As filed with the Securities and Exchange Commission on October 27, 2000.
Registration Nos. 333-33896 and 333-3896-01
======================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
POST-EFFECTIVE
AMENDMENT NO. 6
ON
FORM S-3
TO
FORM S-4
Registration Statement
Under
The Securities Act of 1933
_______________________
NEW NISOURCE INC. NISOURCE INC.
(Exact name of registrant as (Exact name of registrant as
specified in its charter) specified in its charter)
DELAWARE INDIANA
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
35-2108964 35-1719974
(I.R.S employer (I.R.S employer
identification number) identification number)
801 East 86th Avenue
Merrillville, Indiana 46410
(219) 853-5200
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Stephen P. Adik
801 East 86th Avenue
Merrillville, Indiana 46410
(219) 853-5200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
WITH A COPY TO :
Frederick L. Hartmann
Schiff Hardin & Waite
6600 Sears Tower
Chicago, Illinois 60606-6473
(312) 258-5500
___________________________
Approximate Date of Commencement of Proposed Sale to the Public:
From time to time after the Merger described in the Explanatory Note
below has been completed and this post-effective amendment to the
Registration Statement has become effective.
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. [x]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for
the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount maximum maximum
Title of each class of securities to to be offering price aggregate Amount of
be registered registered per share (1) offering price (1) registration fee
------------------------------------ ---------- ------------- ------------------ ----------------
Common Shares, $.01 par value 160,500 (1) (1) (1)
(including associated preferred
share purchase rights) of New
NiSource Inc.
(1) A registration fee with respect to these shares was previously paid
in connection with the filing by New NiSource Inc. and NiSource
Inc. of the Registration Statement on Form S-4 (File No. 333-
33896), which was declared effective April 24, 2000. See
Explanatory Note below.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states
that this Registration Statement will thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until
this Registration Statement shall be effective on such date as the
Commission acting pursuant to said Section 8(a) may determine.
EXPLANATORY NOTE
New NiSource Inc. (the "Company") and NiSource Inc. ("Old
NiSource") hereby amend their Registration Statement on Form S-4 (File
No. 333-33896), effective _____, 2000 by filing this Post-Effective
Amendment No. 6 on Form S-3 relating to 160,500 common shares
of the Company, $.01 par value per share (including associated
preferred purchase rights) (the "Common Shares") issuable under the
Bay State Gas Company Savings Plan for Operating Employees (the
"Plan").
On or about November 1, 2000, the mergers of Old NiSource and
Columbia Energy Group ("Columbia") (the "Merger") are expected to be
completed. Upon completion of the Merger, Columbia will be a
wholly-owned subsidiary of the Company and Old NiSource will be merged
into the Company. Pursuant to the Merger Agreement, the Company, Old
NiSource and Columbia have taken the necessary actions to cause the
Common Shares to be issuable under the Plan when the Merger is
completed. Accordingly, Old NiSource's common shares will no longer be
issuable under the Plan.
This Registration Statement relates to 160,500 Common Shares
registered on the Form S-4 that are not being issued at the time of
the Merger and that are issuable under the Plan on and after the
Merger.
SUBJECT TO COMPLETION - DATED OCTOBER 27, 2000
PROSPECTUS
NEW NISOURCE INC.
160,500 Shares
Common Shares, $.01 Par Value
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
This Prospectus relates to common shares of New NiSource Inc.
which may be offered and sold under the Bay State Gas Company Savings
Plan for Operating Employees (the "Plan") to Plan participants who
ceased to be employees of New NiSource Inc. and its subsidiaries,
including Bay State Gas Company, on or prior to November __, 2000.
Our common shares are traded on the New York Stock Exchange under
the symbol "NI". On October 26, 2000, the closing sale price of the
common shares on the New York Stock Exchange was $24 per share.
The mailing address and telephone number of New NiSource's
principal executive offices are: 801 East 86th Avenue, Merrillville,
Indiana 46410, telephone number (219) 853-5200.
This Prospectus should be retained for future reference.
__________________________________________
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities
or passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
__________________________________________
The date of this Prospectus is November __, 2000
The information in this prospectus is not complete and may be changed.
We may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and is not
soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
You should rely only on the information provided or incorporated by
reference in this Prospectus. The information in this Prospectus is
accurate as of the date on these documents, and you should not assume
that it is accurate as of any other date.
TABLE OF CONTENTS
-----------------
Page
----
THE COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
WHERE YOU CAN FIND MORE INFORMATION . . . . . . . . . . . . . . . . 6
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
PROSPECTUS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
APPENDIX DATED OCTOBER, 2000 TO SUMMARY PLAN DESCRIPTION DATED
AUGUST, 1999 . . . . . . . . . . . . . . . . . . . . . . . . . 8
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
SUMMARY PLAN DESCRIPTION DATED AUGUST, 1999 . . . . . . . . . 12
PLAN HIGHLIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . 12
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Who Is Eligible? . . . . . . . . . . . . . . . . . . . . . . . 13
When Does Participation Begin? . . . . . . . . . . . . . . . . 14
YOUR CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . 14
Employee Pre-Tax Contributions . . . . . . . . . . . . . . . . 14
Changing, Discontinuing Or Resuming Your Contributions . . . . 15
Rollover Contributions From Another Qualified Plan . . . . . . 15
Separate Accounts . . . . . . . . . . . . . . . . . . . . . . 15
EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . 16
Employer Contributions . . . . . . . . . . . . . . . . . . . . 16
Separate Accounts . . . . . . . . . . . . . . . . . . . . . . 16
ANNUAL CONTRIBUTION AND COMPENSATION MAXIMUMS . . . . . . . . . . . 16
INVESTMENT FUNDS, INVESTMENT DIRECTION AND FUND TRANSFERS . . . . . 17
Who Makes The Investment Decisions? . . . . . . . . . . . . . 17
How May I Obtain Investment Fund Performance Information? . . 18
How May I Change My Investment Direction And When Does My
New Investment Direction Take Effect? . . . . . . . . . . 18
How Do I Transfer My Funds? . . . . . . . . . . . . . . . . . 18
Information Regarding Voting And Tendering Company Stock . . . 19
VESTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
PARTICIPANT LOANS . . . . . . . . . . . . . . . . . . . . . . . . . 19
2
May I Borrow From My Account? . . . . . . . . . . . . . . . . 19
How Much May I Borrow? . . . . . . . . . . . . . . . . . . . . 19
What Is The Loan Interest Rate? . . . . . . . . . . . . . . . 20
What Is The Loan Repayment Term? . . . . . . . . . . . . . . . 20
How Do I Make Loan Payments And How Are The Payments Invested? 20
What Happens If My Employment Terminates? . . . . . . . . . . 20
How Is My Loan Secured? . . . . . . . . . . . . . . . . . . . 21
Are There Any Loan Fees? . . . . . . . . . . . . . . . . . . . 21
What Happens When I Request A Loan? . . . . . . . . . . . . . 21
WITHDRAWALS WHILE YOU ARE AN EMPLOYEE . . . . . . . . . . . . . . . 22
Under What Circumstances May I Make A Withdrawal From The
Plan While I Am An Employee? . . . . . . . . . . . . . . 22
What Are My In-Service Withdrawal Payment Options? . . . . . . 23
What Are My In-Service Withdrawal Methods? . . . . . . . . . . 23
What Happens When I Request An In-Service Withdrawal? . . . . 23
What Are The Taxes And Penalties For In-Service Withdrawals? . 24
DISTRIBUTIONS AFTER YOU TERMINATE EMPLOYMENT WITH BAY STATE . . . . 24
What Are My Distribution Payment Options? . . . . . . . . . . 24
What Are My Distribution Methods? . . . . . . . . . . . . . . 24
When Are Distributions Made? . . . . . . . . . . . . . . . . . 25
What Happens When I Request A Distribution? . . . . . . . . . 25
What Are The Tax Treatments, Taxes And Penalties For
Distributions? . . . . . . . . . . . . . . . . . . . . . 26
DEATH BENEFITS . . . . . . . . . . . . . . . . . . . . . . . . . . 26
What Happens To My Plan Benefit If I Die? . . . . . . . . . . 26
How May I Designate My Beneficiary? . . . . . . . . . . . . . 26
REEMPLOYMENT WITH BAY STATE . . . . . . . . . . . . . . . . . . . . 27
When Can I Resume My Participation? . . . . . . . . . . . . . 27
FUTURE OF THE PLAN . . . . . . . . . . . . . . . . . . . . . . . . 27
PLAN ADMINISTRATION ISSUES . . . . . . . . . . . . . . . . . . . . 28
Account Statements And Account Information . . . . . . . . . . 28
Plan Administrator . . . . . . . . . . . . . . . . . . . . . . 28
Hours Of Service . . . . . . . . . . . . . . . . . . . . . . . 28
Agent For Service Of Legal Process . . . . . . . . . . . . . . 28
Type Of Plan . . . . . . . . . . . . . . . . . . . . . . . . . 29
Top Heavy Contribution Provisions . . . . . . . . . . . . . . 29
OTHER THINGS YOU SHOULD KNOW . . . . . . . . . . . . . . . . . . . 29
Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Plan Fees And Expenses . . . . . . . . . . . . . . . . . . . . 29
Plan Participation Pursuant To A Collective Bargaining
Agreement . . . . . . . . . . . . . . . . . . . . . . . . 30
Claim Review Procedures . . . . . . . . . . . . . . . . . . . 30
No Assignment Of Your Account Is Permitted . . . . . . . . . . 30
No Employment Rights . . . . . . . . . . . . . . . . . . . . . 31
Your Rights Under Federal Law . . . . . . . . . . . . . . . . 31
3
PLAN DIRECTORY . . . . . . . . . . . . . . . . . . . . . . . . . . 32
INSTRUCTIONS AT A GLANCE . . . . . . . . . . . . . . . . . . . . . 33
LIMITATION OF LIABILITY . . . . . . . . . . . . . . . . . . . . . . 35
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . 35
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . 35
DESCRIPTION OF COMMON SHARES . . . . . . . . . . . . . . . . . . . 35
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
THE COMPANY
On November __, 2000, New NiSource Inc. (the "Company"), a new
company formed by NiSource Inc. ("NiSource"), completed the
acquisition by merger of Columbia Energy Group ("Columbia").
