exhibit10_2.htm


    Exhibit
10.2

     

    


     

    ELEVENTH
AMENDMENT TO

    THE
CONNECTICUT WATER COMPANY

    EMPLOYEES’
RETIREMENT PLAN

    (as
amended and restated as of January 1, 1997, except as otherwise provided
therein)

    


    


    1. The
following new Section 3.4 is added to the Plan:

    


    “3.4           Elimination of Further
Participation.  Notwithstanding the foregoing, any person who
commences employment with the Employer on or after January 1, 2009 shall
not be eligible to participate in or accrue benefits under the
Plan.  Furthermore, anyone who terminated employment with the Employer
and who is rehired by the Employer on or after January 1, 2009 shall not be
eligible to participate or accrue additional benefits under the
Plan.”

    


    2. The
following new Article XVI is added to the Plan:

    


     

    “ARTICLE
XVI

     

    LIMITATION ON
BENEFITS

    


     

        16.1           The
limitations of this Article XVI shall apply in Limitation Years beginning on or
after July 1, 2007, except as otherwise provided herein.  This Article
supersedes the provisions of Sections 4.4 and 4.5.

     

    16.2           The
Annual Benefit otherwise payable to a Participant under the Plan at any time
shall not exceed the Maximum Permissible Benefit.  If the benefit the
Participant would otherwise accrue in a Limitation Year would produce an Annual
Benefit in excess of the Maximum Permissible Benefit, the benefit shall be
limited (or the rate of accrual reduced) to a benefit that does not exceed the
Maximum Permissible Benefit.

     

    16.3           If
the Participant is, or has ever been, a Participant in another qualified defined
benefit plan (without regard to whether the plan has been terminated) maintained
by the Employer or a predecessor employer, the sum of the Participant's Annual
Benefits from all such plans may not exceed the Maximum Permissible
Benefit.  Where the Participant's employer-provided benefits under all
such defined benefit plans (determined as of the same age) would exceed the
Maximum Permissible Benefit applicable at that age, then the Participant’s
Annual Benefits under this Plan shall be limited so that the Maximum Permissible
Benefit is not exceeded.

     

    16.4           The
application of the provisions of this Article shall not cause the Maximum
Permissible Benefit for any Participant to be less than the Participant's
accrued benefit under all the defined benefit plans of the Employer or a
predecessor employer as of the end of the last Limitation Year beginning before
July 1, 2007 under provisions of the plans that were both adopted and in effect
before April 5, 2007.  The preceding sentence applies only if the
provisions of such defined benefit plans that were both adopted and in effect
before April 5, 2007 and satisfied the applicable requirements of statutory
provisions, regulations, and other published guidance relating to Section 415 of
the Code in effect as of the end of the last Limitation Year beginning before
July 1, 2007, as described in Section 1.415(a)-1(g)(4) of the Income Tax
Regulations.

     

    16.5           The
limitations of this Article shall be determined and applied taking into account
the rules in Section 16.7.

     

    16.6           Definitions.

     

    (a)           Annual
Benefit:

     

    (1)           A
benefit that is payable annually in the form of a straight life
annuity.  Except as provided below, where a benefit is payable in a
form other than a straight life annuity, the benefit shall be adjusted to an
actuarially equivalent straight life annuity that begins at the same time as
such other form of benefit and is payable on the first day of each month, before
applying the limitations of this Article.  For a Participant who has
or will have distributions commencing at more than one Annuity Starting Date,
the Annual Benefit shall be determined as of each such Annuity Starting Date
(and shall satisfy the limitations of this Article as of each such date),
actuarially adjusting for past and future distributions of benefits commencing
at the other Annuity Starting Dates.  For this purpose. the
determination of whether a new starting date has occurred shall be made without
regard to Section 1.401(a)-20, Q&A 10(d), and with regard to Section
1.415(b)-1(b)(1)(iii)(B) and (C) of the Income Tax Regulations.

