Exhibit 10(g)
SEVERANCE PAY
AGREEMENT
THIS AGREEMENT dated as of
____________, between THE EMPIRE DISTRICT ELECTRIC COMPANY (the
“Company”), a Kansas corporation, having its principal
offices at 602 Joplin Street, Joplin, Missouri, and
___________________, residing at _______________________, (the
“Executive”),
WITNESSETH:
WHEREAS, the Company, by
action of its Board of Directors (the “Board”), has
adopted The Empire District Electric Company Change in Control
Severance Pay Plan (the “Plan”), under which the
Company intends to enter into Severance Pay Agreements with certain
key executive officers of the Company or its Subsidiaries;
and
WHEREAS, the Executive is
currently a duly elected and _____________________________ of The
Empire District Electric Company (herein referred to as the
“Employing Company”), and has been designated by the
Board as a key executive selected to participate in the Plan, and
with whom the Company has been authorized by the Board to enter
into this Agreement; and
WHEREAS, the Board has
deemed it imperative that the Company be assured of continuity of
management in the event of any actual or threatened Change in
Control of the Company; and
WHEREAS, the Company desires
to reward the Executive for the Executive’s valuable,
dedicated service to the Company and its Subsidiaries should the
Executive’s service be terminated under circumstances
hereinafter described,
NOW, THEREFORE, to assure
the Company of the Executive’s continued dedication and the
availability of the Executive’s advice and counsel in the
event of any such actual or threatened change in control, to induce
the Executive to remain in the Executive’s current position,
and to reward the Executive for the Executive’s valuable,
dedicated service to the Company and its Subsidiaries should the
Executive’s service be terminated under circumstances
hereinafter described, and for other good and valuable
consideration, the receipt and adequacy of which each party
acknowledges, the Company and the Executive agree as
follows:
1.
Term of Agreement . This Agreement shall commence on
the date hereof and shall continue in effect through
December 31, 2006; provided, however, that commencing on
January 1, 2007 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; and provided further that, if a
Change in Control of the Company shall have occurred during the
original or extended term of this Agreement, this Agreement shall
continue in effect for a period of twenty-four (24) months beyond
the month in which such
Change in Control occurred. All
capitalized terms used herein shall have the same meaning, unless
otherwise specified, as found in the Plan.
2.
Termination Following a Change in Control of the Company
.
(a)
If a Change in Control of the Company occurs during the term of
this Agreement, the Executive shall be entitled to (i) the
benefits provided in Subsections 3(a)(i), (b) and
(c) hereof upon the Executive’s subsequent Involuntary
Termination during the term of this Agreement, or (ii) the
benefits provided in Subsections 3(a)(ii), (b) and
(c) upon the Executive’s subsequent Voluntary
Termination during the term of this Agreement.
(b)
If the Executive’s employment shall be terminated following a
Change in Control other than pursuant to Section 2(a), the
Employing Company shall pay the Executive the Executive’s
full base salary through the Date of Termination at the rate in
effect at the time Notice of Termination is given and shall provide
any benefits to which the Executive may be entitled under any other
plan, programs and arrangements of the Company or Employing Company
and neither the Company nor the Employing Company shall have any
further obligations to the Executive under this Agreement.
Such base salary shall be paid in accordance with the Employing
Company’s normal payroll practices.
(c)
Any Involuntary Termination of the Executive by the Company or the
Employing Company, other than an Involuntary Termination at the
election of the Executive pursuant to the last paragraph of
Section 2.7 of the Plan, shall be communicated by written
Notice of Termination by the Company or by the Employing Company to
the Executive. Any Voluntary Termination by the Executive, or
Involuntary Termination at the election of the Executive pursuant
to the last paragraph of Section 2.7 of the Plan, shall be
communicated by written Notice of Termination by the Executive to
the Employing Company. For purposes of this Agreement, a
“Notice of Termination” shall mean a notice indicating
the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and
circumstances.
(d)
“Date of Termination” means the date specified in the
Notice of Termination, which shall be not more than ninety (90)
days after such Notice of Termination is given; provided, that if
within thirty (30) days after any Notice of Termination is given
the party receiving such Notice of Termination notifies the other
party that a dispute exists concerning the Termination, the Date of
Termination shall be the Date on which the dispute is finally
resolved.
3.
Compensation Upon Involuntary Termination or Voluntary
Termination .
(a)
If the Executive shall incur an Involuntary Termination or
Voluntary Termination, then:
(i)
In the event of the Executive’s Involuntary Termination,
within thirty (30) days following the Executive’s Date of
Termination, the Company will pay, or cause the Employing Company
to pay, to the Executive as compensation for services rendered to
the Company and its Subsidiaries, a lump sum cash amount (subject
to any applicable payroll or other taxes required by law to be
withheld). Such cash amount shall be equal to the
Executive’s Compensation as defined in Section 3.1 of
the Plan, multiplied by 36;
provided, however, that such
payment shall be reduced by the amount paid to the Executive
pursuant to any other severance pay policy of the Company and its
Subsidiaries. The number of months represented by such
multiple shall be considered the “Incremental Period”
for purposes of this Agreement.
(ii)
In the event the Executive elects a Voluntary Termination, within
thirty (30) days following the Executive’s Date of
Termination, the Company will pay, or cause the Employing Company
to pay, to the Executive as compensation for services rendered to
the Company and its Subsidiaries, a lump sum cash amount (subject
to any applicable payroll or other taxes required by law to be
withheld). Such cash amount shall be equal to the Executive’s
Compensation as defined in Section 3.1 of the Plan, multiplied
by 36; provided, however, that such payments shall be reduced by
the amount paid to the Executive pursuant to any other severance
pay policy of the Company and its Subsidiaries.
Notwithstanding the foregoing, in the event the Executive receives
a lump sum payment pursuant to this Section 3(a)(ii) and
becomes otherwise employed before the end of the Incremental
Period, including self-employment in a trade of business in which
personal services of the Executive are a material income-producing
factor, the Executive shall, within thirty (30) days after becoming
so employed, notify the Secretary of the Company of such employment
and pay to the Company an amount equal to the lump sum payment the
Executive had received pursuant to this
Section 3(a)(ii) multiplied by a fraction (i) the
numerator of which is the number of days during the period
beginning on the day on which the Executive becomes so employed and
ending on the last day of the Incremental Period and (ii) the
denominator of which is the number of days in the entire
Incremental Period.
(iii)
If any payment or benefit received by or in respect of the
Executive under the Plan or any other plan, arrangement or
agreement with the Company or any of its Subsidiaries (determined
without regard to any additional payments required under this
Subsection (a)(iii) and Appendix A of the Plan) (a
“Payment”) would be subject to the excise tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as
amended (the “Code”) (or any similar tax that may
hereafter be imposed) or any interest or penalties are incurred by
the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, being hereinafter
collectively referred to as the “Excise Tax”), the
Company shall pay to the Executive with respect to such Payment at
the time specified in Appendix A of the Plan an additional amount
(the “Gross-up Payment”) such that the net amount
retained by the Executive from the Payment and the Gross-up
Payment, after reduction for any Excise Tax upon the Payment and
any Federal, state and local income and employment tax and Excise
Tax upon the Gross-up Payment, shall be equal to the Payment.
The calculation and payment of the Gross-up Payment shall be
subject to the provisions of Appendix A of the
Plan.
(b)
Special Retirement Benefits . In addition to any other
benefits the Executive may be legally entitled by contract or
pursuant to any plan, program or arrangement, the Executive will be
eligible to receive “Special Retirement Benefits” as
provided herein, on a monthly basis, so that the total
retir
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