Effective November __, 2000, the Company changed its name to "NiSource
Inc." Upon completion of the merger, Columbia became a wholly-owned
subsidiary of the Company, and the Company continues the businesses
conducted by NiSource and Columbia prior to the merger. The fiscal
year of the Company will end on December 31 of each year. The Company
is a Delaware corporation with its corporate headquarters in
Merrillville, Indiana.
The Company is a super-regional energy and utility-based holding
company that provides natural gas, electricity, water and energy
related services for residential, commercial and industrial uses
through a number of regulated and non-regulated subsidiaries. The
Company has over 3.6 million gas and electric customers located
primarily in nine states and is the leading gas competitor within the
key energy corridor between the Gulf Coast and the Northeast. The
Company is a registered holding company under the Public Utility
Holding Company Act of 1935. The Company's principal executive
offices are located at 801 East 86th Avenue, Merrillville, Indiana
46410, and its telephone number is (219) 853-5200.
NATURAL GAS. The Company's gas business is comprised of
regulated gas utilities and gas transmission companies that operate in
nine states. The Company is the largest gas company east of the
Rockies based on customers, and has the nation's second largest volume
of gas sales with 911 million cubic feet per day.
Through its wholly-owned subsidiary, Columbia Energy Group, the
Company owns five distribution subsidiaries that provide natural gas
services to nearly 2.1 million residential commercial and industrial
customers in Ohio, Pennsylvania, Virginia, Kentucky and Maryland. The
Company also distributes natural gas to approximately 751,000
4
customers in northern Indiana through three subsidiaries: Northern
Indiana Public Service Company, Kokomo Gas and Fuel Company and
Northern Indiana Fuel and Light Company, Inc. Additionally, the
Company's subsidiaries, Bay State Gas Company and Northern Utilities,
Inc. distribute natural gas to more than 320,000 customers in the
areas of Brockton, Lawrence and Springfield, Massachusetts, Lewiston
and Portland, Maine, and Portsmouth, New Hampshire.
The Company's subsidiaries Columbia Gas Transmission Corporation
and Columbia Gulf Transmission Company own and operate an interstate
pipeline network of approximately 16,250 miles extending from offshore
in the Gulf of Mexico to Lake Erie, New York and the eastern seaboard.
Together, Columbia Gas Transmission and Columbia Gulf serve customers
in 15 northeastern, mid-Atlantic, midwestern, and southern states and
the District of Columbia. In addition, Columbia Gas Transmission
operates one of the nation's largest underground natural gas storage
systems. Columbia Gas Transmission is also participating in the
proposed 442-mile Millennium Pipeline Project that has been submitted
to the FERC for approval. As proposed, the project will transport
approximately 700,000 Mcf of natural gas per day from the Lake Erie
region to eastern markets.
The Company's wholly-owned subsidiary, Crossroads Pipeline
Company, owns and operates a 201-mile, 20 inch diameter interstate
pipeline extending from the northwestern corner of Indiana (near the
border with Chicago) eastward into Ohio. Another wholly-owned Company
subsidiary, Granite State Transmission, owns and operates a 105-mile,
6 to 12 inch diameter interstate pipeline that extends from Haverhill,
Massachusetts in a northeasterly direction to Maine. In addition to
the Crossroads and Granite State pipelines, the Company owns a 19%
share of Portland Natural Gas Transmission System, a 292-mile pipeline
built to bring Canadian gas from New Brunswick into Maine, New
Hampshire and Massachusetts in order to increase the gas supply to the
region.
ELECTRICITY. The Company generates and distributes electricity
to the public through its subsidiary Northern Indiana Public Service
Company. Northern Indiana provides electric service to approximately
426,000 customers in 30 counties in the northern part of Indiana, with
an area of approximately 12,000 square miles and a population of
approximately 2.2 million. In addition, the Company develops
unregulated power projects through its subsidiary, Primary Energy,
Inc. Primary Energy works with industrial customers in managing the
engineering, construction, operation and maintenance of "inside the
fence" cogeneration plants that provide cost-effective, long-term
sources of energy for energy-intensive facilities.
WATER. Through its wholly-owned subsidiary IWC Resources
Corporation and its subsidiaries, the Company supplies water to
residential, commercial and industrial customers and for fire
protection service in Indianapolis, Indiana and surrounding areas.
5
NON-REGULATED ENERGY SERVICES. The Company provides non-
regulated energy services through its wholly-owned subsidiary Energy
USA, Inc. Through its subsidiaries and investments, Energy USA
provides to customers in 22 states a variety of energy-related
services, including gas marketing and asset management services,
pipeline construction and underground utility locating and marking
services. The Company expanded its gas marketing and trading
operations with the April 1999 acquisition of TPC Corporation,
now renamed Energy USA-TPC Corp., a natural gas asset management
company. Through Columbia, it also owns Columbia Energy Resources,
Inc., an exploration and production subsidiary that explores for,
develops, gathers and produces natural gas and oil in Appalachia
and Canada. In addition, the Company has invested in a number of
distributed generation technologies, including fuel cells and
microturbine ventures.
In the merger, NiSource shareholders received one common share of
the Company, par value $.01 per share, ("Common Share") for each of
their NiSource common shares. Accordingly, each of the NiSource
common shares held in the NiSource Common Stock Fund under the Plan
has been converted into one Common Share of the Company.
ALL REFERENCES IN THE PLAN AND THE SUMMARY PLAN DESCRIPTION TO
NISOURCE ARE NOW REFERENCES TO THE COMPANY, AND ALL REFERENCES IN THE
PLAN AND THE SUMMARY PLAN DESCRIPTION TO NISOURCE COMMON SHARES ARE
NOW REFERENCES TO COMPANY COMMON SHARES. EXCEPT AS DESCRIBED BELOW,
ALL OF THE TERMS OF THE PLAN WILL CONTINUE TO APPLY.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements
and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms in Washington,
D.C., New York, New York and Chicago, Illinois. Please call the SEC
at 1-800-SEC-0330 for further information on the public reference
rooms. Our SEC filings are also available to the public at the SEC's
web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this
prospectus the information we file with it, which means that we can
disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to
be part of this prospectus, and later information that we file with
the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future
filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 until our offering is completed:
1. The Annual Report on Form 10-K of NiSource for the fiscal year
ended December 31, 1999;
6
2. The Annual Report on Form 10-K and Form 10-K/A of Columbia for
the fiscal year ended December 31, 1999;
3. The Quarterly Reports on Form 10-Q of NiSource for the quarterly
periods ended March 31, 2000 and June 30, 2000;
4. The Quarterly Reports on Form 10-Q of Columbia for the quarterly
periods ended March 31, 2000, June 30, 2000 and September 30, 2000;
5. The Current Reports on Form 8-K of NiSource dated February 14,
2000, February 24, 2000, March 3, 2000, April 3, 2000, April 25,
2000, June 13, 2000, September 1, 2000 and September 13, 2000;
6. The Current Reports on Form 8-K of Columbia dated January 25,
2000, April 13, 2000, May 3, 2000, May 12, 2000, May 22, 2000,
June 2, 2000, June 15, 2000 and July 14, 2000;
7. The description of our Common Shares contained in our Joint Proxy
Statement / Prospectus dated April 24, 2000;
8. The description of our Rights contained in our Joint Proxy
Statement / Prospectus dated April 24, 2000; and
9. The description of our SAILS contained in our Joint Proxy
Statement / Prospectus dated April 24, 2000.
You may request a copy of these filings at no cost, by writing to
or telephoning us at the following address:
New NiSource Inc.
801 East 86th Avenue
Merrillville, Indiana 46410
(219) 853-5200
You should rely only on the information included or incorporated
by reference in this prospectus. We have not authorized anyone else
to provide you with different information. We are not making an offer
of these securities in any state where the offer is not permitted.
You should not assume that the information is this prospectus is
accurate as of any date other than the date on the front of the
document.
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
PROSPECTUS
The prospectus for the Plan includes (i) the Appendix dated
October, 2000 to the Summary Plan Description dated August, 1999, and
(ii) the Summary Plan Description dated August, 1999.
7
NOTE: REFERENCES IN THE APPENDIX DATED OCTOBER, 2000 AND IN THE
SUMMARY PLAN DESCRIPTION TO NISOURCE AND NISOURCE COMMON SHARES NOW
REFER TO THE COMPANY AND THE COMPANY'S COMMON SHARES.
APPENDIX
THIS DOCUMENT CONSTITUTES PART OF A SECTION 10(A) PROSPECTUS
COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
Appendix dated October, 2000
to
Summary Plan Description dated
August, 1999
This Appendix provides certain current and updated information
regarding the Plan identified above, which is fully described in the
Prospectus and Summary Plan Description to which this Appendix
relates. Capitalized terms in this Appendix have the same meaning
assigned in the Prospectus and Summary Plan Description.
MERGER
On November __, 2000, New NiSource Inc. (the "Company"), a new
company formed by NiSource Inc. ("NiSource") completed the
acquisition by merger of Columbia Energy Group ("Columbia").
