v
VECTREN CORPORATION
RETIREMENT SAVINGS PLAN
(AMENDED AND RESTATED
EFFECTIVE AS OF JULY 1, 2000)
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<TABLE>
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TABLE OF CONTENTS
PAGE
<S> <C> <C> <C>
ARTICLE I ESTABLISHMENT OF THE PLAN 2
1.1 Effective Date 2
1.2 Legal Requirements 2
ARTICLE II DEFINITIONS 3
2.1 Actual Deferral Percentage 3
2.2 Annual Additions 3
2.3 Appropriate Form 4
2.4 Beneficiary 4
2.5 Break in Service 4
2.6 Company 4
2.7 Company Matched Contribution 4
Percentage
2.8 Company Matched Contributions 4
2.9 Company Matching Contributions 4
Account
2.10 Company Non-Matching Contributions 5
Account
2.11 Compensation 5
2.12 Compensation Redirection Account 5
2.13 Compensation Redirection Agreement 5
2.14 Compensation Redirection Amount 6
2.15 Compensation Redirection Percentage 6
2.16 Computation Period 6
2.17 Current Year ACP Method 6
2.18 Current Year ADP Method 6
2.19 Defined Benefit Fraction 6
2.20 Defined Contribution Fraction 7
2.21 Effective Date 7
2.22 Employee 7
2.23 ESOP 8
2.24 Group 8
2.25 Highly Compensated Participant 9
2.26 Hour of Service 9
2.27 Normal Retirement Age 11
2.28 Participant 11
2.29 Participant Accounts 11
2.30 Participating Companies 11
2.31 Plan 11
2.32 Plan Administrator 11
2.33 Plan Year 11
2.34 Plan Year Compensation 11
2.35 Prior Year ACP Method 12
2.36 Prior Year ADP Method 12
Prior Year's Non-Highly Compensated
2.37 Participant 12
2.38 Section 415 Compensation 12
2.39 Spouse 14
2.40 Termination Date 14
2.41 Top Paid Group 14
2.42 Total Disability 15
2.43 Trust Agreement 15
2.44 Trustee 15
2.45 Trust Fund 15
2.46 Union 16
2.47 Valuation Date 16
2.48 Year of Service 16
ARTICLE III ELIGIBILITY 17
3.1 Requirements for Eligibility 17
3.2 Commencement of Participation 17
3.3 Method of Becoming a Participant 17
3.4 Reemployment 18
3.5 Change in Status 18
3.6 Limited Participant 18
ARTICLE IV COMPENSATION REDIRECTION 20
4.1 Compensation Redirection Agreements 20
4.2 Change in Compensation Redirection 20
Agreements
4.3 Revocation of Compensation 20
Redirection Agreements
ARTICLE V COMPANY CONTRIBUTIONS 21
5.1 Amount of Company Contributions 21
5.2 Company Matching Contributions 21
(a) Non-Union Employees 21
(b) Union Employees 22
5.3 Company Non-Matching Contributions 22
(a) Pre-1999 Contributions for Non-Union 22
Employees
(b) Union Employees 23
Post June 30, 1999 Contributions for
(c) Non-Union Employees 23
5.4 Remittance of Company Contributions 24
5.5 Maximum Contributions 24
5.6 Return of Company Contributions 25
5.7 Return of Compensation Redirection 25
Amounts
5.8 Return of Company Matched 27
Contributions
5.9 Maximum Redirection Amounts 32
5.10 Investment Fund Priority of Excess 33
Contributions
5.11 Plan Priority of Excess Contributions 33
5.12 ESOP and ESOP I Accounts Transfers 34
5.13 Transfer of Assets from Other Plans 34
5.14 Rehire after Military Service 35
ARTICLE VI INVESTMENT OF CONTRIBUTIONS 36
6.1 Investment of Contributions 36
6.2 Change in Investment Election 36
6.3 Conversion of Investments 36
ARTICLE VII PARTICIPANT ACCOUNTS 37
7.1 Maintenance of Participant Accounts 37
7.2 Valuation of Participant Accounts 37
7.3 Nature of Participant's Interest in 37
Trust Fund
ARTICLE VIII WITHDRAWALS 38
8.1 Right to Withdraw 38
8.2 Basis for Withdrawals 38
8.3 Form of Payment 40
ARTICLE IX DISTRIBUTIONS 41
Benefits on Retirement, Vested
9.1 Resignation,
Vested Dismissal or Total Disability 41
9.2 Benefits on Death 42
9.3 Non-Vested Benefits 42
9.4 Forfeiture Accounts and Forfeitures 43
9.5 Application of Forfeitures 44
9.6 Form of Payment 45
9.7 Designation of Beneficiary 45
9.8 Payment of Benefits 45
9.9 Death Distribution Provisions 46
9.10 Minimum Distribution Amount 47
9.11 Incapacity 47
9.12 Identity of Payee 48
9.13 Direct Transfers 48
ADOPTION AND WITHDRAWAL BY
ARTICLE X SUBSIDIARIES AND AFFILIATES 50
10.1 Adoption by Affiliates 50
10.2 Withdrawal by Participating Company 50
ARTICLE XI CLAIMS 51
11.1 Procedure 51
ARTICLE XII ADMINISTRATION OF PLAN 53
12.1 Plan Administrator 53
12.2 Delegation of Duties 53
12.3 Duties of Plan Administrator 53
12.4 Communications to Trustee 53
12.5 Additional Rights of Plan 53
Administrator
12.6 Compliance with Law 54
12.7 Waiver of Time Deadlines 54
ARTICLE XIII DUTIES OF THE TRUSTEE 55
13.1 General Provisions 55
13.2 Trust Agreement 55
13.3 Appointment of Investment Manager 55
13.4 Voting of Common Stock in Fund A 56
ARTICLE XIV MISCELLANEOUS 57
14.1 Payment of Expenses 57
14.2 Forms 57
14.3 No Right of Employment 57
14.4 Construction 57
14.5 Copies of Documents 57
14.6 Jurisdiction 58
14.7 Nonalienation of Benefits 58
14.8 Non-Diversion 58
Non-Liability of Participating
14.9 Companies 59
14.10 Illegal or Invalid Provisions 59
14.11 Execution of Counterparts 59
14.12 Tax Approval 59
14.13 Non-Liability of Shareholders 59
14.14 Rights of Third Parties 60
14.15 Titles 60
14.16 Successors and Assigns 60
14.17 Forms and Proofs; Notice of Address 60
ARTICLE XV AMENDMENT, TERMINATION OR MERGER 61
15.1 Right To Amend or Terminate 61
15.2 Distribution upon Termination 62
15.3 Plan Merger or Consolidation 62
ARTICLE XVI PARTICIPANT LOANS 64
16.1 Authorization by Plan Administrator 64
16.2 Terms and Conditions 65
16.3 Accounting for Loans 69
ARTICLE XVII TEFRA TOP-HEAVY RULES 70
17.1 Application 70
17.2 Determination 70
17.3 Accrued Benefits 72
17.4 Vesting Provisions 72
17.5 Minimum Contribution 73
17.6 Code Section 415 Limitations 73
ARTICLE XVIII MERGER OF SIGCORP PLANS 74
18.1 Effective Date of Merger 74
18.2 Eligibility 74
18.3 Investment of Merged Funds 74
18.4 Distributions 74
Transfer of Plan Monies of Former
18.5 Employees 74
18.6 Accounts 75
EXHIBIT A 77
EXHIBIT B 78
</TABLE>
<PAGE>VECTREN CORPORATION
RETIREMENT SAVINGS PLAN
(AMENDED AND RESTATED EFFECTIVE AS OF JULY 1, 2000)
This Plan was initially established effective January 1, 1986
to provide retirement benefits to the non-collective bargaining
employees of Indiana Gas Company, Inc. The Indiana Gas Company,
Inc. Retirement Savings Plan for Bargaining Unit Employees (the
"Bargaining Savings Plan") was initially established effective
July 1, 1988 to provide retirement benefits to the collective
bargaining employees of Indiana Gas Company, Inc. Effective
October 1, 1994, Indiana Gas Company, Inc. merged the Bargaining
Savings Plan into this Plan. Effective October 1, 1997,
sponsorship of the Plan was transferred from Indiana Gas Company,
Inc. to Indiana Energy, Inc. Vectren, Inc. ("Vectren") is the
successor corporation to Indiana Energy, Inc. Effective April 1,
2000, the name of the Plan was changed to the Vectren Corporation
Retirement Savings Plan. Effective July 1, 2000, the 401(k) Plan
for Salaried Employees of Southern Indiana Gas and Electric
Company (the "SIGEC Plan"), the SIGCORP, Inc. 401(k) Profit
Sharing Plan (the "SIGCORP Plan") and the SIGECo Advanced
Communication, Inc. Non-Standardized 401(k) Profit Sharing Plan
(the "SIGECo Advanced Communication Plan") were merged into, and
became a part of, this Plan. This Plan shall be deemed to be the
continuation of the Bargaining Savings Plan, the SIGEC Plan, the
SIGCORP Plan and the SIGECo Advanced Communication Plan for the
affected employees.
The purpose of the Plan is to assist eligible employees to
provide additional security for their retirement.
It is intended that the Plan and the Trust Agreement which
is part of the Plan meet the requirements of the Employee
Retirement Income Security Act of 1974, as now in effect or
hereafter amended and regulations promulgated thereunder,
("ERISA") and be qualified and exempt as a profit sharing plan
with a cash or deferred arrangement under Section 401(a), Section
401(k) and Section 501(a) of the Internal Revenue Code of 1986,
as now in effect or hereafter amended and regulations promulgated
thereunder, (the "Code").
Pursuant to rights reserved under Section 15.1 of the Plan,
Vectren amends and restates the Plan, effective July 1, 2000, to
provide, in its entirety, as follows:
<PAGE>
ARTICLE I
ESTABLISHMENT OF THE PLAN
1.1 Effective Date. The Plan became effective as of July 1,
1986.
1.2 Legal Requirements. The establishment of the Plan was
contingent upon the receipt of a written determination by
the Internal Revenue Service that the Plan and the Trust
Agreement qualify under Section 401(a), under Section
401(k) and under Section 501(a) of the Code.
<PAGE>
ARTICLE II
DEFINITIONS
2.1 Actual Deferral Percentage means for each Plan Year
the average of the ratios (calculated separately to
the nearest one hundredth percent (.01%) for each
Participant) of:
(a) the Compensation Redirection Amount of each
such Participant for such Plan Year relating to
Compensation which, but for the election, would
have been paid in such Plan Year, to
(b) such Participant's Plan Year Compensation for
such Plan Year;
provided, however, that if a Highly Compensated
Participant also participates in another qualified
retirement plan with a salary deferral feature
maintained by the Group under Section 401(a) and
Section 401(k) of the Code, his Actual Deferral
Percentage shall be determined as if all such
qualified plans with a salary deferral feature were
a single plan.
2.2 Annual Additions mean, with respect to any
Participant for any Plan Year and with respect to
the Plan and to all other qualified defined
contribution plans maintained by the Group, the sum
of:
(a) Company contributions, including Compensation
Redirection Amounts, and forfeitures, if
applicable, credited to his Participant Account
for such Plan Year under the Plan; and
(b) the amount of such Participant's non-deductible
contributions, and
(c) amounts allocated after March 31, 1984 to an
individual medical account as defined in
Section 415(l)(2) of the Code which is part of
a pension or annuity plan maintained by the
Group shall be treated as annual additions to a
qualified defined contribution plan; amounts
derived from contributions paid or accrued
after December 31, 1985 in taxable years ending
after such date which are attributable to post-
retirement medical benefits allocated to the
separate account of a key employee as defined
in Section 419A(d)(3) of the Code under a
welfare benefit fund as defined in Section
419(e) of the Code maintained by the Group
shall also be treated as annual additions to a
tax qualified defined contribution plan.
2.3 Appropriate Form means the form prescribed by the
Plan Administrator for purposes of any specific
request or authorization under the Plan.
2.4 Beneficiary means the person or persons to whom the
benefits of deceased Participants are payable under
Section 9.2.
2.5 Break in Service means after an Employee becomes
eligible to participate in the Plan any Plan Year in
which such Employee completes less than five hundred
(500) Hours of Service for the Group.
2.6 Company means Vectren Corporation and each other
individual Participating Company and, as used herein
with reference to an individual Participant, it
shall be construed to mean that Participant's
employer at the time of reference or his last
employer prior to his Termination Date. If at the
time of reference a Participant is concurrently
employed by more than one (1) Participating Company,
it shall be construed to mean all such employers
acting collectively and not individually.
2.7 Company Matched Contribution Percentage means for
each Plan Year the average of the ratios (calculated
separately for each Participant to the nearest one
hundredth of one percent (.01%)) of:
(a) the Company Matched Contributions allocated to
each such Participant for such Plan Year, to
(b) such Participant's Plan Year Compensation for
such Plan Year;
provided, however, that if a Highly Compensated
Participant also participates in another
qualified retirement plan maintained by the
Group which provides for Company matching
contributions or employee contributions, the
Plan Participants' Company Matched Contribution
Percentages shall be determined as if all such
qualified plans were a single plan and
Subsection (a) shall include any non-deductible
employee contributions made by the
Participants, if any, to such other qualified
plans for such Plan Year.
2.8 Company Matched Contributions means the matching
contributions made by the Participating Companies
under Section 5.2.
2.9 Company Matching Contributions Account means for
each Participant the contributions made by the
Participating Companies under Section 5.2 and, for
the period before January 1, 1999 under Section 5.3;
provided, however, that the Company Matching
Contributions Account shall also be credited with
any amounts transferred on his behalf to the Plan
from the ESOP or rollovers transferred in accordance
with Section 5.13; provided, further, that any
amounts transferred from the ESOP and any rollovers
shall be fully vested and non-forfeitable at all
times.
2.10 Company Non-Matching Contributions Account means
the Company contributions made for each Participant
under Section 5.3.
2.11 Compensation means for each Participant the total
cash salary or wages (including overtime, bonuses
and Compensation Redirection Amounts but excluding
non-cash salary and fringe benefits) paid by the
Group to such Participant in a payroll period.
Compensation also includes with respect to a
Participant any amount which the Participant elects
to contribute to this Plan pursuant to a
Compensation Redirection Agreement and which is not
includible in that Participant's gross income under
Section 125 of the Code. For Plan Years beginning
after December 31, 1988 and before January 1, 1994,
Compensation in excess of two hundred thousand
dollars ($200,000), as adjusted pursuant to Section
415(b)(1)(A) and (d)(1) of the Code, shall be
disregarded. In addition to other applicable
limitations set forth in this Plan, and
notwithstanding any other provision of this Plan to
the contrary, for Plan Years beginning on or after
January 1, 1994, the annual Compensation of each
Employee taken into account under this Plan shall
not exceed the OBRA '93 Annual Compensation Limit.
The OBRA '93 Annual Compensation Limit is one
hundred and fifty thousand dollars ($150,000), as
adjusted by the Commissioner for increases in the
cost of living in accordance with Section
401(a)(17)(B) of the Code. The cost-of-living
adjustment in effect for a Plan Year applies to any
period not exceeding twelve (12) months, over which
Compensation is determined (determination period)
beginning in such calendar year. If a determination
period consists of fewer than twelve (12) months,
the OBRA '93 Annual Compensation Limit will be
multiplied by a fraction, the numerator of which is
the number of months in the determination period,
and the denominator of which is twelve (12). For
Plan Years beginning on or after January 1, 1994,
any reference in this Plan to the limitation under
Section 401(a)(17) of the Code shall mean the OBRA
'93 Annual Compensation Limit set forth in this
provision.
2.12 Compensation Redirection Account means for each
Participant the account established by the Trustee
to reflect the Company contributions made on his
behalf under Section 5.1. A Participant's interest
in his Compensation Redirection Account shall be
fully vested and non-forfeitable at all times.
2.13 Compensation Redirection Agreement means the
agreement between a Participant and the
Participating Companies in which such Participant
designates the percentage or dollar amount of his
Compensation to be contributed to the Plan.
2.14 Compensation Redirection Amount means the amount of
reduction in a Participant's Compensation resulting
from a Compensation Redirection Agreement between a
Participant and the Participating Companies pursuant
to Section 4.1.
2.15 Compensation Redirection Percentage means the
percentage reduction in a Participant's Compensation
resulting from the Compensation Redirection
Agreement between a Participant and the
Participating Companies pursuant to Section 4.1.
2.16 Computation Period means, for all purposes of the
Plan, the consecutive twelve (12) month period
commencing on the date on which such Employee first
(1st) completes an Hour of Service and any Plan Year
beginning after the date on which such Employee
first (1st) completes an Hour of Service.
2.17 Current Year ACP Method means, with respect to a
Plan Year, the calculation of the average of the
Company Matched Contribution Percentages for all
Employees who are eligible to be Participants in
that Plan Year, other than Highly Compensated
Participants, based on the Company Matched
Contributions made on behalf of and the Plan Year
Compensation earned by each such Employee during the
Plan Year to which such calculation relates.
2.18 Current Year ADP Method means, with respect to a
Plan Year, the calculation of the Actual Deferral
Percentage for all Employees who are eligible to be
Participants in that Plan Year, other than Highly
Compensated Participants, based on the Compensation
Redirection Amounts of and the Plan Year
Compensation earned by each such Employee during the
Plan Year to which such calculation relates.
2.19 Defined Benefit Fraction means for any Plan Year a
fraction:
(a) the numerator of which is the projected annual
benefit of a Participant under all qualified
defined benefit plans of the Group (determined
as of the last calendar day of that Plan
Year), and
(b) the denominator of which is the lesser of:
(i) the product of one and twenty-five one
hundredths (1.25) multiplied by ninety
thousand dollars ($90,000), as adjusted
beginning with the Plan Year commencing
January 1, 1988 pursuant to Section
415(b)(1)(A) and to Section 415(d)(1) of
the Code, or
(ii) the product of one and four tenths (1.4)
multiplied by one hundred percent (100%)
of such Participant's average Section
415 Compensation for his three (3)
consecutive Plan Years that produce the
highest average.
