2003 SEC FORM 10-K EXHIBIT 10-D-41
PERSONAL AND CONFIDENTIAL
February 10, 2004
Donald J. Rendall, Jr.
Vice President and General Counsel
Green Mountain Power Corporation
163 Acorn Lane
Colchester, VT 05446
Dear Don:
Green
Mountain Power
Corporation (the "Company") considers it essential to
the best interests of its shareholders to foster the
continuous employment of
key management personnel. In addition, the Board of Directors
of the Company
(the "Board") recognizes that the possibility of a change of control
of the
Company may exist and the uncertainty and questions
which it may raise among
management may result in the distraction or
departure of management personnel to
the detriment of the Company and its shareholders.
The Board has determined that appropriate steps should be taken to
reinforce and encourage the continued
attention and dedication of members of the
Company's management, including yourself, to their assigned duties without
distraction in the face of the possibility of a change in control of the
Company, although no such change is known to be contemplated.
In order to induce you to remain in the employ of the Company and
in
consideration of your agreements set forth
in subsections 4(ii), 6(ix), 6(x) and
6(xi) hereof, the Company agrees that you shall
receive the severance benefits
set forth in this Agreement in the event your
employment with the Company is
terminated subsequent to a "change in control of the Company"
(as defined in
section 4 hereof and hereinafter a "Change
of Control") under the circumstances
described below.
1. Term
of Agreement. This Agreement shall commence on
February 15, 2004
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(the "Effective Date") and shall continue in
effect through December 31, 2004;
provided, however, that commencing on January 1, 2005 and each January 1
thereafter, the term of this Agreement shall
automatically be extended for one
additional year unless, not later than September
30 of the preceding year, the
Company shall have given notice that it
does not wish to extend this Agreement.
This Agreement shall replace, in its entirety, the Agreement,
dated March 1,
2002, between you and the Company.
2. Terms
of Employment Before a Change of Control. Prior to a Change of
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Control, your terms of employment ("Terms of
Employment") shall be as follows:
(a) General
duties. Excluding periods of vacation and sick leave
to which
you are entitled, you will continue to
exercise such authority and perform such
executive duties as are commensurate with the authority being exercised
and
duties being performed by you immediately before the Effective Date.
(b) Place
of employment. Your services will be performed at the
location
where you were employed immediately before
the Effective Date. If
the Company
and you agree, however, the location of
your employment may be changed without
affecting your rights under this Agreement.
(c) Expenses
generally.
You are entitled to receive prompt
reimbursement
for all reasonable expenses you incur.
Reimbursement must be
made in accordance
with the Company's policies and procedures in effect on the Effective
Date
(which may include a requirement that you
submit an itemized expense voucher).
(d) Meetings,
conventions,
and seminars. You are encouraged and are
expected to attend seminars, professional meetings and conventions, and
educational courses. The cost of travel, tuition or registration,
food, and
lodging for attending those activities must
be paid by the Company. Other costs
are your expense, unless the Company authorizes those
costs. If those
other
costs are authorized expenses, you must be reimbursed after satisfying
the
Company's policies and procedures for such reimbursement
(which may include a
requirement that you submit an itemized expense voucher).
(e) Promotional
expenses. You are
encouraged and are expected, from time to
time, to incur reasonable expenses for
promoting the Company's business. Such
promotional expenses include travel, entertainment (including
memberships in
social and athletic clubs), professional advancement, and community
service
expenses. You agree to bear those expenses except to the extent that
those
expenses are incurred at the Company's
specific direction or those expenses are
specifically authorized by the Company as expenses that the Company may
pay
directly or indirectly through reimbursement to you.
(f) Outside
activities.
You may (i) serve on corporate, civic, or
charitable boards or committees; (ii) deliver lectures, fulfill speaking
engagements, or teach at educational institutions; and
(iii) manage personal
investments. Such activities must not significantly interfere with the
performance of your responsibilities for the Company.
To the extent that
any
such activities have been conducted by you
before the Effective Date, such prior
conduct of activities and any subsequent
conduct of activities similar in nature
and scope may not be deemed to interfere with the performance of your
responsibilities to the Company.
