Exhibit 10.1
EMPLOYMENT
AGREEMENT
AGREEMENT effective as of
November 1, 2006 (the “Commencement Date”) by and
between UNITIL CORPORATION, a New Hampshire corporation (the
“Company”) and ROBERT G. SCHOENBERGER (the
“Executive”) (this “Agreement”).
The Company desires to employ the
Executive and the Executive is willing to be employed by the
Company, on the terms and conditions hereinafter
provided.
In order to effect the foregoing,
the parties hereto wish to enter into an employment agreement on
the terms and conditions set forth below. Accordingly, in
consideration of the premises and the respective covenants and
agreements of the parties herein contained, and intending to be
legally bound hereby, the parties hereto agree as
follows:
1. Employment . The Company
hereby agrees to employ the Executive, and the Executive hereby
agrees to be employed by the Company, on the terms and conditions
set forth herein.
2. Term . The employment of
the Executive under this Agreement shall commence on the
Commencement Date and shall end at the close of business on
October 31, 2009 (the “Term”).
3. Title, Duties and
Authority . The Executive shall serve as Chairman of the Board
of Directors (the “Board”) and as a member of the
Board, and as Chief Executive Officer and President of the Company,
and shall have such responsibilities and duties for the Company and
its subsidiaries consistent with the Executive’s positions as
Chairman, Board member, Chief Executive Officer and President. The
Executive shall have all of the powers and duties usually incident
to the offices of Chairman, Chief Executive Officer and President.
The Executive shall devote substantially all of his working time
and efforts to the business and affairs of the Company. The
Executive agrees that he shall resign as a Board member effective
on the date of his termination of employment with the Company;
which agreement shall survive the termination of this
Agreement.
4. Compensation and Benefits
.
(a) Base Salary . During the
term, the Company shall pay the Executive a base salary
(“Base Salary”), payable in accordance with the
Company’s normal practice for paying base salaries to its
executive employees. The Base Salary shall initially be payable at
the rate of $400,200 per annum, and shall be subject to annual
review by the Board for discretionary periodic increases in
accordance with the Company’s compensation
policies.
(b) Bonus . The Executive
shall participate in the Company’s Management Incentive Plan
at the target rate of 50%.
(c) Employee Benefits . The
Executive shall be entitled to participate in the Company’s
Supplemental Executive Retirement Program (the “SERP”),
and all other employee benefit plans made available by the Company
(or any affiliate thereof) to all of its executives during the Term
as may be in effect from time to time.
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(d) Stock Plans . The
Executive shall be entitled to participate in any stock option,
restricted stock, phantom stock or similar plan of the Company or
any subsidiary as and to the extent provided by the Board from time
to time.
(e) Expenses . During the
Term, the Executive shall be entitled to receive prompt
reimbursement upon submission of expense claims to the Company for
all reasonable and customary expenses incurred by the Executive in
performing services hereunder, in accordance with the terms and
conditions of the Company’s expense reimbursement policy. The
Executive shall be entitled to a monthly allowance of $1,000 for
the leasing or financing by the Executive of a vehicle in
accordance with the Company’s automobile policies. The
Company shall pay for the membership in a local club.
(f) Vacations . The Executive
shall be entitled to paid vacation in accordance with the
Company’s vacation policy, subject to a minimum of four
(4) weeks of paid vacation per year. The Executive shall also
be entitled to all paid holidays and sick days given by the Company
to its executives.
(g) Taxes . The Company may
withhold from any amounts payable under this Agreement such
federal, state, local and/or other taxes as shall be required to be
withheld pursuant to any applicable law or regulation.