     

    (2)           No
actuarial adjustment to the benefit shall be made for (A) survivor benefits
payable to a surviving spouse under a qualified joint and survivor annuity to
the extent such benefits would not be payable if the Participant's benefit were
paid in another form; (B) benefits that are not directly related to retirement
benefits (such as a qualified disability benefit, preretirement incidental death
benefits, and post-retirement medical benefits); or (C) the inclusion in the
form of benefit of an automatic benefit increase feature, provided the form of
benefit is not subject to Section 417(e)(3) of the Code and would otherwise
satisfy the limitations of this Article, and the Plan provides that the amount
payable under the form of benefit in any Limitation Year shall not exceed the
limits of this Article applicable at the Annuity Starting Date, as increased in
subsequent years pursuant to Section 415(d) of the Code.  For this
purpose, an automatic benefit increase feature is included in a form of benefit
if the form of benefit provides for automatic, periodic increases to the
benefits paid in that form.

     

    (3)           The
determination of the Annual Benefit shall take into account social security
supplements described in Section 411(a)(9) of the Code and benefits transferred
from another defined benefit plan, other than transfers of distributable
benefits pursuant Section 1.411(d)-4, Q&A 3(c), of the Income Tax
Regulations, but shall disregard benefits attributable to employee contributions
or rollover contributions.

     

    (4)           Effective
for distributions in Plan Years beginning after December 31, 2003, the
determination of actuarial equivalence of forms of benefit other than a straight
life annuity shall be made in accordance with subparagraphs (A) or (B)
below.

     

    (A)           Benefit
Forms Not Subject to Section 417(e)(3) of the Code:  The straight life
annuity that is actuarially equivalent to the Participant's form of benefit
shall be determined under this subparagraph (A) if the form of the Participant's
benefit is either (I) a nondecreasing annuity (other than a straight life
annuity) payable for a period of not less than the life of the Participant (or,
in the case of a qualified pre-retirement survivor annuity, the life of the
surviving Spouse), or (II) an annuity that decreases during the life of the
Participant merely because of (a) the death of the survivor annuitant (but only
if the reduction is not below 50% of the benefit payable before the death of the
survivor annuitant), or (b) the cessation or reduction of Social Security
supplements or qualified disability payments (as defined in Section 401(a)(11)
of the Code).

     

    (i)           Limitation
Years beginning before July 1, 2007.  For Limitation Years beginning
before July 1, 2007, the actuarially equivalent straight life annuity is equal
to the annual amount of the straight life annuity commencing at the same Annuity
Starting Date that has the same actuarial present value as the Participant's
form of benefit computed using whichever of the following produces the greater
annual amount:  (I) the interest rate and mortality table (or other
tabular factor) specified in the Plan for adjusting benefits in the same form:
and (II) a 5 percent interest rate assumption and the Applicable Mortality Table
referenced in Exhibit I of the Plan for that Annuity Starting Date.

     

    (ii)           Limitation
Years beginning on or after July 1, 2007.  For Limitation Years
beginning on or after July 1, 2007, the actuarially equivalent straight life
annuity is equal to the greater of (I) the annual amount of the straight life
annuity (if any) payable to the Participant under the Plan commencing at the
same Annuity Starting Date as the Participant's form of benefit; and (II) the
annual amount of the straight life annuity commencing at the same Annuity
Starting Date that has the same actuarial present value as the Participant's
form of benefit, computed using a 5 percent interest rate assumption and the
Applicable Mortality Table defined in Exhibit I of the Plan for that Annuity
Starting Date.

     

    (B)           Benefit
Forms Subject to Section 417(e)(3) of the Code:  The straight life
annuity that is actuarially equivalent to the Participant's form of benefit
shall be determined under this subparagraph (B) if the form of the Participant's
benefit is other than a benefit form described in subparagraph
(A).  In this case, the actuarially equivalent straight life annuity
shall be determined as follows:

     