(g) Compensation
and fringe benefits. Your compensation (including your
annual base salary and any bonuses or incentive compensation) and
benefits
generally are the same as those in effect on the Effective Date. Your
compensation and benefits are, however, subject to periodic review and
adjustment by the Company. This section of this Agreement
does not change the
terms of any fringe benefit program or
employee benefit plan maintained by the
Company and does not give you any
additional vested interest in any compensation
or benefit to which you are not
already entitled under any such program or plan
on the Effective Date. Generally, your benefits include
the following items,
all of which are subject to periodic review
and adjustment: (i) You are entitled
to receive all group life, accidental death and dismemberment, long-term
disability, and medical insurance benefits
available to you according to Company
policies and employee benefit plans
maintained by the Company that are in effect
on the Effective Date; (ii) You are
entitled to paid vacation in accordance with
the Company's policies in effect on the
Effective Date; (iii) You are entitled
to sick leave in accordance with the Company's policies in effect on the
Effective Date; and (iv) You are entitled
to participate in all employee benefit
plans and programs in which you participate on the
Effective Date, whether or
not such plans or programs are subject
to the Employee Retirement Income Act of
1974, as amended ("ERISA"), including but not limited to the Company's
Retirement Plan, Supplemental Retirement Plan or any successor
plans thereto,
any incentive compensation plans maintained by the Company or any
successor
thereto, the Company's Deferred Compensation
Plan for Certain Officers and any
stock-based compensation plans maintained by the Company or successor plans
thereto and any savings or thrift plan maintained by the Company,
3. Extension
of Agreement Upon Change of Control.
If a Change of
Control
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shall have occurred during the original or
extended term of this Agreement, this
Agreement shall continue in effect for a period of at least
thirty-six (36)
months beyond the month in which such
Change of Control occurred. The Terms of
Employment set forth in section 2 continue in
effect after a Change of Control
and may not be changed to terms and conditions less
favorable than those in
effect on the day immediately preceding a Change of Control.
4. Change
of Control.
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(i) No benefits
shall be payable hereunder unless there shall have been
a Change of Control, as set forth below. For purposes of this Agreement,
a
Change of Control shall be deemed to have
occurred if (A) any "person" (as such
term is used in sections 13(d) and 14(d) of
the Securities Exchange Act of 1934,
as amended (the "Exchange Act")), other than a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or a
corporation owned, directly or indirectly,
by the shareholders of the Company in
substantially the same proportions as their
ownership of stock of the Company,
is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of
securities of the Company representing
20% or more of the combined voting power of the Company's then
outstanding
securities (a "20% Holder"); or (B) during any
period of two consecutive years
(not including any period prior to the
execution of this Agreement), individuals
who at the beginning of such period constitute the
Board of Directors of the
Company (the "Board") and any new director
(other than a director designated by
a person who has entered into an agreement with the Company to effect a
transaction described in clauses (A) or (C) of this
subsection) whose election
by the Board or nomination for election by the Company's shareholders
was
approved by a vote of at least two-thirds
(2/3) of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so
approved, cease for any
reason to constitute a majority of the directors of the Company;
or (C) the
shareholders of the Company approve a merger or consolidation
of the Company
with any other corporation, other than a merger or
consolidation which would
result in the voting securities of the Company
outstanding immediately prior
thereto continuing to represent (either by remaining outstanding
or by being
converted into voting securities of the surviving
entity) at least 80% of the
combined voting power of the voting
securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation, or the
shareholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the
Company of all or
substantially all the Company's assets; provided, however, that a Change
of
Control shall not be deemed to have
occurred under clauses (A) or (C) above if a
majority of the Continuing Directors (as defined
below) determine within five
business days after the occurrence of any
event specified in clauses (A) or (C)
above that control of the Company has not in
fact changed and it is reasonably
expected that such control of the Company in fact will not change.
