Change of Control Agreement with Dawn D. Bugbee dated April 3, 2006


    EXHIBIT
      10.1

    


    


    


    


    


    PERSONAL
      AND CONFIDENTIAL

    


    April
      3,
      2006

    


    Dawn
      D.
      Bugbee

    Chief
      Financial Officer

    Green
      Mountain Power Corporation

    163
      Acorn
      Lane

    Colchester,
      VT 05446

    


    Dear
      Dawn:

    


    Green
      Mountain Power Corporation (the “Company”) considers it essential to the best
      interests of its shareholders to foster the continuous employment of key
      management personnel. In addition, the Board of Directors of the Company (the
      “Board”) recognizes that the possibility of a change of control of the Company
      may exist and the uncertainty and questions which it may raise among management
      may result in the distraction or departure of management personnel to the
      detriment of the Company and its shareholders.

    


    The
      Board
      has determined that appropriate steps should be taken to reinforce and encourage
      the continued attention and dedication of members of the Company’s management,
      including yourself, to their assigned duties without distraction in the face
      of
      the possibility of a change in control of the Company, although no such change
      is known to be contemplated.

    


    In
      order
      to induce you to remain in the employ of the Company and in consideration of
      your agreements set forth in subsections 4(ii), 6(ix), 6(x) and 6(xi) hereof,
      the Company agrees that you shall receive the severance benefits set forth
      in
      this Agreement in the event your employment with the Company is terminated
      subsequent to a “change in control of the Company” (as defined in section 4
      hereof and hereinafter a “Change of Control”) under the circumstances described
      below.

    


    1. Term
      of Agreement.
      This
      Agreement shall commence on April 3, 2006 (the “Effective Date”) 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.

    


    2. Terms
      of Employment Before a Change of Control.
      Prior
      to a Change of Control, your terms of employment (“Terms of Employment”) shall
      be as follows:

    


    (a) General
      duties. Excluding periods of vacation and sick leave to which you are entitled,
      you will continue to exercise such authority and perform such executive duties
      as are commensurate with the authority being exercised and duties being
      performed by you immediately before the Effective Date.

    


    (b) Place
      of
      employment. Your services will be performed at the location where you were
      employed immediately before the Effective Date. If the Company and you agree,
      however, the location of your employment may be changed without affecting your
      rights under this Agreement.

    


    (c) Expenses
      generally. You are entitled to receive prompt reimbursement for all reasonable
      expenses you incur. Reimbursement must be made in accordance with the Company’s
      policies and procedures in effect on the Effective Date (which may include
      a
      requirement that you submit an itemized expense voucher).

    


    (d) Meetings,
      conventions, and seminars. You are encouraged and are expected to attend
      seminars, professional meetings and conventions, and educational courses. The
      cost of travel, tuition or registration, food, and lodging for attending those
      activities must be paid by the Company. Other costs are your expense, unless
      the
      Company authorizes those costs. If those other costs are authorized expenses,
      you must be reimbursed after satisfying the Company’s policies and procedures
      for such reimbursement (which may include a requirement that you submit an
      itemized expense voucher).

    


    (e) Promotional
      expenses. You are encouraged and are expected, from time to time, to incur
      reasonable expenses for promoting the Company’s business. Such promotional
      expenses include travel, entertainment (including memberships in social and
      athletic clubs), professional advancement, and community service expenses.
      You
      agree to bear those expenses except to the extent that those expenses are
      incurred at the Company’s specific direction or those expenses are specifically
      authorized by the Company as expenses that the Company may pay directly or
      indirectly through reimbursement to you.

    


    (f) Outside
      activities. You may (i) serve on corporate, civic, or charitable boards or
      committees; (ii) deliver lectures, fulfill speaking engagements, or teach at
      educational institutions; and (iii) manage personal investments. Such activities
      must not significantly interfere with the performance of your responsibilities
      for the Company. To the extent that any such activities have been conducted
      by
      you before the Effective Date, such prior conduct of activities and any
      subsequent conduct of activities similar in nature and scope may not be deemed
      to interfere with the performance of your responsibilities to the
      Company.