    (i)           Annuity
Starting Date in Plan Years Beginning After 2005.  If the Annuity
Starting Date of the Participant's form of benefit is in a Plan Year beginning
after 2005, the actuarially equivalent straight life annuity is equal to the
greatest of (I) the annual amount of the straight life annuity commencing at the
same Annuity Starting Date that has the same actuarial present value as the
Participant's form of benefit, computed using the interest rate and mortality
table (or other tabular factor) specified in the Plan for adjusting benefits in
the same form; (II) the annual amount of the straight life annuity commencing at
the same Annuity Starting Date that has the same actuarial present value as the
Participant's form of benefit, computed using a 5.5 percent interest rate
assumption and the Applicable Mortality Table defined in Exhibit I of the Plan;
and (III) the annual amount of the straight life annuity commencing at the same
Annuity Starting Date that has the same actuarial present value as the
Participant's form of benefit, computed using the applicable interest rate
defined in Exhibit I of the Plan and the Applicable Mortality Table defined in
Exhibit I of the Plan, divided by 1.05.

     

    (ii)           Annuity
Starting Date in Plan Years Beginning in 2004 or 2005.  If the Annuity
Starting Date of the Participant's form of benefit is in a Plan Year beginning
in 2004 or 2005, the actuarially equivalent straight life annuity is equal to
the annual amount of the straight life annuity commencing at the same Annuity
Starting Date that has the same actuarial present value as the Participant's
form of benefit computed using whichever of the following produces the greater
annual amount:  (I) the interest rate and the mortality table (or
other tabular factor) specified in the Plan for adjusting benefits in the same
form; and (II) a 5.5 percent interest rate assumption and the Applicable
Mortality Table defined in Exhibit I of the Plan.

     

    (b)           Compensation:

     

    (1)           Information
required to be reported under Sections 6041, 6051, and 6052 of the Code (wages,
tips, and other compensation as reported on Form W-2).  Compensation
is defined as wages, within the meaning of Section 3401(a), and all other
payments of compensation to an employee by the Employer (in the course of the
Employer's trade or business) for which the Employer is required to furnish the
Employee a written statement under Sections 6041(d), 6051(a)(3), and 6052 of the
Code.  Compensation shall be determined without regard to any rules
under Section 3401(a) of the Code that limit the remuneration included in wages
based on the nature or location of the employment or the services performed
(such as the exception for agricultural labor in Section 3401(a)(2) of the
Code).

     

    (2)           Except
as provided herein, for Limitation Years beginning after December 31, 1991,
Compensation for a Limitation Year is the Compensation actually paid or made
available during such Limitation Year.

     

    (3)           For
Limitation Years beginning on or after July 1, 2007, Compensation for a
Limitation Year shall also include Compensation paid by the later of 21⁄2 months
after an Employee's severance from employment with the Employer maintaining the
Plan or the end of the Limitation Year that includes the date of the Employee's
severance from employment with the Employer maintaining the Plan,
if:

     

    (A)           the
payment is regular Compensation for services during the Employee's regular
working hours, or Compensation for services outside the Employee's regular
working hours (such as overtime or shift differential), commissions. bonuses, or
other similar payments, and, absent a severance from employment, the payments
would have been paid to the Employee while the Employee continued in employment
with the Employer; or

     

    (B)           the
payment is for unused accrued bona fide sick, vacation or other leave that the
Employee would have been able to use if employment had continued:
or

     

    (C)           the
payment is received by the Employee pursuant to a nonqualified unfunded deferred
compensation plan and would have been paid at the same time if employment had
continued, but only to the extent includible in gross income.

     

    (4)           Any
payments not described above shall not be considered Compensation if paid after
severance from employment, even if they are paid by the later of 21⁄2 months after
the date of severance from employment or the end of the Limitation Year that
includes the date of severance from employment.

     

    (5)           Back
pay, within the meaning of Section 1.415(c)-2(g)(8) of the Income Tax
Regulations, shall be treated as Compensation for the Limitation Year to which
the back pay relates to the extent the back pay represents wages and
compensation that would otherwise be included under this
definition.

     

    (6)           For
Limitation Years beginning after December 31, 1997, Compensation paid or made
available during such Limitation Year shall include amounts that would otherwise
be included in Compensation but for an election under Section 125(a), Section
402(e)(3), Section 402(h)(1)(B), Section 402(k), or Section 457(b) of the
Code.

