EMPLOYMENT AGREEMENT

 

 

                                                 Exhibit 2.4

                                                           

                    EMPLOYMENT AGREEMENT

                             

   THIS  EMPLOYMENT AGREEMENT (the "Agreement") is made  and

entered into this 13th day of September, 2005 by and between

BayCorp   Holdings,  Ltd.,  a  Delaware   corporation   (the

"Company"), and Anthony M. Callendrello ("Executive"), to be

effective as of the Effective Date, as defined in Section 1.

 

                         BACKGROUND

                             

   The  Company  is being acquired by Sloan Group  Ltd.  and

its   wholly  owned  subsidiary,  Sloan  Acquisition   Corp.

Following  the  acquisition, the Company desires  to  employ

Executive as Chief Operating Officer of the Company, or such

other   executive  position  of    comparable   status   and

responsibilities as the Board of Directors  of  the  Company

shall assign from time to time, from and after the Effective

Date,  in  accordance with the terms of this Agreement.   In

addition, the Company desires to have the Executive serve as

a  member of its Board of Directors. Executive is willing to

serve  as  Chief  Operating Officer in accordance  with  the

terms  and  conditions of this Agreement and as a member  of

the Board of Directors.

 

   NOW  THEREFORE, in consideration of the foregoing and  of

the  mutual  covenants and agreements set forth herein,  and

other  good  and  valuable consideration,  the  receipt  and

sufficiency  of which are hereby acknowledged,  the  parties

hereto agree as follows:

 

   1.    Effective  Date.   The  effective  date   of   this

Agreement (the "Effective Date") shall be the effective date

of,  and contingent upon, the merger between the Company and

Sloan Acquisition Corp. (the "Merger").

 

   2.   Employment.   Executive is hereby  employed  on  the

Effective Date as Chief Operating Officer of the Company, or

such  other  executive position of comparable    status  and

responsibilities as the Board of Directors  of  the  Company

shall assign from time to time, and Executive shall have the

duties, responsibilities, and authority as shall be assigned

to  him  from time to time by the Board of Directors of  the

Company or its designee.  Executive will report to the Board

of  Directors of the Company.  The Executive will also serve

as a member of the Board of Directors of the Company so long

as  Executive  remains the Chief Operating  Officer  of  the

Company.

 

   3.   Employment  Period.   Unless earlier  terminated  in

accordance  with  Section  7  hereof,  Executive's   initial

employment  shall  be for a one-year term beginning  on  the

Effective Date and ending on the corresponding date  of  the

following calendar year (the "Initial Term").  Following the

Initial  Term,  this  Agreement and  Executive's  employment

hereunder will automatically be extended for additional one-

year  periods  (each  such period being  referred  to  as  a

"Renewal  Term")  on  the  terms and  conditions  set  forth

herein,  without further action by Executive or the Company.

This  process of automatic renewal shall continue from  year

to year unless and until either the Executive or the Company

gives written notice to the other, at least ninety (90) days

prior  to  the end of the Renewal Term then in effect,  that

the  Term  of the Agreement shall not be extended, in  which

case  the Executive's employment will terminate on the  last

day  of the Renewal Term in which the notice is given.   The

Initial   Term  and  any  Renewal  Terms  are  referred   to

collectively herein as the "Term".

 

   4.   Extent  of  Service.   During  the  Term,  Executive

agrees to employment with the Company on a full-time basis

 

 

                             -1-

 

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devoting  all  of his business time, attention,  skill,  and

efforts  exclusively  to  the faithful  performance  of  his

duties   hereunder,  excluding  any  periods  of   vacation,

holiday,  sick leave, and Company-approved leave of  absence

to  which  Executive is entitled in accordance with  Company

policies.  It shall not be a violation of this Agreement for

Executive  to  (i)  devote reasonable  time  to  charitable,

religious  or community activities, (ii) serve on corporate,

civic,  educational,  or charitable  boards  or  committees,

subject  to  the Company's standards of business conduct  or

other  code  of  ethics, (iii) deliver lectures  or  fulfill

speaking  engagements  from time to time  on  an  infrequent

basis,  and/or  (iv) manage personal business interests  and

investments, subject to the Company's standards of  business

conduct  or  other  code of ethics,  and  so  long  as  such

activities  do not interfere in a material manner  or  on  a

routine   basis   with   the  performance   of   Executive's

responsibilities under this Agreement.