2.20 Defined Contribution Fraction means for any Plan
Year a fraction:
the numerator of which is the sum of the
Annual Additions to a Participant's accounts
under all qualified defined contribution plans
of the Group (determined as of the last
calendar day of that Plan Year), and
(b) the denominator of which is the sum of the
lesser of the following amounts determined for
that Plan Year and for each prior Plan Year of
service with the Group:
(i) the product of one and twenty-five one
hundredths (1.25) multiplied by thirty
thousand dollars ($30,000) or, if
greater, one-fourth (1/4th) of the
dollar limitation in effect for such
Plan Year under Section 415(b)(1)(A) of
the Code, or
(ii) the product of one and four tenths (1.4)
multiplied by twenty-five percent (25%)
of such Participant's Section 415
Compensation for such Plan Year.
2.21 Employee shall also include any individual deemed to
be a leased employee (as defined below) of the Group
but only to the extent required by the Code. For
purposes of this Plan, the term "leased employee"
means any person (other than an employee of the
recipient) who pursuant to an agreement between the
recipient and any other person ("leasing
organization") has performed services for the
recipient (or for the recipient and related persons
determined in accordance with Section 414(n)(6) of
the Code) on a substantially full-time basis for a
period of at least one year, and with respect to
Plan Years beginning on or after January 1, 1997,
such services are performed under the primary
direction or control by the recipient employer;
provided, however, that a leased employee shall not
be considered an employee of the recipient if (a)
such employee is covered by a money purchase pension
plan providing a nonintegrated employer contribution
rate of at least ten percent (10%) of Compensation,
immediate participation and full and immediate
vesting and (b) leased employees do not constitute
more than twenty percent (20%) of the recipient's
non-highly compensated workforce.
2.22 Employee means any person who is employed by and
receives Compensation from the Group but shall
exclude any employee who is part of a collective
bargaining unit unless and until the applicable
Company and the collective bargaining representative
for that unit agree in writing for the person's
coverage hereunder; provided, however, that for the
period on and after October 1, 1994 Employee shall
also include any person who is employed by and
receives Compensation from the Group and whose terms
of employment with the applicable Company are
governed by a collective bargaining agreement
between the Union and the Company and which
collective bargaining agreement provides for the
person's coverage hereunder.
A leased employee within the meaning of Section
414(n)(2) of the Code shall become a Participant in
the Plan based on service as a leased employee only
as provided in provisions of the Plan other than
this Section. Contributions or benefits provided a
leased employee by the leasing organization which
are attributable to services performed for the
recipient employer shall be treated as provided by
the recipient employer.
2.23 ESOP means the Indiana Gas Company, Inc. Employee
Stock Ownership Plan II and the Indiana Gas Company,
Inc. Employee Stock Ownership Plan which were
terminated on June 15, 1988 and July 9, 1989
respectively and from which the Plan Participants
were permitted to transfer their account balances to
this Plan or the Bargaining Retirement Plan.
2.24 Group means all the Participating Companies at the
time of reference. Solely for the purpose of:
(a) computing an Employee's Years of Service and
Hours of Service to determine his eligibility
to participate in the Plan and his right to
make withdrawals pursuant to Section 8.2;
(b) applying the limitations contained in Section
5.5;
(c) determining whether the Plan is a Top-Heavy
Plan under Section 17.2 and, thus, subject to
the provisions of Article XVII,
(d) determining a Participant's Termination Date,
and
(e) determining whether a Participant is a Highly
Compensated Participant,
Group shall also include any entity which, together
with a Participating Company, constitutes a member
of a controlled group of corporations (as defined in
Section 414(b) of the Code), a member of a group of
trades or businesses (whether or not incorporated)
which is under common control (as defined in Section
414(c) of the Code), a member of an affiliated
service group (as defined in Section 414(m) of the
Code) or any other entity required to be aggregated
with a Participating Company pursuant to Section
414(o) of the Code, but only to the extent required
by the Code.
2.25 Highly Compensated Participant means for each Plan
Year beginning on and after January 1, 1997 and you
shall include any Employee described in Section
414(q) of the Code who:
(a) is a five percent (5%) or more owner (as then
defined in Section 416(i)(1) of the Code) of a
member of the Group at any time during that
Plan Year or the immediately preceding Plan
Year; or
(b) received more than eighty thousand dollars
($80,000), as automatically adjusted pursuant
to Sections 414(q)(1) and 415(d) of the Code
without the necessity of any amendment to the
Plan, of Section 415 Compensation from the
Group in the immediately preceding Plan Year
and was in the Top Paid Group for that
immediately preceding Plan Year.
For purposes of determining whether an Employee is a
Highly Compensated Participant and notwithstanding
anything else contained in this Section, the
following rules shall apply:
(c) A former Employee shall be treated as a Highly
Compensated Participant if he was a Highly
Compensated Participant in the Plan Year during
which his employment with the Group terminated
or in any Plan Year during which occurs or
commencing after his fifty-fifth (55th)
birthday.
(d) Section 415 Compensation shall include any
amount which is contributed by the Group
pursuant to a salary reduction agreement and
which is not includible in the gross income of
an Employee under Sections 125, 401(k),
402(a)(8), 402(h)(1)(B) and 403(b) of the Code.
(e) An Employee shall only be deemed to be a Highly
Compensated Participant to the extent required
by the Code.
2.26 Hour of Service means and shall include:
(a) each hour for which an Employee is directly or
indirectly paid, or entitled to payment, for
the performance of duties assigned to him by
the Group; these hours shall be credited to the
Employee for the Computation Period in which
the duties are performed; and
(b) each hour for which an Employee is directly or
indirectly paid, or entitled to payment, by the
Group on account of a period of time during
which no duties are performed (irrespective of
whether the employment relationship has
terminated) due to vacation, holiday, illness,
incapacity (including disability but excluding
any disability payments made pursuant to the
Plan or pursuant to any other qualified
retirement plans maintained by the Group),
layoff, jury duty, military duty or leave of
absence; provided, however, that no Hours of
Service shall be credited under this Subsection
if the payment is made or due solely as
reimbursement for medical or medically-related
expenses incurred by such Employee or to comply
with applicable workmen's compensation,
unemployment compensation or disability
insurance laws, if any; no more than five
hundred and one (501) Hours of Service shall be
credited under this Subsection for any single
continuous period (whether or not such period
occurs in a single Computation Period); hours
under this Subsection shall be calculated and
credited pursuant to Section 2530.200b-2 of the
Department of Labor Regulations which are
incorporated herein by this reference; and
(c) each hour for which back pay, irrespective of
mitigation of damages, is either awarded to an
Employee or agreed to by the Group to the
extent that such award or agreement is intended
to compensate that Employee for periods during
which that Employee would have been engaged in
the performance of duties for the Group; the
same Hours of Service shall not be credited
both under Subsection (a) or Subsection (b), as
the case may be, and under this Subsection.
Solely for purposes of determining whether a Break
in Service, for participation and vesting purposes,
has occurred in any Computation Period, an
individual who is absent from work for maternity or
paternity reasons shall receive credit for the Hours
of Service which would otherwise have been credited
to such individual but for such absence or, in any
case in which such Hours of Service cannot be
determined, eight (8) Hours of Service per day of
such absence. For purposes of this paragraph, an
absence from work for maternity or paternity reasons
means an absence by reason of the pregnancy of the
individual, by reason of the birth of a child of the
individual, by reason of the placement of a child
with the individual in connection with the adoption
of such child by that individual or for purposes of
caring for such child for a period beginning
immediately following such birth or placement. The
Hours of Service credited under this paragraph shall
be credited in the Computation Period in which the
absence begins if the crediting is necessary to
prevent a Break in Service in that Computation
Period or, in all other cases, in the next following
Computation Period.
To the extent required under the Family and Medical
Leave Act of 1993 ("FMLA") and solely for purposes
of determining whether a Break in Service for
participation and vesting purposes has occurred in
any computation period, an individual who is absent
from work on unpaid leave under the FMLA on or after
August 5, 1993 shall receive credit for the Hours of
Service which would otherwise have been credited to
such individual but for such absence or, in any case
in which such Hours of Service cannot be determined,
eight (8) Hours of Service per each regularly
scheduled work day of such absence.
Hours of Service shall be determined from the
records of the Group or in accordance with the
method or methods adopted by the Plan Administrator,
which method or methods shall be uniformly,
consistently and nondiscriminatorily applied;
provided, however, that in determining the Hours of
Service of any Employee whose Compensation is not
based on hours worked, during a period of time when
such hours cannot be accurately determined, each
such Employee shall be credited with not less than
forty-five (45) Hours of Service per week or ten
(10) Hours of Service per day. Hours of Service
determined under this Section shall be credited for
all purposes for which a determination as to Hours
of Service is relevant.
2.27 Normal Retirement Age means age sixty-five (65). A
Participant's interest in his Participant Account
shall automatically be fully vested and non-
forfeitable upon the attainment of Normal Retirement
Age regardless of his Years of Service.
2.28 Participant means any Employee of a Participating
Company who is eligible to and who has elected to
participate in the Plan under Article III.
2.29 Participant Accounts means and shall include for
each Participant his Compensation Redirection
Account, Company Matching Contributions Account and
Company Non-Matching Contributions Account. The
earnings, losses, appreciation and depreciation
attributable to such Participant Accounts shall be
credited on his behalf by the Trustee.
2.30 Participating Companies means Vectren Corporation,
Southern Indiana Gas and Electric Company, and any
entity which becomes a Participating Company in
accordance with Article X.
2.31 Plan means the qualified defined contribution plan
embodied herein, as it may be hereafter amended from
time to time.
2.32 Plan Administrator means Vectren Corporation. The
Plan Administrator shall be a "named fiduciary" for
purposes of Section 402(a)(1) of ERISA, responsible
for the administration, operation and interpretation
of the Plan.
2.33 Plan Year means the calendar year.
2.34 Plan Year Compensation means with respect to each
Employee for each Plan Year the sum of the wages,
salaries and bonuses (including overtime,
commissions, Compensation Redirection Amounts) paid
by the Group to such Employee or, if applicable, to
the Plan. Plan Year Compensation also includes,
with respect to a Participant, any amount which is
not includible in the Participant's gross income
under Section 125 of the Code. For Plan Years
beginning after December 31, 1988, Plan Year
Compensation in a Plan Year in excess of the OBRA
'93 Annual Compensation Limit (as such term is
defined in Section 2.11) shall be disregarded.
2.35 Prior Year ACP Method means, with respect to a Plan
Year, the calculation of the average of the Company
Matched Contribution Percentages of the Prior Year's
Non-Highly Compensated Participants, based on the
Company Matched Contributions made on behalf of and
the Plan Year Compensation earned by each Prior
Year's Non-Highly Compensated Participant during the
immediately preceding Plan Year.
2.36 Prior Year ADP Method means, with respect to a Plan
Year, the calculation of the Actual Deferral
Percentage for all Prior Year's Non-Highly
Compensated Participants, based on the Compensation
Reduction Amounts of and the Plan Year Compensation
earned by each Prior Year's Non-Highly Compensated
Participant during the immediately preceding Plan
Year.
2.37 Prior Year's Non-Highly Compensated Participant
means, with respect to any Plan Year beginning on or
after January 1, 1997, each individual who was in
the immediately preceding Plan Year:
(a) an Employee eligible to participate in this
Plan; and
(b) not a Highly Compensated Participant, as
determined in accordance with the definition of
"Highly Compensated Participant" in effect with
respect to such immediately preceding Plan
Year.
An individual may be a Prior Year's Non-Highly
Compensated Participant even though he is not an
Employee or Participant in the current Plan Year or
even though he would be treated as a Highly
Compensated Participant in the current Plan Year.
2.38 Section 415 Compensation means for each Plan Year
and shall:
(a) include amounts accrued to a Participant
(regardless of whether he was a Participant
during the entire Plan Year):
(i) as wages, salaries, fees for
professional services and other amounts
received for personal services actually
rendered in the course of employment
with the Group, including but not
limited to commissions, compensation for
services on the basis of a percentage of
profits and bonuses;
(ii) for purposes of Subsection (a)(i) above,
earned income from sources outside the
United States (as defined in Section
911(b) of the Code), whether or not
excludible from gross income under
Section 911 of the Code or deductible
under Section 913 of the Code;
(iii) amounts described in Section 104(a)(3),
Section 105(a) and Section 105(h) of the
Code, but only to the extent that these
amounts are includible in the gross
income of such Participant;
(iv) amounts paid or reimbursed by the Group
for moving expenses incurred by such
Participant, but only to the extent that
these amounts are not deductible by such
Participant under Section 217 of the
Code; and
(v) for Plan Years beginning after December
31, 1997, by a Participant's elective
deferrals under Section 402(g)(3) of the
Code and any amount which is contributed
or deferred by the Group at the election
of the Participant and which is not
includible in the Participant's income
by reason of Section 125 or 457 of the
Code.
(b) not include:
(i) notwithstanding Subsection (a)(i) above
and solely with respect to Plan Years
beginning before January 1, 1998,
amounts contributed to the Plan under
Article V;
(ii) except as otherwise provided in
Subsection (a)(v) above, other
contributions made by the Group to a
qualified plan of deferred compensation
to the extent that, before the
application of the Section 415 of the
Code limitations to that plan, the
contributions are not includible in the
gross income of such Participant for the
taxable year in which contributed; in
addition, Company contributions made on
behalf of such Participant to a
simplified employee pension plan
described in Section 408(k) of the Code
shall not be considered as Section 415
Compensation for the taxable year in
which contributed; additionally, any
distributions from a qualified plan of
deferred compensation shall not be
considered as Section 415 Compensation,
regardless of whether such amounts are
includible in the gross income of such
Participant when distributed; however,
any amounts received by such Participant
pursuant to an unfunded nonqualified
plan shall be considered as Section 415
Compensation in the taxable year in
which such amounts are includible in the
gross income of such Participant; and
(iii) except as otherwise provided in
Subsection (a)(v) above, other amounts
which receive special federal income tax
treatment under the Code, such as
premiums for group term life insurance
(but only to the extent that those
premiums are not includible in the gross
income of such Participant).
Notwithstanding anything in this Section 2.38 to the
contrary, for Plan Years beginning on or after
January 1, 1998, Section 415 Compensation shall
include any elective deferral (as defined in Section
402(g) of the Code) and any amount contributed or
deferred at the election of the Participant that is
not includible in that Participant's gross income by
reason of Section 125 or Section 457 of the Code.
2.39 Spouse means the person to whom an Employee is lawfully
married or was lawfully married at the date of his death.
2.40 Termination Date means the date on which a Participant's
employment with the Group is terminated by reason of his
discharge, resignation, retirement, Total Disability or
death.
2.41 Top Paid Group means in a Plan Year the Employees who
are in the top twenty percent (20%) of the Group's
Employees in terms of Section 415 Compensation for such
Plan Year; provided, however, that for purposes of
determining the number of Employees to be included in the
Top Paid Group, the following Employees shall be excluded
to the extent permitted by Section 414(q)(4) of the Code:
(a) Employees who have not completed six (6) months of
service with the Group;
(b) Employees who normally work less than seventeen and
one-half (17 1/2) hours per week or less than six
(6) months during a Plan Year;
(c) Employees who have not attained age twenty-one (21);
(d) except as provided by regulations promulgated under
the Code, Employees who are covered by a
collectively bargained agreement; and
(e) Employees who are non-resident aliens and who
receive no earned income (within the meaning of
Section 911(d)(2) of the Code) from the Group which
constitutes income from sources in the United States
(within the meaning of Section 861(a)(3) of the
Code).
2.42 Total Disability means a Participant's mental or
physical condition which entitles him to disability
benefits under the long term disability plan maintained
by the Group.
2.43 Trust Agreement means the agreement entered into between
Vectren Corporation and the Trustee to carry out the
purposes of the Plan, as set forth herein, which Trust
Agreement, as it may be amended hereafter from time to
time, shall form a part of the Plan.
2.44 Trustee mean the Trustee of the Trust Fund and its
successors and substitutes.
2.45 Trust Fund means the cash and other assets held and
administered by the Trustee in accordance with the
provisions of the Trust Agreement and of the Plan and
shall consist of the following investment funds:
(a) Fund A which shall be invested principally in shares
of common stock of Vectren Corporation which shares
shall be purchased on the open market, unless
Vectren Corporation makes available for purchase by
the Plan authorized but unissued shares of its
common stock at a price per share equal to its
closing price as reported in The Wall Street Journal
as of the trading day immediately preceding the date
of such purchase;
(b) Fund B which shall be a stable value fund investing
principally in fixed income investments, including
guaranteed investment contracts, bank investment
contracts and structured investment contracts;
(c) Fund C which shall be an equity investment fund
consisting primarily of common stocks; and
(d) Fund D which shall be a balanced fund investing
primarily in a mix of fixed income investments and
equities;
(e) Fund E which shall be an equity index fund investing
in all five hundred (500) stocks composing the S&P
500;
(f) Fund F which shall be a fund investing in equity
securities emphasizing long-term growth of capital
and income and which is primarily invested either in
equities or other mutual fund equity funds;
(g) Fund G which shall be an equity fund investing
primarily in equities of non-United States
companies; and
(h) Fund H which shall be an equity fund investing in
emerging growth companies;
Without the need of a formal amendment, the Plan
Administrator may modify the available investment funds.
2.46 Union means the International Brotherhood of Electrical
Workers, Local Union 1393, the United Steelworkers of
America AFL-CIO-CLC, Locals 7441 and 12213, and any other
collective bargaining unit with respect to which the
Participating Companies and that collective bargaining
unit have agreed to its participation in this Plan.
2.47 Valuation Date means and shall include each business
date.
2.48 Year of Service means any Computation Period during
which an Employee completes one thousand (1,000) Hours of
Service; provided, however, that for eligibility
purposes, an Employee shall not be deemed to have
completed a Year of Service in a Computation Period until
the last day of the Computation Period.
<PAGE>
ARTICLE III
ELIGIBILITY
3.1 Requirements for Eligibility. Each Employee who is
expected to complete at least one thousand (1,000)
Hours of Service during his first Computation Period
is eligible to become a Participant in the Plan once
he completes at least one (1) Hour of Service;
provided, however, that an Employee whose terms of
employment are covered by a collective bargaining
agreement entered into by a Participating Company
and a Union shall not be eligible until he completes
at least one (1) Year of Service or is employed for
six (6) months, whichever occurs first; provided,
further, that an Employee whose terms of employment
are not covered by a collective bargaining agreement
entered into by a Participating Company and a Union
and who is not expected to complete at least one
thousand (1,000) Hours of Service during his first
Computation Period is eligible to become a
Participant in the Plan once he completes at least
one (1) Year of Service.