Effective November __, 2000, the Company changed its name to "NiSource
Inc." Upon completion of the merger, Columbia became a wholly-owned
subsidiary of the Company, and the Company continues the businesses
conducted by NiSource and Columbia prior to the merger. The fiscal
year of the Company will end on December 31 of each year. The Company
is a Delaware corporation with its corporate headquarters in
Merrillville, Indiana. All references in the Plan and the Summary
Plan Description to NiSource common shares are now references to
common shares of the Company, par value $.01 per share ("Common
Shares"). Except as described below, all of the terms of the Plan
will continue to apply.
In the merger, each NiSource common share was converted into the
right to receive one Common Share of the Company. Accordingly, each
NiSource common share held in the NiSource Common Stock Fund under the
Plan has been converted into one Company Common Share.
FINANCIAL INFORMATION
Certain information regarding the performance of the Funds described
below has been extracted from materials provided to the Company by the
Funds. The Company has not made any independent review of the
accuracy of this information and, accordingly, makes no warranty or
representation concerning this information. Performance information
8
related to an investment in the Funds will be updated periodically and
can be obtained from Merrill Lynch, Group Employee Services, P.O. Box
6610, Englewood, CO 80155-6610, telephone (800) 228-4015 (or if
hearing impaired telephone (800) 637-1215).
STABLE VALUE FUND*
-----------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 6.28%, 6.30%, 5.96% and 1.45% for
1997, 1998, 1999 and year to date through March 31, 2000;
respectively. Additional information is included in its annual report
and product description, copies of which can be obtained from Merrill
Lynch, Group Employee Services, P.O. Box 6610, Englewood, CO 80155-
6610, telephone (800) 228-4015 (or if hearing impaired telephone (800)
637-1215).
* Note: Effective April 10, 2000, the Bay State Gas Stable Value Fund
was replaced by the Merrill Lynch Income Accumulation Fund.
LIFE PATH INCOME FUND
---------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 9.77%, 9.65%, 5.16% and 2.03% for
1997, 1998, 1999 and year to date through March 31, 2000;
respectively. Additional information is included in its annual report
and prospectus, copies of which can be obtained from Merrill Lynch,
Group Employee Services, P.O. Box 6610, Englewood, CO 80155-6610,
telephone (800) 228-4015 (or if hearing impaired telephone (800) 637-
1215).
LIFE PATH 2010 FUND
-------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 14.82%, 14.49%, 9.71% and 2.21% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
LIFE PATH 2020 FUND
-------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 18.57%, 18.26%, 14.42% and 2.37% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
9
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
AIM CONSTELLATION FUND(A)
-------------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 12.92%, 18.89%, 44.38% and 14.32%
for 1997, 1998, 1999 and year to date through March 31, 2000;
respectively. Additional information is included in its annual report
and prospectus, copies of which can be obtained from Merrill Lynch,
Group Employee Services, P.O. Box 6610, Englewood, CO 80155-6610,
telephone (800) 228-4015 (or if hearing impaired telephone (800) 637-
1215).
TEMPLETON FOREIGN FUND
----------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 6.65%, -4.89%, 39.21% and -5.61% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
BGI S&P 500 STOCK FUND
----------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 33.07%, 28.41%, 20.59% and 2.20% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
LIFE PATH 2030 FUND
-------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 21.85%, 21.40%, 16.83% and 3.20% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
10
LIFE PATH 2040 FUND
-------------------
The Fund has experienced annual returns, after deduction for Fund
expenses and asset based fees, of 23.75%, 24.46%, 21.83% and 2.81% for
1997, 1998, 1999 and year to date through March 31, 2000; respec-
tively. Additional information is included in its annual report and
prospectus, copies of which can be obtained from Merrill Lynch, Group
Employee Services, P.O. Box 6610, Englewood, CO 80155-6610, telephone
(800) 228-4015 (or if hearing impaired telephone (800) 637-1215).
NISOURCE COMMON STOCK FUND
--------------------------
The Fund, based on NiSource Common Shares, has experienced annual
returns, after deduction for Fund expenses and asset based fees and
inclusion of dividends, of 16.1%, 16.1% and 12.8% for 1997,
1998 and 1999; respectively. Effective as of November __, 2000,
the Fund performance will be based on the Company Common Shares.
AVAILABLE INFORMATION
The Company has filed a Registration Statement on Form S-3 (the
"Registration Statement") with the Securities and Exchange Commission
covering up to 160,500 Common Shares, to be offered and
sold under the Plan to Plan participants who ceased to be employees of
NiSource and its subsidiaries on or prior to November __, 2000.
The Company will provide, without charge, to each person eligible to
participate in the Plan, upon written or oral request, (i) a copy of
any of the documents which are incorporated by reference in the
Registration Statement, other than the exhibits to such documents
(unless such exhibits are specifically incorporated by reference into
the information that the Registration Statement incorporates) and (ii)
a copy of its Annual Report to Shareholders for its most recent fiscal
year. The documents incorporated by reference in the Registration
Statement are hereby specifically incorporated by reference in this
Prospectus. Requests for copies of such documents should be directed
to the Director, Compensation and Benefits, at New NiSource Inc., 801
East 86th Avenue, Merrillville, Indiana 46410, telephone number (219)
853-5200.
11
NOTE: REFERENCES IN THIS DOCUMENT TO NISOURCE AND NISOURCE COMMON
SHARES NOW REFER TO THE COMPANY AND THE COMPANY'S COMMON SHARES.
BAY STATE GAS COMPANY SAVINGS PLAN FOR OPERATING EMPLOYEES
----------------------------------------------
SUMMARY PLAN DESCRIPTION
------------------------
Dated August, 1999
PLAN HIGHLIGHTS
Saving for your future is a challenge, but with the Bay State Gas
Company Savings Plan for Operating Employees saving can be both
convenient and profitable. The Plan offers you these advantages:
* You choose how much to save, up to 15% of your eligible pay
through convenient payroll deduction.
* You may save on taxes since contributions and earnings are
not subject to current federal and, in most cases, state
income taxes.
The Plan offers you flexibility:
* You choose how to invest your Account among the investment
funds offered.
You may borrow or withdraw from your Account (subject to
certain conditions and terms).
* You have easy access to Account information by telephone.
The Plan is a profit-sharing 401(k) plan designed to help you
accumulate savings for retirement and achieve your future financial
goals. It is one of the few ways you can set aside savings for the
future without having to pay current federal and, in most cases, state
income taxes on the money you are saving and the earnings from the
investments in your Account.
(You will find a useful "Instructions At A Glance" on pages 22 and
23.)
INTRODUCTION
Effective January 1, 1988, Bay State Gas Company ("Bay State")
established the Bay State Gas Company Savings Plan for Operating
Employees (the "Plan").
The Plan is governed by the official text of the Plan and Trust
Agreement. The purpose of this Summary Plan Description is to provide
a simplified description of how the Plan works. If the meaning of the
Plan and Trust Agreement differs from that of the Summary Plan
Description in any way, the official text of the Plan and Trust
Agreement will govern in administering the Plan.
12
References to Bay State generally mean Bay State Gas Company, and, if
applicable, any successor by merger, purchase or otherwise, and its
affiliated companies participating in the Plan as the context requires
and except that with regard to issues related to service credit,
termination of employment or reemployment, references to Bay State
shall also include any affiliated companies not participating in the
Plan. With regard to primarily administrative matters, however,
references to Bay State mean Bay State Gas Company, which is the Plan
Sponsor.
ELIGIBILITY
WHO IS ELIGIBLE?
All employees of Bay State who are covered by one of the following
collective bargaining agreements are eligible:
* Lawrence Division, International Brotherhood of Electrical
Workers, Local No. 326 ("Local 326-Lawrence Employees");
* Brockton Division, Utility Workers' Union of America, AFL-
CIO, Local No. 273 Operating ("Local 273-Brockton Operating
Employees");
* Brockton Division, Utility Workers' Union of America, AFL-
CIO, Local No. 273 Clerical/Technical Unit ("Local 273-
Brockton Clerical/Technical Employees");
* Northern Utilities, Inc., Portland Division, Brotherhood of
Utility Workers of New England, Incorporated, Local No. 341
("Local 341-Portland Employees");
* Granite State Gas Transmission, Inc., Brotherhood of Utility
Workers of New England, Incorporated, Local No. 341 ("Local
341-Granite State Employees");
* Springfield Division, United Steel Workers of America, AFL-
CIO-CLC, Local No. 12026 ("Local 12026-Springfield
Employees");
* Springfield Division, International Brotherhood of
Electrical Workers, Local No. 486 ("Local 486-Springfield
Employees");
Northern Utilities, Inc., Portsmouth Division, United
Steelworkers of America, AFL-CIO-CLC, Local No. 12012-6
("Local 12012-6 Portsmouth Employees");
* EnergyUSA, Brockton Propane Division, Oil, Chemical and
Atomic Workers International Union, AFL-CIO, Quincy Local 8-
366 ("Local 8-366-EnergyUSA Employees"); and
13
* EnergyUSA, Northern Propane Division, United Steelworkers of
America, AFL-CIO-CLC, Local No. 12012-8, ("Local 12012-8
EnergyUSA Employees").
WHEN DOES PARTICIPATION BEGIN?
If you are an eligible Employee, your participation will begin on the
first day of the next month after completion of a 12 consecutive month
eligibility period in which you are credited with at least 1,000 hours
of service during that period.
However, if provided by your collective bargaining agreement, for
purposes of Employee Pre-Tax Contributions only, you may participate
on the first day of the next month after you have completed 60 days of
service.
Your initial eligibility period begins on your date of hire. Subse-
quent eligibility periods begin with the start of the next Plan Year
beginning after your date of hire.
To enroll, refer to Section entitled INSTRUCTIONS AT A GLANCE.