    


    (g) Compensation
      and fringe benefits. Your compensation (including your annual base salary and
      any bonuses or incentive compensation) and benefits generally are the same
      as
      those in effect on the Effective Date. Your compensation and benefits are,
      however, subject to periodic review and adjustment by the Company. This section
      of this Agreement does not change the terms of any fringe benefit program or
      employee benefit plan maintained by the Company and does not give you any
      additional vested interest in any compensation or benefit to which you are
      not
      already entitled under any such program or plan on the Effective Date.
      Generally, your benefits include the following items, all of which are subject
      to periodic review and adjustment: (i) You are entitled to receive all group
      life, accidental death and dismemberment, long-term disability, and medical
      insurance benefits available to you according to Company policies and employee
      benefit plans maintained by the Company that are in effect on the Effective
      Date; (ii) You are entitled to paid vacation in accordance with the
      Company’s policies in effect on the Effective Date; (iii) You are entitled to
      sick leave in accordance with the Company’s policies in effect on the Effective
      Date; and (iv) You are entitled to participate in all employee benefit plans
      and
      programs in which you participate on the Effective Date, whether or not such
      plans or programs are subject to the Employee Retirement Income Act of 1974,
      as
      amended (“ERISA”), including but not limited to the Company’s Retirement Plan,
      Supplemental Retirement Plan or any successor plans thereto, any incentive
      compensation plans maintained by the Company or any successor thereto, the
      Company’s Deferred Compensation Plan for Certain Officers and any stock-based
      compensation plans maintained by the Company or successor plans thereto and
      any
      savings or thrift plan maintained by the Company, 

    


    3. Extension
      of Agreement Upon Change of Control.
      If a
      Change of Control shall have occurred during the original or extended term
      of
      this Agreement, this Agreement shall continue in effect for a period of at
      least
      thirty-six (36) months beyond the month in which such Change of Control
      occurred. The Terms of Employment set forth in section 2 continue in effect
      after a Change of Control and may not be changed to terms and conditions less
      favorable than those in effect on the day immediately preceding a Change of
      Control. 

    


    4. Change
      of Control.
      

    (i) No
      benefits shall be payable hereunder unless there shall have been a Change of
      Control, as set forth below. For purposes of this Agreement, a Change of Control
      shall be deemed to have occurred if (A) any “person” (as such term is used in
      sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended
      (the
“Exchange Act”)), other than a trustee or other fiduciary holding securities
      under an employee benefit plan of the Company or a corporation owned, directly
      or indirectly, by the shareholders of the Company in substantially the same
      proportions as their ownership of stock of the Company, is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
      or indirectly, of securities of the Company representing 20% or more of the
      combined voting power of the Company’s then outstanding securities (a “20%
      Holder”); or (B) during any period of two consecutive years (not including any
      period prior to the execution of this Agreement), individuals who at the
      beginning of such period constitute the Board of Directors of the Company (the
      “Board”) and any new director (other than a director designated by a person who
      has entered into an agreement with the Company to effect a transaction described
      in clauses (A) or (C) of this subsection) whose election by the Board or
      nomination for election by the Company’s shareholders was approved by a vote of
      at least two-thirds (2/3) of the directors then still in office who either
      were
      directors at the beginning of the period or whose election or nomination for
      election was previously so approved, cease for any reason to constitute a
      majority of the directors of the Company; or (C) the shareholders of the Company
      approve a merger or consolidation of the Company with any other corporation,
      other than a merger or consolidation which would result in the voting securities
      of the Company outstanding immediately prior thereto continuing to represent
      (either by remaining outstanding or by being converted into voting securities
      of
      the surviving entity) at least 80% of the combined voting power of the voting
      securities of the Company or such surviving entity outstanding immediately
      after
      such merger or consolidation, or the shareholders of the Company approve a
      plan
      of complete liquidation of the Company or an agreement for the sale or
      disposition by the Company of all or substantially all the Company’s assets;
      provided, however, that a Change of Control shall not be deemed to have occurred
      under clauses (A) or (C) above if a majority of the Continuing Directors (as
      defined below) determine within five business days after the occurrence of
      any
      event specified in clauses (A) or (C) above that control of the Company has
      not
      in fact changed and it is reasonably expected that such control of the Company
      in fact will not change. Notwithstanding that, in the case of clause (A) above,
      the Board shall have made a determination of the nature described in the
      preceding sentence, if there shall thereafter occur any material change in
      facts
      involving, or relating to, the 20% Holder or to the 20% Holder’s relationship to
      the Company, including, without limitation, the acquisition by the 20% Holder
      of
      l% or more additional outstanding voting stock of the Company, the occurrence
      of
      such material change in facts shall result in a new Change of Control for the
      purpose of this Agreement. In such event, the second immediately preceding
      sentence hereof shall be effective. As used herein, the term “Continuing
      Director” shall mean any member of the Board on the date of this Agreement and
      any successor of a Continuing Director who is recommended to succeed the
      Continuing Director by a majority of Continuing Directors. If, following a
      Change of Control, you are the beneficial owner of two percent or more of the
      then-outstanding equity securities of the Company, or its successor in interest,
      a majority of the Continuing Directors may elect, within five business days
      after such Change of Control, to terminate any benefits payable to you under
      this Agreement after the date of such an election by the Continuing
      Directors.