     

    (7)           For
Limitation Years beginning after December 31, 2000, Compensation shall also
include any elective amounts that are not includible in the gross income of the
Employee by reason of Section 132(f)(4) of the Code.

     

    (c)           Defined
Benefit Compensation Limitation:

     

    (1)           100
percent of a Participant's High Three-Year Average Compensation, payable in the
form of a straight life annuity.

     

    (2)           In
the case of a Participant who is rehired after a severance from employment, the
Defined Benefit Compensation Limitation is the greater of 100 percent of the
Participant's High Three-Year Average Compensation, as determined prior to the
severance from employment, or 100 percent of the Participant's High Three-Year
Average Compensation, as determined after the severance from employment under
paragraph (g) below.

     

    (d)           Defined
Benefit Dollar Limitation:  Effective for Limitation Years ending
after December 31, 2001, the Defined Benefit Dollar Limitation is $160,000,
automatically adjusted under Section 415(d) of the Code, effective
January 1 of each year, as published in the Internal Revenue Bulletin, and
payable in the form of a straight life annuity.  The new limitation
shall apply to Limitation Years ending with or within the calendar year of the
date of the adjustment, but a Participant's benefits shall not reflect the
adjusted limit prior to January 1 of that calendar year.  The
automatic annual adjustment of the Defined Benefit Dollar Limitation under
Section 415(d) of the Code shall not apply to Participants who have had a
separation from employment.

     

    (e)           Employer:  For
purposes of this Article, Employer shall mean the Employer that adopts this
Plan, and all members of a controlled group of corporations, as defined in
Section 414(b) of the Code, as modified by Section 415(h), all commonly
controlled trades or businesses (as defined in Section 414(c) of the Code, as
modified, except in the case of a brother-sister group of trades or businesses
under common control, by Section 415(h)), or affiliated service groups (as
defined in Section 414(m) of the Code) of which the adopting Employer is a part,
and any other entity required to be aggregated with the Employer pursuant to
Section 414(o) of the Code.

     

    (f)           Formerly
Affiliated Plan of the Employer:  A plan that, immediately prior to
the cessation of affiliation, was actually maintained by the Employer and,
immediately after the cessation of affiliation, is not actually maintained by
the Employer.  For this purpose, cessation of affiliation means the
event that causes an entity to no longer be considered the Employer, such as the
sale of a member controlled group of corporations, as defined in Section 414(b)
of the Code, as modified by Section 415(h), to an unrelated corporation, or that
causes a plan to not actually be maintained by the Employer, such as transfer of
plan sponsorship outside a controlled group.

     

    (g)           High
Three-Year Average Compensation:  The average compensation for the
three consecutive years of service (or, if the Participant has less than three
consecutive years of service, the Participant's longest consecutive period of
service, including fractions of years, but not less than one year) with the
Employer that produces the highest average.  A year of service is the
12-consecutive month period beginning January 1 and ending
December 31.  In the case of a Participant who is rehired by the
Employer after a severance from employment, the Participant's high three-year
average Compensation shall be calculated by excluding all years for which the
Participant performs no services for and receives no Compensation from the
Employer (the break period) and by treating the years immediately preceding and
following the break period as consecutive.  A Participant's
Compensation for a year of service shall not include Compensation in excess of
the limitation under Section 401(a)(17) of the Code that is in effect for the
calendar year in which such year of service begins.

     

    (h)           Limitation
Year:  The Plan Year.

     

    (i)           Maximum
Permissible Benefit:  The lesser of the Defined Benefit Dollar
Limitation or the Defined Benefit Compensation Limitation (both adjusted where
required, as provided below).