3.2 Commencement of Participation. An Employee shall
become a Participant in the Plan as soon as
practicable following satisfaction of the
requirements for eligibility set forth in Section
3.1; provided, however, that such Employee shall not
have his Compensation redirected pursuant to Section
4.1 until he has complied with Section 3.3. If an
Employee is a Participant and is eligible to have
his Compensation redirected pursuant to Section 4.1
but does not elect to redirect his Compensation when
first eligible to do so, he may commence having his
Compensation redirected at any time thereafter,
assuming that such Employee continues to be eligible
under the Plan and complies with Section 3.3.
3.3 Method of Becoming a Participant. An Employee shall
become a Participant in the Plan by following the
procedures established by the Plan Administrator
and:
(a) electing to have his Compensation redirected
pursuant to Section 4.1;
(b) electing to have the amount by which his
Compensation is redirected contributed by the
Participating Companies to the Plan;
(c) specifying his investment election for his
Compensation Redirection Amount and the annual
Company contributions made under Section 5.3
among the investment funds maintained pursuant
to the Plan;
(d) agreeing to the terms of the Plan; and
(e) designating a Beneficiary to receive any
benefits which may be payable under the Plan
after his death.
3.4 Reemployment. If an Employee has a Break in Service
after completing the eligibility requirements set
forth in Section 3.1 but while still employed by the
Group, he shall remain eligible to participate in
the Plan during such period of employment. Upon
reemployment, a former Employee who had completed
the eligibility requirements in Section 3.1 and who
has had a Break in Service and a former Employee
whose employment by the Group was terminated but who
has had no Break in Service shall be eligible to
participate in the Plan as of the later of:
(a) his reemployment date by the Group, or
(b) the date on which he would have otherwise been
eligible to participate in the Plan had his
employment by the Group not been terminated,
and shall have his Years of Service completed before
the Break in Service reinstated; provided, however,
that, for purposes of determining the vested balance
of the Company Matching and Non-Matching
Contributions Accounts of a reemployed Employee who
did not have a vested interest in his Compensation
Redirection Account or Company Matching or Non-
Matching Contributions Accounts at the time he
incurred a Break in Service, his Years of Service
accrued before the Break in Service shall be
disregarded on his reemployment if the number of
such Employee's consecutive one (1) year Breaks in
Service equals or exceeds the greater of five (5) or
his Years of Service completed before the Break in
Service.
3.5 Change in Status. If a Participant hereunder ceases
to be an Employee due to a change in his employment
status, while remaining an employee of the Group (as
defined for purposes of Article XVII), he shall
become an inactive Participant hereunder until such
time as he again becomes an Employee, and during the
period in which he is an inactive Participant he
shall no longer be entitled to redirect his
Compensation to the Plan; provided, however, that
his Participant Account shall continue to be
adjusted in accordance with Article VII; provided,
further, that the employment of such an inactive
Participant shall not be deemed terminated until he
ceases to be employed by the Group (as such term is
defined for purposes of Article XVII). If an
employee who is not a Participant becomes an
Employee due to a change in his employment status or
due to the adoption of the Plan by his employer in
accordance with Section 11.1, he shall become
eligible to participate in this Plan immediately;
provided, however, that his participation shall not
commence until his enrollment in accordance with the
procedures set forth in Section 3.3.
3.6 Limited Participant An Employee who is not eligible
to become a Participant in the Plan but on whose
behalf amounts are transferred to the Plan from
another qualified retirement plan in accordance with
Section 5.13 shall be deemed to be a limited
Participant under the Plan with respect to such
transferred amounts.
<PAGE>
ARTICLE IV
COMPENSATION REDIRECTION
4.1 Compensation Redirection Agreements. Each Employee
electing to participate in the Plan shall enter into
a Compensation Redirection Agreement with the
Participating Companies if he elects to have a
portion of his Compensation contributed to the Plan.
If an Employee completes a Compensation Redirection
Agreement, he shall specify a percentage from one
percent (1%) to nineteen percent (19%) (in multiples
of one (1) percentage point).
4.2 Change in Compensation Redirection Agreements. By
following the procedures established by the Plan
Administrator, a Participant may prospectively
change his Compensation Redirection Agreement within
the limits set forth in Section 4.1. The Plan
Administrator may as of any payroll period modify
the Compensation Redirection Agreements of any
Participant if necessary to comply with the limits
contained in Sections 5.5, 5.7, 5.8 and 5.9;
provided, however, that any modification by the Plan
Administrator shall be determined in a uniform and
non-discriminatory manner; provided, further, that
any modification may result in the Compensation
Redirection Percentage of a Participant reduced to a
fractional percentage in order to permit such
Participant to maximize his Compensation Redirection
Amount.
Revocation of Compensation Redirection Agreements.
4.3 As of any payroll period, a Participant may cease
having his Compensation redirected to the Plan and
revoke his Compensation Redirection Agreement by
following the procedures established by the Plan
Administrator or its designate in advance of the
date on which the revocation is to be effective. In
order for a Participant to reinstate his
Compensation Redirection Agreement, such Participant
shall follow the procedures outlined in Section 3.3
as though he were a new Participant.
<PAGE>
ARTICLE V
COMPANY CONTRIBUTIONS
5.1 Amount of Company Contributions. Subject to the
limitations of Section 5.5, the Participating
Companies shall contribute with respect to each
payroll period an amount equal to one hundred
percent (100%) of that Participant's Compensation
Redirection Amount; provided, however, that the
amount of contributions by any Participating
Companies under this Section and under Sections 5.2
and 5.3 with respect to any Plan Year shall not
exceed an amount equal to the maximum amount
deductible by such Participating Companies under
Section 404 of the Code for such Plan Year as an
expense for federal income tax purposes; provided,
further, that no contributions shall be made under
this Section after the effective date of a
Participant's termination of employment with the
Participating Companies.
5.2 Company Matching Contributions.
(a) Non-Union Employees. Subject to the
limitations of Section 5.5 and Section 5.8 and
effective January 1, 1999, the Company Matching
Contributions with respect to each payroll
period for a Participant whose terms of
employment are not governed by a collective
bargaining agreement entered into by a Company
and a Union shall be an amount equal to one
hundred percent (100%) of that portion of such
Participant's Compensation Redirection Amount
not in excess of six percent (6%) of his
Compensation in such payroll period to be
allocated to his Company Matching Contributions
Account; provided, however, that effective July
1, 2000 for Participants who were not employed
by Indiana Energy, Inc. or any of its
subsidiaries on March 30, 2000, the Company
Matching Contributions with respect to each
payroll period shall be an amount equal to
fifty percent (50%) of that portion of such
Participant's Compensation Redirection Amount
not in excess of six percent (6%) of his
Compensation in such payroll period to be
allocated to his Company Matching Contributions
Account. Notwithstanding anything contained in
this Section 5.2 to the contrary, if the Plan
Administrator reduces or returns in accordance
with Section 5.7 the Compensation Redirection
Amounts of a Participant in order to comply
with Section 5.7, Section 415 of the Code or
Section 402(g) of the Code, the Participating
Companies shall be required to forfeit any
Company Matched Contributions attributable to
the reduced or returned Compensation
Redirection Amounts but only to the extent that
the Participant Compensation Redirection
Amounts for such Plan Year (after adjusted to
reflect the required reductions and returns) is
not in excess of six percent (6%) of his
Compensation for such Plan Year.
(b) Union Employees. Subject to the limitations of
Section 5.5 and Section 5.8 and effective
January 1, 1999, the Participating Companies
shall also contribute with respect to each
payroll period for a Participant whose terms of
employment are governed by a collective
bargaining agreement entered into by the
Participating Companies and a Union during
which a Participant has in effect a
Compensation Redirection Agreement an amount
equal to fifty percent (50%) of:
(i) that portion of such Participant's
Compensation Redirection Amount not in
excess of four percent (4%) of his
Compensation in such payroll period; and
(ii) any amounts redirected to the Plan by the
Participant and not includible in that
Participant's income under Section 125 of
the Code;
to be allocated to his Company Matching
Contributions Account.
5.3 Company Non-Matching Contributions
(a) Pre-1999 Contributions for Non-Union Employees.
For Plan Years beginning before January 1, 1999
and subject to the limitations of Section 5.5,
the Participating Companies also contributed
with respect to each Plan Year for a
Participant (regardless of the number of Hours
of Service completed by such Participant during
such Plan Year) whose terms of employment were
not governed by a collective bargaining
agreement entered into by a Company and a Union
who was actively employed by the Company on the
last calendar day of the Plan Year an amount
equal to two and one-half percent (2 1/2%) of
his annualized base salary from the
Participating Companies (including Compensation
Redirection Amounts and commissions but
excluding overtime, bonuses and any other
extraordinary compensation) in effect on the
December 1 in the Plan Year for which the
contribution related; provided, however, that
for purposes of this Section, a Participant
shall be deemed to be actively employed by the
Participating Companies if he is on a paid or
FMLA leave of absence, he is receiving benefits
under a short term disability plan maintained
by the Participating Companies or he is
receiving wages from the Participating
Companies under a wage continuation program
maintained by the Participating Companies but
shall not be deemed actively employed by the
Participating Companies if he is on an unpaid
leave of absence (other than FMLA leave) or if
he is receiving benefits under any long term
disability plan maintained by the Participating
Companies; provided, further, that with respect
to any Employee becoming a Participant after
August 1, 1994, the Participant shall be
required to have completed at least one
thousand (1,000) Hours of Service in a Plan
Year to be eligible for the annual contribution
described in this Section for the Plan Year.
(b) Union Employees. For Plan Years beginning
before January 1, 1999 and subject to the
limitations of Section 5.5, the Participating
Companies also contributed with respect to each
Plan Year for a Participant (regardless of the
number of Hours of Service completed by such
Participant during such Plan Year) whose terms
of employment were governed by a collective
bargaining agreement entered into by a
Participating Company and a Union and who was
actively employed by a Participating Company on
the last calendar day of the Plan Year an
amount equal to two and one-half percent
(2 1/2%) of his annualized base salary from the
Participating Companies (including Compensation
Redirection Amounts and commissions but
excluding overtime, bonuses and any other
extraordinary compensation) in effect on the
December 15 in the Plan Year for which the
contribution relates; provided, however, that
for purposes of this Section, a Participant
shall be deemed to be actively employed by a
Participating Company if he is on a paid or
FMLA leave of absence, he is receiving benefits
under a short term disability plan maintained
by the Group but shall not be deemed actively
employed by the Participating Companies if he
is on an unpaid leave of absence (other than
FMLA leave) or if he is receiving benefits
under any long term disability plan maintained
by the Group; provided, further, that with
respect to any Employee becoming a Participant
after August 1, 1994, the Participant shall be
required to have completed at least one
thousand (1,000) Hours of Service in a Plan
Year to be eligible for the annual contribution
described in this Section for the Plan Year.
(c) Post June 30, 1999 Contributions for Non-Union
Employees. For the period beginning on and
after July 1, 2000, the Participating Companies
shall also contribute for a Participant
(regardless of the number of Hours of Service
completed by such Participant) who was not an
Employee of Indiana Energy, Inc. or one of its
subsidiaries on or before March 30, 2000 and
whose terms of employment are not governed by a
collective bargaining agreement entered into by
a Company and a union an amount equal to three
percent (3%) of his Compensation in each
payroll period; provided, however, that this
three percent (3%) contribution shall not be
made on behalf of any Participant who is
actively employed and on the payroll of
Southern Indiana Gas and Electric Company on
March 31, 2000 unless such Participant chooses
to receive the three percent (3%) annual
contribution in lieu of other rights otherwise
available under other Company sponsored
qualified retirement plans or shall not be made
on behalf of a Participant employed by Vectren
Energy Delivery of Ohio, Inc.; provided,
further, that attached to this Plan as
Exhibit B is a list of Participants who have
not made the special election to receive the
three percent (3%) contribution under this
Plan.
5.4 Remittance of Company Contributions. Company
contributions required under Sections 5.1 and 5.2
shall be remitted to the Trustee as soon as
practicable, but in any event within thirty (30)
calendar days after the month during which the
Compensation upon which the contributions are based
would have been paid to the Participants, and shall
then be allocated among the investment funds as
directed by the Participants. Company contributions
under Section 5.3(c) shall be remitted to the
Trustee as soon as practicable after the end of the
payroll period to which the Company contributions
relate, but in any event before the Company's
federal income tax return is due (including
extensions) for that Plan Year during which occurs
the payroll period and shall then be allocated among
investment funds as directed by the Participants.
5.5 Maximum Contributions. Notwithstanding any other
provisions of the Plan, the Annual Additions
allocated to any Participant in any Plan Year under
the Plan and under any other qualified defined
contribution plans maintained by the Group shall not
exceed the lesser of:
(a) twenty-five percent (25%) of such Participant's
Section 415 Compensation from the Group in that
Plan Year, or
(b) thirty thousand dollars ($30,000), as adjusted
for cost of living increases pursuant to
Section 415(d) of the Code.
For Plan Years beginning before January 1, 2000, in
any case in which an Employee is a participant in
one (1) or more qualified defined contribution plans
and in one (1) or more qualified defined benefit
plans (as those terms are defined in Section 415(k)
of the Code) maintained by the Group, the sum of the
Defined Benefit Fraction and of the Defined
Contribution Fraction in any Plan Year computed as
of the last calendar day of such Plan Year shall not
exceed one (1.0).
If, as a result of a reasonable error in estimating
a Participant's Section 415 Compensation, the
allocation of forfeitures, a reasonable error in
determining the amount of Compensation Redirection
Amounts that may be contributed to the Plan with
respect to any individual under the limits of
Section 415 of the Code or other facts and
circumstances which the Commissioner of Internal
Revenue finds justifies the corrective action
described in this Subsection, the limitations as
contained in this Subsection would be exceeded for
any Participant, the Plan Administrator shall take
action in accordance and consistent with Section 415
of the Code and applicable Treasury Regulations
(which Code Section and applicable regulations are
hereby incorporated by reference) to reduce the
Participant's Compensation Redirection Amount, and
Company contributions to the extent necessary to
comply with the Section 415 of the Code limit.
5.6 Return of Company Contributions. Notwithstanding
the foregoing, a Participating Company shall be
entitled to receive, without interest, the amount of
any contributions made by it to the Plan on account
of a mistake in fact; provided, however, that
repayment of such mistaken contributions is made to
the Participating Company within one (1) year after
the date of remittance of such contributions to the
Trustee. Any contributions returned to a
Participating Company which represent a
Participant's Compensation Redirection Amounts shall
be immediately refunded to that Participant by the
Participating Companies. Any earnings attributable
to amounts refunded to a Participant in accordance
with the previous sentence shall also be paid to
such Participant as soon as practicable.
5.7 Return of Compensation Redirection Amounts. In any
Plan Year in which the average of the Actual
Deferral Percentages for the group of Highly
Compensated Participants would be more than the
greater of:
(a) the average of the Actual Deferral Percentage
of all other Employees who are eligible to be
Participants multiplied by one and one-fourth
(1 1/4), or
(b) the lesser of:
(i) two percent (2%) plus the average of the
Actual Deferral Percentage of all other
Employees who are eligible to be
Participants, or
(ii) average of the Actual Deferral Percentage
of all other Employees who are eligible
to be Participants multiplied by two (2),
the Compensation Redirection Amounts of the Highly
Compensated Participants shall be reduced to the
extent necessary so that the average of the Actual
Deferral Percentage for the group of Highly
Compensated Participants is not more than the
greater of Subsection (a) or (b) above.
For Plan Years beginning on or after January 1, 1997
and unless the Plan Administrator properly elects at
such time and in such manner as prescribed by the
Secretary of the Treasury to apply the Current Year
ADP Method instead, if after making the adjustments
required by Section 5.9 the average of the Actual
Deferral Percentages for the group of Highly
Compensated Participants who are eligible to be
Participants in a Plan Year would be more than the
greater of:
(c) the average of the immediately preceding Plan
Year's Actual Deferral Percentages of all Prior
Year's Non-Highly Compensated Participants
multiplied by one and one fourth (1 1/4th), or
(d) the lesser of:
(i) two percent (2%) plus the immediately
preceding Plan Year's Actual Deferral
Percentage of all Prior Year's Non-Highly
Compensated Participants, or
(ii) the immediately preceding Plan Year's
Actual Deferral Percentage of all Prior
Year's Non-Highly Compensated
Participants multiplied by two (2),
the Compensation Redirection Percentages of the
Highly Compensated Participants shall be reduced to
the extent necessary so that the Actual Deferral
Percentage for the group of Highly Compensated
Participants is not more than the greater of
Subsection (c) or (d) above.
Reduction of Compensation Redirection Percentages
shall be accomplished first by determining the
maximum deferral for the group of Highly Compensated
Participants permitted by Subsection (a) or (b)
above or Subsection (c) and (d), whichever is
applicable, and then reducing the Compensation
Redirection Percentage of the Highly Compensated
Participants with the highest Compensation
Redirection Percentages by one tenth of one percent
(0.1%). If after making the above reduction the
limitations are still exceeded, the Compensation
Redirection Percentages of the Highly Compensated
Participants shall be further reduced in one tenth
of one percent (0.1%) increments until the
limitations of this Section 5.7 are not exceeded.
For Plan Years beginning on or after January 1,
1997, correction of excess Compensation Redirection
Amounts shall be accomplished as follows. First,
the Plan Administrator shall calculate the total
dollar amount of the Compensation Redirection
Amounts of Highly Compensated Participants that
would otherwise be reduced as the result of the
reduction of the Compensation Redirection
Percentages of those Highly Compensated Participants
in accordance with this Section 5.7 (the "Total
Excess Contributions") without attributing any such
dollar reduction to a particular Highly Compensated
Participant. The Compensation Redirection Amounts
of the Highly Compensated Participant with the
highest dollar amount of Compensation Redirection
Amounts shall then be reduced by the amount required
to cause that Highly Compensated Participant's
Compensation Redirection Amounts to equal the dollar
amount of the Compensation Redirection Amounts of
the Highly Compensated Participant with the next
highest dollar amount of Compensation Redirection
Amounts. If the total amount of the reductions of
Compensation Redirection Amounts in the preceding
sentence is less than the Total Excess
Contributions, the process in the preceding sentence
shall be repeated. In no event shall the reductions
required under the preceding two sentences exceed
the Total Excess Contributions.
The amount by which a Participant's Compensation
Redirection Amount exceeds the amount permitted
under this Section, plus any earnings (or, if
applicable, less any losses) allocated to such
excess Compensation Redirection Amount which are
attributable to the Plan Year in which the excess
amount relates, shall be returned to such
Participant no later than the end of the Plan Year
immediately following the Plan Year for which the
excess Compensation Redirection Amount was made.