Notwithstanding that, in the case of clause
(A) above, the Board shall have made
a determination of the nature described in the preceding
sentence, if there
shall thereafter occur any material change in facts
involving, or relating to,
the 20% Holder or to the 20% Holder's
relationship to the Company, including,
without limitation, the acquisition by the 20% Holder
of l% or more additional
outstanding voting stock of the Company, the
occurrence of such material change
in facts shall result in a new Change of Control for the purpose of
this
Agreement. In such event, the second immediately preceding sentence
hereof
shall be effective. As used herein, the term
"Continuing Director" shall mean
any member of the Board on the date of this
Agreement and any successor of a
Continuing Director who is recommended to succeed the
Continuing Director by a
majority of Continuing Directors. If, following a Change of Control,
you are
the beneficial owner of two percent or more of the then-outstanding
equity
securities of the Company, or its successor in interest, a majority
of the
Continuing Directors may elect, within five business
days after such Change of
Control, to terminate any benefits payable
to you under this Agreement after the
date of such an election by the Continuing Directors.
(ii)
For
purposes of this Agreement, a "Potential
Change of Control"
shall be deemed to have occurred if (A) the
Company enters into an agreement,
the consummation of which would result in
the occurrence of a Change of Control;
(B) any person (including the Company)
publicly announces an intention to take
or to consider taking actions which
if consummated would constitute a Change of
Control; (C) any person, other than a trustee or other fiduciary holding
securities under an employee benefit plan
of the Company or a corporation owned,
directly or indirectly, by the shareholders
of the Company in substantially the
same proportion as their ownership of stock of the Company, becomes the
beneficial owner, directly or indirectly, of securities of the Company
representing 5% or more of the combined voting power of the
Company's then
outstanding securities; or (D) the Board
adopts a resolution to the effect that,
for purposes of this Agreement, a Potential
Change of Control has occurred. You
agree that, subject to the terms and
conditions of this Agreement, in the event
of a Potential Change of Control, you
will remain in the employ of the Company
until the earliest of (i) a date which
is six (6) months from the occurrence of
such Potential Change of Control, (ii) the
termination by you of your employment
by reason of Long-Term Disability or
Retirement (at your normal retirement age),
as defined in subsection 5(i), or (iii) the
occurrence of a Change of Control.
5. Termination
Following Change of
Control. If any of the
events described
----------------------------------------
in subsection 4(i) hereof
constituting a Change of Control shall have occurred,
you shall be entitled to the benefits
provided in subsection 6(iii) hereof upon
the subsequent termination of your
employment during the term of this Agreement
unless such termination is (A) because of your death,
Long-Term Disability or
Retirement, (B) by the Company for Cause, or (C) by you other
than for Good
Reason.
(i) Death,
Long-Term Disability, or Retirement. If, as a result of
your incapacity due to physical or mental illness which is
determined to be
total and permanent and to prevent you from performing, with or without
reasonable accommodation, the essential functions of your employment by a
physician and any other consultants selected
by the Company or its insurers and
acceptable to you or your legal
representative, you shall have been absent from
the full-time performance of your duties with the Company for six (6)
consecutive months, and within thirty (30) days after written notice of
termination is given you shall not have
returned to the full-time performance of
your duties, your employment may be terminated for "Long -Term
Disability".
Termination by the Company or you of your
employment based on "Retirement" shall
mean termination in accordance with the Company's
retirement policy, including
early retirement, generally applicable to its salaried employees or in
accordance with any retirement arrangement established
with your consent with
respect to you. Your death ("Death") during the term of this
Agreement will
terminate the Agreement.