     

    (1)           Adjustment
for Less Than 10 Years of Participation or Service:  If the
Participant has less than 10 Years of Participation in the Plan, the Defined
Benefit Dollar Limitation shall be multiplied by a fraction -- (A) the numerator
of which is the number of Years (or part thereof, but not less than one year) of
Participation in the Plan, and (B) the denominator of which is 10.  In
the case of a Participant who has less than ten Years of Service with the
Employer, the Defined Benefit Compensation Limitation shall be multiplied by a
fraction -- (A) the numerator of which is the number of Years (or part thereof,
but not less than one year) of Service with the Employer, and (B) the
denominator of which is 10.

     

    (2)           Adjustment
of Defined Benefit Dollar Limitation for Benefit Commencement Before Age 62 or
after Age 65:  Effective for benefits commencing in Limitation Years
ending after December 31, 2001, the Defined Benefit Dollar Limitation shall be
adjusted if the Annuity Starting Date of the Participant's benefit is before age
62 or after age 65.  If the Annuity Starting Date is before age 62,
the Defined Benefit Dollar Limitation shall be adjusted under subparagraph (A),
as modified by subparagraph (C).  If the Annuity Starting Date is
after age 65, the Defined Benefit Dollar Limitation shall be adjusted under
subparagraph (B), as modified by subparagraph (C).

     

    (A)           Adjustment
of Defined Benefit Dollar Limitation for Benefit Commencement Before Age
62:

     

    (i)           Limitation
Years Beginning Before July 1, 2007. If the Annuity Starting Date for the
Participant's benefit is prior to age 62 and occurs in a Limitation Year
beginning before July 1, 2007, the Defined Benefit Dollar Limitation for
the Participant's Annuity Starting Date is the annual amount of a benefit
payable in the form of a straight life annuity commencing at the Participant's
Annuity Starting Date that is the actuarial equivalent of the Defined Benefit
Dollar Limitation (adjusted under subparagraph (1) for Years of Participation
less than 10, if required) with actuarial equivalence computed using whichever
of the following produces the smaller annual amount:  (a) the interest
rate and the mortality table (or other tabular factor) equivalence for early
retirement benefits; or (b) a 5-percent interest rate assumption and the
Applicable Mortality Table as defined in Exhibit I of the Plan.

     

    (ii)           Limitation
Years Beginning on or After July 1, 2007.

     

    (a)           Plan
Does Not Have Immediately Commencing Straight Life Annuity Payable at Both Age
62 and the Age of Benefit Commencement.  If the Annuity Starting Date
for the Participant's benefit is prior to age 62 and occurs in a Limitation Year
beginning on or after July 1, 2007, and the Plan does not have an immediately
commencing straight life annuity payable at both age 62 and the age of benefit
commencement, the Defined Benefit Dollar Limitation for the Participant's
Annuity Starting Date is the annual amount of a benefit payable in the form of a
straight life annuity commencing at the Participant's Annuity Starting Date that
is the actuarial equivalent of the Defined Benefit Dollar Limitation (adjusted
under subparagraph (1) for Years of Participation less than 10, if required)
with actuarial equivalence computed using a 5 percent interest rate assumption
and the Applicable Mortality Table for the Annuity Starting Date as defined in
Exhibit I of the Plan (and expressing the Participant's age based on completed
calendar months as of the Annuity Starting Date).

     

    (b)           Plan
Has Immediately Commencing Straight Life Annuity Payable at Both Age 62 and the
Age of Benefit Commencement.  If the Annuity Starting Date for the
Participant's benefit is prior to age 62 and occurs in a Limitation Year
beginning on or after July 1, 2007, and the Plan has an immediately
commencing straight life annuity payable at both age 62 and the age of benefit
commencement, the Defined Benefit Dollar Limitation for the Participant's
Annuity Starting Date is the lesser of the limitation determined under
subparagraph (a) and the Defined Benefit Dollar Limitation (adjusted under
subparagraph (1) for Years of Participation less than 10, if required)
multiplied by the ratio of the annual amount of the immediately commencing
straight life annuity under the Plan at the Participant's Annuity Starting Date
to the annual amount of the immediately commencing straight life annuity under
the Plan at age 62, both determined without applying the limitations of this
Article.