Any Company Matched Contributions that are
attributable to excess Compensation Redirection
Amounts and that are not returned in accordance with
Section 5.8 shall be treated as a mistaken
contribution, shall be forfeited, shall be credited
to and held in a suspense account and shall be
applied to reduce the amount of Company Matched
Contributions otherwise required of the
Participating Companies for the next following Plan
Years(s) until exhausted. The Plan Administrator
shall apply the discrimination test of this Section
separately for the collective bargaining groups of
Employees. To the extent permitted by applicable
regulations, the Plan Administrator may elect to
test each collective bargaining group separately or
to aggregate one (1) or more of the groups for a
combined test. For the purposes of determining
whether the discrimination test described in this
Section is satisfied, all elective contributions
that are made under two or more plans that are
aggregated for the purposes of Code Section
401(a)(4) or 410(b) (other than Code Section
410(b)(2)(A)(ii)) are to be treated as made under a
single plan and that if two (2) or more plans are
permissively aggregated for purposes of Code Section
401(k), the aggregated plans must also satisfy Code
Sections 401(a)(4) and 410(b) as though they were a
single plan.
5.8 Return of Company Matched Contributions. If after
making the adjustments required by Section
5.7 the average of the Company Matched
Contribution Percentages for the group of
Highly Compensated Participants in a Plan
Year would be more than the greater of:
(a) the average of the Company Matched Contribution
Percentages of all other Employees who are
eligible to be Participants multiplied by one
and one-fourth (1 1/4th), or
(b) the lesser of:
(i) two percent (2%) plus the average of the
Company Matched Contribution Percentages
of all other Employees who are eligible
to be Participants, or
(ii) the average of the Company Matched
Contribution Percentages of all other
Employees who are eligible to be
Participants multiplied by two (2.0),
the Company Matched Contributions of the Highly
Compensated Participants shall be reduced before the
end of the immediately following Plan Year to the
extent necessary so that the average of the Company
Matched Contribution Percentages for the group of
Highly Compensated Participants is not more than the
greater of Subsection (a) or (b) above.
For Plan Years beginning on or after January 1, 1997
and unless the Plan Administrator properly elects at
such time and in such manner as prescribed by the
Secretary of the Treasury to apply the Current Year
ACP Method instead, if after making the adjustments
required by Section 5.7 the average of the Company
Matched Contribution Percentages for the group of
Highly Compensated Participants in a Plan Year would
be more than the greater of:
(c) the average of the immediately preceding Plan
Year's Company Matched Contribution Percentages
of all Prior Year's Non-Highly Compensated
Participants multiplied by one and one fourth
(1-1/4th), or
(d) the lesser of:
(i) two percent (2%) plus the average of the
immediately preceding Plan Year's Company
Matched Contribution Percentages of all
Prior Year's Non-Highly Compensated
Participants, or
(ii) the average of the immediately preceding
Plan Year's Company Matched Contribution
Percentages of all Prior Year's Non-
Highly Compensated Participants
multiplied by two (2.0),
the Company Matched Contributions of the Highly
Compensated Participants shall be reduced to the
extent necessary so that the average of the Company
Matched Contribution Percentages for the group of
Highly Compensated Participants is not more than the
greater of Subsection (c) or (d) above.
Reduction of excess Company Matched Contributions
shall be accomplished first by determining the
maximum average percentage for the group of Highly
Compensated Participants permitted by Subsection (a)
or (b) above or Subsection (c) or (d), whichever is
applicable, and then reducing the Company Matched
Contributions of the Highly Compensated Participants
with the highest Company Matched Contribution
Percentage so that their Company Matched
Contribution Percentage is reduced by one tenth of
one percent (0.1%). If after making the above
reduction the limitations are still exceeded, the
Company Matched Contribution Percentages of the
Highly Compensated Participants shall be further
reduced in one tenth of one percent (0.1%)
increments until the limitations are not exceeded.
For Plan Years beginning on or after January 1,
1997, the amount of excess Company Matched
Contributions to be corrected with respect to a
Highly Compensated Participant shall be determined
as follows. First, the Plan Administrator shall
calculate the total dollar amount of the Company
Matched Contributions of Highly Compensated
Participants that would otherwise be reduced as the
result of the reduction of Company Matched
Contributions Percentages in accordance with this
Section 5.8 (the "Total Excess Aggregate
Contributions") without attributing any such dollar
reduction to a particular Highly Compensated
Participant. The Company Matched Contributions of
the Highly Compensated Participant with the highest
dollar amount of Company Matched Contributions shall
then be reduced by the amount required to cause that
Highly Compensated Participant's Company Matched
Contributions to equal the dollar amount of the
Company Matched Contributions of the Highly
Compensated Participant with the next highest dollar
amount of Company Matched Contributions. If the
total amount of the reductions of Company Matched
Contributions in the preceding sentence is less than
the Total Excess Aggregate Contributions, the
process in the preceding sentence shall be repeated.
In no event shall the reductions required under the
preceding two sentences exceed the Total Excess
Aggregate Contributions.
For Plan Years beginning both before and on or after
January 1, 1997, Excess Company Matched
Contributions shall be corrected by taking the
following actions:
(e) First, Company Matched Contributions that are
not forfeitable under Section 8.2, plus income
attributable thereto, shall be refunded to the
affected Participants no later than the end of
the Plan Year immediately following the Plan
Year for which such excess Company Matched
Contributions were made; and
(f) Second, Company Matched Contributions that are
forfeitable under Section 8.2, plus income
attributable thereto, shall be forfeited and
applied to reduce the amount of Company Matched
Contributions otherwise required of the
Participating Companies to whom they relate for
the next following Plan Year(s) until
exhausted.
The income attributable to excess Company Matched
Contributions shall include only income for the Plan
Year for which the Company Matched Contributions
were made.
After application of Section 5.7 and Subsections (a)
and (b) of this Section 5.8 (or Subsections (c) and
(d), whichever is applicable), if the average of the
Company Matched Contribution Percentages for the
group of Highly Compensated Participants who are
eligible to participate in the Plan exceeds the
limits prescribed by Subsection (a) above or
Subsection (c) above, whichever is applicable, and
the Actual Deferral Percentage for the group of
Highly Compensated Participants who are eligible to
participate in the Plan exceeds the limits
prescribed by Section 5.7(a) or Section 5.7(c),
whichever is applicable, then the following
"Multiple Use Test" shall apply under which the sum
of:
(g) the average of the Company Matched
Contributions Percentages in such Plan Year
for the group of Highly Compensated
Participants who are eligible to participate
in the Plan, and
(h) the Actual Deferral Percentage in such Plan
Year for the group of Highly Compensated
Participants who are eligible to participate
in the Plan;
shall not exceed the greater of:
(i) the sum of:
(i) one hundred and twenty-five percent
(125%) of the greater of:
(A) the average of the Company Matched
Contributions Percentages for such
Plan Year determined under the
Current Year ACP Method or for the
immediately preceding Plan Year
determined under the Prior Year ACP
Method, whichever is being used for
such Plan Year, or
(B) the Actual Deferral Percentage for
such Plan Year determined under the
Current Year ADP Method or for the
immediately preceding Plan Year
determined under the Prior Year ADP
Method, whichever is being used for
such Plan Year,
plus
(ii) the sum of two percent (2%) and the
lesser of:
(A) the average of the Company Matched
Contributions Percentages for such
Plan Year determined under the
Current Year ACP Method or for the
immediately preceding Plan Year
determined under the Prior Year ACP
Method, whichever is being used for
such Plan Year, or
(B) the Actual Deferral Percentage for
such Plan Year determined under the
Current Year ADP Method or for the
immediately preceding Plan Year
determined under the Prior Year ADP
Method, whichever is being used for
such Plan Year;
provided, however, that the amount determined
under this Subsection (i),(ii) may not exceed
two hundred percent (200%) of the lesser of
(A) or (B) of this Subsection (i),(ii);
or
(j) the sum of:
(i) one hundred and twenty-five percent
(125%) of the lesser of:
(A) the average of the Company Matched
Contribution Percentages for such
Plan Year determined under the
Current Year ACP Method or for the
immediately preceding Plan Year
determined under the Prior Year ACP
Method, whichever is being used for
such Plan Year, or
(B) the Actual Deferral Percentage for
such Plan Year determined under the
Current Year ADP Method or for the
immediately preceding Plan Year
determined under the Prior Year ADP
Method, whichever is being used for
such Plan Year,
plus
(ii) the sum of two percent (2%) and the
greater of:
(A) the average of the Company Matched
Contributions Percentages for such
Plan Year determined under the
Current Year ACP Method or for the
immediately preceding Plan Year
determined under the Prior Year ACP
Method, whichever is being used for
such Plan Year, or
(B) the Actual Deferral Percentage for
such Plan Year determined under the
Current Year ADP Method or for the
immediately preceding Plan Year
determined under the Prior Year ADP
Method, whichever is being used for
such Plan Year;
provided, however, that the amount determined
under this Subsection (j),(ii) may not exceed
two hundred percent (200%) of the greater of
(A) or (B) of this Subsection (j),(ii).
For Plan Years beginning on or after January 1,
1997, if there has been a corrective distribution of
excess Compensation Redirection Amounts for a Plan
Year, then, in applying the Multiple Use Test for
that Plan Year, the average Compensation Redirection
Percentage for the Highly Compensated Participants
shall equal the maximum amount permitted under
Section 5.7. For Plan Years beginning on or after
January 1, 1997, if there has been a corrective
distribution of excess Company Matched Contributions
for a Plan Year, then, in applying the Multiple Use
Test for that Plan Year, the average Company Matched
Contribution Percentage for the Highly Compensated
Participants shall equal the maximum amount
permitted under Section 5.8(a) and (b) (or Section
5.8(c) and (d), whichever is applicable).
If the limits prescribed by the Multiple Use Text
are exceeded, the Plan Administrator, in its sole
discretion, may elect either to reduce the Company
Matched Contributions or Compensation Redirection
Amounts of the Highly Compensated Participants who
are eligible both to enter into Compensation
Redirection Agreements and to receive Company
Matched Contributions, or a combination thereof, to
the extent necessary so that the limits are not
exceeded in the same manner such Company Matched
Contributions or Compensation Redirection Amounts
are reduced under Section 5.7 or Subsections (a) and
(b) (or Subsections (c) and (d), whichever is
applicable) of this Section 5.8.
To the extent permitted by the Code and applicable
regulations, the Plan Administrator shall not be
required to apply the discrimination test of this
Section for the collective bargaining groups of
Employees. For purposes of this Section, all
Company Matched Contributions that are made under
two or more plans that are aggregated for purposes
of Code Sections 401(a)(4) and 410(b) (other than
Code Section 410(b)(2)(A)(ii)) are to be treated as
made under a single plan, and if two or more plans
are permissively aggregated for purposes of Code
Section 401(m), the aggregated plans shall also
satisfy Code Sections 401(a)(4) and 410(b) as though
they were a single plan.
5.9 Maximum Redirection Amounts. Notwithstanding
anything contained in the Plan to the contrary, the
maximum Compensation Redirection Amount which a
Participant may elect to have redirected under
Section 4.1 and under any other qualified retirement
plan, whether or not maintained by a member of the
Group, in any calendar year is the applicable limit
in effect for Section 402(g) of the Code (the
"Section 402(g) Limit"). If due to a mistake in
fact Compensation Redirection Amounts in excess of
the Section 402(g) Limit are allocated in a calendar
year to the Participant Account of any Participant,
the Trustee shall return to such Participant the
portion of his Compensation Redirection Amount in
excess of the Section 402(g) Limit, plus any
earnings (or, if applicable, less any losses)
attributable to such excess which are attributable
to the Plan Year in which the excess amounts relate,
not later than the April 15 immediately following
the calendar year during which such excess
contribution was made. If in a calendar year a
Participant's Compensation Redirection Amount under
the Plan, when aggregated with any other elective
deferrals made by such Participant in such calendar
year to any other qualified retirement plan under
Section 401(k), Section 403(b) and Section 408(k) of
the Code, whether or not maintained by a member of
the Group, would otherwise exceed the Section 402(g)
Limit, such Participant may before the March 1
immediately following such calendar year notify the
Plan Administrator on the Appropriate Form as to the
portion of the amount in excess of the Section
402(g) Limit to be allocated to the Plan, and the
Plan Administrator may, but is not required to,
direct the Trustee to pay to such Participant the
amount of the excess which was allocated to the Plan
by such Participant plus any earnings, or less any
losses, allocated to such excess amount before the
April 15 immediately following the calendar year
during which the excess contribution was made. The
Section 402(g) Limit limitation contained in this
Section shall automatically be adjusted in
accordance with Sections 402(g)(5) and 415(d) of the
Code.
5.10 Investment Fund Priority of Excess Contributions.
If contributions to the Plan exceed the permissible
limits described in Sections 5.5, 5.6, 5.7, 5.8 and
5.9 and contributions are refunded to a Participant,
the investment funds in which such Participant's
Participant Accounts are allocated shall be
liquidated pro rata.
5.11 Plan Priority of Excess Contributions. If
contributions to the Plan and any other qualified
defined contribution plan maintained by the Group
and benefit accruals under the qualified defined
benefit retirement plans maintained by the Group are
in excess of the limits contained in Section 5.5,
contributions and benefit accruals with respect to
each type of qualified retirement plan shall be
reduced in the following order of priority:
(a) defined benefit plans;
(b) this Plan and other profit sharing plans with a
salary deferral feature under Section 401(k) of
the Code;
(c) profit sharing plans without a salary deferral
feature under Section 401(k) of the Code; and
(d) employee stock ownership plans, qualifying for
federal income tax credit under Section 41 of
the Code.
5.12 ESOP and ESOP I Accounts Transfers. Any amounts
which were previously transferred to this Plan from
the ESOP or ESOP I shall be credited to the Company
Matching Contributions Accounts of the Employees
requesting the transfer as of the Effective Date
with respect to amounts transferred from the ESOP
and as of March 31, 1989 with respect to amounts
transferred from ESOP I, and such transferred
amounts shall be fully vested and non-forfeitable at
all times.
5.13 Transfer of Assets from Other Plans. Effective on
or after January 1, 1992, an Employee may with the
consent of the Plan Administrator, transfer (roll
over) a distribution which he received from another
defined contribution plan qualified under Section
401(a) or under Section 403(a) of the Code to the
Plan; provided, however, that:
(a) the Employee was not an owner-employee under
such plan within the meaning of Section
401(c)(1) of the Code;
(b) the transfer is made to the Plan no later than
the sixtieth (60th) calendar day after
distribution was made to that Employee from
such plan;
(c) the distribution from such plan constituted
that Employee's entire interest in such plan
and was distributed within one (1) taxable year
to that Employee as a qualifying lump-sum
distribution within the meaning of Section
402(e)(4)(A) of the Code;
(d) the amount transferred to the Plan does not
include any nondeductible amounts contributed
by that Employee to such plan;
(e) the transfer is made in cash to the Trustee;
and
(f) if the assets are transferred directly by the
Trustee from such other qualified plan to the
Trustee, the Employee is required to provide
the Plan Administrator documentation
establishing that such other plan does not
permit distribution in any form other than a
single lump sum payment or installments unless
the transfer would be deemed to be a rollover
under the Code.
Such a transfer (rollover) may also be made through
an Individual Retirement Account qualified under
Section 408 of the Code where that Individual
Retirement Account was used as conduit from the
prior plan, the transfer is made in accordance with
the rules provided at Subsections (a) through (f)
above and the transfer does not include any personal
contributions or earnings thereon which that
Employee may have made to that Individual Retirement
Account. Any monies rolled over shall be fully
vested and non-forfeitable at all times.
5.14 Rehire after Military Service. The provisions
relating to qualified retirement plans which are set
forth in the Uniformed Services Employment and
Reemployment Rights Act of 1994 ("USERRA") are
hereby incorporated into, and made a part of, this
Plan by reference. The Committee shall apply the
provisions of the USERRA with respect to any
Participant who is reemployed after completing
covered military service in a manner consistent with
the USERRA and all other applicable law and
regulations.
<PAGE>
ARTICLE VII
NVESTMENT OF CONTRIBUTIONS
6.1 Investment of Contributions. Each Participant, at
the date he initially elects to become a Participant
in the Plan, shall direct in accordance with
procedures adopted by the Plan Administrator that
the amount of Company contributions made on his
behalf under Section 5.1 and Section 5.2 and that
the amount of Company contributions made on his
behalf under Section 5.3 be invested among the
Funds, made available under the Plan in five percent
(5%) increments. Any amounts transferred from the
ESOP and ESOP I in accordance with Section 5.12 were
automatically invested in Fund A. If at the date on
which a Participant is credited with the Company
contributions under Section 5.3 the Participant does
not have an investment election in effect, such
Company contributions shall be initially invested in
Fund B. Notwithstanding anything contained herein
to the contrary, Fund A investments shall be limited
to Participants who are employed by Indiana Energy,
Inc. or by an entity which was a subsidiary of
Indiana Energy, Inc. on March 30, 2000.
6.2 Change in Investment Election. Any investment
election given by a Participant shall continue in
effect until changed by such Participant. A
Participant, in accordance with procedures
established by the Plan Administrator, may change
his current investment election as to future
contributions within the limits of Section 6.1.
Such a change in investment election shall be
effective as soon as practicable after the change
election is made
6.3 Conversion of Investments. Subject to Section 6.1,
a Participant may change in accordance with
procedures established by the Plan Administrator his
investment election as to his prior Company
contributions, ESOP transferred amounts and earnings
thereon in five percent (5%) increments or in
specified dollar amounts. All such conversions
shall be effected as soon as practicable after the
conversion request is made.
<PAGE>
ARTICLE VII
PARTICIPANT ACCOUNTS
7.1 Maintenance of Participant Accounts. The Plan
Administrator shall maintain, or cause to be
maintained, a Compensation Redirection Account, a
Company Matching Contributions Account and a Company
Non-Matching Contributions Account for each
Participant. Each such Account shall be maintained
so as to reflect the investments in each of the
investment funds maintained pursuant to this Plan.