 

   5.  Compensation and Benefits.

 

        (a)  Base Salary.  During the Term, the Company will

pay  to  Executive a base salary at the rate of $One Hundred

Forty  Thousand US Dollars (U.S. $140,000) per  year  ("Base

Salary"), less normal withholdings, payable in approximately

equal  bi-weekly  or other installments  as  are  or  become

customary  under  the Company's payroll  practices  for  its

employees from time to time.  The compensation committee  of

the  Board  of Directors of the Company (or the  full  Board

excluding  Executive, if there is no compensation committee)

shall review, outside the presence of Executive, Executive's

Base  Salary  annually and may increase  (but  not  decrease

except  as  provided  in Section 7(d)(1))  Executive's  Base

Salary  from  year  to  year,  based  upon  its  good  faith

evaluation of Executive's performance, the Company's results

of  operations,  changes in general economic conditions  and

other  relevant  factors.  Such adjusted salary  then  shall

become   Executive's  Base  Salary  for  purposes  of   this

Agreement.

 

        (b)   Incentive,  Savings,  and  Retirement   Plans.

During  the Term, Executive shall be entitled to participate

in  all incentive, savings, and retirement plans, practices,

policies,   and  programs  available  to  senior   executive

officers  of the Company ("Peer Executives"), if  there  are

any, and on the same basis as such Peer Executives.  Without

limiting the foregoing, Executive may be entitled to receive

discretionary cash bonuses as determined from time  to  time

by  the compensation committee of the Board of Directors  of

the Company (or the full Board excluding Executive, if there

is  no  compensation  committee)  outside  the  presence  of

Executive.

 

        (c)   Welfare  Benefit  Plans.   During  the   Term,

Executive  and  Executive's  eligible  dependents  shall  be

eligible  for  participation  in,  and  shall  receive   all

benefits   under,  the  welfare  benefit  plans,  practices,

policies,  and programs provided by the Company  (including,

without  limitation,  medical,  prescription  drug,  dental,

disability, employee life, dependent life, accidental death,

and  travel accident insurance plans and programs) ("Welfare

Plans")  to  the extent available to other Peer  Executives.

Without limiting the foregoing, the following shall apply:

 

            (i)  The Company will provide the Executive with

a  term  life insurance policy (the "Life Insurance Policy")

in  the amount of $500,000 U.S. Dollars consistent with past

Company  practices and subject to the Executive's  continued

eligibility for coverage at reasonable rates.  The Executive

shall  select  the  beneficiaries under the  Life  Insurance

Policy, and ownership of the Life Insurance Policy shall  be

vested in the Executive.  Coverage shall begin no later than

the  Effective  Date  and continue  for  the  Term  of  this

Agreement.  If the Executive's employment is terminated  and

the  Company is no longer obligated under this Agreement  to

maintain the Life Insurance Policy, the Executive shall have

the  option  to  continue the Life Insurance Policy  at  the

Executive's expense.

 

 

                             -2-

 

<Page>

 

            (ii)     The  Company will provide the Executive

with a long-term disability policy ("the Disability Policy")

that  will  provide monthly benefits of no less than  $2,500

U.S.  Dollars per month.  Coverage shall begin no later than

the  Effective  Date  and continue  for  the  Term  of  this

Agreement.  If the Executive's employment is terminated  and

the  Company is no longer obligated under this Agreement  to

maintain the Disability Policy, the Executive shall have the

option  to continue the Disability Policy at the Executive's

expense.

 

        (d)  Expenses.   Executive  shall  be  entitled   to

receive  prompt  reimbursement for all  reasonable  expenses

incurred  by  Executive during the Term  in  the  course  of

performing  his  duties  and  responsibilities  under   this

Agreement,  in accordance with the policies, practices,  and

procedures of the Company.

 

        (e)  Fringe  Benefits.  During the  Term,  Executive

shall be entitled to fringe benefits in accordance with  the

plans,  practices,  programs, and policies  of  the  Company

available to other Peer Executives.

