Exhibit 10
(e)(iii)
SOUTH JERSEY INDUSTRIES
SOUTH JERSEY GAS COMPANY
SOUTH JERSEY ENERGY COMPANY
Officer
Employment Agreement
THIS AGREEMENT made as of
the first day of January 2006, by and between South Jersey
Industries, Inc. (“SJI”) and/or one or more of
its subsidiaries South Jersey Gas Company and South Jersey
Energy Company, all New Jersey corporations, having their
principal offices at Number One South Jersey Plaza, Route 54,
Folsom, New Jersey (the “Companies”), and
___________________ (the “Officer”).
WITNESSETH:
WHEREAS, the Companies
desire to assure themselves of the continued employment of
the Officer by the Companies and to encourage his or her
continued attention and dedication to the Companies in the
best interests of the Companies and SJI shareholders;
and
WHEREAS, the Officer is
presently employed by the Companies as follows:
WHEREAS, the Officer
desires to remain and continue in the employ of the Companies
on the terms hereinafter provided;
NOW, THEREFORE, in
consideration of the premises and the mutual covenants
contained herein, the parties hereto agree as
follows:
Section 1.
Employment .
The Companies hereby agrees
to continue to employ the Officer in the positions in which
he or she presently serves, and the Officer hereby agrees to
continue to serve in those positions, on the terms and
conditions set forth herein.
Section 2.
Term .
The term of this Agreement
shall be for a period of three (3) years beginning January 1,
2006 and ending on December 31, 2009 subject to earlier
termination under sections 7 and 8.
Section 3.
Duties and Responsibilities .
The Officer shall serve in
the positions in which he or she presently serves and shall
report only to the President and/or Chief Executive Officer
of SJG. The Officer shall perform such duties and
services as are customarily performed by him or her and as
are assigned to him or her by the President and/or Chief
Executive Officer of SJG.
Section 4.
Outside Services .
The Officer agrees to
devote substantially all of his or her working time and
efforts to the business and affairs of the Companies and
shall not, directly or indirectly, without the written
consent of the Chief Executive Officer of SJI, render any
services to any other person, firm or entity, or own, manage,
operate, control or participate in the management of any
other person, firm or entity during the term of this
Agreement. However, the Officer is not prohibited
or prevented from acquiring or holding investments and
securities listed on a national or regional securities
exchange or sold in an over-the-counter public market,
provided that the Officer is not part of any control group of
such corporation or entity. So long as it does not
interfere with his or her duties under this Agreement, the
Officer shall have the right to serve as a director of any
other corporation upon the approval of the President and/or
Chief Executive Officer of SJI.
Section 5.
Place of Performance .
The Officer’s
services during the term of this Agreement shall be performed
primarily in the corporate headquarters building of the
Companies at Number One South Jersey Plaza, Route 54, Folsom,
New Jersey. Without his or her prior consent, the
Officer shall not be required to move his or her place of
permanent employment from this corporate headquarters
building, although the Officer may be required to undertake
reasonable domestic and international travel from time to
time consistent with his or her business travel
obligations.
Section 6.
Compensation and Expenses .
6.1 Total
Direct Compensation.
During
the period of the Officer’s employment under this
Agreement, the Companies shall pay to the Officer a Base
Salary of not less than $__________ per annum; a performance
based annual cash award targeted at __% of base salary; and a
long-term incentive plan targeted at __% of base salary, the
three components being defined as Total Direct
Compensation. Base Salary shall be paid in either
twenty-four (24) or twenty-six (26) equal
installments. The amount of Total Direct
Compensation shall be reviewed annually in accordance with the
normal business practices of the Companies.
6.2
Additional Benefits.