7.2 Valuation of Participant Accounts. As of each
Valuation Date the Plan Administrator or its
designate shall, by uniform methods, adjust, or
cause to be adjusted, the Participant Accounts of
each Participant or former Participant with a
Participant Account balance as of such Valuation
Date to reflect contributions, withdrawals,
distributions, income earned, expenses incurred by
the Plan not directly paid by the Participating
Companies and any increase or decrease in the fair
market value of Trust Fund assets since the last
Valuation Date. Any income or losses with respect
to each Fund shall be allocated proportionately
among all Participant Accounts invested in such Fund
in accordance with the value of such Participant
Accounts attributable to such Fund's investments at
the last Valuation Date; provided, however, that for
purposes of allocating, income or losses in a
calendar year quarter, the value of the Participant
Accounts as of the preceding calendar year quarter
shall be adjusted by the Plan Administrator or its
designate, by uniform and non-discriminatory
methods, to account for contributions to and
distributions from the Participant Accounts during
such quarter. Notwithstanding the above, dividends
(whether paid in cash or property) and distributions
of shares pursuant to stock splits, stock dividends
or recapitalizations made with respect to shares of
Vectren Corporation common stock held in Fund A
shall be credited to the Participant Accounts in
which the shares on which the dividends or
distributions were made are held, and any income
earned in Fund A with respect to uninvested cash
held in Fund A shall be allocated among all
Participant Accounts invested in Fund A in
accordance with the amount of uninvested cash in
such Participant Accounts credited to Fund A at the
last Valuation Date. Each Participant shall be
provided a statement as soon as practicable
following each Valuation Date reflecting any
contributions, withdrawals, distributions, income
earned and increase or decrease in the value of his
Participant Accounts since the last preceding
Valuation Date.
7.3 Nature of Participant's Interest in Trust Fund. The
maintenance of Participant Accounts is for
accounting purposes only, and a segregation of Plan
assets shall not be required. The rights of the
Participants under the Plan are the rights to the
benefits provided in the Plan, and the fact of
maintenance of individual Participant Accounts shall
not vest any right, title or interest in the assets
of the Plan, in and of itself.
<PAGE>
ARTICLE VIII
WITHDRAWALS
8.1 Right to Withdraw. Subject to the limitations
imposed by Section 8.2 and by this Section, a
Participant employed by the Group may request a
withdrawal of his interest in his Compensation
Redirection Account and his Company Matching and Non-
Matching Contributions Accounts, if vested under
Article IX, by following the procedures established
by the Plan Administrator. The withdrawal shall be
effected as soon after the request is made. All
payments shall be made based on the valuation of his
Participant Accounts as of the Valuation Date
coinciding with or immediately preceding the
withdrawal date. Except for withdrawals pursuant to
Section 8.2(g), a Participant may elect to withdraw
assets from his Participant Accounts only once in
any twelve (12) month period. Any withdrawal shall
be for at least two hundred and fifty dollars
($250). Except as provided below, withdrawals shall
be charged against the Participant Accounts in
accordance with the following order of priority:
(a) Compensation Redirection Account; and
(b) Company Non-Matching Contributions Account, if
vested under Article IX; and
(c) Company Matching Contributions Account, if
vested under Article IX.
Withdrawals by a Participant shall be charged
against the investment funds in which his applicable
Participant Account is invested pro rata.
The Compensation Redirection Agreement of a
Participant age fifty-nine and one-half (59 1/2) or
older making a withdrawal in accordance with this
Article shall be revoked effective as of the date of
the withdrawal, and such Participant shall not be
eligible to reinstate his Compensation Redirection
Agreement until the conclusion of a twelve (12)
month period commencing on the date of the
withdrawal. Notwithstanding anything contained
herein to the contrary, earnings accrued after
December 31, 1988 attributable to a Participant's
Compensation Redirection Account may not be
withdrawn.
8.2 Basis for Withdrawals. Withdrawals shall be
permitted only if the distribution both is made on
account of an immediate and heavy financial need of
the Participant and is necessary to satisfy such
financial need. The determinations of the existence
of an immediate and heavy financial need and of the
amount necessary to meet the need shall be made by
the Plan Administrator or its designate in
accordance with the deemed hardship standards under
Treasury Regulations Section 1.401(k)-1(d)(2)(ii)(B)
and Section 1.401(k)-1(d)(2)(iii)(B) and the
limitations imposed by this Section. A distribution
shall be deemed to be made on account of an
immediate and heavy financial need only if the
Appropriate Form submitted by the Participant
demonstrates to the satisfaction of the Plan
Administrator or its designate that the distribution
is needed on account of:
(a) uninsured medical expenses as described in
Section 213(d) of the Code incurred by the
Participant, the Spouse of the Participant or
any dependents of the Participant as defined in
Section 152 of the Code;
(b) purchase (excluding mortgage payments) of a
principal residence for the Participant;
(c) payment of tuition for the twelve (12) month
period immediately following the date the
withdrawal is to be made; provided, however,
that such tuition shall be restricted to post-
secondary education for the Participant, the
Spouse of the Participant or any dependents of
the Participant as defined in Section 152 of
the Code; or
(d) the need to prevent the eviction of the
Participant from his principal residence or
foreclosure on the mortgage of the
Participant's principal residence.
The Plan Administrator shall have authority to
expand this list of deemed immediate and heavy
financial needs to reflect the terms of published
Revenue Rulings, notices and other documents of
general applicability by the Commissioner of
Internal Revenue or his designate without the
necessity of any amendment to the Plan.
A withdrawal shall be deemed to be necessary to
satisfy an immediate and heavy financial need only
if the Appropriate Form as submitted by the
Participant demonstrates to the satisfaction of the
Plan Administrator or its designate that all of the
following requirements are satisfied:
(e) the distribution is not in excess of the amount
of the immediate and heavy financial need of
the Participant; provided, however, that for
purposes of determining the amount needed to
meet the hardship, the Plan Administrator may
take into account the expected tax consequences
of the distribution;
(f) the Participant has obtained all distributions,
other than hardship distributions, and all
nontaxable loans currently available under all
tax qualified retirement plans maintained by
the Group;
(g) the Plan and all other tax qualified retirement
plans maintained by the Group provide that the
Participant's Compensation Redirection Amounts
and all Participant contributions will be
suspended for at least twelve (12) consecutive
months following the date of payment under
Section 8.3; and
(h) the Plan and other tax qualified retirement
plans maintained by the Group provide that the
Participant shall not be permitted to authorize
any Compensation Redirection Amounts for the
calendar year immediately following the date of
payment under Section 8.3 in excess of the
applicable limit under Section 402(g) of the
Code for that year reduced by the amount of the
Participant's Compensation Redirection Amounts
for the calendar year in which payment was made
under Section 8.3.
The Plan Administrator shall have authority to
expand this list of deemed requirements necessary to
satisfy financial need to reflect the terms of
published Revenue Rulings, notices or other
documents of general applicability by the
Commissioner of Internal Revenue or his designate
without the necessity of any amendment to the Plan.
Notwithstanding the above, a Participant who is
still employed by the Group, who has completed five
(5) or more Years of Service with the Group and who
has attained at least age fifty-nine and one-half
(59 1/2) may once in a Plan Year make for any reason
a partial or complete withdrawal, without penalty or
suspension, from his Compensation Redirection
Account and from his Company Matching and Non-
Matching Contributions Accounts.
8.3 Form of Payment. All withdrawals pursuant to this
Article shall be paid in cash in a lump sum;
provided, however, that a Participant may, by giving
prior written notice to the Plan Administrator on
the Appropriate Form and within such time limit as
the Plan Administrator shall prescribe, elect to
have that portion of his withdrawal which is charged
against Fund A paid in shares of Vectren Corporation
common stock, with the value of any fractional
shares and any uninvested funds held in his name in
Fund A paid in cash.
ARTICLE IX
DISTRIBUTIONS
9.1 Benefits on Retirement, Vested Resignation, Vested
Dismissal or Total Disability. If a Participant's
Termination Date occurs for any reason other than
his death:
(a) on or after his attainment of Normal Retirement
Age;
(b) its subsidiaries on July 1, 1998 or who is
entitled to special benefits under Section 4.11
of the Pension Plan for Salaried Employees of
Southern Indiana Gas and Electric Company shall
be deemed to have completed at least five (5)
Years of Service, regardless of the actual
number of Years of Service completed by such
Participant; or
(c) by reason of his incurring a Total Disability,
the balances in his Participant Accounts shall
become distributable at the time as provided in
Section 9.8 to or for the benefit of such
Participant in either of the following methods as
elected by that Participant:
(d) by payment in a single lump sum, or
(e) by payment in a series of substantially equal
annual, semi-annual or quarterly installments
over a period not exceeding ten (10) years;
provided, however, that the duration of such
installments shall not exceed the life
expectancy of that Participant or the joint
life expectancy of such Participant and his
designated Beneficiary; provided, further, that
installment payments of less than two hundred
and fifty dollars ($250) shall not be
permitted.
For purposes of this Section, the balances held in a
Participant's Participant Accounts as of his
Termination Date shall be equal to his balances held
in his Participant Accounts as of the later
Valuation Date preceding the distribution date as of
which the value may be determined. If a Participant
dies before receiving all of his benefits payable in
accordance with this Section, any remaining portion
of his Participant Accounts shall be paid as soon as
practicable to or for the benefit of the Beneficiary
designated by that Participant in accordance with
Section 9.7 in such form as is selected by such
Beneficiary and over a period which is permitted by
Section 9.8.
9.2 Benefits on Death. If a Participant's Termination
Date occurs by reason of his death, the balances in
his Participant Accounts as of the later Valuation
Date preceding the distribution as of which the
value may be determined.
9.3 Non-Vested Benefits. If a Participant's Termination
Date occurs for any reason other than his death:
(a) before his completion of at least five (5)
Years of Service; provided, however, that for
purposes of this Subsection, any non-collective
bargaining Participant in this Plan employed by
Indiana Energy or any of its subsidiaries on
July 1, 1988, any participant in the Bargaining
Retirement Plan employed by the Group on
January 1, 1989 or any Participant who is
entitled to special benefits under Section 4.11
of the Pension Plan for Salaried Employees of
Southern Indiana Gas and Electric Company shall
be deemed to have completed at least five (5)
Years of Service, regardless of the actual
number of Years of Service completed by such
Participant;
(b) before his attainment of Normal Retirement Age;
and
(c) not by reason of his incurring a Total
Disability,
the vested balance in his Company Matching
Contributions Account and Company Non-Matching
Contributions Account (as determined below) shall be
applied as provided in Section 9.4, and the balances
in his Compensation Redirection Account as of the
Valuation Date coincidental with or next following
his Termination Date (after all adjustments then
required under the Plan have been made) shall become
distributable to or for his benefit or, in the event
of his subsequent death, to or for the benefit of
his Beneficiary pursuant to either of the methods
set forth in Section 9.1 as selected by such
Participant or, if applicable, his Beneficiary. For
purposes of this Section, the vested balance of a
Participant who was not an Employee of Indiana
Energy, Inc. or any of its subsidiaries on March 30,
2000 and whose terms of employment are not covered
by a collective bargaining agreement entered into by
a Participating Company and a Union in his Company
Matching Contributions Account shall be based upon
his Years of Service determined in accordance with
the following schedule:
<TABLE>
<CAPTION>
Completed Years of Vested Percentage of a Non-
Service Union Participant's Company
Matching Contributions
Account
<S> <C>
Less than One (1) Zero Percent (0%)
One (1) Twenty Percent (20%)
Two (2) Forty Percent (40%)
Three (3) Sixty Percent (60%)
Four (4) Eighty Percent (80%)
Five (5) or More One Hundred Percent (100%)
</TABLE>
For purposes of this Section, the vested balance of
a Participant who was not an Employee of Indiana
Energy, Inc. or any of its subsidiaries on March
30, 2000 or whose terms of employment are not
covered by a collective bargaining agreement
entered into by a Participating Company and a Union
in his Company Non-Matching Contributions Account
and the vested balances of a Participant who was an
employee of Indiana Energy, Inc. or any of its
subsidiaries on March 30, 2000 or whose terms of
employment are covered by a collective bargaining
agreement between a Company and the Union in his
Company Matching and Non-Matching Contributions
Accounts shall be based upon his Years of Service
determined in accordance with the following
schedule:
<TABLE>
<CAPTION>
Completed Years of Vested Percentage of a
Service Participant's Company Non-
Matching Contributions
Account and a Union
Participant's Company
Matching Contributions
Account
<S> <C>
Less than Five (5) Zero Percent (0%)
Five (5) or More One Hundred Percent (100%)
</TABLE>
9.4 Forfeiture Accounts and Forfeitures. The portion of
a Participant's Company Non-Matching and Matching
Contributions Accounts that is not distributable to
him on account of the provisions of Section 9.3
shall be credited to a forfeiture account
established and maintained by the Trustee in such
Participant's name as of the Valuation Date
coincidental with or next following his Termination
Date. If such Participant does not resume his
employment with a member of the Group before
incurring five (5) or more consecutive one (1) year
Breaks in Service or, if earlier, the date he
receives a distribution of his vested Participant
Account balances in accordance with Section 9.3, the
balance in his forfeiture account shall be forfeited
and shall then be allocated in accordance with the
provisions of Section 9.5. If such Participant
returns to employment with a member of the Group
before incurring five (5) or more consecutive one
(1) year Breaks in Service and repays to the Plan
the amount, if any, of any distribution from the
Plan upon his earlier termination of employment
before the expiration of a five (5) year period
beginning on his reemployment date or, if earlier,
the date he completes five (5) consecutive one (1)
year Breaks in Service, the balance in his
forfeiture account as of the next following
Valuation Date (after all adjustments then required
under the Plan have been made) shall be returned to
his Company Matching Contributions Account and
Company Non-Matching Contributions Account,
whichever is applicable, and shall be distributable
upon his next Termination Date to or for his benefit
or, in the event of his death, to or for the benefit
of his Beneficiary in accordance with the provisions
of this Article.
If a Participant returns to employment with a member
of the Group after the allocation of his forfeiture
account but before completing five (5) or more
consecutive one (1) year Breaks in Service, the
amount which was forfeited by reason of this Section
shall be reinstated as the beginning balances of his
Company Matching Contributions Account and Company
Non-Matching Contributions Account as of his date of
re-employment and shall be distributable upon his
next Termination Date to or for his benefit or, in
the event of his death, to or for the benefit of his
Beneficiary in accordance with the provisions of
this Article. Any amount required to be reinstated
by reason of the preceding sentence shall be paid by
the Companies for whose benefit the forfeiture was
applied under Section 9.5 and in the same proportion
in which such forfeiture was applied in accordance
with Section 9.5.
9.5 Application of Forfeitures. The balance in the
Company Matching and Non-Matching Contributions
Accounts which is forfeited by a Participant in
accordance with Section 9.4 shall be applied in the
Plan Year of forfeiture and in succeeding Plan Years
to reduce the amount of contributions, if any,
required by the Companies under Section 9.4 and the
amount of the Company contributions, if any,
required of the Participating Companies under
Section 5.2 and Section 5.3, until exhausted. The
portion of any forfeiture arising under the Plan
during any period which is applied to reduce the
Company contributions of any one (1) Participating
Company shall be that proportion of such forfeiture
amount which the contributions made by such
Participating Companies and credited to the Company
Matching and Non-Matching Contributions Accounts of
the Participant with respect to whom the forfeiture
occurred bear to the total contributions of all
Companies which were credited to such Company
Matching and Non-Matching Contributions Accounts.
9.6 Form of Payment. Distributions made in accordance
with this Article shall be made in cash; provided,
however, that if a Participant or, if applicable,
his Beneficiary elects to receive his benefits in a
single lump sum payment, the distribution of the
portion, if any, of a Participant's Participant
Accounts held in Fund A shall be made in whole
shares of Vectren Corporation common stock with
fractional shares and any uninvested funds held in
his name in Fund A paid in cash unless such
Participant or, if applicable, his Beneficiary
elects otherwise.
9.7 Designation of Beneficiary. Each Participant, by
signing an Appropriate Form furnished by the Plan
Administrator, may designate any legal or natural
person or persons (who may be designated
contingently or successively) as his Beneficiary to
whom his vested benefits are to be paid if he dies
before he receives all of his vested benefits. A
Beneficiary designation form shall be effective only
when the signed form is filed with the Plan
Administrator while the Participant is still alive
and shall cancel any Beneficiary designation forms
signed earlier. If a Participant fails to designate
a Beneficiary or if a deceased Participant's
Beneficiary dies before complete payment of such
Participant's vested benefits, the Plan
Administrator, in its sole discretion, shall direct
the Trustee to pay such deceased Participant's
benefits to his Spouse, if then living; if not
living, to such deceased Participant's surviving
children, in equal shares; and if no surviving
children, to such deceased Participant's estate.
Notwithstanding anything else contained in this
Section to the contrary, the Beneficiary of a
married Participant shall be his Spouse unless his
Spouse consents to the naming of another Beneficiary
in a writing witnessed by a member of the Plan
Administrator or by a Notary Public.
9.8 Payment of Benefits. The payment of benefits under
this Article shall commence as soon as practicable
after the Participant's Termination Date; provided,
however, that if the aggregate value of a
Participant's Participant Accounts is at the first
date on which the Accounts may be distributed (after
increasing such balance to reflect any previous
distributions or withdrawals) is greater than five
thousand dollars ($5,000), payment of benefits to a
Participant shall not commence before his Normal
Retirement Age without his written consent. If the
aggregate value of a Participant's Participant
Accounts has at all times been equal to or less than
five thousand dollars ($5,000), payment shall be
made in a single lump sum payment. If a Participant
dies before his benefit commencement date but after
his Termination Date, payment of benefits shall be
made in accordance with this Section as if such
deceased Participant's date of death was his
Termination Date. Notwithstanding anything else
contained in this Section to the contrary, payment
of benefits to which a Participant or, if deceased,
his Beneficiary is entitled hereunder shall commence
not later than the sixtieth (60th) calendar day
after the last calendar day of the Plan Year in
which:
(a) such Participant attains the Normal Retirement
Age,
(b) occurs the tenth (10th) anniversary of the Plan
Year in which such Participant commenced his
participation in the Plan, or
(c) such Participant terminates his employment with
the Group;
whichever is last to occur; provided, however, that
except as otherwise provided in Section 9.10, the
payment of benefits to a Participant shall commence
no later than April 1 of the calendar year
immediately following such Participant's taxable
year in which occurs such Participant's Termination
Date or in which such Participant attains age
seventy and one-half (70-1/2), whichever is last to
occur; provided, further, that in the case of a five
percent (5%) owner of a Participating Company
(within the meaning of Section 416 of the Code) or a
Participant who reaches age seventy and one-half
(70 1/2) before January 1, 1999, distribution shall
be required to commence no later than the April 1
immediately following the Participant's taxable year
in which the Participant reaches age seventy and one-
half (70 1/2). Notwithstanding anything contained
in this Plan to the contrary, if a qualified
domestic relations order (as described in Section
14.7) provides for the payment of all or a portion
of a Participant's Participant Accounts immediately
or any other time prior to the Participant's
termination of employment with the Group, the Plan
Administrator shall follow the terms of the order to
the extent permitted by the Code or ERISA.