 

        (f)  Vacation.  During the Term, Executive  will  be

entitled  to  paid vacation time not to exceed  20  business

days per year.

 

   6.    Change  of  Control.   For  the  purposes  of  this

Agreement,  a "Change of Control" shall mean the  occurrence

of any of the following events:

 

        (a)   any person is or becomes a "beneficial  owner"

        (as  defined  in  Rule  13d-3 under  the  Securities

        Exchange   Act   of  1934  (the  "Exchange   Act")),

        directly or indirectly, of either (i) a majority  of

        the  then-outstanding shares of common stock of  the

        Company  ("Company Common Stock") or (ii) securities

        of  the  Company  representing  a  majority  of  the

        combined   voting  power  of  the   Company's   then

        outstanding  securities eligible  to  vote  for  the

        election   of   directors   (the   "Company   Voting

        Securities"); provided, however, that  for  purposes

        of  this  paragraph (a), the following  acquisitions

        of   Company   Common   Stock  or   Company   Voting

        Securities   shall  not  constitute  a   Change   of

        Control: (A)  an acquisition by the Company  or  any

        entity  that, directly or indirectly through one  or

        more intermediaries, controls, is controlled by,  or

        is   under  common  control  with  the  Company   (a

        "Company  Affiliate"),  (B) an  acquisition  by  any

        employee  benefit plan (or related trust)  sponsored

        or   maintained  by  the  Company   or   a   Company

        Affiliate,  (C)  an  acquisition  by  Executive   or

        another   Company  officer  or  group   of   Company

        officers, or (D) an acquisition pursuant to  a  Non-

        Qualifying Transaction (as defined in paragraph  (b)

        below); or

       

        (b)    the   consummation  of  a   recapitalization,

        reorganization,  merger,  consolidation,   statutory

        share  exchange,  or  similar  form  of  transaction

        involving  the  Company  or  a  subsidiary  of   the

        Company  (a "Reorganization"), or the sale or  other

        disposition  of  all  or substantially  all  of  the

        Company's  assets (a "Sale") or the  acquisition  of

        assets    or    stock   of   another   entity    (an

        "Acquisition");     provided,     however,      such

        Reorganization,  Sale,  or  Acquisition   shall   be

        deemed  to  be  a  "Non-Qualifying  Transaction"  if

        immediately following such Reorganization, Sale,  or

        Acquisition  the individuals and entities  who  were

        the  beneficial  owners of the  outstanding  Company

        Common   Stock   and  outstanding   Company   Voting

        Securities     immediately     prior     to     such

        Reorganization,  Sale,  or Acquisition  beneficially

        own,  directly  or  indirectly, more  than  50%  of,

        respectively, the then outstanding shares of  common

        stock  and  the combined voting power  of  the  then

        outstanding  voting  securities  entitled  to   vote

        generally in the election of directors, as the  case

        may be, of the entity resulting from or surviving

       

 

                             -3-

 

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        such    Reorganization,   Sale,    or    Acquisition

        (including, without limitation, an entity  which  as

        a  result  of such transaction owns the  Company  or

        all or substantially all of the Company's assets  or

        stock  either  directly  or  through  one  or   more

        subsidiary entities, the "Surviving Entity"); or

       

        (c)  approval by the shareholders of the Company  of

        a   complete  liquidation  or  dissolution  of   the

        Company.

       

   7.  Termination of Employment.

 

        (a)  Death.  Executive's employment shall  terminate

automatically upon Executive's death during the Term.

 

