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EMPLOYMENT AGREEMENT

Employment Agreement

EMPLOYMENT AGREEMENT | Document Parties: Pennichuck Corporation | Donald L. Ware You are currently viewing:
This Employment Agreement involves

Pennichuck Corporation | Donald L. Ware

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Title: EMPLOYMENT AGREEMENT
Governing Law: New Hampshire     Date: 11/14/2006

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Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

      This Agreement is made and entered into as of the 3rd day of October, 2006, by and between Donald L. Ware (the "Executive") of Merrimack, New Hampshire, and Pennichuck Corporation (the "Corporation"), a New Hampshire corporation with principal offices at 25 Manchester St., Merrimack, New Hampshire 03054.

 

      For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in consideration of the mutual covenants and promises set forth in this Agreement, the parties agree as follows:

 

ARTICLE I
EMPLOYMENT

 

      1.1.    The Corporation hereby employs the Executive and the Executive hereby accepts employment with the Corporation on the date hereof for the Term (as defined below) of the Agreement, in the position and with the duties and responsibilities set forth in Article II below and upon the other terms and subject to the conditions hereinafter set forth.

 

ARTICLE II
POSITION, DUTIES AND RESPONSIBILITIES

 

      2.1.    During the Term of this Agreement, the Executive shall serve as the President Pennichuck Water Works, Inc., one of the Corporation's subsidiaries ("PWW"). Subject only to the supervision, control and guidance of the Chief Executive Officer and the Board of Directors of the Corporation (the "Board"), the Executive shall have all of the duties, responsibilities and authorities typically enjoyed by a president of a corporation to control the day-to-day operations of PWW, including, by example but not by way of limitation, the responsibility for the overall operations of PWW, the supervision over the property, business and affairs of PWW and the power to hire and dismiss other employees of PWW.

 

      2.2.    The Executive shall devote substantially all of his business time and attention to the business and affairs of PWW and the Corporation consistent with his executive position with PWW and the Corporation, except for vacations permitted pursuant to Section 5.3. and Disability (as defined in Section 7.5 hereof). Nothing in this Agreement, however, shall preclude the Executive from engaging in charitable activities, community affairs and corporate boards, provided that such activities do not interfere with the performance of his duties and responsibilities enumerated within this Agreement as determined by the Board.

 

ARTICLE III
TERM

 

      3.1.    Unless terminated sooner in accordance with the terms hereof, the term of employment under this Agreement ("Term") shall be for the period commencing onJuly __, 2006 ("Effective Date") and ending two (2) years from the Effective Date; provided, however, that commencing on the first anniversary of the Effective Date and on or about each anniversary of

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the Effective Date thereafter, the term of this Agreement may be extended for subsequent one (1) year periods by vote of the Board of Directors, and in which case the provisions hereof shall remain applicable for each of such subsequent two-year periods. Notwithstanding the foregoing, in the event there is a "Change of Control" (as that term is defined in Section 7.4 below), this Agreement will automatically be extended to 2 years, beginning on the day on which the Change of Control occurs. Thereafter, this Agreement will be extended only by vote of the Board of Directors as described above.

 

ARTICLE IV
COMPENSATION

 

      4.1.    Base Salary. The Executive shall be paid a base salary (the "Base Salary") equal to one hundred fifty six thousand dollars ($156,000.00) per annum for the Term. The Base Salary shall be payable to the Executive in installments, less state and federal income tax withholdings and other normal employee deductions, on the date on which the Corporation's other executive officers are paid, but in no event less frequently than monthly. The Base Salary shall be reviewed by the Board each year (on or about the first business day of each calendar year) and shall be subject to adjustment in the absolute discretion of the Board taking into account, but not limited to additional responsibilities, if any, which may have been assigned to him, corporate and individual performance and general business conditions.

 

      4.2.    Incentive Compensation. During the Term, the Executive shall generally be entitled to participate in any bonus and incentive compensation plans which may be made available to executive officers of the Corporation.

 

      4.3.    Stock Options. During the Term, the Executive shall generally be entitled to participate in any stock option plan or plans which may be made available by the Corporation.