9.9 Death Distribution Provisions. The following
distribution provisions shall take effect upon the
death of a Participant:
(a) If such Participant dies after distribution of
his vested benefits has commenced, the
remaining portion of such vested benefits shall
continue to be distributed at least as rapidly
as under the method of distribution being used
before such Participant's death.
(b) If such Participant dies before distribution of
his vested benefits commences, such
Participant's vested benefits shall be
distributed no later than five (5) years after
such Participant's death except to the extent
that an election is made to receive
distributions in accordance with Subparagraphs
(i) or (ii) below:
(i) if any portion of such Participant's
interest is payable to a designated
Beneficiary, distributions may be made in
substantially equal installments over a
period not exceeding ten (10) years;
provided, however, that the duration of
such installments shall not exceed the
life or life expectancy of that
designated Beneficiary;
(ii) if the designated Beneficiary is such
Participant's surviving Spouse, the date
distributions are required to begin in
accordance with Subsection (b) above
shall not be earlier than the date on
which such Participant would have
attained age seventy and one-half (70-
1/2) and, if that Spouse dies before
payments begin, subsequent distributions
shall be made as if that Spouse had been
such Participant.
(c) For purposes of Subsection (b) above, payments
shall be calculated by use of the return
multiples specified in Section 1.72-9 of the
Treasury Regulations. Life expectancy of a
surviving Spouse may be recalculated annually;
provided, however, that in the case of any
other designated Beneficiary, life expectancy
shall not be recalculated.
(d) For purposes of Subsections (a), (b) and (c)
above, any amount paid to a child of such
Participant shall be treated as if it had been
paid to such Participant's surviving Spouse if
the amount becomes payable to such surviving
Spouse when that child reaches the age of
majority in the State of Indiana.
9.10 Minimum Distribution Amount. If the method of
distribution of a Participant's benefits is in a
form other than a lump sum payment, then the amount
to be distributed to such Participant or to his
Beneficiary shall be no less than the amount equal
to the quotient obtained by dividing such
Participant's entire interest by the life expectancy
of such Participant or the joint and last survivor
expectancy of such Participant and his designated
Beneficiary; provided, however, that at least fifty
percent (50%) of the present value of the amount
available for distribution shall be paid within the
life expectancy of such Participant. Life
expectancy and joint and last survivor expectancy
shall be computed by the use of the return multiples
contained in Section 1.72-9 of the Treasury
Regulation. For purposes of this computation, a
Participant's or his Spouse's life expectancy may be
recalculated no more frequently than annually, but
the life expectancy of a nonspouse Beneficiary shall
not be recalculated. Notwithstanding anything
contained herein to the contrary, Plan distributions
shall be made in accordance and consistent with the
requirements of Section 401(a)(9) of the Code,
including the minimum distribution incidental death
benefit requirements of Treas. Reg. 1.41(a)(9)-2,
which requirements are incorporated herein by
reference.
9.11 Incapacity. If any person who is entitled to
receive any benefits hereunder is, in the judgment
of the Plan Administrator, legally, physically or
mentally incapable of personally receiving and
receipting for any distribution, the Plan
Administrator shall instruct the Trustee to make
distribution to such other person or persons or to
such institution or institutions as in the judgment
of the Plan Administrator shall then be maintaining
or have custody over such distributee.
9.12 Identity of Payee. Except as otherwise provided by
ERISA, the determination of the Plan Administrator
as to the identity of the proper payee for any
payment and the amount properly payable shall be
conclusive, and payment in accordance with such
determination shall, to the extent thereof,
constitute a complete discharge of all obligations
under the Plan.
9.13 Direct Transfers. This Section applies to
distributions made on or after January 1, 1993.
Notwithstanding any provision of the plan to the
contrary that would otherwise limit a distributee's
election under this Section, a distributee may
elect, at the time and in the manner prescribed by
the Plan Administrator, to have any portion of an
eligible rollover distribution paid directly to an
eligible retirement plan specified by the
distributee in a direct rollover. A distributee
shall have at least thirty (30) calendar days to
make a rollover decision; provided, however, that
the distributee may waive all or part of the thirty
(30) day election period. For purposes of this
Section, the following terms shall have the meanings
set forth below:
(a) Eligible rollover distribution: An eligible
rollover distribution is any distribution of
all or any portion of the balance to the credit
of the distributee, except that an eligible
rollover distribution does not include: (1)
any distribution that is one of a series of
substantially equal periodic payments (not less
frequently than annually) made for the life (or
life expectancy) of the distributee or the
joint lives (or joint life expectancies) of the
distributee and the distributee's designated
beneficiary, or for a specified period of ten
(10) years or more; (2) any distribution to the
extent such distribution is required under
section 401(a)(9) of the Code; (3) withdrawal
made under Article VIII to a Participant who
has not reached age fifty-nine and one-half
(59 1/2) and (4) the portion of any
distribution that is not includible in gross
income.
(b) Eligible retirement plan: An eligible
retirement plan is an individual retirement
account described in section 408(a) of the
Code, an individual retirement annuity
described in section 408(b) of the Code, an
annuity plan described in Section 403(a) of the
Code, or a qualified trust described in Section
401(a) of the Code, that accepts the
distributee's eligible rollover distribution.
However, in the case of an eligible rollover
distribution to the surviving spouse, an
eligible retirement plan is an individual
retirement account or individual retirement
annuity.
(c) Distributee: A distributee includes an
employee or former employee. In addition, the
employee's or former employee's surviving
spouse and the employee's or former employee's
spouse or former spouse who is an alternate
payee under a qualified domestic relations
order, as defined in section 414(p) of the
Code, are distributees with regard to the
interest of the spouse or former spouse.
(d) Direct rollover: A direct rollover is a
payment by the plan to the eligible retirement
plan specified by the distributee.
ARTICLE X
ADOPTION AND WITHDRAWAL BY SUBSIDIARIES AND AFFILIATES
10.1 Adoption by Affiliates. Any entity which, together
with Vectren Corporation, constitutes a member of a
controlled group of corporations within the meaning
of Section 414(b) of the Code may, with the approval
of the Chief Executive Officer or the President of
Vectren Corporation, adopt the Plan and Trust
Agreement and participate as a Participating Company
in the Plan by the execution of an agreement of
adoption of the Plan and Trust Agreement which shall
specify the effective date of that party's
participation. A listing of the affiliates who have
adopted the Plan is shown in Exhibit A.
10.2 Withdrawal by Participating Company. Any
Participating Company in the Plan may, by resolution
of its Board of Directors or other governing body,
withdraw from participation as a Participating
Company in the Plan.
<PAGE>
ARTICLE XI
CLAIMS
11.1 Procedure. In order to provide for the payment of
any benefits to which a Participant or other person
may be entitled under the Plan, the Plan
Administrator shall be given timely notice of that
Participant's retirement, Total Disability,
termination or death and of any other event upon
which occurrence benefits may be payable under the
Plan.
(a) A written request for a Plan benefit made by a
Participant, beneficiary or any other person
is a claim; the person making such claim is a
Claimant.
(b) Each claim shall be filed with the Plan
Administrator which shall, within ninety (90)
calendar days after its receipt thereof
("Claim Period"), either accept it or deny it
(wholly or partially) and within that time
notify the Claimant in writing of such
acceptance or denial. The Claim Period may be
extended for another ninety (90) calendar day
period if it is found that special
circumstances require an extension of time for
processing. In such case, before the
expiration of the Claim Period, the Claimant
shall be informed in writing of the reasons
for such extension and the date on which a
final decision is expected.
(c) If a claim is wholly or partially denied, a
Claimant shall be furnished with a written
notice setting forth in a manner calculated to
be understood by the Claimant:
(i) the specific reason(s) for denial;
(ii) specific reference(s) to pertinent Plan
provision(s) on which any denial is
based;
(iii) a description of any additional
material or information necessary for
the Claimant to perfect the claim, if
any, and an explanation of why such
material or information is necessary;
and
(iv) an explanation of the Plan's claim
review procedures.
(d) If a Claimant does not receive written
notification of acceptance, denial or
extension during the Claim Period or any
extension thereof, he may request review as if
his claim had been entirely denied as of the
expiration date of such Claim Period or
extension thereof.
(e) Upon denial, a Claimant is entitled, either in
person or by his duly authorized
representative, to:
(i) request a review of the claim by the
Plan Administrator upon written
application for review made to the
Plan Administrator; in the case of a
denial as to which written notice of
denial has been given to the Claimant,
any such request for review of the
claim shall be made within sixty (60)
calendar days after receipt by the
Claimant of the written denial notice;
(ii) review pertinent documents relating to
the denial; and
(iii) submit issues and comments in writing.
(f) The Plan Administrator shall make its decision
with respect to a claim review promptly, but
not later than sixty (60) calendar days after
receipt of the written review request. Such
sixty (60) calendar day period may be extended
for another period of sixty (60) calendar days
if the Plan Administrator reviewing the claims
finds that special circumstances require an
extension of time for processing. In such
case, before the expiration of the initial
sixty (60) calendar day period, the Claimant
shall be informed, in writing, of the reasons
for such extension. The final decision of the
Plan Administrator shall be in writing, giving
specific reasons for the decision and making
specific references to the pertinent Plan
provisions on which the final decision is
based.
<PAGE>
ARTICLE XII
ADMINISTRATION OF PLAN
12.1 Plan Administrator. The Plan Administrator shall
serve as administrator and named fiduciary of the
Plan for and on behalf of the Participating
Companies and of the Participants and their
Beneficiaries. The Plan Administrator shall
determine all questions as to the rights of
Participants and their Beneficiaries under the Plan.
12.2 Delegation of Duties. The Plan Administrator may
also appoint or designate such agents, as it may
deem necessary for the effective exercise of its
duties and may delegate to such agents any powers
and duties, both ministerial and discretionary, as
is permitted under ERISA and as the Plan
Administrator may deem expedient or appropriate;
provided, however, that the ultimate
responsibilities for the administration of the plan
shall remain with the Plan Administrator.
12.3 Duties of Plan Administrator. Other than the
management of the Trust Fund, with which the Trustee
shall be charged, the Plan Administrator shall have
complete control of the administration of the Plan,
with all powers necessary to enable it properly to
carry out its duties in that respect. Not in
limitation, but in amplification of the foregoing,
the Plan Administrator shall have the power to
construe the Plan and to determine all questions
relating to the eligibility of Employees to
participate in the Plan, the amount of benefits to
which any Participant or his Beneficiary may become
entitled hereunder and the amount of contributions
to the Trust Fund which shall be made by the
Participating Companies. All disbursements by the
Trustee, except for the ordinary expenses of
administration of the Trust Fund, shall be made
upon, and in accordance with, the written directions
of the Plan Administrator. Except as otherwise
provided in Section 11.1, decisions of the Plan
Administrator upon all matters within the scope of
its authority shall be final and binding upon the
Participating Companies and upon each and every
person who may be or become interested in the Plan
or who may claim any rights or benefits hereunder.
12.4 Communications to Trustee. Such instructions and
directions as the Plan Administrator shall give to
the Trustee from time to time or as may be requested
by the Trustee shall be in writing and, except as
otherwise provided by ERISA, the Trustee shall be
protected fully in acting upon any such written
directions and instructions.
12.5 Additional Rights of Plan Administrator. The Plan
Administrator shall have the right to:
(a) engage accountants or pension consultants to
determine the contributions of the
Participating Companies, and
(b) approve record forms and descriptive
literature.
12.6 Compliance with Law. The Plan Administrator shall
exercise such authority and responsibility as it
deems appropriate in order to comply with ERISA and
with the Code relating to records of a Participant's
Years of Service, Hours of Service and compensation,
contributions, notifications to Participants, annual
reports to and registration with the Internal
Revenue Service, annual reports to the Department of
Labor, etc.
12.7 Waiver of Time Deadlines. The Plan Administrator
shall have the right to waive any time deadlines
required by the Plan which the Plan Administrator,
in its sole discretion and by applying uniform and
non-discriminatory standards, believes would be
desirable and in the best interests of the
Participants and of the Plan.
<PAGE>
ARTICLE XIII
DUTIES OF THE TRUSTEE
13.1 General Provisions. The assets of the Trust Fund
shall be held by the Trustee in accordance with the
Trust Agreement.
13.2 Trust Agreement. Vectren Corporation shall enter
into a Trust Agreement with the Trustee under which
the Trustee shall receive contributions made by
each Participating Company pursuant to the Plan and
shall hold, invest, reinvest and distribute the
Trust Fund in accordance with the terms and
provisions of the Plan and of that Trust Agreement.
Vectren Corporation shall determine the form and
terms of any such Trust Agreement and may modify
any such Trust Agreement from time to time to
accomplish the purposes of the Plan without the
consent of any other person; provided, however,
that any such modification shall not cause or
permit any part of the Trust Fund to be diverted to
purposes other than those expressly permitted by
the Plan, by the Code and by ERISA.
13.3 Appointment of Investment Manager. Notwithstanding
anything to the contrary herein contained, Vectren
Corporation may appoint an investment manager or
managers to manage all or a portion of the assets
of the Trust Fund for which the Trustee is
responsible for the investment thereof; provided,
however, that during any period in which there is
in existence an investment committee for the Plan
appointed by the Chief Executive Officer or the
President of Vectren Corporation, the power to
appoint an investment manager or managers shall
reside with such investment committee. If Vectren
Corporation or, if applicable, the investment
committee appoints an investment manager to manage
the Trust Fund, in whole or in part, and delivers
to the Trustee a copy of the instruments appointing
the investment manager and evidencing the
investment manager's acceptance of such
appointment, an acknowledgment by the investment
manager that it is a fiduciary under this Plan and
under ERISA and a certificate evidencing the
investment manager's current registration under the
Investment Advisers Act of 1940, the Trustee shall
be fully protected in relying upon such instruments
and certificate until otherwise notified in writing
by Vectren Corporation The Trustee shall follow
the directions of any such investment manager
regarding the investment and reinvestment of the
Trust Fund, or such portion thereof as shall be
under management by such investment manager. The
Trustee shall be under no duty or obligation to
review any investment to be acquired, held or
disposed of pursuant to such directions nor to make
any recommendations with respect to the disposition
or continued retention of any such investment.
Unless Vectren Corporation's or, if applicable,
investment committee's appointment of an investment
manager or any subsequent written direction of
Vectren Corporation or, if applicable, investment
committee delivered to the applicable investment
manager or managers and Trustee expressly provides
that proxies relating to any investments under the
management control of such investment manager are
to be voted by the Trustee, such proxies are to be
voted by such investment manager. The Trustee
shall have no liability or responsibility for
acting or not acting pursuant to the directions of,
or failing to act in the absence of any direction
from, any such investment manager, unless the
Trustee knows that by such action or failure to act
it would be committing or participating in a breach
of fiduciary duty under Section 405 of ERISA.
13.4 Voting of Common Stock in Fund A. Not less than
thirty (30) calendar days prior to each annual or
special meeting of the shareholders of Vectren
Corporation, the Plan Administrator shall furnish
or cause to be furnished to the Trustee and to each
Participant for who all or a portion of whose
Participant Accounts are invested in Fund A as of
the record date established by Vectren Corporation
a copy of the proxy material supplied by Vectren
Corporation and a card to be returned to the
Trustee which shall request instructions from each
Participant as to how any Vectren Corporation
common stock, including fractional shares,
allocated to his Participant Accounts shall be
voted. Upon receipt of such instruction cards from
the Participants, the Trustee shall vote or may
grant Vectren Corporation's management a proxy to
vote such common stock as such Participants have
directed. For the purposes of voting common stock
held in Fund A or granting Vectren Corporation's
management a proxy to vote such common stock, the
Trustee shall combine the directions of
Participants as to the voting of fractional shares
allocated to their Participant Accounts to the
maximum extent possible and the Trustee shall vote
the resulting aggregate of the whole shares so
combined in accordance with such directions. The
Trustee shall vote any allocated common stock with
respect to any business or issue for which it lacks
a specific direction from any Participant in the
same proportion that it votes the shares for which
it received direction from the Participants.
<PAGE>
ARTICLE XIV
MISCELLANEOUS
14.1 Payment of Expenses. Each Participating Company
shall pay its pro rata share of all administrative
expenses of the Plan (including, but not limited
to, any brokerage commissions incurred by reason of
transactions made on behalf of Fund A) and all fees
and retainers of the Plan's consultants, auditors
and counsel (who may, but need not, be counsel to
the Participating Companies or to the Trustee);
provided, however, that any expenses directly
relating to the investments of the Trust Fund, such
as taxes, commissions incurred by reason of
transactions made on behalf of Fund B and Fund C,
registration charges, etc., shall be paid by the
Trustee from the Trust Fund; provided, further,
that any expenses directly relating to the
Participant Accounts of a Participant (including,
but not limited to, expenses incurred by reason of
compliance with a qualified domestic relations
order (as described in Section 14.7)) shall be
charged directly to such Participant's Participant
Accounts to the fullest extent permitted under the
Code and under ERISA.
14.2 Forms. All forms required to be submitted under
the Plan shall be prepared by the Plan
Administrator or by its designate and submitted in
accordance with its directions.
14.3 No Right of Employment. Neither the Plan nor any
action taken under it shall be construed as giving
any Employee or any other person any right, legal
or equitable, under the Plan against the Group or
against any shareholder, officer, director, agent
or Employee of the Group, except as specifically
provided for in the Plan. Nothing in the Plan
shall be construed as giving any Employee the right
to remain in the employ of the Group or to change
the terms of his employment by the Group.
14.4 Construction. In the construction of the Plan, the
masculine includes the feminine and the singular
includes the plural in all cases in which such
meanings are appropriate.