        (b)  Disability.  If the Company determines in  good

faith  that  the Disability (as defined below) of  Executive

has  occurred  during  the Term, it may  give  to  Executive

written  notice  of  its intention to terminate  Executive's

employment.  In such event, Executive's employment with  the

Company  shall  terminate effective on the  30th  day  after

receipt of such written notice by Executive (the "Disability

Effective  Date"), provided that, within the 30  days  after

such receipt, Executive shall not have returned to full-time

performance  of  Executive's duties.  For purposes  of  this

Agreement,  "Disability"  shall have  the  same  meaning  as

provided   in  the  long-term  disability  plan  or   policy

maintained  by  the Company and covering Executive.   If  no

such  long-term  disability plan or  policy  is  maintained,

"Disability"  shall  mean  the inability  of  Executive,  as

determined by the Board, to perform the essential  functions

of  his regular duties and responsibilities, with or without

reasonable  accommodation, due to a  medically  determinable

physical  or  mental  illness  which  has  lasted  (or   can

reasonably  be  expected  to  last)  for  a  period  of  six

consecutive  months.   At the request of  Executive  or  his

personal representative, the Board's determination that  the

Disability  of Executive has occurred shall be  certified  a

physician mutually agreed upon by Executive, or his personal

representative,  and the Company.  Failing such  independent

certification  (if  so requested by Executive),  Executive's

termination  shall be deemed a termination  by  the  Company

without  Cause  and  not  a termination  by  reason  of  his

Disability.

 

        (c)  Termination  by the Company.  The  Company  may

terminate  Executive's employment during the  Term  with  or

without  Cause.   For  purposes of this  Agreement,  "Cause"

shall mean:

 

           (i)   failure or refusal by Executive to  perform

substantially  Executive's duties with  the  Company  (other

than  any  such  failure resulting from  incapacity  due  to

physical   or   mental  illness,  or  following  Executive's

delivery  of  notice  of termination for  Good  Reason,  and

specifically  excluding  any  failure  by  Executive,  after

reasonable efforts, to meet performance expectations) or  to

obey  a lawful directive from the Board consistent with  the

Executive's  duties and responsibilities,  after  a  written

demand for substantial performance is delivered to Executive

by  the Board which identifies the manner in which the Board

believes  that  Executive  has not  substantially  performed

Executive's duties or has failed or refused to obey a lawful

directive, or

 

           (ii)   engaging by Executive in illegal  conduct,

intentional misconduct, or gross misconduct which the  Board

(excluding  Executive) in its reasonable judgment determines

is  likely  to be injurious to the Company or its reputation

or to subject the Company to liability for damages, or

 

 

                             -4-

 

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           (iii)   conviction of Executive  (or  a  plea  of

guilty or nolo contendere by Executive to) a felony or other

crime involving moral turpitude.

 

   The  cessation of employment of Executive  shall  not  be

deemed  to  be for Cause unless and until there  shall  have

been  delivered  to  Executive a copy of a  resolution  duly

adopted  by the affirmative vote of not less than a majority

of  the  entire  membership  of the  Board  of  the  Company

(excluding  Executive,  if Executive  is  a  member  of  the

Board),  finding  that, in the good faith  opinion  of  such

Board,  Executive  is  guilty of the  conduct  described  in

subparagraph  (i), (ii), or (iii) above, and specifying  the

particulars  thereof  in  detail.   Such  finding  shall  be

effective to terminate Executive's employment for Cause only

if  Executive was provided reasonable notice of the proposed

action  and was given an opportunity, together with counsel,

to be heard by the Board.

 

        (d)  Termination  by Executive.   During  the  Term,

Executive's  employment may be terminated by  Executive  for

Good  Reason or no reason.  For purposes of this  Agreement,

unless  written  consent  of Executive  is  obtained,  "Good

Reason" shall mean:

 

           (i)   a  reduction by the Company in  Executive's

Base  Salary;  provided however, the  Company  may,  on  one

occasion, reduce Executive's Base Salary by an amount not to

exceed  15%  of the Base Salary then in effect without  such

reduction  constituting "Good Reason" under this  Agreement.

Such  reduced  salary  then shall  become  Executive's  Base

Salary  for  purposes of this Agreement, provided  that  the

Company  shall annually review the continuing necessity  for

such  reduction and will restore such amounts to Executive's

Base  Salary  when  the  Board, in  its  business  judgment,

determines it is prudent to do so;

 

           (ii)   any failure by the Company to comply  with

and satisfy 14(c) of this Agreement;

 

           (iii)  a  material reduction by  the  Company  of

Executive's  duties, responsibilities or authority  that  is

inconsistent  with Executive's position as  Chief  Operating

Officer; or

 

           (iv)  a  breach of this Agreement by the  Company

which is not cured in accordance herewith.