In
addition to Total Direct Compensation, the Companies shall pay
for and the Officer shall be entitled without limitation to
participate in employee benefit plans presently in effect or
hereafter adopted by the Companies which are applicable to
employees generally. To the extent said benefits
have been modified or additional benefits provided, they are
detailed in Exhibit A, which is attached hereto and made a
part hereof. If employer contributions to any such
plan (other than a defined benefit plan) for the benefit of
the Officer or his or her dependents or beneficiaries are
reduced in amount by any statute or regulation from the
payments that would otherwise be so made but
for such statute or regulation, the amount
that
is prohibited from being paid to such plan because of such
statute or regulation, increased if necessary as provided in
the next sentence, shall be paid, at the time it would have
been paid to such plan except for such prohibition to the
Officer in a lump sum cash payment. Such amount
shall be increased if necessary so that, after federal and
state income taxes on the amount as so increased are taken
into account, the net amount after such taxes, shall be paid
to the Officer.
6.3
Expenses.
In
addition to Total Direct Compensation and Additional Benefits,
the Companies shall pay for and the Officer shall be entitled
to receive prompt reimbursement for all reasonable expenses
incurred by the Officer in performing services under this
Agreement, including all expenses of travel and living
expenses while away from home on business or at the request of
and in the service of the Companies, provided that such
expenses are incurred and accounted for in accordance with the
policies and procedures presently or hereafter established by
the Companies.
6.4
Services Furnished.
The
Companies shall furnish the Officer with office space,
administrative/clerical assistance and such other facilities
and services as shall be suitable to the Officer’s
position and adequate for the performance of his or her
duties.
Section 7.
Reasons for Termination .
7.1
Death.
This
Agreement shall terminate upon the Officer’s death, and
he or she shall be entitled to such death benefits to which he
or she is otherwise entitled presently or which may be
hereafter established by the Companies.
7.2
Disability.
If
the Officer shall be determined to be disabled in accordance
with the disability policy or plan of the Companies, the
Officer may be removed from positions within the Companies in
which he or she then may be serving. However, the
Officer shall not be terminated as an employee of the
Companies. The Officer shall be retained in such
positions and given such duties and responsibilities as are
commensurate with his or her abilities at the
time. The Officer shall be entitled to such
disability benefits, including short term and long term, to
which he or she is otherwise entitled presently or which may
be hereafter established by the Companies. Until
the Officer becomes entitled to such disability benefits, he
or she shall continue to be paid his or her Total Cash
Compensation in accordance with this Agreement. The
determination of the disability of the Officer shall be made
by the Chief Executive Officer of the Companies in the
exercise of his discretion in accordance with procedures set
forth in the disability policies or plan.
7.3
Retirement.
If
the Officer shall retire, he or she shall be entitled to such
pension and other benefits applicable to executive employees
generally and him or her specifically including, without
limitation, those presently existing or hereafter established
by the Companies.
7.4
For Cause by the Companies.
The
Companies may terminate the Officer’s employment for
Cause. For purposes of this Agreement, the
Companies shall have “Cause” to terminate the
Officer’s employment hereunder only for the following
reasons: (1) the willful and continued failure by the Officer
to substantially perform his or her duties hereunder other
than any such failure resulting from the Officer’s
incapacity due to physical or mental illness or injury; (2)
the conviction of the Officer of a crime under state or
federal law and the Companies’ Board of Directors or one
of its committees is unable to conclude in good faith (and in
its sole discretion) that the Officer had no reasonable cause
to believe that the activities of which he or she was
convicted were unlawful and that such conviction will not
materially impair his or her ability to discharge his or her
duties; (3) the willful engaging by the Officer in misconduct
which is materially injurious to the Companies, monetarily or
otherwise; or (4) the continued inability of the Officer to
perform his or her duties by reason of alcoholism or drug
abuse even after appropriate rehabilitation services have been
made available to him or her.
7.5
For Good Reason by the Officer.