14.5 Copies of Documents. Copies of the Plan and of the
Trust Agreement shall be made available to
Employees during regular business hours at the
Participating Companies' principal office and at
such other locations as the Plan Administrator may
designate. No documents (at any time published or
distributed to any Employee, Participant, former
Participant, Spouse, Beneficiary or any other
person) which summarize and explain the material
provisions of the Plan shall be construed or
interpreted in any way as constituting the Plan,
and in the event of any conflict between such
documents and the terms of the Plan, the terms of
the Plan shall govern.
14.6 Jurisdiction. The Plan shall be construed and
enforced in accordance with the laws of Indiana,
except as otherwise required by ERISA.
14.7 Nonalienation of Benefits. To the fullest extent
permitted by law, no benefit under the Plan shall
be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge,
encumbrance, garnishment or charge; and any action
by way of anticipation, alienation, selling,
transferring, assigning, pledging, encumbering,
garnisheeing or charging the same shall be void and
of no effect; and no such benefit shall be in any
manner liable for or subject to the debts,
contracts, liabilities, engagements or torts of the
person entitled to such benefits. The preceding
sentence shall also apply to the creation,
assignment or recognition of a right to any benefit
payable with respect to a Participant pursuant to a
domestic relations order unless such order is
determined to be a qualified domestic relations
order, as defined in Section 414(p) of the Code.
To the extent permitted by the Code and the Act, an
order may still be deemed to be a qualified
domestic relations order even if it provides for
the payment, including the immediate payment, of a
Participant's vested amounts to an alternate payee
before the date on which the Participant terminates
his employment with the Group. Any expenses
incurred by reason of the Trustee's compliance with
a qualified domestic relations order shall be
charged to the Participant Accounts of the
Participant to which the order relates in
accordance with Section 14.1. Subject to any
applicable provision of law to the contrary, if any
Participant or if any Beneficiary under the Plan
shall become bankrupt or shall attempt to
anticipate, alienate, sell, transfer, assign,
pledge, encumber, permit to be garnished or charge
any benefit to which he may be or become entitled
under the Plan, all rights of such Participant or
of such Beneficiary to such benefit shall, in the
sole discretion of the Plan Administrator, then
cease and terminate. In such event, the Plan
Administrator shall hold or apply the benefit or
any part thereof to or for such Participant or for
such Beneficiary, Spouse, children or other
dependents, or any of them, in such manner and in
such proportions as the Plan Administrator shall in
its sole discretion determine. Subject to any
applicable provisions of law to the contrary and
except as provided above, it is declared to be the
express purpose and intention of the Plan that
payments hereunder shall be made only at the times,
in the amounts and to the payees as specified in
the Plan regardless of any marital dissolution,
bankruptcy or other legal proceedings to which such
payees may be a party.
14.8 Non-Diversion. Irrespective of anything contained
in the Plan or in the separate Trust Agreement, as
now expressed or hereafter amended, it shall be
impossible for any part of the Trust Fund to be
used for, or diverted to, any purpose not for the
exclusive benefit of Participants or, if deceased,
of their designated Beneficiaries at any time,
either by the operation, amendment, revocation or
termination of the Plan; and no part of the Trust
Fund shall be paid, distributed or made available
to the Participating Companies at any time, except
as expressly provided in the Plan and permitted
under ERISA and under the Code.
14.9 Non-Liability of Participating Companies. Except
as otherwise provided by ERISA, no liability
whatsoever shall attach to or be incurred by any
shareholder, officer or director, as such, of the
Participating Companies under or by reason of any
provision of the Plan or any act with reference to
the Plan, and any and all rights and claims against
the Participating Companies, or any shareholder,
officer or director thereof, as such, whether
arising at common law or in equity or created by
statute, constitution or otherwise, are hereby
expressly waived and released to the fullest extent
permitted by law by every Participant and by any
Beneficiary claiming through him as a condition of
and part of the consideration for the payments by
the Participating Companies under the Plan and for
the receipt of benefits hereunder.
14.10 Illegal or Invalid Provisions. If any provision of
the Plan shall be held illegal or invalid for any
reason, such illegality or invalidity shall not
affect the remaining parts of the Plan and it shall
be construed and enforced as if such illegal or
invalid provision had never been inserted herein.
14.11 Execution of Counterparts. The Plan may be
executed in any number of counterparts, each of
which shall be deemed to be an original. All the
counterparts shall constitute but one (1) and the
same instrument, and the Plan may be sufficiently
evidenced by any one (1) counterpart.
14.12 Tax Approval. If for any reason the Key District
Director of the Internal Revenue Service should at
any time fail to approve any of the terms,
conditions or amendments contained in or implied
from the Plan for qualification under Sections
401(a) and 501(a) of the Code, then Vectren
Corporation shall be authorized to make such
modifications, alterations and amendments of the
Plan as are necessary to obtain or to retain such
approval and such modifications, alterations and
amendments shall be effective retroactively to the
Effective Date or to such later date as is required
to obtain or to retain such approval.
14.13 Non-Liability of Shareholders. Except as otherwise
provided by ERISA, no liability whatsoever shall
attach to, or be incurred by, any past, present or
future shareholder, officer or director, as such,
of the Participating Companies under or by reason
of any of the terms, conditions or agreements
contained in or implied from the Plan, and any and
all liability of, and any and all rights and claims
against, the Participating Companies or any
shareholder, officer or director of Participating
Companies, as such, whether arising at common law
or in equity or created by statute or constitution
or otherwise, shall be deemed to have been
expressly waived and released to the fullest extent
permitted by law by every Participant or, if
deceased, by his Beneficiary as a condition of, and
as a part of the consideration for, the
contributions made by the Participating Companies
pursuant to Article V.
14.14 Rights of Third Parties. Except as otherwise
provided by ERISA and by Section 14.7, nothing
expressed or implied in the Plan is intended or
shall be construed to confer upon or to give to any
person, other than the Participating Companies, the
Trustee and all Participants or, if deceased, their
Beneficiaries any right, remedy or claim under or
by reason of any provisions of the Plan, and all
provisions of the Plan shall be for the sole and
exclusive benefit of the Participating Companies,
the Trustee and all Participants or, if deceased,
their Beneficiaries. Notwithstanding any
provisions in the Plan to the contrary, the Spouse
or other Beneficiary of any Participant shall have
absolutely no rights whatsoever under the Plan
before the death of such Participant except to the
extent required under a qualified domestic
relations order as provided in Section 14.7.
14.15 Titles. Titles of the Articles and Sections of the
Plan are for general information only, and the Plan
shall not be construed by reference to such titles.
14.16 Successors and Assigns. The Plan shall be binding
upon the successors and assigns of the
Participating Companies.
14.17 Forms and Proofs; Notice of Address. Each
Participant or Beneficiary of a deceased
Participant eligible to receive any distributions
hereunder shall complete such forms and furnish
such proofs, receipts and releases as shall be
required by the Plan Administrator or by the
Participating Companies. Failure to furnish such
information or to sign such documents shall not
result in any forfeiture but shall be deemed to be
a voluntary election to postpone distributions
hereunder. No interest shall be paid on
distributions as to which the time of commencing
payment has been postponed as herein provided.
Each Participant, former or retired Participant and
the Spouse or other beneficiary of any deceased
Participant shall file with the Plan Administrator
in writing his post-office address and each change
of post-office address. Any communication,
statement or notice addressed to such person at his
latest post-office address as filed with the Plan
Administrator shall be binding upon such person for
all purposes of the Plan, and neither the Trustee
nor the Participating Companies shall be obligated
to search for or to ascertain the whereabouts of
any such person.
<PAGE>
ARTICLE XV
AMENDMENT, TERMINATION OR MERGER
15.1 Right To Amend or Terminate. The Chief Executive
Officer or the President of Vectren Corporation
reserves the right to alter, amend or modify,
revoke or terminate, in whole or in part, the Plan
and the Trust Agreement that was established
currently with the Plan to effectuate and implement
the Plan by executing a written instrument
evidencing such action and filing a copy thereof
with each of the other Participating Companies and
with the Trustee; provided, however, that the Board
of Directors of Vectren Corporation must approve
any amendment that results in an increase in
benefits and/or costs to the Group with a present
value (as determined by the actuary for the Vectren
Corporation current defined benefit plan covering
salaried employees) as of the date of the amendment
in excess of one million dollars ($1,000,000).
Notwithstanding the foregoing, no such alteration,
amendment or modification, in whole or in part, of
the Plan or of the Trust Agreement shall:
(a) cause any part of the Trust Fund to be used
for or diverted to any purpose other than for
the exclusive benefit of Participants or other
persons entitled to the benefits under the
Plan except as expressly provided in the Plan
and permitted under ERISA and under the Code;
or
(b) retroactively affect adversely the rights of
any Participant or his Beneficiary to any
benefits under the Plan, unless such amendment
is determined to be necessary or desirable to
comply with ERISA or with the Code; or
(c) adversely affect the rights of any Participant
whose employment with the Group has
terminated, unless the effective date of such
amendment coincides with or precedes the date
on which the employment of that Participant by
the Participating Companies was terminated;
(d) change the vesting schedule in Section 9.3 or
in Section 17.4 unless each Participant who
has completed five (5) or more Years of
Service (effective after December 31, 1988,
this shall be reduced to three (3) or more
Years of Service) as of the effective date of
such amendment is permitted to elect, within
sixty (60) calendar days after the latest of
the date on which the amendment is adopted,
the date on which the amendment is effective
or the date on which he is notified in writing
by the Plan Administrator of his rights under
this Subsection, to have his vested interest
determined without regard to such amendment;
or
(e) decrease a Participant Account balance or
eliminate an optional form of distribution for
the accrued benefits of a Participant
determined as of the date of the alteration,
amendment or modification.
15.2 Distribution upon Termination. In the event of the
termination, in whole or in part, of the Plan by
Vectren Corporation or in the event of the
permanent discontinuance of contributions to the
Plan, Vectren Corporation may direct the Trustee to
segregate the assets allocable to the respective
Companies concerned. The assets in the Trust Fund
shall be valued as of the date of such partial or
total termination or permanent discontinuance.
That portion of the assets in the Trust Fund
attributable to the Participants directly affected
by the partial or total termination or permanent
discontinuance (except such part thereof as is used
for the payment of expenses), which shall remain
non-forfeitable and fully vested, shall be, if
permitted by the Code, distributed as though all
Participants directly affected by the partial or
total termination or permanent discontinuance had
retired on the date of such partial or total
termination or permanent discontinuance. That
portion of the assets in the Trust Fund
attributable to the Participants directly affected
by the partial or total termination or permanent
discontinuance shall be that fractional share of
the assets (determined as of the date of the
partial or total termination or permanent
discontinuance) which is expressed by a fraction,
the numerator of which is the aggregate present
value of the Participant Accounts of all
Participants directly affected by the partial or
total termination or permanent discontinuance and
the denominator of which is the aggregate present
value of the Participant Accounts of all
Participants, both present values and all
Participant Account values to be determined as of
the date of the partial or total termination or
permanent discontinuance.
15.3 Plan Merger or Consolidation. Vectren Corporation,
expressly reserves the right, by action of its
Chief Executive Officer or its President, to merge
or to consolidate the Plan with, or to transfer the
assets or liabilities of the Plan to, any other
similar qualified retirement plan at any time,
except that no such merger, consolidation or
transfer shall be authorized unless each
Participant in the Plan would receive a benefit
immediately after the merger, consolidation or
transfer (if the merged, consolidated or
transferred plan then terminated) equal to or
greater than the benefit to which he would have
been entitled immediately before the merger,
consolidation or transfer (if the Plan then
terminated). Subject to the foregoing limitations
regarding benefits before and after a merger,
consolidation or transfer of assets, if any
Participating Company (the "Transferee") acquires
all or substantially all of the assets of another
Participating Company (the "Transferor") by
purchase, merger, liquidation or otherwise and if,
as a result of such acquisition, a substantial
number of the Employees of the Transferor are
employed by the Transferee, the Transferor and the
Transferee may, by duly adopted resolutions of
their Boards of Directors, take whatever steps they
deem necessary or appropriate, consistent with any
requirements imposed under ERISA and under the
Code, to cause the Trustee to transfer on its
records of the Trust Fund the assets and
liabilities allocable to the Transferor under the
Plan to the Transferee.
ARTICLE XVI
PARTICIPANT LOANS
16.1 Authorization by Plan Administrator. The Plan
Administrator or its designee may, in its sole
discretion, in accordance with rules adopted and
consistently applied in a uniform and nondiscriminatory
manner, direct the Trustee to loan a Participant, who is
actively employed by the Group, an amount from his
vested Participant Accounts which is not less than one
thousand dollars ($1,000) and which, when added to any
other loan outstanding to such Participant under any
other qualified retirement plans maintained by the
Group, does not exceed the lesser of:
(a) fifty thousand dollars ($50,000); provided,
however, that effective for loans made after
December 31, 1986, the fifty thousand dollar
($50,000) limit shall be reduced by the excess of:
(i) the highest outstanding loan balance of
loans from the Plan during the one (1) year
period ending on the day preceding the date
as of which such loan was made, over
(ii) the outstanding loan balance of loans from
the Plan on the date such loan is made;
or
(b) fifty percent (50%) of the sum of his Compensation
Redirection Account and his Company Matching and
Non-Matching Contributions Accounts, if vested
under Article IX, balances as of the Valuation Date
coincident with or immediately preceding the
effective date of the loan and as adjusted to
reflect any withdrawals or other distributions from
his Participant Accounts since such Valuation
Date);
provided, however, that the aforesaid loan privileges
shall also be extended to any party in interest (within
the meaning of Section 3(14) of ERISA) to the Plan, who
is a former Participant with undistributed vested
Participant Accounts, who is the Beneficiary of a
deceased Participant with undistributed vested
Participant Accounts, or who is an alternate payee under
any court order which has been determined by the Plan
Administrator to be a qualified domestic relations order
with an interest in all or a portion of a Participant's
undistributed vested Participant Accounts, but only to
the extent of that alternate payee's vested interest in
that Participant's Participant Accounts under such court
order, and references to the term "Participant" in this
Article shall include, where appropriate, such other
individuals eligible for loans under this Article;
provided, further, that if the Plan Administrator
determines that the class of individuals for whom loans
may be granted (exclusive of active employees) is
disproportionately represented by former Highly
Compensated Participants, the Plan Administrator shall
also make loans available to other former Participants,
Beneficiaries and alternate payees, regardless whether
they are a party in interest (within the meaning of
Section 3(14) of ERISA). Except for circumstances which
would permit a withdrawal under Section 8.2, no loans
shall be permitted between June 15, 1995 and August 31,
1995.
16.2 Terms and Conditions. Effective with respect to loans
made, extended, renewed or modified after October 17,
1989 in accordance with Section 16.1, the following
restrictions shall apply in addition to any restrictions
imposed pursuant to Section 4975(d)(1) of the Code or
pursuant to Section 408(b)(1) of ERISA:
(a) Loans shall be made available to all Participants
who are actively employed by a Company and, if
parties in interest (within the meaning of Section
3(14) of ERISA) to the Plan, to former
Participants, Beneficiaries of deceased
Participants and alternate payees on a reasonably
equivalent basis without regard to race, color,
religion, sex, age or national origin and after
giving consideration only to those factors which
would be considered in a normal commercial setting
by an entity in the business of making similar
types of loans, including but not limited to the
applicant's credit-worthiness and financial need.
(b) Loans shall not be made available to Participants
who are Highly Compensated Participants within the
meaning of Section 414(q) of the Code, officers or
shareholders of the Group in an amount greater
than the amount made available to other
Participants.
(c) Loans shall be made in accordance with the
specific provisions regarding such loans as set
forth in this Article and with rules containing
strict objective criteria which are adopted by the
Plan Administrator and consistently applied in a
uniform and nondiscriminatory manner, which rules
are hereby incorporated by reference and made a
part of the Plan.
(d) Loans shall be adequately secured, but in no event
shall more than fifty percent (50%) of the
borrowing Participant's or, where applicable,
Beneficiary's or alternate payee's, as the case
may be, vested interest in the Participant
Accounts in the Plan immediately after the
origination of the loan be considered as security.
The adequacy of such security shall be determined
by the Plan Administrator, in its sole discretion,
in light of the type and amount of security which
would be required in the case of an otherwise
identical transaction in a normal commercial
setting between unrelated parties on arms-length
terms. No security shall be accepted under the
Plan other that vested Participant Account
balances.
(e) The loan program established pursuant to this
Article shall at all times be administered for the
exclusive purpose of providing benefits to
Participants and their Beneficiaries based on an
evaluation of all relevant facts and circumstances
by the Committee.
(f) An application for a loan by a Participant shall
be made by a written request filed with the Plan
Administrator at least ten (10) calendar days in
advance of the date as of which the loan is to be
effective.
(g) The entire unpaid balance of any loan made under
this Section and all interest due thereon,
including all arrearages thereon, shall, at the
option of the Plan Administrator, immediately
become due and payable without further notice or
demand, upon the occurrence, with respect to the
borrowing Participant, of any of the following
events of default:
(i) any payment of principal and accrued
interest on the loan remains due and unpaid
for a period of ten (10) calendar days
after the same becomes due and payable
under the terms of the loan;
(ii) the commencement of a proceeding in
bankruptcy, receivership or insolvency by
or against the borrowing Participant;
(iii) the termination of the employment of the
borrowing Participant with the Group for
any reason;
(iv) the borrowing Participant attempts to make
an assignment, for the benefit of
creditors, of his interest in his
Participant Accounts;
(v) a qualified domestic relations order (as
such term is defined in Section 414(p) of
the Code) with respect to the borrowing
Participant is received by the Plan
Administrator; or
(vi) any loan proceeds are used, directly or
indirectly, by the borrowing Participant to
purchase or carry securities (as such term
is defined for purposes of Regulation G of
the Federal Reserve Board as promulgated
pursuant to Section 7 of the Securities and
Exchange Act of 1934).
Any payments of principal and interest of the loan
not paid when due shall bear interest thereafter,
to the fullest extent permitted by law, at the
rate specified by the terms of the loan. The
payment and acceptance of any sum or sums at any
time on account of the loan after an event of
default, or any failure to act to enforce the
rights granted hereunder upon an event of default,
shall not be a waiver of the right of acceleration
set forth in this Subparagraph.