YOUR CONTRIBUTIONS
You may elect to contribute regularly through payroll deductions once
you are eligible to participate. Your contributions are based on your
eligible pay. Eligible pay for this purpose is straight time wages,
exclusive of all daily or weekly overtime, bonuses, supplementary
compensation payments, retirement benefits and other forms of non-
recurring compensation, but inclusive of shift differentials,
Saturday/Sunday premiums, compensation paid at an alternative rate
(not including compensation paid at an alternative rate if you are a
salesperson) and seventy-five percent of sales commissions paid to you
by Bay State (one hundred percent of sales commissions if paid to you
by EnergyUSA). Your eligible pay includes pre-tax contributions you
make to this Plan and other plans sponsored by Bay State.
To elect to contribute, refer to Section entitled INSTRUCTIONS AT A
GLANCE.
EMPLOYEE PRE-TAX CONTRIBUTIONS
You may choose to save pre-tax dollars by electing to contribute any
percentage, up to 15%, of your eligible pay, subject to an annual
contribution maximum. Refer to "Maximum Pre-Tax Contribution Dollar
Limit" paragraph in Section entitled ANNUAL CONTRIBUTION AND
COMPENSATION MAXIMUMS. If you are a highly compensated employee, as
defined by the Internal Revenue Code and related regulations, you may
be limited to a percentage that is less than 15%. Refer to "Maximum
Allowable Contribution Percentage Limit" in Section entitled ANNUAL
14
CONTRIBUTION AND COMPENSATION MAXIMUMS. If you are limited to a
percentage that is less than 15%, you will be notified.
Your Employee Pre-Tax contributions are deposited into your Employee
Pre-Tax Account.
CHANGING, DISCONTINUING OR RESUMING YOUR CONTRIBUTIONS
You may change your contribution percentage election as of the first
day of any month. Your payroll deductions will change as soon as
practicable after your request has been processed. You may discontinue
contributions at any time. Your payroll deductions will stop as soon
as practicable after your request has been processed. You may resume
contributions as of the first day of any month. Your payroll
deductions will resume as soon as practicable after your request has
been processed. If you discontinue contributions more than once in a
12-month period, the Administrator reserves the right to require a
longer waiting period before you resume contributions.
To begin or change your contribution percentage election or to
discontinue or resume contributions, refer to Section entitled
INSTRUCTIONS AT A GLANCE.
ROLLOVER CONTRIBUTIONS FROM ANOTHER QUALIFIED PLAN
If you receive a distribution eligible for rollover from another
employer's qualified plan (or a qualified plan of Bay State) or if you
have a "rollover IRA," you may "roll over" all or part of that amount
into this Plan if you are an eligible employee, even if you have not
yet met the Plan's eligibility requirements. By making a Rollover
contribution, you defer the tax liability on your distribution and
take advantage of the investments offered in this Plan.
Your Rollover contributions are deposited into your Rollover Account.
To make a Rollover contribution, refer to Section entitled
INSTRUCTIONS AT A GLANCE.
SEPARATE ACCOUNTS
Separate Accounts will be maintained for your contributions as
described above and may also include a Prior After-Tax Account for
after-tax contributions made under former Plan provisions.
EMPLOYER CONTRIBUTIONS
EMPLOYER CONTRIBUTIONS
Your eligibility for Employer contributions and the amount Bay State
contributes are determined under the terms of your governing
collective bargaining agreement. If your collective bargaining
agreement calls for Employer contributions, the Employer contributions
15
are based on your Employee Pre-Tax contributions and are deposited to
your Account each time you contribute.
Employer contributions made on your behalf are deposited into your
Employer Account.
SEPARATE ACCOUNTS
Separate Accounts will be maintained for your Employer contributions
as described above and which may also include a Prior Company Account
for contributions made under former Plan provisions.
ANNUAL CONTRIBUTION AND COMPENSATION MAXIMUMS
The Internal Revenue Code and related regulations require that a
number of limitations be applied to the Plan. These include (1)
maximum amounts which may be contributed by you or on your behalf in
any year and (2) a maximum amount of your eligible pay that may be
taken into account for purposes of contributions. These limitations
are briefly described below:
MAXIMUM PRE-TAX CONTRIBUTION DOLLAR LIMIT.
Your maximum pre-tax contribution dollar limit (including any pre-tax
contributions you may make to any other 401(k) plan) is established
each calendar year. This limit may be adjusted annually as announced
by the Internal Revenue Service. For the calendar years 1998 and 1999,
this limit is $10,000. For the calendar year 2000, this limit is
$10,500.
If you make pre-tax contributions to more than one 401(k) plan during
the calendar year and the combination of your pre-tax contributions to
the plans exceeds the maximum pre-tax contribution dollar limit, you
should notify the Plan Administrator of this Plan or the plan
administrator of the other plan that an excess has occurred and
request that the excess amount be returned to you no later than April
15 of the following year. If the excess amount is not returned to you
by April 15 of the following year, the excess amount will be taxable
to you in the year the amount was contributed and the year the amount
is distributed.
MAXIMUM ALLOWABLE CONTRIBUTION PERCENTAGE LIMIT.
If you are a highly compensated employee, your maximum Employee Pre-
Tax contribution percentage may be limited to a percentage that is
less than the percentage described in Section entitled YOUR
CONTRIBUTIONS, as determined by a factor based on the average Employee
Pre-Tax contribution percentage for non-highly compensated employees.
Highly compensated employees generally include employees who earn more
than a specified amount in the preceding Plan Year ($80,000 for 1998
and 1999, $85,000 for 2000). This amount may be adjusted annually as
announced by the Internal Revenue Service.
16
If you are a highly compensated employee and you exceed this limit at
any time, you will be notified and your future contributions may be
reduced or stopped, and any excess may be refunded to you.
MAXIMUM ANNUAL ADDITION LIMIT.
The maximum amount that may be contributed by you (excluding rollover
contributions) or on your behalf to this Plan or any other qualified
defined contribution plan sponsored by Bay State is the lesser of (1)
25% of your W-2 taxable income (and salary reductions, if any,
pursuant to Code Section 125, 402(e)(3), 402(h)(l)(B), 403(b),
408(p)(2)(A)(i) or 457) or (2) $30,000. The $30,000 amount may be
adjusted annually as announced by the Internal Revenue Service.
MAXIMUM ELIGIBLE PAY LIMIT.
The maximum amount of your eligible pay that may be taken into account
per Plan Year for purposes of contributions is $160,000. This amount
may be adjusted annually as announced by the Internal Revenue Service.
INVESTMENT FUNDS, INVESTMENT DIRECTION AND FUND TRANSFERS
WHO MAKES THE INVESTMENT DECISIONS?
You make your own investment decisions. Bay State has selected a
variety of daily valued investment funds with different risk and
return characteristics. Investment fund information sheets and
prospectuses provide information about the investment options. If you
have not received this information or would like updated information,
you may obtain this information by telephoning 1-800-228-4015 and
peaking with a participant services representative (or if you are
hearing impaired, telephone 1-800-637-1215).
Each of the investment funds has specific investment objectives for
both risk and expected return. The specific investment funds available
to you may be changed from time to time. The investment funds include
a Company Stock Fund, which invests in shares of NiSource Inc.
("NiSource") common stock ("Company Stock"). For liquidity purposes, a
portion of the Company Stock Fund will also be invested in money
market type assets.
When you enroll in the Plan you may elect the percentage of your
Account you want invested in each investment fund. However, the
Administrator reserves the right to set a maximum percentage of the
total election that you may direct into any specific investment fund.
You should make your investment choices based on your investment goals
and your willingness to assume investment risk in order to realize
potentially higher returns. Investment risk is defined as a measure of
how much the investment returns can vary, either up or down, from
period to period.
17
HOW MAY I OBTAIN INVESTMENT FUND PERFORMANCE INFORMATION?
You may obtain recent investment fund performance information by
telephoning 1-800-228-4015 (or if you are hearing impaired, telephone
1-800-637-1215).
HOW MAY I CHANGE MY INVESTMENT DIRECTION AND WHEN DOES MY NEW
INVESTMENT DIRECTION TAKE EFFECT?
You may change your investment direction for future contributions and
loan payments to your Account at any time. Only one investment
direction will be allowed each day.
If you telephone on a business day before the close of the New York
Stock Exchange (4 p.m. Eastern time), your investment change will be
processed that day. Otherwise it will be processed the next business
day. For this purpose, a business day is a day on which the stock
markets are open for trading. A written confirmation of your
investment direction change will be sent within 48 hours of processing
the transaction.
To change your investment direction, refer to Section entitled
INSTRUCTIONS AT A GLANCE.
HOW DO I TRANSFER MY FUNDS?
You may elect to transfer funds by telephoning 1-800-228-4015 (or if
you are hearing impaired, telephone 1-800-637-1215). Transfers out may
be requested in terms of dollars, shares or percentages. Dollar and
percent transfers are based on the previous night's closing Net Asset
Value and will be converted into a specific number of shares to be
sold. Transfers in are always in percentages (in 1% increments) and
must total to 100%. Only one fund transfer per day may be requested.
In order for a fund transfer to be executed on the same business day
as the telephone call, it must be completed by 4 p.m. Eastern time.
To initiate a fund transfer, refer to Section entitled INSTRUCTIONS AT
A GLANCE.
INFORMATION REGARDING VOTING AND TENDERING COMPANY STOCK
You will be entitled to instruct the Plan Trustee as to the voting or
tendering of any whole and fractional shares of Company Stock held on
your behalf in the Company Stock Fund. Nisource will be responsible
for the timely distribution of proxy solicitation or other material to
you in connection with any shareholder vote or tender decision,
including a form for you to complete to instruct the Trustee with
regard to voting or tendering.
