amounts from any or all Investment Funds to any or all
other Investment Funds; provided that immediately after such transfer,
the total Asset Balance of the Accounts of the Member, Inactive Member or
Former Member under Fund A shall not exceed fifty percent (50%) of the
total Asset Balance of all the Accounts of the Member, Inactive Member or
Former Member under all Investment Funds. Such election to transfer may
be made at any time, but not more than once a day, by directly notifying
the Savings Plan Board (or its delegated agent) in the manner determined
by the Savings Plan Board.
Notwithstanding the foregoing, beginning January 1, 1998, transfer of
assets may be made from Fund D to any other Investment Fund except for
Fund A provided the shares subject to the transfer have remained in the
Plan (or the Tax Reduction Act of 1975 Employees Stock Ownership Plan and
Trust of Commonwealth Energy System and Subsidiary Companies) for the
required 84 months from the allocation date as required by Section 409(d)
of the Code. No transfer of assets shall be to Fund D from any other
Investment Fund."
6. Effective January 1, 1998, Article 5 is amended to add a new Section 5.17
as follows:
"5.17 Rollover Contribution. An Employee may file a written request
with the Savings Plan Board to accept his rollover contribution. Any
such request shall state the amount of the Rollover Contribution and
include a statement that such contribution constitutes a Rollover
Contribution.
The Savings Plan Board shall determine in accordance with a uniform and
nondiscriminatory policy, whether or not such contribution originated
from a plan qualified under Section 401(a) of the Code, and may require
such Employee to submit such other evidence and documentation as it deems
necessary.
All Rollover Contributions must be in cash and the amount contributed
under the Plan and any subsequent investment experience on such
contributions shall be credited to the Employee's Rollover Account.
For purposes of this Section 5.17, a Rollover Contribution means a
rollover of an "eligible rollover distribution" as defined in Section
402(c)(4) of the Code from a qualified plan or a distribution from a
conduit Individual Retirement Account."
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7. Effective January 1, 1998, Section 6.01 of the Plan is amended to add the
following paragraph:
"Notwithstanding the above, with regard to Employees who become eligible
to become Members on or after January 1, 1998, such Members shall be
eligible to share in Company Contributions commencing with the first
payroll period of the calendar month following the month they complete
one year of Eligibility Service described in Section 3.03 of the Plan."
8. Effective January 1, 1998, Section 6.02 of the Plan is amended to add the
following paragraph:
"Notwithstanding the above, with regard to Employees who become eligible
to become Members on or after January 1, 1998, such Members shall be
eligible to share in the allocation of Company Contributions commencing
with the first payroll period that begins in the calendar month following
the calendar month in which they complete one year of Eligibility Service
as described in Section 3.03 of the Plan."
9. Effective January 1, 1998, Section 6.03 of the Plan is amended to add the
following paragraph:
"Effective for Employees who become eligible to become Members on or
after January 1, 1998, the Company Account of such Members shall be fully
vested on the first anniversary of the date such Employees first become
eligible to become Members provided such Employees are employed by the
Participating Employer or an Affiliated Company on such anniversary
date."
10. Effective January 1, 1998, Section 8.01 is amended to revise the last
sentence to read as follows:
"A Member, Inactive Member or Former Member shall be required to take an
immediate lump sum payment without such Member's consent if the value of
such payment is less than or equal to $5,000 (or such other amount as
permitted by applicable law or regulations)."
11. Effective January 1, 1998, Section 8.02 is amended to revise the last
sentence to read as follows:
"A Former Member shall be required to take an immediate lump sum payment
without such Former Member"s consent if the value of such payment is less
than or equals $5,000 (or such other amount as permitted by applicable
law or regulations)."
12. Effective January 1, 1998, Section 8.03 is amended to revise the last
sentence to read as follows:
"A Member, Inactive Member or Former Member shall be required to take an
immediate lump sum payment without such Member's consent if the value of
such payment is less than or equal to $5,000 (or such other amount as
permitted by applicable law or regulations)."