 

   Good  Reason  shall  not  include  Executive's  death  or

Disability;  provided that Executive's  mental  or  physical

incapacity following the occurrence of an event described in

clause  (i)  -  (  iv)  above shall not  affect  Executive's

ability  to  terminate for Good Reason.  In the  event  that

"Cause" exists under this Agreement and the Company acts  to

terminate Executive's employment for Cause, Executive  shall

not be entitled to exercise a termination for Good Reason or

to  receive  payments or benefits pursuant to Section  8  of

this  Agreement for termination for Good Reason.  Except  as

provided   in   Section   8(b)(1),   Executive's   continued

employment shall not constitute consent to, or a  waiver  of

rights  with respect to, any circumstance constituting  Good

Reason  hereunder.   Any claim of "Good Reason"  under  this

Agreement shall be communicated by Executive to the  Company

in  writing within 10 business days of his knowledge of  its

occurrence,  which writing shall specifically  identify  the

factual  details  concerning  all  events  giving  rise   to

Executive's  claim of Good Reason under this  Section  7(d).

No   general   description  of  unspecified   events   shall

constitute  proper notice of Good Reason or termination  for

Good  Reason.  The Company shall have an opportunity to cure

any  claimed event of Good Reason described in clause (i)  -

(iv) above within 30 days of such notice from Executive.

 

 

                             -5-

 

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        (e)  Notice of Termination.  Any termination by  the

Company for Cause, or by Executive for Good Reason, shall be

communicated  by  Notice of Termination to the  other  party

hereto  given  in  accordance with  Section  15(f)  of  this

Agreement.   For purposes of this Agreement,  a  "Notice  of

Termination" means a written notice which (i) indicates  the

specific  termination  provision in  this  Agreement  relied

upon,  (ii) to the extent applicable, sets forth  the  facts

and circumstances claimed to provide a basis for termination

of  Executive's employment under the provision so indicated,

and  (iii)  specifies the termination date.  The failure  by

Executive  or  the  Company to set forth in  the  Notice  of

Termination any fact or circumstance which contributes to  a

showing of Good Reason or Cause shall not waive any right of

Executive   or  the  Company,  respectively,  hereunder   or

preclude  Executive  or  the  Company,  respectively,   from

asserting such fact or circumstance in enforcing Executive's

or the Company's rights hereunder.

 

        (f)  Date  of  Termination.  "Date  of  Termination"

means  (i)  if Executive's employment is terminated  by  the

Company for Cause, or by Executive for Good Reason, the date

of  receipt of the Notice of Termination or a date within 15

days  after  receipt  of  the  Notice  of  Termination,   as

specified in such notice, (ii) if Executive's employment  is

terminated   by  the  Company  other  than  for   Cause   or

Disability,  the Date of Termination shall be  the  date  of

receipt  of  the Notice of Termination or a date  within  45

days  after  receipt  of  the  Notice  of  Termination,   as

specified in such notice, (iii) if Executive's employment is

terminated  by reason of death or Disability,  the  Date  of

Termination shall be the date of death of Executive  or  the

Disability Effective Date, as the case may be, and  (iv)  if

Executive's  employment is terminated by  Executive  without

Good  Reason,  the  Date of Termination  shall  be  30  days

following   the   Company's  receipt  of   the   Notice   of

Termination, unless the Company specifies an earlier Date of

Termination.

 

   8.  Obligations of the Company upon Termination.

 

         (a)   Benefits  Payable  on  All  Terminations   of

Employment.  The  following benefits  ("Standard  Benefits")

shall  be payable to the Executive, his estate or his  legal

representative (as the case may be) upon any termination  of

employment, whenever and however occurring:

 

            (i)  in  a  single lump sum, within thirty  (30)

days after the Date of Termination, cash payment in the  sum

of  the following amounts, to the extent not previously paid

to  Executive  (the "Accrued Obligations"): (1)  Executive's

Base  Salary through the Date of Termination, and (2) unless

Executive  has  a  later payout date  that  is  required  in

connection  with the terms of a deferral plan or  agreement,

any  vested  compensation previously deferred  by  Executive

(together with any amount equivalent to accrued interest  or

earnings thereon); and

 