(h) If an event of default and an acceleration of the
unpaid balance of the loan and interest due
thereon shall occur (as described above in
Subparagraph (g)) but only to the extent permitted
by applicable Treasury regulations, the Plan
Administrator shall have the right to direct the
Trustee to pursue any remedies available to a
creditor at law or under the terms of the loan,
including the right to execute on the security for
the loan, and to apply any amounts credited to the
Participant Accounts of the borrowing individual
at the time of execution or at any time thereafter
in satisfaction of the unpaid balance of the loan
and interest due thereon; provided, however, that
the Plan Administrator shall not have the right to
direct the Trustee to execute on any amounts
credited to the borrowing Participant's
Participant Accounts prior to the date on which
such Participant dies, becomes disabled,
terminates his employment with the Group, or
attains age fifty-nine and one-half (59 1/2);
provided, further, that if a Participant fails
timely to make loan payments, the Plan
Administrator shall for tax purposes treat all or
a portion of the loan balance as a deemed
distribution to the extent required by applicable
Treasury regulations.
(i) The period of repayment for each loan shall be
arrived at by mutual agreement between the Plan
Administrator and the borrowing individual, but
such period shall not in any case exceed five (5)
years or, if the borrower is a Participant, extend
beyond the date the Participant is expected to
reach age seventy and one-half (70 1/2); provided,
however, that if the loan proceeds are used by a
borrowing Participant to acquire any dwelling unit
which within a reasonable time period is to be
used (determined at the time that the loan is
made) as a principal residence by such Participant
or by a member of the family (as defined in
Section 267(c)(4) of the Code) of such
Participant, the term of that loan may be for a
period longer than five (5) years but not beyond
the date on which that borrowing Participant is
expected to reach age seventy and one-half
(70 1/2).
(j) Loans shall bear a reasonable rate of interest to
provide the Plan with a return commensurate with
the interest rates charged by entities in the
business of lending money for loans which would be
made under similar circumstances. The interest
rate of loans shall be determined by the Plan
Administrator in accordance with the parameters
described above. Each loan shall bear interest at
a reasonable rate to be fixed by the Plan
Administrator. The Plan Administrator shall not
discriminate among Participants in the matter of
interest rates, but loans granted at different
times may bear different interest rates if, in the
opinion of the Plan Administrator, the difference
in rates is justified by a change in general
economic conditions or other relevant factors, so
long as such different interest rates are
reasonable and do not discriminate in favor of
highly compensated Participants.
(k) A loan may be granted no more than once during any
consecutive twelve (12) month period, and no more
than one (1) loan may be outstanding at any point
in time.
(l) Each loan shall be evidenced by such documentation
as may be required by the Plan Administrator.
(m) No distribution (other than a withdrawal under
Section 8.2 of an amount not security for a loan
under the Plan) shall be made to any Participant
or former Participant or to a Spouse or other
Beneficiary of any deceased Participant unless and
until all unpaid loans, including accrued interest
thereon, have been liquidated.
(n) Each loan shall have such additional terms as to
default, prepayment and security as the Plan
Administrator, in its sole discretion, may
determine.
(o) The installments constituting repayments of any
outstanding loan under this Section shall be made
through regular payroll deductions from amounts
otherwise payable to a borrowing Participant by
the Participating Companies so as to assure that
the loan is amortized in level payments, made not
less frequently than quarterly, over the term of
the loan; provided, however, that if a borrowing
Participant is not receiving any Compensation from
the Participating Companies during a period in
which any loan is outstanding due to being placed
on layoff or on unpaid leave of absence, that
borrowing Participant shall be required to make
installment payments, no less frequent than
quarterly, equivalent in value and timing to the
payments which would otherwise have been deducted
from his paychecks by the Participating Companies.
The installments constituting monthly repayments
of an outstanding loan to a Beneficiary of a
deceased Participant or to an alternate payee
under this Article or to a borrowing Participant
who is not receiving any Compensation from which
payroll deductions can be made shall be made by
personal check, money order or a certified or
cashier's check delivered to the office of the
Plan Administrator on or before their respective
due dates. Cash payments shall not be accepted.
(p) Each such loan shall require substantially level
amortization over its term.
16.3 Accounting for Loans. There shall be a fifty dollar
($50.00) charge assessed against the Participant
Accounts of a Participant for whom a loan is approved.
A Participant loan subaccount shall be established as of
the date a loan is made to a Participant in accordance
with this Article. The Participant loan subaccount
shall be charged against the Participant Accounts in
accordance with the following order of priority:
(a) Company Matching Contributions Account;
(b) Company Non-Matching Contributions Account; and
(c) Compensation Redirection Account.
The loan shall be treated as an investment of the funds
credited to the applicable Participant Account of such
borrowing Participant. Cash equal to the amount of any
loan granted under this Section shall be obtained by
liquidating the borrowing Participant's applicable
Participant Account investments in the investment funds
pro rata.
Loan payments, both principal and interest, shall be
transferred back to the investment funds and Participant
Accounts from which the loan proceeds were obtained, in
accordance with the order of priority described above
but reversed, as soon as practicable after receipt of
the payments by the Plan Administrator; provided,
however, that effective on and after October 1, 1989, a
loan payment of a Participant shall be reinvested in the
investment funds in accordance with the investment
election in effect for such Participant under Section
6.1 on the date of each such loan payment.
ARTICLE XVII
TEFRA TOP-HEAVY RULES
17.1 Application. The rules set forth in this Article
shall be applicable with respect to any Plan Year
in which the Plan is determined to be a Top-Heavy
Plan; provided, however that the provisions of this
Article shall be applied only to the extent
necessary to comply with Section 416 of the Code
and in a manner consistent with all requirements
imposed under Section 416 of the Code.
17.2 Determination. The Plan shall be considered a Top-
Heavy Plan with respect to any Plan Year if as of
the last calendar day of the immediately preceding
Plan Year or, if the determination is to be made
for the Plan's first (1st) Plan Year, the last
calendar day of the first (1st) Plan Year (the
"determination date"):
(a) the present value of the accrued benefits of
key employees (as such term is defined below)
exceeds sixty percent (60%) of the present
value of the accrued benefits of all Plan
Participants (excluding former key employees
(as such term is defined below)); provided,
however, that the accrued benefits of any
Participant who has not performed any services
for the Group during a five (5) year period
ending on the determination date (as such term
is defined above) shall be disregarded, or
(b) the Plan is part of a required aggregation
group (as such term is defined below) and the
required aggregation group is top-heavy;
provided, however, that the Plan shall not be
considered a Top-Heavy Plan with respect to any
Plan Year in which the Plan is part of a required
or permissive aggregation group (as such term is
defined below) which is not top-heavy. For
purposes of this Article, the term "key employee"
shall include for any Plan Year any Employee or
former Employee who at any time during the Plan
Year or any of the four (4) preceding Plan Years
is:
(c) an officer of a Company whose Section 415
Compensation from the Group is greater than
fifty percent (50%) of the maximum dollar
limitation under Section 415(b)(1)(A) of the
Code in effect for the calendar year in which
the determination date (as such term is
defined above) falls,
(d) one (1) of the ten (10) Employees who own (or
who is considered as owning within the meaning
of Section 318 of the Code) the largest
interest in a Company, whose ownership
interest in such Company is at least one-half
of one percent (0.5%) and whose Section 415
Compensation from the Group is equal to or
greater than the maximum dollar limitation
under Section 415(c)(1)(A) of the Code in
effect for the calendar year in which the
determination date (as such term is defined
above) falls; provided, however, that if two
(2) Employees have the same interest in a
Company, the Employee whose Section 415
Compensation from the Group is greater shall
be treated as having a larger interest in that
Company,
(e) a five percent (5%) owner (determined without
regard to Sections 414(b), (c) and (m) of the
Code) of a Company, or
(f) a one percent (1%) owner (determined without
regard to Sections 414(b), (c) and (m) of the
Code) of a Company whose Section 415
Compensation from the Group is in excess of
one hundred and fifty thousand dollars
($150,000);
provided, however, that the Beneficiary of any
deceased Employee or of any deceased former
Employee who was included as a key employee by
reason of this Section shall also be included as a
key employee; provided, further that an Employee or
former Employee shall only be included as a key
employee to the extent required by Section 416(i)
of the Code; provided, further, that for purposes
of this Section, Section 415 Compensation shall
include any amount which is contributed by the
Participating Companies pursuant to a salary
reduction agreement and which is not includible in
the gross income of an Employee under Sections 125,
401(k), 402(a)(8), 402(h)(1)(B) and 403(b) of the
Code. For purposes of this Section, the term
"required aggregation group" shall include:
(g) all qualified retirement plans maintained by
the Group in which a key employee (as such
term is defined above) is a participant;
provided, however, that the term "required
aggregation group" shall also include all
qualified retirement plans previously
maintained by the Group but terminated within
the five (5) year period ending on the
determination date (as such term is defined
above) in which a key employee (as such term
is defined above) was a participant; and
(h) any other qualified retirement plans
maintained by the Group which enable any
qualified retirement plan described in
Subsection (g) above to meet the requirements
of Section 401(a)(4) or of Section 410 of the
Code.
For purposes of this Section, the term "permissive
aggregation group" shall include all qualified
retirement plans that are part of a required
aggregation group (as such term is defined above)
and any other qualified retirement plan or plans
maintained by the Group if such group will continue
to meet the requirements of Section 401(a)(4) and
of Section 410 of the Code. Solely for the purpose
of determining if the Plan or any other qualified
retirement plan included in a required aggregation
group of which the Plan is a part is Top-Heavy
(within the meaning of Section 416(g) of the Code),
the Accrued Benefit of any Employee other than a
key employee (within the meaning of Section
416(i)(1) of the Code) shall be determined under:
(i) the method, if any, that uniformly applies for
accrual purposes under all qualified
retirement plans maintained by the Group, or
(j) if there is no such method, as if such benefit
accrued not more rapidly than the slowest
accrual rate permitted under the fractional
accrual rule of Section 411(b)(1)(C) of the
Code.
17.3 Accrued Benefits. For purposes of this Article,
accrued benefits with respect to any Plan Year
shall be determined as of the determination date
(as such term is defined in Section 17.2) for that
Plan Year based on the Participant Account balances
as of the most recent Valuation Date within a
consecutive twelve (12) month period ending on such
determination date; provided, however, that such
Participant Account balances shall be adjusted to
the extent required by Section 416 of the Code to
increase the Participant Account balances by the
amount of any Company contributions and of any
rollovers (other than rollovers initiated by a
Participant from any qualified retirement plan
maintained by an unrelated employer) made and
allocated after the Valuation Date but on or before
such determination date and by any distributions
made to a Participant before the most recent
Valuation Date during any of the five (5)
consecutive Plan Years immediately preceding the
Plan Year for which the determination as to whether
the Plan is a Top-Heavy Plan is being made
(including distributions from a terminated plan
which if not terminated would have been part of a
required aggregation group (as such term is defined
in Section 17.2)) and to reduce the Participant
Account balances by any rollovers made on or before
the Valuation Date which are initiated by a
Participant from any qualified retirement plan
maintained by an unrelated employer.
17.4 Vesting Provisions. With respect to any Plan Year
in which the Plan is determined to be a Top-Heavy
Plan, a Participant's vested percentage in his
Participant Account shall not be less than one
hundred percent (100%) after he has completed at
least three (3) Years of Service; provided,
however, that if the Plan becomes a Top-Heavy Plan
and subsequently ceases to be such:
(a) the vesting schedule shown above shall
continue to apply but only with respect to
those Participants who had completed five (5)
(or for Plan Years beginning after December
31, 1988, three (3)) or more Years of Service
as of the last calendar day of the final Top-
Heavy Plan Year,
(b) the vesting schedule shown above shall
continue to apply but only with respect to the
accrued benefits of all other Participants as
of the last calendar day of the final Top-
Heavy Plan Year, and
(c) the vesting schedule in Section 9.3 shall
apply to any additional accrued benefits of
the Participants described in Subsection (b)
above which accrue after the final Top-Heavy
Plan Year.
17.5 Minimum Contribution. The minimum amount of
Company contributions and forfeitures, if
applicable, to be allocated to the Participant
Account of any non-key employee (as such term is
defined in Section 17.2), regardless of his Section
415 Compensation, regardless of his Hours of
Service, and regardless whether he is accruing a
top heavy minimum benefit under any qualified
defined benefit plan maintained by the Group, who
is eligible to participate in the Plan during the
Plan Year and who had not separated from service
with the Group as of the last calendar day of the
Plan Year, including any Company contributions and
forfeitures, if applicable, allocated to such
Participant under any other qualified defined
contribution plans maintained by the Group, in any
Plan Year during which the Plan is a Top-Heavy Plan
shall not be less than three percent (3%) of such
Participant's Section 415 Compensation in such Plan
Year; provided, however, that the percentage of
Section 415 Compensation allocated to the
Participant Account of any Participant who is not a
key employee (as such term is defined in Section
17.2) under this Section with respect to such Plan
Year shall not exceed the highest percentage of
Section 415 Compensation allocated to the
Participant Account of any Participant who is a key
employee (as such term is defined in Section 17.2)
in such Plan Year, including Company contributions
made under Section 5.1.
17.6 Code Section 415 Limitations. With respect to any
Plan Year in which the Plan is a Top-Heavy Plan,
Sections 2.20 and 2.21 shall be read by
substituting the number one (1.00) for the number
one and twenty-five one-hundredths (1.25) wherever
it appears therein.
ARTICLE XVIII
MERGER OF SIGCORP PLANS
18.1 Effective Date of Merger. The 401(k) Plan for
Salaried Employees of Southern Indiana Gas and
Electric Company (the "SIGEC Plan"), the SIGCORP,
Inc. 401(k) Profit Sharing Plan (the "SIGCORP Plan")
and the SIGECo Advanced Communication, Inc. Non-
Standardized 410(k) Profit Sharing Plan (the "SIGECo
Advanced Communication Plan") shall be merged into,
and become a part of, the Plan on July 1, 2000. The
terms of the SIGEC Plan, the SIGCORP Plan and the
SIGECo Advanced Communication Plan shall be
incorporated herein by reference.
18.2 Eligibility. Any participant in the SIGEC Plan, the
SIGCORP Plan and the SIGECo Advanced Communication
Plan on June 30, 2000 shall become a Participant in
this Plan on July 1, 2000. Any other Employee shall
become a Participant in accordance with Article III.
18.3 Investment of Merged Funds. The monies held in the
SIGEC Plan, the SIGCORP Plan and the SIGECo Advanced
Communication Plan immediately before their merger
into this Plan shall be invested in accordance with
Participant investment elections and, to the extent
investment directions are not received, in
accordance with procedures established by the Plan
Administrator.
18.4 Distributions. Amounts transferred from the SIGEC
Plan, the SIGCORP Plan and the SIGECo Advanced
Communication Plan shall be distributed in
accordance with Articles VIII and IX.
18.5 Transfer of Plan Monies of Former Employees. The
vested portion of the SIGEC Plan, the SIGCORP Plan
and the SIGECo Advanced Communication Plan,
whichever is applicable, monies transferred on
behalf of an individual who is not employed as an
Employee by the Group on July 1, 2000 shall be
determined in accordance with the applicable vesting
rules contained in the SIGEC Plan, the SIGCORP Plan
or the SIGECo Advanced Communication Plan, whichever
is applicable, immediately prior to July 1, 2000.
The non-vested portion of the accounts of the former
Employees that are not distributable shall be
aggregated and credited to a forfeiture account
established and maintained by the Trustee as of
July 1, 2000; provided, however, that the Plan
Administrator shall maintain a forfeiture sub-
account of such forfeiture account in the name of
each former Employee whose non-vested portion of his
accounts were credited to the forfeiture account.
If such former Employee does not resume his
employment with the Group before incurring five (5)
or more consecutive one (1) year Breaks in Service
(as determined in accordance with the terms of the
SIGEC Plan, the SIGCORP Plan or the SIGECo Advanced
Communication Plan, whichever is applicable, in
effect on June 30, 2000) or, if earlier, the date he
receives the distribution of the vested portion of
his account balances, the Plan Administrator shall
direct the Trustee that the balance in the
forfeiture account attributable to such individual's
forfeiture sub-account shall be forfeited and
applied in the Plan Year of forfeiture and any
succeeding Plan Years to reduce the amount of
contributions, if any, required by the Participating
Companies to meet the regular Company contributions
until exhausted. If a former Employee resumes his
employment with the Group at any time on or after
July 1, 2000 and before his completion of at least a
five (5) year Break in Service, the Plan
Administrator shall direct the Trustee to reinstate
from the forfeiture account an amount equal to such
individual forfeiture sub-account as the beginning
balance of his Participant Account as of his date of
reemployment and such account shall become fully
vested and non-forfeitable as of his reemployment
date and shall be distributable to him upon his next
termination of employment to or for his benefit, or,
in the event of his death, to or for the benefit of
his Beneficiary in accordance with the provisions of
this Plan.
18.6 Accounts. The monies transferred on behalf of a
Participant from the SIGEC Plan, the SIGCORP Plan
and the SIGECo Advanced Communication Plan shall be
credited to the Participant Accounts (including
Compensation Redirection Accounts, Company Matching
Contributions Accounts and Company Non-Matching
Contributions Accounts which most closely parallel
the accounts from the SIGEC Plan, the SIGCORP Plan
and the SIGECo Advanced Communication Plan to which
these amounts were credited prior to July 1, 2000.
<PAGE>
This amended and restated Plan has been adopted this _____
day of ________, 2000 to be effective as of July 1, 2000.
VECTREN CORPORATION
By: Niel C. Ellerbrook
Niel C. Ellerbrook
Chief Executive Officer
<PAGE>
VECTREN CORPORATION
RETIREMENT SAVINGS PLAN
EXHIBIT A
The following are the Participating Companies in the
Plan:
(1) Vectren Corporation, effective July 1, 1986.
(2) Indiana Gas Company, Inc., effective July 1,
1986.
(3) IGC Energy, Inc., effective July 1, 1986.
(4) IEI Investments, Inc., effective October 1,
1997.
(5) IEI Services, LLC, effective October 1, 1997.
(6) IEI Financial Services, LLC, effective April 1,
1998.
(7) Southern Indiana Gas and Electric Company,
effective July 1, 2000.
(8) SIGECo Advanced Communication, Inc., effective
July 1, 2000
(9) Vectren Energy Delivery of Ohio, Inc., effective
July 1, 2000
(10) Vectren Utility Holdings, Inc., effective
July 1, 2000
<PAGE>
VECTREN CORPORATION
RETIREMENT SAVINGS PLAN
EXHIBIT B
The following participants have elected not to receive the
three percent (3%)
Company contribution under Section 5.3:
1.
2.
3.
4.