    


    (ii) For
      purposes of this Agreement, a “Potential Change of Control” shall be deemed to
      have occurred if (A) the Company enters into an agreement, the consummation
      of
      which would result in the occurrence of a Change of Control; (B) any person
      (including the Company) publicly announces an intention to take or to consider
      taking actions which if consummated would constitute a Change of Control; (C)
      any person, other than a trustee or other fiduciary holding securities under
      an
      employee benefit plan of the Company or a corporation owned, directly or
      indirectly, by the shareholders of the Company in substantially the same
      proportion as their ownership of stock of the Company, becomes the beneficial
      owner, directly or indirectly, of securities of the Company representing 5%
      or
      more of the combined voting power of the Company’s then outstanding securities;
      or (D) the Board adopts a resolution to the effect that, for purposes of this
      Agreement, a Potential Change of Control has occurred. You agree that, subject
      to the terms and conditions of this Agreement, in the event of a Potential
      Change of Control, you will remain in the employ of the Company until the
      earliest of (i) a date which is six (6) months from the occurrence of such
      Potential Change of Control, (ii) the termination by you of your employment
      by
      reason of Long-Term Disability or Retirement (at your normal retirement age),
      as
      defined in subsection 5(i), or (iii) the occurrence of a Change of
      Control.

    


    5. Termination
      Following Change of Control.
      If any
      of the events described in subsection 4(i) hereof constituting a Change of
      Control shall have occurred, you shall be entitled to the benefits provided
      in
      subsection 6(iii) hereof upon the subsequent termination of your employment
      during the term of this Agreement unless such termination is (A) because of
      your
      death, Long-Term Disability or Retirement, (B) by the Company for Cause, or
      (C)
      by you other than for Good Reason.

    


    (i) Death,
      Long-Term Disability, or Retirement. If, as a result of your incapacity due
      to
      physical or mental illness which is determined to be total and permanent and
      to
      prevent you from performing, with or without reasonable accommodation, the
      essential functions of your employment by a physician and any other consultants
      selected by the Company or its insurers and acceptable to you or your legal
      representative, you shall have been absent from the full-time performance of
      your duties with the Company for six (6) consecutive months, and within thirty
      (30) days after written notice of termination is given you shall not have
      returned to the full-time performance of your duties, your employment may be
      terminated for “Long-Term Disability”. Termination by the Company or you of your
      employment based on “Retirement” shall mean termination in accordance with the
      Company’s retirement policy, including early retirement, generally applicable to
      its salaried employees or in accordance with any retirement arrangement
      established with your consent with respect to you. Your death (“Death”) during
      the term of this Agreement will terminate the Agreement.