     

    (B)           Adjustment
of Defined Benefit Dollar Limitation for Benefit Commencement After Age
65:

     

    (i)           Limitation
Years Beginning Before July 1, 2007.  If the Annuity Starting Date for
the Participant's benefit is after age 65 and occurs in a Limitation Year
beginning before July 1, 2007, the Defined Benefit Dollar Limitation for
the Participant's Annuity Starting Date is the annual amount of a benefit
payable in the form of a straight life annuity commencing at the
Participant's Annuity Starting Date that is the actuarial equivalent of the
Defined Benefit Dollar Limitation (adjusted under subparagraph (1) for Years of
Participation less than 10, if required) with actuarial equivalence computed
using whichever of the following produces the smaller annual
amount:  (a) the interest rate and the mortality table (or other
tabular factor) specified in the Plan for purposes of determining actuarial
equivalence for delayed retirement benefits; or (b) a 5-percent interest rate
assumption and the Applicable Mortality Table as defined in Exhibit I of the
Plan.

     

    (ii)           Limitation
Years Beginning On or After July 1, 2007:

     

    (a)           Plan
Does Not Have Immediately Commencing Straight Life Annuity Payable at Both Age
65 and the Age of Benefit Commencement.  If the Annuity Starting Date
for the Participant’s benefit is after age 65 and occurs in a Limitation Year
beginning on or after July 1, 2007, and the Plan does not have an
immediately commencing straight life annuity payable at both age 65 and the age
of benefit commencement, the Defined Benefit Dollar Limitation at the
Participant’s Annuity Starting Date is the annual amount of a benefit payable in
the form of a straight life annuity commencing at the Participant’s Annuity
Starting Date that is the actuarial equivalent of the Defined Benefit Dollar
Limitation (adjusted under subparagraph (1) for Years of Participation less than
10, if required), with actuarial equivalence computed using a 5 percent interest
rate assumption and the Applicable Mortality Table for that Annuity Starting
Date as defined in Exhibit I of the Plan (and expressing the Participant’s age
based on completed calendar months as of the Annuity Starting
Date).

     

    (b)           Plan
Has Immediately Commencing Straight Life Annuity Payable at Both Age 65 and the
Age of Benefit Commencement.  If the Annuity Starting Date for the
Participant’s benefit is after age 65 and occurs in a Limitation Year beginning
on or after July 1, 2007, and the Plan has an immediately commencing
straight life annuity payable at both age 65 and the age of benefit
commencement, the Defined Benefit Dollar Limitation at the Participant’s Annuity
Starting Date is the lesser of the limitation determined under subparagraph (i)
and the Defined Benefit Dollar Limitation (adjusted under subparagraph (1) for
Years of Participation less than 10, if required) multiplied by the ratio of the
annual amount of the adjusted immediately commencing straight life annuity under
the Plan at the Participant’s Annuity Starting Date to the annual amount of the
adjusted immediately commencing straight life annuity under the Plan at age 65,
both determined without applying the limitations of this Article.  For
this purpose. The adjusted immediately commencing straight life annuity under
the Plan at the Participant’s Annuity Starting Date is the annual amount of such
annuity payable to the Participant, computed disregarding the Participant’s
accruals after age 65 but including actuarial adjustments even if those
actuarial adjustments are used to offset accruals; and the adjusted immediately
commencing straight life annuity under the Plan at age 65 is the annual amount
of such annuity that would be payable under the Plan to a hypothetical
Participant who is age 65 and has the same accrued benefit as the
Participant.

     

    (C)           Notwithstanding
the other requirements of this subparagraph (2), no adjustment shall be made to
the Defined Benefit Dollar Limitation to reflect the probability of a
Participant’s death between the Annuity Starting Date and age 62, or between age
65 and the Annuity Starting Date, as applicable, if benefits are not forfeited
upon the death of the Participant prior to the Annuity Starting
Date.  To the extent benefits are forfeited upon death before the
Annuity Starting Date, such an adjustment shall be made.  For this
purpose, no forfeiture shall be treated as occurring upon the Participant’s
death if the Plan does not charge Participants for providing a qualified
preretirement survivor annuity, as defined in Section 417(c) of the Code, upon
the Participant’s death.