The Trustee is responsible for tabulating and complying with the
voting or tendering instructions it receives from participants. The
18
Trustee will hold your instructions in confidence and will not divulge
or release specific information regarding such instructions, on an
individual basis, to any person, including officers or employees of
NiSource or Bay State, except to the extent required by law.
If you do not instruct the Trustee with regard to a shareholder vote
or tender decision, your shares will be voted or tendered as
instructed by the Committee for the Plan.
VESTING
Vesting is a term used to describe the portion of your Account which
you own. Your balance in each of your Accounts is fully vested at all
times.
PARTICIPANT LOANS
MAY I BORROW FROM MY ACCOUNT?
You may borrow from all of your Accounts. You may have two loans
outstanding at a time.
HOW MUCH MAY I BORROW?
The minimum loan amount is $1,000.
The maximum you may borrow is 50% of your vested Account balance or,
if less, $50,000. The $50,000 amount is reduced by your highest
outstanding balance on all loans during the preceding 12 months. For
purposes of this paragraph, all of Bay State's qualified plans are
considered as part of this Plan to the extent the maximum loan amount
would be decreased.
You may obtain information about the amount you may borrow or do
"modeling" to help you decide on the terms of the loan by telephoning
1-800-228-4015 (or if you are hearing impaired, telephone 1-800-637-
1215).
WHAT IS THE LOAN INTEREST RATE?
The interest rate is fixed at the time you borrow and shall be a
reasonable rate of interest, determined by the Plan Administrator,
which provides the Plan with a return commensurate with the prevailing
interest rate charged by persons in the business of lending money for
loans which would be made under similar circumstances.
The interest rate may be changed from time to time. You may obtain
information about the current interest rate by telephoning 1-800-228-
4015 (or if you are hearing impaired, telephone 1-800-637-1215).
19
WHAT IS THE LOAN REPAYMENT TERM?
The loan repayment term may be for a period not to exceed five years.
HOW DO I MAKE LOAN PAYMENTS AND HOW ARE THE PAYMENTS INVESTED?
Loan payments, consisting of principal and interest, are made through
convenient payroll deduction (or by check during any period you are
temporarily ineligible for payroll deduction), and each payment is
credited to your Account. You may make additional loan payments at any
time by check or pay off the remaining balance of your loan at any
time by cashier's check, certified check or money order. You may
obtain your loan payoff amount by telephoning 1-800-228-4015 (or if
you are hearing impaired, telephone 1-800-637-1215).
Loan payments credited to your Account are invested in accordance with
your current investment instructions for future contributions to your
Account at the time the loan payment is deposited into your Account.
WHAT HAPPENS IF MY EMPLOYMENT TERMINATES?
Your outstanding loan balance is due should your employment with Bay
State terminate for any reason. Your outstanding loan balance is due
upon the earlier of the date you request a distribution from your
Account or approximately 90 days after you terminate employment with
Bay State. If you do not take action to pay your outstanding loan
balance before that time, the unpaid balance will become a taxable
distribution to you, except to the extent any portion of the unpaid
balance represents a return of after-tax contributions.
HOW IS MY LOAN SECURED?
Your loan will be evidenced by a promissory note, secured by the
portion of your Account from which the loan is made. The Plan shall
have a lien on this portion of your Account.
A suspension of loan payments may be authorized for up to 12 months if
you are on leave of absence without pay. During the suspension period
interest on your outstanding loan balance will continue to accrue. All
past due amounts will be due at the end of the suspension period
unless otherwise authorized.
A loan is treated as in default if a scheduled loan payment is not
made at the time required. You will have a grace period to cure the
default before it becomes final. In the event the default becomes
final, the default will be treated as a taxable distribution to you,
except to the extent any portion of the unpaid balance represents a
return of after-tax contributions. However, your promissory note will
not be distributed and interest will continue to accrue on your
outstanding loan balance, until such time as you are otherwise
eligible for an in-service withdrawal or a distribution from your
Account.
20
ARE THERE ANY LOAN FEES?
If you took a loan prior to May 28, 1999, a loan maintenance fee of
$3.50 will be assessed to your Account for each month your Account has
a loan balance. The fee will be charged quarterly to your Account. You
will see these fees on your quarterly statement. However, for new
loans initiated after May 28, 1999, there will be a one-time fee of
$40.00 that will be assessed to your Account at the time you take out
the loan.
WHAT HAPPENS WHEN I REQUEST A LOAN?
Upon processing of your request, your investments will be redeemed as
needed to fund your loan. Within each Account used for funding your
loan, amounts will be redeemed from your investment funds in direct
proportion to the value of your interest in each investment fund as of
the date the loan is processed. As the Plan's investment funds are
daily valued investment funds, your investments are redeemed based on
the value of each such investment on the day your loan is processed.
Your check and loan documents are generally issued within three
business days thereafter.
To request a loan, refer to Section entitled INSTRUCTIONS AT A GLANCE.
WITHDRAWALS WHILE YOU ARE AN EMPLOYEE
UNDER WHAT CIRCUMSTANCES MAY I MAKE A WITHDRAWAL FROM THE PLAN WHILE I
AM AN EMPLOYEE?
Withdrawals while you are an employee are permitted as described
below. These withdrawals are referred to as in-service withdrawals.
There is no minimum amount for any type of in-service withdrawal.
* HARDSHIP WITHDRAWAL
You may make an in-service withdrawal in certain cases of
financial hardship. You may withdraw from all of your
Accounts, except for any earnings credited to your Employee
Pre-Tax Account after December 31, 1988.
The amount you may withdraw may be no greater than the
amount necessary to satisfy your financial need including
amounts necessary to pay any federal, state or local income
taxes or penalties reasonably anticipated to result from the
withdrawal.
For this purpose, hardship is a financial need to:
* Purchase your principal residence.
21
Pay unreimbursable medical expenses incurred or to be
incurred by you, your spouse or dependents.
* Pay unreimbursable tuition, related educational fees and
room and board for up to the next 12 months of post-
secondary education for you, your spouse or dependents.
* Pay amounts necessary to prevent losing your principal
residence through eviction or foreclosure on your mortgage.
You may qualify for a Hardship Withdrawal by first borrowing
and withdrawing all other available amounts from this Plan
(and from any other plan maintained by Bay State), other
than hardship withdrawals. You will be ineligible to
contribute to the Plan for 12 months from the date of your
Hardship Withdrawal.
A special limitation may reduce the maximum amount of
Employee Pre-Tax contributions you may contribute in the
calendar year following the calendar year of your Hardship
Withdrawal.
* PRIOR AFTER-TAX ACCOUNT WITHDRAWAL
You may make a Prior After-Tax Account Withdrawal once in
any 12-month period.
* ROLLOVER ACCOUNT WITHDRAWAL
You may make a Rollover Account Withdrawal once in any 12-
month period.
* OVER AGE 59-1/2 WITHDRAWAL
Once you have attained age 59-1/2 , you may make an Over Age
59-1/2 Withdrawal once in any 12-month period.
You may withdraw from all of your Accounts. If you have a
Prior After-Tax Account, you will need to designate whether
you want to withdraw from this Account first as part of your
Over Age 59-1/2 Withdrawal.
* PRIOR COMPANY ACCOUNT PLUS WITHDRAWAL
You may make a Prior Company Account Plus Withdrawal once in
any 12-month period.
You may withdraw from your Prior After-Tax, Rollover and
Prior Company Accounts.
22
WHAT ARE MY IN-SERVICE WITHDRAWAL PAYMENT OPTIONS?
Your in-service withdrawal will be paid in a single lump sum, in cash.
WHAT ARE MY IN-SERVICE WITHDRAWAL METHODS?
You may choose to have all or a portion of your in-service withdrawal
that is eligible for rollover be made payable directly to an IRA,
another employer's qualified plan or to you. The portion of your in-
service withdrawal representing a return of after-tax contributions
and, effective January 1, 1999 the portion of your hardship withdrawal
representing Employee Pre-Tax contributions, are not eligible for
rollover and will be made payable to you. Regarding the portion of
your in-service withdrawal that is eligible for rollover and that is
made payable to you, the law requires that 20% of that amount be
withheld for federal taxes. Your actual tax liability may be more or
less depending on your personal tax situation.
WHAT HAPPENS WHEN I REQUEST AN IN-SERVICE WITHDRAWAL?
An IRS Tax Notice is required to be provided to you no more than 90
days before your in-service withdrawal is made. The IRS Tax Notice
summarizes the rules related to rollovers, income tax and penalties
that may apply to your in-service withdrawal. You should review the
IRS Tax Notice prior to requesting an in-service withdrawal.
Upon processing of your request, your investments will be redeemed as
needed to fund your in-service withdrawal. Within each Account used
for funding your in-service withdrawal, amounts will be redeemed from
your investment funds in direct proportion to the value of your
interest in each investment fund as of the date the in-service
withdrawal is processed. As the Plan's investment funds are daily
valued investment funds, your investments are redeemed based on the
value of each such investment on the day your in-service withdrawal is
processed. Your check is generally issued within three business days
thereafter.
To request an in-service withdrawal, refer to Section entitled
INSTRUCTIONS AT A GLANCE.
WHAT ARE THE TAXES AND PENALTIES FOR IN-SERVICE WITHDRAWALS?
The IRS Tax Notice summarizes the rules related to rollovers, income
tax and penalties that may apply to your in-service withdrawal.
DISTRIBUTIONS AFTER YOU TERMINATE EMPLOYMENT WITH BAY STATE
WHAT ARE MY DISTRIBUTION PAYMENT OPTIONS?