The
Officer may terminate the Officer’s employment for Good
Reason following a Change of Control of the Companies at any
time during the term of this Agreement. For purposes of this
Agreement, “Good Reason” shall mean any of the
following: (1) the assignment to the Officer by the Companies,
without the Officer’s express written approval, of
duties inconsistent with the Officer’s position, duties,
responsibilities, titles, offices or status with the Companies
immediately prior to a Change of Control of the Companies, or
any removal of the Officer from or any failure to re-elect the
Officer to any such positions; (2) a reduction in the
Officer’s Total Cash Compensation as in effect on the
date hereof or as the same is increased from time to time
during the term of this Agreement; (3) the failure to review
and increase the Officer’s Total Cash Compensation
within twelve (12) months after the Officer’s last
increase in Total Cash Compensation by an amount which at
least equals, on a percentage basis, the average percentage
increase Total Cash Compensation for all the Companies’
Officers for that same period (excluding promotions); (4) the
failure to continue in effect any benefit plan or arrangement
in which the Officer is participating immediately prior to a
Change of Control, or the taking of any action by the
Companies which would adversely affect the Officer’s
participation in and/or materially reduce the Officer’s
benefits under any such benefit plan or arrangement or which
would deprive the Officer of any material fringe benefit
enjoyed by the Officer immediately prior to a Change of
Control; (5) a relocation of the Companies’ corporate
headquarters to a location outside of Folsom, New Jersey, or
the Officer’s relocation to any place other than the
location at which the Officer performed the Officer’s
duties except for required travel by the Officer on the
Companies’ business to an extent
substantially consistent with the Officer’s business
travel obligations
immediately
prior to a Change of Control; (6) any purported termination of
the Officer’s employment which is not effected pursuant
to a Notice of Termination.
For
purposes of this Agreement a “Change of Control”
of the Companies shall mean any of the following: (1)
consummation of any pay or proposal for the merger,
liquidation, dissolution or acquisition of SJI or all or
substantially all of its assets; (2) election to the Board of
Directors of SJI a new majority different from the individuals
who at the beginning of the term of this Agreement constituted
the entire Board of Directors of SJI, unless each such new
director stands for election as a management nominee and is
elected by shareholders immediately prior to the election of
any such new majority; or (3) the acquisition by any person of
20% or more of the stock of SJI having general voting rights
in the election of directors (for purposes of this clause (3),
the term “person” shall include two or more
persons acting as a group for the purpose of acquiring,
holding or disposing of stock of SJI).
Section 8. Benefits upon Termination
.
8.1 Termination by the
Companies for Cause.
If
the Officer’s employment by the Companies shall be
terminated for Cause (as defined in Section 7.4), the
Companies shall pay the Officer his or her Total Direct
Compensation through the Date of Termination at the rate in
effect at the time Notice of Termination is given and the
Companies shall have no further salary obligations to the
Officer under this Agreement. The Officer shall be
entitled to such retirement benefits as he or she may
otherwise be entitled to on the Date of
Termination. Effective as of the Date of
Termination, the Officer shall no longer be an employee of the
Companies and shall no longer be entitled to the privileges
and benefits thereof.
8.2 Termination by the Officer for Good
Reason.
If
the Officer’s employment shall be terminated by the
Officer for Good Reason following a Change of Control (as
defined in Section 7.5), the Companies shall pay the Officer
as severance pay an amount equal to 300% of a base amount
determined to be the average of the aggregate annual
compensation paid to the Officer during the five (5) calendar
years preceding the Date of Termination and subject to federal
income taxes; provided that, if any lump-sum severance
payment, either alone or together with any other payment which
the Officer has the right to receive from the Companies, would
constitute a “parachute payment” as defined in
Section 280G of the Internal Revenue Code of 1986, as amended,
such lump-sum payment shall be reduced to the largest amount
as will result in no portion of the lump-sum payment being
subject to the excise tax imposed by Section 4999 of the
Internal Revenue Code of 1986, as amended. The
Companies shall pay this lump-sum severance payment, in cash,
on the Date of Termination, provided that the Officer has
executed a general release and waiver of claims in a form of
agreement prepared by the Companies.
8.3 Termination by the
Companies for Other than Cause.
If
the Companies terminate the Officer’s employment for
other than Cause following a Change of Control, the Officer
shall be entitled to those benefits set forth in paragraph 8.2
above. If the Companies terminates the
Of