     

    (3)           Minimum
benefit permitted:  Notwithstanding anything else in this paragraph
(i) to the contrary, the benefit otherwise accrued or payable to a Participant
under this Plan shall be deemed not to exceed the Maximum Permissible Benefit
if:

     

    (A)           the
retirement benefits payable for a Limitation Year under any form of benefit with
respect to such Participant under this Plan and under all other defined benefit
plans (without regard to whether a plan has been terminated) ever maintained by
the Employer do not exceed $10,000 multiplied by a fraction – (i) the numerator
of which is the Participant's number of Years (or part thereof, but not less
than one year) of Service (not to exceed 10) with the Employer, and (ii) the
denominator of which is 10; and

     

    (B)           the
Employer (or a predecessor employer) has not at any time maintained a defined
contribution plan in which the Participant participated (for this purpose,
mandatory employee contributions under a defined benefit plan, individual
medical accounts under Section 401(h) of the Code, and accounts for
postretirement medical benefits established under Section 419A(d)(1) of the Code
are not considered a separate defined contribution plan).

     

    (j)           Predecessor
Employer:  If the Employer maintains a plan that provides a benefit
which the Participant accrued while performing services for a former employer,
the former employer is a Predecessor Employer with respect to the Participant in
the Plan.  A former entity that antedates the Employer is also a
Predecessor Employer with respect to a Participant if, under the facts and
circumstances, the employer constitutes a continuation of all or a portion of
the trade or business of the former entity.

     

    (k)           Severance
from Employment:  An Employee has a severance from employment when the
Employee ceases to be an Employee of the Employer maintaining the
Plan.  An Employee does not have a severance from employment if, in
connection with a change of employment, the Employee's new employer maintains
the Plan with respect to the Employee.

     

    (l)           Year
of Participation:  The Participant shall be credited with a Year of
Participation (computed to fractional parts of a year) for each accrual
computation period for which the following conditions are met:  (1)
the Participant is credited with at least the number of hours of service (or
Period of Service if the elapsed time method is used) for benefit accrual
purposes, required under the terms of the Plan in order to accrue a benefit for
the accrual computation period, and (2) the Participant is included as a
Participant under the eligibility provisions of the Plan for at least one day of
the accrual computation period.  If these two conditions are met, the
portion of a Year of Participation credited to the Participant shall equal the
amount of benefit accrual service credited to the Participant for such accrual
computation period.  A Participant who is permanently and totally
disabled within the meaning of Section 415(c)(3)(C)(i) of the Code for an
accrual computation period shall receive a Year of Participation with respect to
that period.  In addition, for a Participant to receive a Year of
Participation (or part thereof) for an accrual computation period, the Plan must
be established no later that the last day of such accrual computation
period.  In no event shall more than one Year of Participation be
credited for any 12-month period.

     

    (m)           Year
of Service:  For purposes of paragraph (g), the Participant shall be
credited with a Year of Service (computed to fractional parts of a year) for
each accrual computation period for which the Participant is credited with at
least the number of Hours of Service (or Period of Service if the elapsed time
method is used) for benefit accrual purposes, required under the terms of the
Plan in order to accrue a benefit for the accrual computation period, taking
into account only service with the Employer or a Predecessor
Employer.

     

    16.7           Other
Rules.

     

    (a)           Benefits
Under Terminated Plans.  If a defined benefit plan maintained by the
employer has terminated with sufficient assets for the payment of benefit
liabilities of all plan Participants and a Participant in the plan has not yet
commenced benefits under the plan, the benefits provided pursuant to the
annuities purchased to provide the Participant's benefits under the terminated
plan at each possible Annuity Starting Date shall be taken into account in
applying the limitations of this Article.  If there are not sufficient
assets for the payment of all participants' benefit liabilities, the benefits
taken into account shall be the benefits that are actually provided to the
participant under the terminated plan.