            (ii)  to  the  extent  not theretofore  paid  or

provided,  the  Company  shall  timely  pay  or  provide  to

Executive  any  other amounts or benefits  accrued  for  the

benefit  of  Executive under any plan, program,  policy,  or

practice  of  the Company prior to the Date  of  Termination

(such  other  amounts  and  benefits  shall  be  hereinafter

referred to as the "Other Benefits").  With respect  to  the

provision of Other Benefits, the term Other Benefits as used

in  this  paragraph shall include, without  limitation,  and

Executive   or   his   estate,   beneficiaries,   or   legal

representatives,  as  applicable,  shall  be   entitled   to

receive, benefits under such plans, programs, practices, and

policies   relating  to  death,  disability,  or  retirement

benefits,  if  any, as are applicable to  Executive  or  his

family on the Date of Termination; and

 

            (iii)   if   Executive's  employment  shall   be

terminated for Cause, or if Executive voluntarily terminates

employment without Good Reason or decides not to extend  the

Term of this Agreement as contemplated in Section 3, this

 

 

                             -6-

 

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Agreement  shall  terminate without further  obligations  to

Executive, other than for payment of Accrued Obligations and

Other Benefits as provided in this Section.

 

        (b)    Additional    Termination   Benefits.    Upon

occurrence  of any Additional Benefit Event (as  defined  in

paragraph  (c)  below),  and in  addition  to  the  Standard

Benefits,  the  Executive  shall also  be  entitled  to  the

following:

 

            (i)  in  consideration of Executive's  execution

of  a Release and Agreement Not to Sue in substantially  the

form  of  Exhibit A hereto as such form may  be  amended  to

comply with applicable law at the time of execution of  such

Release  and Agreement Not to Sue (the "Release"),  payments

to  Executive over a 12-month period following the  Date  of

Termination equal to the annual Base Salary at the  Date  of

Termination,  payable in approximately  equal  bi-weekly  or

other  installments  as are or become  customary  under  the

Company's payroll practices for its employees from  time  to

time; and

 

            (ii)  the Company shall, at its expense, provide

for  a  12-month  period: (1) medical  and  dental  benefits

substantially similar in the aggregate to those provided  to

the  Executive  and  the Executive's dependents  immediately

prior to the Date of Termination, and (2) continued coverage

for  the  Executive under the Life Insurance Policy and  the

Disability  Policy;  provided,  however,  that  the  Company

obligations with respect to the foregoing benefits shall  be

reduced  to the extent that the Executive or the Executive's

dependents obtain any such benefits pursuant to a subsequent

employer's benefit plan.

 

        (c)   Additional  Benefit  Events.  The   Additional

Benefit Events are:

 

            (i)   termination   by  the   Company   of   the

Executive's employment within thirty-six (36) months of  the

Effective Date, without Cause (but excluding termination  on

death or for Disability);

 

            (ii)   the   Executive's  termination   of   his

employment  within thirty-six (36) months of  the  Effective

Date, for Good Reason;

 

            (iii)  the  Company's exercise of its  right  to

terminate further renewal of Executive's employment pursuant

to  Section  3, which results in the Term of this  Agreement

being less than thirty-six (36) months;

 

            (iv)  the  occurrence of any event described  in

paragraphs  (i)-(ii) at any time within twelve  (12)  months

following a Change of Control; or

 

            (v)   the  occurrence of any event described  in

paragraphs (i)-(iii) following a Change of Control but prior

to the third anniversary of the Effective Date.

 

          For  purposes  of  paragraphs  (i)  and  (ii),  an

Additional  Benefit Event will be deemed  to  have  occurred

when  the  underlying  event giving rise  to  the  right  of

termination  occurred,  without regard  to  when  Notice  of

Termination  was  delivered or the date on which  it  became

effective.  For purposes of paragraph (iii), if  Executive's

employment is terminated by the Company without Cause  prior

to  the  occurrence of a Change of Control  and  if  it  can

reasonably be shown that Executive's termination (1) was  at

the  direction  or request of a third party that  had  taken

steps  reasonably calculated to effect a Change  of  Control

after  such  termination,  or  (2)