If your vested Account balance is $5,000 or less, your distribution
payment options are limited to a single lump sum. Otherwise, you may
choose to have your vested Account balance distributed as follows:
23
* paid in a single lump sum,
* a portion paid in a lump sum, and the remainder paid later,
or
* paid in periodic installments over a period not to exceed
the life expectancy of you and your beneficiary.
Your distribution will be paid in cash, except to the extent of the
distribution of your outstanding loan balance, if any, and except (if
your Account is distributed in a lump sum) to the extent you choose to
receive the portion of your distribution attributable to your Account
balance invested in the Company Stock Fund in the form of whole shares
of Company Stock and cash in lieu of fractional shares.
WHAT ARE MY DISTRIBUTION METHODS?
You may choose to have all or a portion of your distribution that is
eligible for rollover be made payable directly to an IRA, another
employer's qualified plan or to you. The portion of your distribution
representing a return of after-tax contributions is not eligible for
rollover and will be made payable to you. If your vested Account
balance is $5,000 or less and you do not request a distribution, your
vested Account balance may be distributed to you without your consent
in a check made payable to you.
Regarding the portion of your distribution that is eligible for
rollover and that is made payable to you, the law requires that 20% of
that amount be withheld for federal taxes. Your actual tax liability
may be more or less depending on your personal tax situation.
If you elect distribution in periodic installments, your Account will
be charged a fee for each installment payment. You will see these fees
on your quarterly statement. Currently, this fee is $3.00 per check
and may be changed from time to time.
WHEN ARE DISTRIBUTIONS MADE?
You may generally choose when to take a distribution of your vested
Account balance following your termination of employment with Bay
State. Prior to 1999, the law required that you start taking
distributions from your Account on or before the April 1 immediately
after the later of the end of the calendar year in which you reach age
70-1/2 or the end of the calendar year in which your employment with
Bay State terminates. Beginning in 1999, your distribution must begin
upon the later of your attainment of age 70-1/2 or your termination of
employment with Bay State.
If your vested Account balance is $5,000 or less, you should request a
distribution of your vested Account balance at the time you terminate
employment with Bay State or shortly thereafter. If you do not request
a distribution, your vested Account balance may be distributed to you
24
without your consent in a check made payable to you. Mandatory 20%
federal tax withholding will apply as described above.
If you are eligible and choose to defer distribution of your Account
after your employment with Bay State terminates, an administrative fee
will continue to be assessed to your Account each month and charged
quarterly to your Account as described in Section entitled OTHER
THINGS YOU SHOULD KNOW.
Your Account will continue to be invested as you direct until it is
distributed to you.
WHAT HAPPENS WHEN I REQUEST A DISTRIBUTION?
An IRS Tax Notice is required to be provided to you no more than 90
days before your distribution is made. The IRS Tax Notice summarizes
the rules related to rollovers, income tax and penalties that may
apply to your distribution. You should review the IRS Tax Notice prior
to requesting a distribution.
Upon processing of your request, your investments will be redeemed as
needed to fund your distribution. Within each Account used for funding
your distribution, amounts will be redeemed from your investment funds
in direct proportion to the value of your interest in each investment
fund as of the date the distribution is processed. As the Plan's
investment funds are daily valued investment funds, your investments
are redeemed based on the value of each such investment on the day
your distribution is processed. Your check is generally issued within
three business days thereafter. If you choose to receive the portion
of your distribution attributable to your Account balance in the
Company Stock Fund in the form of whole shares of Company Stock and
cash in lieu of fractional shares, your stock certificate will be
issued within a few weeks thereafter.
To request a distribution upon termination of employment with Bay
State, refer to Section entitled INSTRUCTIONS AT A GLANCE.
WHAT ARE THE TAX TREATMENTS, TAXES AND PENALTIES FOR DISTRIBUTIONS?
The IRS Tax Notice summarizes the rules related to rollovers, tax
treatments, income tax and penalties that may apply to your
distribution.
DEATH BENEFITS
WHAT HAPPENS TO MY PLAN BENEFIT IF I DIE?
Upon your death, your Account becomes payable to your
beneficiary(ies). If you die while an employee, your Account will
become fully vested, if not otherwise fully vested. In general, your
beneficiary has the same options as you do regarding when and how to
25
receive payment, except that a distribution to your beneficiary may
only be eligible for rollover if your beneficiary is your spouse. Your
beneficiary should contact the benefits department for further
instructions.
HOW MAY I DESIGNATE MY BENEFICIARY?
When you become eligible to participate in the Plan or, if earlier, at
the time you make a Rollover Contribution, you must complete and file
a Beneficiary Designation Form stating who is to receive your Account
balance if you die. You may change your beneficiary(ies) at any time
by completing and filing a new Beneficiary Designation Form. The
change takes effect on the date your new completed Beneficiary
Designation Form is on file with the benefits department.
If you are married, your spouse is automatically your sole primary
beneficiary. To designate someone in addition to or other than your
spouse as a primary beneficiary, you must obtain your spouse's written
consent to your designation and your spouse's signature must be
witnessed by a Plan representative or Notary Public. If you complete
and file a Beneficiary Designation Form and later become married or
remarry, your earlier Beneficiary Designation Form will not be valid.
You will need to complete and file a new Beneficiary Designation Form.
If you fail to complete and file a Beneficiary Designation Form before
you die, your benefit upon death will be paid to the individual(s) in
the first of the following categories in which there is at least one
survivor: your spouse; your children (in equal shares), by right of
representation; or your estate.
REEMPLOYMENT WITH BAY STATE
WHEN CAN I RESUME MY PARTICIPATION?
If you were a Plan participant before your employment with Bay State
terminated and you are rehired by Bay State, you may resume
participation on the date of your rehire as an eligible employee. If
you were not a participant when your employment with Bay State
terminated, or were not eligible for Employer contributions, you will
enter the Plan or become eligible for Employer contributions as
described in Section entitled ELIGIBILITY, but no earlier than the
date you would have entered the Plan or become eligible for Employer
contributions if you had not terminated your employment with Bay
State.
FUTURE OF THE PLAN
Bay State intends for the Plan to be a permanent part of your total
benefits program. However, Bay State reserves the right to terminate
the Plan at any time.
26
Bay State reserves the right to amend the Plan at any time if it
becomes desirable or necessary. You will be notified within 210 days
after the end of the Plan Year of any relevant Plan amendment. The
Plan (including any amendments) is subject to approval by the IRS.
From time to time, changes in the details of the Plan may be required
by the IRS. However, no Plan amendment may take away any benefits you
have earned.
As the Plan benefits are provided by individual participant accounts,
benefits under this Plan are not insured by the Pension Benefit
Guaranty Corporation (PBGC). PBGC insurance does not apply to this
type of plan.
PLAN ADMINISTRATION ISSUES
ACCOUNT STATEMENTS AND ACCOUNT INFORMATION
You will receive statements four times each year. They will normally
be sent to you within three weeks after the end of each quarter of the
Plan Year.
You have easy access to information regarding your Account at any
time.
To obtain information regarding your Account, refer to Section
entitled INSTRUCTIONS AT A GLANCE.
PLAN ADMINISTRATOR
The Bay State Gas Company Benefits Committee is the Plan
Administrator. Bay State has appointed this Benefits Committee and
delegated to it all or part of its duties to oversee the Plan's
operations. As a Plan fiduciary, the Plan Administrator acts on your
behalf to see that the Plan is administered fairly according to
standards outlined in the law and the terms of the Plan and Trust
Agreement.
Plan records are maintained on a Plan Year basis. The Plan Year ends
on December 31.
HOURS OF SERVICE
Hours of service are used in determining your eligibility to
participate. You earn one hour of service for each hour you are paid
by Bay State (including any back pay you may be awarded). This
includes hours when you do not actually work but receive pay (such as
vacation, holiday, jury duty, illness or incapacity, such as
disability). You receive credit for non-paid company time, such as a
leave of absence approved by Bay State, military duty or a temporary
layoff.
27
Service earned while you are not actively at work is based on your
normally scheduled weekly hours. If you are a salaried employee, or
there are no accurate records of your working hours, you will be
credited with a set number of hours for each pay period in which you
are paid for at least one hour. The rates of hours credited for each
pay period are: 45 hours per weekly pay period, 90 hours per bi-weekly
pay period, 95 hours per semi-monthly pay period and 190 hours per
monthly pay period.
AGENT FOR SERVICE OF LEGAL PROCESS
Service of legal process may be made upon the Clerk of Bay State at
the address listed in Section entitled PLAN DIRECTORY.
TYPE OF PLAN
This Plan is a profit sharing plan with a pre-tax salary deferral
(401(k)) feature.
TOP HEAVY CONTRIBUTION PROVISIONS
The Plan includes provisions which apply only if the Plan is "top
heavy." A plan is top heavy if more than 60% of the total plan assets
belong to "key employees." Key employees include certain officers,
shareholders and owners. If the plan is top heavy, contributions may
not be made by or on behalf of key employees, other than a Rollover
contribution, unless Bay State makes a minimum contribution to all
eligible employees.
OTHER THINGS YOU SHOULD KNOW
TRUST FUND
All of the Plan's assets are held in a trust fund which is the sole
source of all benefit payments. The trust fund is a separate and
distinct legal entity, and is not part of Bay State. The assets of the
trust fund are not commingled with Bay State's assets. Generally, no
part of the trust fund can be attached by creditors of any Plan
participant or of Bay State. Assets of the trust fund are held
exclusively to pay Plan benefits and expenses, and cannot revert to or
be paid to Bay State, except under certain limited circumstances
permitted by law.
The Plan Trustee holds the Plan's assets, executes all of the
investments, maintains the financial records relating to the trust,
and makes all benefit payments as directed by the Plan Administrator.