     

    (b)           Benefits
Transferred From the Plan.  If a Participant's benefits under a
defined benefit plan maintained by the Employer are transferred to another
defined benefit plan maintained by the Employer and the transfer is not a
transfer of distributable benefits pursuant to Section 1.411(d)-4, Q&A-3(c)
of the Income Tax Regulations, the transferred benefits are not treated as being
provided under the transferor plan (but are taken into account as benefits
provided under the transferee plan).  If a Participant's benefits
under a defined benefit plan maintained by the Employer are transferred to
another defined benefit plan that is not maintained by the Employer and the
transfer is not a transfer of distributable benefits pursuant to Section
1.411(d)-4, Q&A 3(c), of the Income Tax Regulations, the transferred
benefits are treated by the Employer's plan as if such benefits were provided
under annuities purchased to provide benefits under a plan maintained by the
Employer that terminated immediately prior to the transfer with sufficient
assets to pay all Participants' benefit liabilities under the
Plan.  If a Participant's benefits under a defined benefit plan
maintained by the Employer are transferred to another defined benefit plan in a
transfer of distributable benefits pursuant to Section 1.411(d)-4, Q&A-3(c),
of the Income Tax Regulations, the amount transferred is treated as a benefit
paid from the transferor plan.

     

    (c)           Formerly
Affiliated Plans of the Employer.  A formerly affiliated plan of an
employer shall be treated as a plan maintained by the Employer, but the formerly
affiliated plan shall be treated as if it had terminated immediately prior to
the cessation of affiliation with sufficient assets to pay Participants' benefit
liabilities under the plan and had purchased annuities to provide
benefits.

     

    (d)           Plans
of a Predecessor Employer.  If the Employer maintains a defined
benefit plan that provides benefits accrued by a Participant while performing
services for a Predecessor Employer, the Participant's benefits under a plan
maintained by the Predecessor Employer shall be treated as provided under a plan
maintained by the Employer.  However, for this purpose, the plan of
the Predecessor Employer shall be treated as if it had terminated immediately
prior to the event giving rise to the Predecessor Employer relationship with
sufficient assets to pay Participants' benefit liabilities under the plan, and
had purchased annuities to provide benefits;  the Employer and the
Predecessor Employer shall be treated as if they were a single employer
immediately prior to such event and as unrelated employers immediately after the
event; and if the event giving rise to the predecessor relationship is a benefit
transfer, the transferred benefits shall be excluded in determining the benefits
provided under the plan of the Predecessor Employer.

     

    (e)           The
limitations of this Article shall be determined and applied taking into account
the rules in Section 1.415(f)-1(d), (e) and (h) of the Income Tax
Regulations.

     

    (f)           Aggregation
with Multiemployer Plans.

     

    (1)           If
the Employer maintains a multiemployer plan, as defined in Section 414(f) of the
Code, and the multiemployer plan so provides, only the benefits under the
multiemployer plan that are provided by the Employer shall be treated as
benefits provided under a plan maintained by the Employer for purposes of this
Article.

     

    (2)           Effective
for Limitation Years ending after December 31, 2001, a multiemployer plan shall
be disregarded for purposes of applying the Defined Benefit Compensation
Limitation to a plan which is not a multiemployer plan.

     

    (g)           The
increased limitations on benefits pursuant to the Economic Growth and Tax Relief
Reconciliation Act of 2001 (“EGTRRA”) shall not apply to any Participant who
does not complete at least one Hour of Service after December 31,
2001.”

    


    3. Except as
hereinabove modified and amended, the Plan as amended shall remain in full force
and effect.

    


     

    CERTIFICATE


    


    The undersigned hereby certifies that
The Connecticut Water Company Employees' Retirement Plan, as amended and
restated effective as of January 1, 1997, except as otherwise provided therein,
was duly amended by the Board of Directors of The Connecticut Water Company by
an Eleventh Amendment on November 21, 2008, and the Plan, as so amended, is in
full force and effect.

    


    


    
      	
              Date:  November
      21, 2008

            	
              By:  /s/ Daniel J.
      Meaney

               

              Title:
      Secretary