13. Effective January 1, 1998, Article 8 is amended to add new Section 8.13
as follows:
"8.13 Special Options for Terminated Information Services Employees.
Effective as of the transaction date, Members of the Plan who terminate
employment as a result of the outsourcing of the information systems
function to a third party service provider and who are subsequently
employed by such third party service provider to assist with such
outsourcing shall be provided with the following options:
(a) Members may elect to leave all of their Accounts with the Plan
until such time they terminate employment with the third party service
provider, at which time they may elect to receive distribution of all of
their Accounts;
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(b) Members may elect to receive a distribution of all of their
Accounts except their Pay Deferral Account which must be transferred to
the qualified plan of the third party service provider."
Notwithstanding any provision to the contrary, all such Members who are
so terminated due to the outsourcing of the information service function
shall be fully vested upon such termination of employment."
14. Effective January 1, 1998, Section 9.02 is amended to read as follows:
"9.02 Regular Withdrawal. Subject to 9.03 and 9.04, a Member, Inactive
Member or disabled Former Member may not withdraw (i) any portion of his
Company Account attributable to contributions not held in such Account
for at least twenty-four (24) calendar months or (ii) any portion of his
Pay Deferral Account. Subject to these conditions, a withdrawal from his
Accounts may be made from the Investment Funds specified by the Member,
Inactive Member or disabled Former Member and in the following sequence
of contributions and earnings:
(a) First, one hundred percent (100%) of his Member Account
consisting of his contributions made to the Plan;
(b) Second, one hundred percent (100%) of his Rollover Account as
described in Section 5.17;
(c) Third, one hundred percent (100%) of the earnings on his
contributions in his Member Account; and
(d) Fourth, one hundred percent (100%) of his Company Account
consisting of Participating Company contributions held in his Company
Account for twenty-four (24) calendar months or longer and earnings
thereon."
15. Effective January 1, 1998, Article 9 is amended to add new Section 9.07
as follows:
"9.07 Withdrawals from Rollover Account. A Member, Inactive Member or
Former Member may withdraw all or part of the value of his Rollover
Account as described in Section 5.17 at any time in accordance with the
provisions of Section 9.02."
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IN WITNESS WHEREOF, Commonwealth Energy System, Cambridge Electric Light
Company, Canal Electric Company, Commonwealth Gas Company, COM/Energy Services
Company, Commonwealth Electric Company, Advanced Energy Systems, Inc.,
COM/Energy Marketing, Inc. and COM/Energy Technologies, Inc. have caused this
Amendment to be duly executed in their name and on their behalf, this 14th day
of January, 1998.
COMMONWEALTH ENERGY SYSTEM*
CAMBRIDGE ELECTRIC LIGHT COMPANY
CANAL ELECTRIC COMPANY
COMMONWEALTH GAS COMPANY
COM/ENERGY SERVICES COMPANY
COMMONWEALTH ELECTRIC COMPANY
ADVANCED ENERGY SYSTEMS, INC.
COM/ENERGY MARKETING, INC.
COM/ENERGY TECHNOLOGIES, INC.
By: W. G. POIST
W.G. Poist
President of Commonwealth Energy
System and Chairman of its
Subsidiary Companies
By: M. P. SULLIVAN
M.P. Sullivan
Secretary of Commonwealth Energy
System and Clerk of its Subsidiary
Companies
*The name "Commonwealth Energy System" means the trustees for the time being
(as trustees but not individually) under a Declaration of Trust, dated
December 31, 1926, as amended, which is hereby referred to, and a copy of
which has been filed with the Secretary of the Commonwealth of Massachusetts.
Any agreement, obligation or liability made, entered into or incurred by or on
behalf of, said System binds only the trust estate, and no shareholder,
director, trustee, officer or agent assumes, or shall be held to, any
liability by reason therefore.