PLAN FEES AND EXPENSES
Bay State pays all administrative fees and expenses related to
maintaining the Plan as a whole. Bay State may, at a later date,
28
choose to have all or a portion of such fees and expenses paid by
participants. Bay State will notify you in advance of any such change.
If changed, an administrative fee will be assessed to your Account
each month and charged quarterly to your Account, except that no fee
may reduce your Account balance below zero.
You will pay any special fees related to your own Account, such as
loan fees and fees for installment payments. You will see these fees
on your quarterly statement.
PLAN PARTICIPATION PURSUANT TO A COLLECTIVE BARGAINING AGREEMENT
The Plan is maintained pursuant to one or more collective bargaining
agreements. You may obtain a copy of each such collective bargaining
agreement by contacting the Plan Administrator or Human Resources.
CLAIM REVIEW PROCEDURES
As the Plan Administrator, the Benefits Committee is responsible for
determining and informing you of your entitlement to a benefit and of
any amounts payable to you. If you disagree with a decision, you or
your authorized representative may ask for a review by submitting a
written request to the benefits department. Your request should
include the issues and comments you feel are important. You also have
the right to review pertinent documents.
The review process sets the following limits on the amount of time you
may take to make your request and for the Plan Administrator to
respond:
DAYS TO RESPOND
ACTION FROM PRIOR ACTION
------ -----------------
Plan Administrator sends you a benefit statement -
You request an initial review . . . . . . . . . . . . . . . 60 days
Plan Administrator sends you its initial decision . . . . . 90 days
You request a final review. . . . . . . . . . . . . . . . . 60 days
Plan Administrator sends you its final decision . . . . . . 60 days
The Plan Administrator will either approve your claim or explain why
your claim is being denied (by referring to specific Plan provisions)
and how applications are reviewed. In special circumstances, the Plan
Administrator may notify you and take up to an additional 90 days for
its initial review and 60 days for its final review.
NO ASSIGNMENT OF YOUR ACCOUNT IS PERMITTED
Under this Plan, you may not assign, sell, transfer or use your
Account as collateral, other than for a loan from your Account as
29
described in Section entitled PARTICIPANT LOANS. In addition,
creditors may not attach your Account as a means of collecting debts.
However, the Plan Administrator will comply with a "qualified domestic
relations order" (QDRO). This is an order or judgment from a state
court directing that a participant's Account, or portion thereof, be
paid to an Alternate Payee (spouse, former spouse, child or other
dependent of the participant) as child support, alimony or part of a
division of marital property rights, provided that the order meets
certain requirements of federal law.
NO EMPLOYMENT RIGHTS
Your participation in the Plan does not give you any employment rights
with Bay State.
YOUR RIGHTS UNDER FEDERAL LAW
As a participant of this Plan you are entitled to certain rights and
protection under the Employee Retirement Income Security Act of 1974
("ERISA"). ERISA provides that all Plan participants shall be entitled
to:
* examine, without charge, at the Plan Administrator's office,
all Plan documents and copies of all documents filed by the
Plan with the U.S. Department of Labor, such as annual
reports;
* obtain copies of all Plan documents and information upon
written request to the Plan Administrator. The Plan
Administrator may make a reasonable charge for the copies;
* receive a summary of the Plan's annual financial report. The
Plan Administrator is required by law to furnish each
participant with a copy of this summary annual report; and
* obtain a statement telling you the amount of your Account
balance, the portion of your Account balance you currently
have a right to and when you will have the right to receive
payment. If you do not have a right to a benefit, the
statement will tell you how many years you have to work to
get this right. This statement must be requested in writing
and is not required to be given more than once a year. The
Plan Administrator must provide the statement free of
charge.
In addition to creating rights for Plan participants, ERISA imposes
duties upon the people who are responsible for the operation of the
Plan. The people who operate your Plan, called "fiduciaries" of the
Plan, have a duty to do so prudently and in the interest of you and
other Plan participants and beneficiaries.
30
No one, including your employer or any other person, may terminate you
or otherwise discriminate against you in any way to prevent you from
obtaining a benefit or exercising your rights under ERISA.
If your claim for a benefit is denied in whole or in part, you must
receive a written explanation of the reason for the denial. You have
the right to have the Plan Administrator review and reconsider your
claim.
Under ERISA, there are steps you can take to enforce the above rights.
For instance, if you request written materials from the Plan
Administrator and do not receive them within 30 days, you may file
suit in federal court. In such a case, the court may require the Plan
Administrator to provide the materials and pay you up to $100 a day
until you receive the materials, unless the materials were not sent
because of reasons beyond the control of the Plan Administrator.
If you have a claim for a benefit which is denied or ignored, in whole
or in part, you may file suit in a state or federal court. If it
should happen that Plan fiduciaries misuse the Plan's money, or if you
are discriminated against for asserting your rights, you may seek
assistance from the U.S. Department of Labor, or you may file suit in
a federal court. The court will decide who should pay court costs and
legal fees. If you are successful, the court may order the person you
have sued to pay these costs and fees. If you lose, the court may
order you to pay the costs and fees if, for example, it finds your
claim is frivolous.
If you have any questions about your Plan, you should contact the
benefits department. If you have any questions about this statement of
your rights under ERISA, you should contact the nearest Area Office of
the Pension and Welfare Benefits Administration, U.S. Department of
Labor.
PLAN DIRECTORY
* OFFICIAL PLAN NAME
Bay State Gas Company Savings Plan for Operating
Employees
* Employer and Plan Number
Employer's Identification Number (EIN) is 04-3442797
Plan Identification Number (PN) is 011
* OTHER PARTICIPATING COMPANIES
Northern Utilities, Inc.
Granite State Gas Transmission, Inc.
EnergyUSA
* PLAN YEAR
January 1 through December 31
31
* PLAN SPONSOR
Bay State Gas Company
300 Friberg Parkway
Westborough, MA 01581-5039
1-508-836-7000
* INITIAL EFFECTIVE DATE
January 1, 1988
* PLAN ADMINISTRATOR
Benefits Committee
Bay State Gas Company
* PLAN'S RECORDKEEPING SERVICE PROVIDER
Merrill Lynch
Group Employee Services
P.O. Box 6610
Englewood, CO 80155-6610
* PLAN TRUSTEE
Merrill Lynch Trust Company, FSB
300 Davidson Avenue
Somerset, NJ 08873
* AGENT FOR SERVICE OF LEGAL PROCESS
Clerk - Bay State Gas Company
300 Friberg Parkway
Westborough, MA 01581-5039
1-508-836-7000
INSTRUCTIONS AT A GLANCE
IF YOU WANT TO ... YOU NEED TO DO THE FOLLOWING ...
------------------ --------------------------------
ENROLL IN THE PLAN * COMPLETE A PLAN ENROLLMENT FORM AND
AND ELECT TO MAKE BENEFICIARY DESIGNATION FORM. RETURN
CONTRIBUTIONS: THE FORMS TO THE BENEFITS DEPARTMENT
FOR PROCESSING. YOUR ENROLLMENT FORM
WILL BE FORWARDED TO MERRILL LYNCH FOR
PROCESSING OF YOUR INVESTMENT FUND
DIRECTION. YOU WILL RECEIVE A PERSONAL
IDENTIFICATION NUMBER (PIN) FOR THE
BAY STATE GAS COMPANY SAVINGS PLAN FOR
OPERATING EMPLOYEES IN A SECURED
ENVELOPE AS A SEPARATE MAILING.
32
MAKE A ROLLOVER * Request a Rollover Contribution Form
Contribution: from the benefits department.
Complete and return the form to the
benefits department for approval and
forwarding to Merrill Lynch for
processing.
CHANGE OR SUSPEND YOUR * Request a Deferral Percentage Change
SAVINGS RATE (DEFERRAL Form from the benefits department.
PERCENTAGE): Complete and return the form to the
benefits department for processing.
CHANGE YOUR INVESTMENT * Telephone* Merrill Lynch at 1-800-228-
DIRECTION OR TRANSFER 4015 (or if you are hearing impaired
FUNDS:<1> telephone 1-800-637-1215).
REQUEST A PARTICIPANT * Telephone* Merrill Lynch at 1-800-228-
LOAN:<1> 4015 (or if you are hearing impaired
telephone 1-800-637-1215).
REQUEST AN IN-SERVICE * Telephone* Merrill Lynch at 1-800-228-
WITHDRAWAL:<1> 4015 (or if you are hearing impaired
telephone 1-800-637-1215). If you have
not already received an IRS Tax Notice
within the last 90 days, an IRS Tax
Notice will be provided to you.
* If you are requesting a Hardship
Withdrawal, Merrill Lynch will send
you a Hardship Withdrawal Request
Form. Upon completion, return the form
to the benefits department for
approval and forwarding to Merrill
Lynch for processing.
REQUEST A DISTRIBUTION * Telephone* Merrill Lynch at 1-800-228-
UPON TERMINATION: 4015 (or if you are hearing impaired
telephone 1-800-637-1215). If you have
not already received an IRS Tax Notice
within the last 90 days, an IRS Tax
Notice will be provided to you.
OBTAIN INFORMATION * Telephone* Merrill Lynch at 1-800-228-
REGARDING YOUR 4015 (or if you are hearing impaired
ACCOUNT, INVESTMENT telephone 1-800-637-1215).
FUND PRICES, LOAN
INTEREST RATE ETC.:
The Voice Response System (VRS) operates 24 hours a day, 7 days a
week. If the information you need or the transaction you want to
perform is not available through the VRS, or if you prefer to speak to
a participant services representative, press "0" as soon as the VRS
answers. If you have a rotary phone, simply stay on the line.
33
PARTICIPANT SERVICES REPRESENTATIVES ARE AVAILABLE ON ANY BUSINESS DAY
BETWEEN 8 A.M. AND 8 P. M. (EASTERN TIME).