(h) Board Fees . The
Executive shall promptly remit to the Company any compensation
received by the Executive (including, without limitation, any fees,
equity securities or retirement benefits) for service on the board
of directors or similar governing body of any entity in which the
Company owns at least five percent of the voting equity securities,
unless the Board authorizes the Executive to retain some or all of
any such compensation. Notwithstanding the foregoing, the Executive
shall be entitled to retain any reimbursements paid to him by any
such entity of the actual out-of-pocket expenses incurred by the
Executive in attending any meeting of any such board or other
governing body. Nothing in this Section 4(h) shall be deemed
to authorize the Executive to serve on the board of directors or
similar governing body of any other entity if doing so would cause
the Executive to be in breach of his obligations under any other
provision of this Agreement.
(i) Change in Control . The
Company and the Executive have entered into a Severance Agreement
(“Severance Agreement”) dated February 6, 1998,
providing for certain vesting acceleration and other benefits upon
certain changes in the control or ownership of the Company. In
addition to any acceleration or benefits under the Severance
Agreement, the Executive shall be 100% vested upon a Change in
Control (as defined in the Severance Agreement) under the SERP, and
the SERP benefit shall be paid to the Executive upon reaching his
Normal Retirement Date or Early Retirement Date as defined in the
SERP.
5. Termination . The Company,
by action of the Board, may terminate the Executive’s
employment hereunder for any reason. If the Executive’s
employment is terminated by the Company during the Term for any
reason other than for Cause (as defined below), death, or
Disability (as defined below), or if the Executive terminates his
employment hereunder because of a Constructive Termination, the
Company shall pay to the Executive a combination of (i) base
pay
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at the rate in effect on the date of employment
termination, (ii) an annual amount equal to the average of the
annual bonus amounts received by the Executive in the two calendar
years preceding the year in which the employment termination
occurs, and (iii) benefits, in each case for a period of two
years following the date of termination; provided, that if during
such two year period the Executive shall secure full-time
employment, the Company’s obligation to provide benefits to
the Executive shall thereupon cease and be of no further force or
effect. Such payments shall be made in accordance with the
Company’s regular payroll practices. If the Executive
terminates his employment hereunder for any reason other than due
to a Constructive Termination, if the Executive’s employment
hereunder is terminated due to the Executive’s death, or if
the Company terminates the Executive’s employment as a result
of Disability or Cause, the Company shall have no further
obligation hereunder and no further payments (except for accrued
and unpaid salary, bonus and expense reimbursement) shall be made
to the Executive.
(a) Disability . For purposes
of this Agreement, “Disability” shall mean the
Executive’s incapacity due to physical or mental illness
which, if he were to apply, would in the sole determination of the
Board entitle him to the receipt of benefits under the
Company’s long-term disability plan and if the Executive
shall not have returned to the performance of his duties hereunder
on a full-time basis within thirty (30) days after a written
Notice of Termination (as defined in Section 6(a)) is given to
the Executive by the Company.
(b) Cause . For the purposes
of this Agreement, “Cause” shall mean:
(i) the failure by the Executive to
substantially perform the Executive’s duties hereunder (other
than any such failure resulting from the Executive’s
incapacity due to physical or mental illness which shall be subject
to the provisions of Section 5(a));
(ii) the willful violation by the
Executive of any of the Executive’s material obligations
hereunder;
(iii) the willful engaging by the
Executive in misconduct which is materially injurious to the
business or reputation of the Company or any of its affiliates;
or
(iv) the Executive’s
conviction of a felony.
Notwithstanding the foregoing, the
Executive shall not be terminated for Cause without:
(A) reasonable notice to the
Executive setting forth the reasons for the Company’s
intention to terminate the Executive’s employment hereunder
for Cause;
(B) the failure of the Executive to
cure the nonperformance, violation or misconduct described in the
notice referred to in clause (A) of this paragraph, if the
cure thereof is possible, to the reasonable satisfaction of the
Board, within fifteen (15) days of such notice;
(C) an opportunity for the
Executive, together with the Executive’s counsel, to be heard
before the Board; and
(D) delivery to the Executive of a
written Notice of Termination (as defined in Section 6(a))
from the Company notifying him that in the good faith opinion of a
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