 

      Federal, state, and local withholding, social security, and other appropriate taxes shall be deducted from all compensation paid to, or provided by the Corporation for, Executive as and to the extent required by law.

 

ARTICLE V
FRINGE BENEFIT PLANS

 

      5.1.    Employee Benefit Programs. The Executive shall be entitled to: (A) receive health and dental insurance coverage, as and to the extent provided by the Corporation to its executive officers; (B) receive group life and disability coverage, as and to the extent provided by the Corporation to its executive officers; (C) receive insurance on the life of the Executive in the amount of three (3) times his annual salary; and (D) be a full participant in (1) all of the Corporation's pension and other retirement plans and profit-sharing plans, if any, or equivalent successor plans, if any, that may hereafter be adopted and maintained by the Corporation in each case with at least the same opportunity to participate therein as shall be applicable to other executive officers of the Corporation and (2) all of the Corporation's other benefit plans which may be in effect from time to time. Further, the Corporation shall provide the Executive with (a) short term disability coverage encompassing up to sixty percent

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(60%) of his then Base Salary for a period of up to twenty six (26) weeks, as well as (b) long term disability coverage (at the Executive's option) encompassing up to sixty percent (60%) of his then Base Salary up to a maximum benefit of six thousand dollars ($6,000) per month. The Corporation acknowledges that the Executive currently meets the eligibility criteria for participation in all of the Corporation's present employee benefit programs.

 

      5.2.    Reimbursement of Expenses. It is contemplated that in connection with the Executive's employment hereunder, the Executive may be required to incur business, entertainment and travel expenses. The Corporation agrees to promptly reimburse the Executive in full for all reasonable out-of-pocket business, entertainment and other related expenses (including all expenses of travel and living expenses while away from home on business at the request of, and in the service of, the Corporation) incurred or expended by the Executive incident to the performance of his duties hereunder; provided, that the Executive properly accounts for such expenses in accordance with the policies and procedures established by the Board and applicable to the executive officers of the Corporation.

 

      5.3.    Vacation. The Executive shall be entitled, in each year during the Term, to the number of paid vacation days determined by the Corporation from time to time to be appropriate for its executive officers, but in no event less than four (4) weeks in any such year (pro-rated, as necessary, for partial calendar years during the Term). The Executive may take his allotted vacation days at such times as are mutually convenient for the Corporation and the Executive, consistent with respect to its executive officers. The Executive shall also be entitled to all paid holidays given by the Corporation to its executive officers.

 

      5.4.    Automobile. The Executive shall be provided the use of an automobile. The Corporation shall pay all gas, upkeep, insurance coverage, and maintenance on said vehicle; provided, however, that the value of any personal use thereof shall be included in the Executive's taxable wages reported by the Corporation as and to the extent required by applicable law.

 

ARTICLE VI
INDEMNIFICATION

 

      6.1 .    The Executive shall be entitled, at all times, to the benefit of the maximum indemnification and advancement of expenses available from time to time under the Corporation's and PWW's Articles of Incorporation and Bylaws, and under the laws of the State of New Hampshire. Such indemnification shall survive the termination of this Agreement unless such termination is for "Cause" (as that term is defined in Section 7.2 below) and the claim for liability is related to the actions underlying the termination for "Cause". In addition, either PWW or the Corporation shall have and maintain in full force and effect an officers' liability insurance policy providing such coverages, exclusions and deductibles as the Corporation and the Executive shall reasonably agree and as is available on a reasonable premium basis.

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ARTICLE VII
TERMINATION

 

      7.1.    Termination by the Executive. The Executive may terminate his employment hereunder for any reason at any time upon at least thirty (30) days prior written notice to the Corporation. In the event the Executive terminates his employment, the Executive shall receive accrued but unpaid salary, bonus (if any) and benefits through the last day of employment only. Notwithstanding the foregoing, in the event the Executive, for "Good Reason" (as that term is defined below), terminates his employment within twenty-four (24) months following a "Change of Control" (as that term is defined below), the Corporation shall provide the Executive with severance benefits, payable as a lump sum, equal to the Executive's then current salary and fringe benefits provided hereunder, in


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