* All or a portion of the calls are tape recorded for your protection.
<1> Limitations on Transactions. Only ONE FINANCIAL TRANSACTION may
be initiated in any given business day. Therefore, transfers, loans
and withdrawals may not be transacted on the same business day.
______________________________________________________________________
______________________________________________________________________
INTERNET ACCESS
Internet access to your account will be provided through Bene
OnLine{SM} Bene OnLine is a comprehensive web site that will allow you
to make transactions as well as check the status of your Plan account.
To access Bene OnLine, you will need your Social Security number and
your PIN. Then, just follow these steps to gain access to the web
site.
1. Connect to the Internet
2. Type http://www.benefits.ml.com in the "location" box of your
browser. Hit the "enter" key on your keyboard.
3. Enter your Social Security number and PIN. If you don't enter
your PIN, you will still be able to view the entire site with the
exception of account-related information.
4. Click on the "sign-on" button.
Remember to log off the site when you are finished.
LIMITATION OF LIABILITY
Neither the Company, Bay State, nor any of their agents (including Bay
State if it is acting as such) in administering the Plan shall be
liable for any act done in good faith or for the good faith omission
to act in connection with the Plan. However, nothing contained herein
shall affect a Participant's right to bring a cause of action based on
alleged violations of federal securities laws.
USE OF PROCEEDS
The Company does not anticipate that it will realize any net proceeds
from the issuance of its Common Shares under the Plan.
PLAN OF DISTRIBUTION
The Common Shares being offered hereby are offered pursuant to the Plan,
the terms of which provide for the issuance of Common Shares in
34
connection with investment of participant and employer contributions
to the Plan.
DESCRIPTION OF COMMON SHARES
The Company's certificate of incorporation authorizes the issuance of
400,000,000 Common Shares. The description of the Common Shares is
incorporated by reference into this Prospectus. See "Where You Can
Find More Information" for information on how to obtain a copy of this
description.
EXPERTS
The consolidated financial statements and schedules of NiSource
incorporated by reference herein have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their reports
with respect thereto, and are incorporated by reference herein in
reliance upon the authority of said firm as experts in giving said
reports.
The consolidated financial statements of Columbia incorporated in this
document by reference herein have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with
respect thereto, and are incorporated by reference herein in reliance
upon the authority of said firm as experts in giving said report.
LEGAL MATTERS
Certain legal matters in connection with the Company's Common Shares
offered hereby have been passed upon for the Company by Schiff Hardin
& Waite, Chicago, Illinois.
35
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the offering are as
follows:
Registration fee under the Securities Act . . . . . . . . . $0*
Legal fees and expenses . . . . . . . . . . . . . . . . $15,000
Accounting fees and expenses . . . . . . . . . . . . . $ 5,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . $15,000
------
Total . . . . . . . . . . . . . . . . . . $35,000
*Registration fee was previously paid in connection with the filing by
Registrants of the Registration Statement on Form S-4 (File No. 333-
33896).
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law permits a corporation to
indemnify any person who is a party or is threatened to be made a
party to any action, suit or proceeding brought or threatened by
reason of the fact that the person is or was a director, officer,
employee or agent of the corporation, or is or was serving as such
with respect to another corporation at the request of the corporation,
if that person acted in good faith, in the case of conduct in his or
her official capacity, that person reasonably believed his or her
conduct to be in the best interests of the corporation, or in the case
of all other conduct, that person reasonably believed his or her
conduct was not opposed to the best interests of the corporation, and
with respect to any criminal action, that person had reasonable cause
to believe his or her conduct was lawful or had no reasonable cause to
believe his or her actions were unlawful.
A corporation must indemnify a person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, because he or she is or was a director or
officer or is or was serving at the request of the corporation as a
director or officer of another corporation or other enterprise, if the
person has been wholly successful in defense of the proceeding on the
merits or otherwise. A corporation may advance expenses, including
attorneys' fees, to any director or officer who is a party to a
proceeding in advance of final disposition of the proceeding if the
director or officer furnishes the corporation a written undertaking to
repay the advance if it is ultimately determined that the director did
not meet the required standard of conduct. Amounts to be indemnified
include judgments, penalties, fines, settlements and reasonable
expenses that were actually incurred by the person. However, if the
36
proceeding was by or in the right of the corporation, the person will
be indemnified only against reasonable expenses incurred and
indemnification will not be provided if the individual is adjudged
liable to the corporation in the proceeding.
The Company's certificate of incorporation permits the Company to
indemnify directors, officers, employees and agents of the corporation
and its wholly-owned subsidiaries to the fullest extent permitted by
law.
As authorized under the Company's By-Laws and the Delaware
General Corporation Law, the Company and its subsidiaries maintain
insurance that insures directors and officers for acts committed in
their capacities as such directors or officers that are determined to
be not indemnifiable under the Company's indemnity provisions.
Section 6.10 of the Agreement and Plan of Merger dated as of
February 27, 2000, as amended and restated as of March 31, 2000, among
Columbia Energy Group, NiSource Inc., New NiSource Inc., Parent
Acquisition Corp., Company Acquisition Corp. and NiSource Finance
Corp. (the "Merger Agreement") provides for indemnification by the
Company under certain circumstances of the directors and officers of
Columbia. Additionally, the Merger Agreement provides that the
Company will maintain Columbia's existing officers' and directors'
insurance policies or provide substantially similar insurance coverage
for at least six years.
ITEM 16. EXHIBITS.
The Exhibits filed herewith are set forth on the Exhibit Index
filed as part of this Registration Statement.
ITEM 17. UNDERTAKINGS.
The Registrants hereby undertake:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of a prospectus filed
37
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if
the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the Registrant pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of an annual report pursuant to Section 13(a) or Section 15(d)
of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrants pursuant to the foregoing
provisions, or otherwise, the registrants have been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrants of expenses incurred or paid by a director, officer or
controlling person of the registrants in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
38
the registrants will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
39
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Company certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3
and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Merrillville, State of Indiana, on October 27, 2000.
NEW NISOURCE INC.
(Registrant)
By: /s/ Gary L. Neale
-----------------------------------
Gary L. Neale
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
Each director and officer of the Registrant whose signature
appears below hereby authorizes the agent for service named in the
registration statement to execute in the name of such person and to
file any amendments to this registration statement necessary or
advisable to enable the Registrant to comply with the Securities Act
of 1933, as amended, and any rules, regulations and requirements of
the Securities and Exchange Commission in respect thereof, which
amendments may make such other changes in this registration statement
as the agent for service deems appropriate, and any subsequent
registration statement for the same offering that may be filed under
Rule 462(b) under the Securities Act of 1933, as amended. Pursuant to
the requirements of the Securities Act of 1933, as amended, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ Gary L. Neale Chairman, President and October 27, 2000
----------------------- Chief Executive Officer
Gary L. Neale (Principal Executive
Officer)
/s/ Stephen P. Adik Vice President and October 27, 2000
----------------------- Director (Principal
Stephen P. Adik Financial and
Accounting Officer)
40
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, NiSource Inc. certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3
and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Merrillville, State of Indiana, on October 27, 2000.
NISOURCE INC.
(Registrant)
By: /s/ Gary L. Neale
---------------------------------
Gary L. Neale
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as
amended, this registration statement has been signed by the following
persons in the capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ Gary L. Neale Chairman, President October 27, 2000
----------------------- and Chief Executive
Gary L. Neale Officer (Principal
Executive Officer)
/s/ Stephen P. Adik Senior Executive Vice October 27, 2000
----------------------- President, Chief
Stephen P. Adik Financial Officer and
Treasurer (Principal
Accounting Officer)
/s/ Steven C. Beering* Director October 27, 2000
-------------------------
Steven C. Beering
41
/s/ Arthur J. Decio* Director October 26, 2000
-------------------------
Arthur J. Decio
/s/ Dennis E. Foster* Director October 26, 2000
-------------------------
Dennis E. Foster
/s/ James T. Morris* Director October 26, 2000
-------------------------
James T. Morris
/s/ Ian M. Rolland* Director October 26, 2000
-------------------------
Ian M. Rolland
/s/ John W. Thompson* Director October 26, 2000
-------------------------
John W. Thompson
/s/ Robert J. Welsh* Director October 26, 2000
-------------------------
Robert J. Welsh
/s/ Carolyn Y. Woo* Director October 26, 2000
-------------------------
Carolyn Y. Woo
/s/ Roger A. Young* Director October 26, 2000
-------------------------
Roger A. Young
*By: /s/ Stephen P. Adik
------------------------
Stephen P. Adik
Attorney-in-Fact
42
INDEX TO EXHIBITS
Exhibit Number Description
------------- -----------
2* Agreement and Plan of Merger dated as of February
27, 2000, as amended and restated as of March 31,
2000, among Columbia Energy Group, NiSource Inc.,
New NiSource Inc., Parent Acquisition Corp.,
Company Acquisition Corp. and NiSource Finance
Corp. (incorporated by reference to Annex I of the
Joint Proxy Statement/Prospectus contained in the
Company's Registration Statement on Form S-4/A
(File No. 333-33896), filed with the Commission on
April 24, 2000).
4.1 Form of Bay State Gas Company Savings Plan for
Operating Employees.
4.2** Rights Agreement between New NiSource Inc. and
ChaseMellon Shareholder Services, L.L.C., as
rights agent dated ______, 2000.
5 Opinion of Schiff Hardin & Waite.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Schiff Hardin & Waite (included in its
opinion filed as Exhibit 5).
24.1 Power of Attorney for New NiSource Inc. (included
on signature page).
24.2 Power of Attorney for NiSource Inc.
__________
* Incorporated by reference.
** To be filed by amendment.
43