(ii)
Cause. Termination
by the Company of your
employment for "Cause"
shall mean termination upon (A) the willful and continued failure
by you to
substantially perform your duties with the
Company (other than any such failure
resulting from your incapacity due to physical or mental illness
or any such
actual or anticipated failure after the
issuance of a Notice of Termination, by
you for Good Reason, as defined in
subsection 5(iii)) after a written demand for
substantial performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board
believes that you
have
not substantially performed your duties, (B) the willful engaging by you
in
conduct which is demonstrably and materially injurious to the Company,
monetarily or otherwise, or (C) your willful
and continued breach of a material
term of this Agreement. For purposes of this subsection,
no act, or failure to
act, on your part shall be deemed
"willful" unless done, or omitted to be done,
by you not in good faith and without reasonable belief that
your action or
omission was in the best interest of the Company. Notwithstanding the
foregoing, you shall not be deemed to have
been terminated for Cause unless and
until there shall have been delivered to
you a copy of a resolution duly adopted
by the affirmative vote of not less than three-quarters (3/4)
of the entire
membership of the Board at a meeting of the Board called and
held for such
purpose (after reasonable notice to you and an opportunity for you,
together
with your counsel, to be heard before the
Board), finding that in the good faith
opinion of the Board you were guilty of
conduct set forth above in clauses (A),
(B), or (C) of the first sentence of this subsection and specifying the
particulars thereof in detail.
(iii)
Good
Reason. You shall be entitled to terminate
your employment
for Good Reason. For purposes of this Agreement, "Good Reason"
shall mean,
without your express written consent, the
occurrence after a Change of Control
of any of the following circumstances unless, in
the case of paragraphs (A),
(E), (F), (G), (H) or (I), such
circumstances are fully corrected prior to the
Date of Termination specified in the Notice of Termination, as defined in
Subsections 6(iv) and 6(v), respectively, given in respect thereof:
(A) the assignment to you of any duties inconsistent
with your status
as Vice President and General Counsel of
Green Mountain Power Corporation or a
substantial adverse alteration in the nature
or status of your responsibilities
from those in effect immediately prior to the Change of Control;
(B) a reduction by the Company in your
annual base salary as in effect
on the date hereof or as the same may
be increased from time-to-time except for
across-the-board salary reductions similarly affecting all executives of
the
Company and all executives of any person in control of the Company;
(C) the relocation of the Company's principal executive offices
(presently located at 163 Acorn Lane, Colchester,
Vermont) to a location more
than fifty miles distant from the present location prior to the Change
of
Control, or the closing thereof, or the Company's requiring you to
be based
anywhere other than within fifty miles of the present location, except
for
required travel on the Company's business
to an extent substantially consistent
with your present business travel obligations;
(D) the failure by
the Company, without your consent, to pay to you any
portion of your current compensation except pursuant to an
across-the-board
compensation deferral similarly affecting all
executives of the Company and all
executives of any person in control of the Company;
(E) the failure by the Company to offer you any compensation
plan
introduced to other executives of similar
responsibility or any substitute plans
adopted prior to the Change of Control, unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made
with
respect to such plan; or the failure by the Company to continue your
participation in any such compensation plan (or in such substitute or
alternative plan) on a basis not materially
less favorable, both in terms of the
amount of benefits provided and the level of your participation
relative to
other participants, as existed at the time of the Change of Control;
(F)
the failure
by the Company to continue to provide you with
the
benefits substantially similar to those enjoyed by you under any of the
following plans or programs maintained by
the Company at the time of a Change of
Control
or the taking of any action which would directly or
indirectly
materially reduce any of such benefits,
including but not limited to: (i) fringe
benefits, in accordance with the Company's
policies in effect at the time of a
Change of Control; (ii) group life, accidental death and dismemberment,
long-term disability, and medical and
dental insurance benefits available to you
according to Company policies and employee benefit plans maintained by
the
Company that are in effect at the time of a Change of Control; (iii)
paid
vacation in accordance with your agreements with the Company's and/or the
Company's policies in effect at the time of
a Change of Control; (iv) sick leave
in accordance with the Company's policies in
effect at the time of a Change of
Control; and (v) the Company's Retirement and
Supplemental Retirement Plans or
any successors thereto, any incentive compensation plans maintained by the
Company or any successor thereto, the
Company's Deferred Compensation Plan for
Certain Officers, any stock-based compensation plans
maintained by the Company
or successor plans thereto, any savings or thrift plan maintained by the
Company, whether or not such plans or programs are subject to ERISA;
(G)
any action by the Company that eliminates,
materially reduces or
jeopardizes the ability of the Company to fulfill its obligations
under the
Company's Deferred Compensation or