    


    (ii) Cause.
      Termination by the Company of your employment for “Cause” shall mean termination
      upon (A) the willful and continued failure by you to substantially perform
      your
      duties with the Company (other than any such failure resulting from your
      incapacity due to physical or mental illness or any such actual or anticipated
      failure after the issuance of a Notice of Termination, by you for Good Reason,
      as defined in subsection 5(iii)) after a written demand for substantial
      performance is delivered to you by the Board, which demand specifically
      identifies the manner in which the Board believes that you have not
      substantially performed your duties, (B) the willful engaging by you in conduct
      which is demonstrably and materially injurious to the Company, monetarily or
      otherwise, or (C) your willful and continued breach of a material term of this
      Agreement. For purposes of this subsection, no act, or failure to act, on your
      part shall be deemed “willful” unless done, or omitted to be done, by you not in
      good faith and without reasonable belief that your action or omission was in
      the
      best interest of the Company. Notwithstanding the foregoing, you shall not
      be
      deemed to have been terminated for Cause unless and until there shall have
      been
      delivered to you a copy of a resolution duly adopted by the affirmative vote
      of
      not less than three-quarters (3/4) of the entire membership of the Board at
      a
      meeting of the Board called and held for such purpose (after reasonable notice
      to you and an opportunity for you, together with your counsel, to be heard
      before the Board), finding that in the good faith opinion of the Board you
      were
      guilty of conduct set forth above in clauses (A), (B), or (C) of the first
      sentence of this subsection and specifying the particulars thereof in
      detail.

    


    (iii) Good
      Reason. You shall be entitled to terminate your employment for Good Reason.
      For
      purposes of this Agreement, “Good Reason” shall mean, without your express
      written consent, the occurrence after a Change of Control of any of the
      following circumstances unless, in the case of paragraphs (A), (E), (F), (G),
      (H) or (I), such circumstances are fully corrected prior to the Date of
      Termination specified in the Notice of Termination, as defined in Subsections
      6(iv) and 6(v), respectively, given in respect thereof:

    


    (A) the
      assignment to you of any duties inconsistent with your status as Chief Financial
      Officer of Green Mountain Power Corporation or a substantial adverse alteration
      in the nature or status of your responsibilities from those in effect
      immediately prior to the Change of Control; 

    


    (B) a
      reduction by the Company in your annual base salary as in effect on the date
      hereof or as the same may be increased from time-to-time except for
      across-the-board salary reductions similarly affecting all executives of the
      Company and all executives of any person in control of the Company;

    


    (C) the
      relocation of the Company’s principal executive offices (presently located at
      163 Acorn Lane, Colchester, Vermont) to a location more than fifty miles distant
      from the present location prior to the Change of Control, or the closing
      thereof, or the Company’s requiring you to be based anywhere other than within
      fifty miles of the present location, except for required travel on the Company’s
      business to an extent substantially consistent with your present business travel
      obligations;

    


    (D) the
      failure by the Company, without your consent, to pay to you any portion of
      your
      current compensation except pursuant to an across-the-board compensation
      deferral similarly affecting all executives of the Company and all executives
      of
      any person in control of the Company;

    


    (E) the
      failure by the Company to offer you any compensation plan introduced to other
      executives of similar responsibility or any substitute plans adopted prior
      to
      the Change of Control, unless an equitable arrangement (embodied in an ongoing
      substitute or alternative plan) has been made with respect to such plan; or
      the
      failure by the Company to continue your participation in any such compensation
      plan (or in such substitute or alternative plan) on a basis not materially
      less
      favorable, both in terms of the amount of benefits provided and the level of
      your participation relative to other participants, as existed at the time of
      the
      Change of Control;

    


    (F)
        the
      failure by the Company to continue to provide you with the benefits
      substantially similar to those enjoyed by you under any of the following plans
      or programs maintained by the Company at the time of a Change of Control or
      the
      taking of any action which would directly or indirectly materially reduce any
      of
      such benefits, including but not limited to: (i) fringe benefits, in accordance
      with the Company’s policies in effect at the time of a Change of Control; (ii)
      group life, accidental death and dismemberment, long-term disability, and
      medical and dental insurance benefits available to you according to Company
      policies and employee benefit plans maintained by the Company that are in effect
      at the time of a Change of Control; (iii) paid vacation in accordance with
      your agreements with the Company’s and/or the Company’s policies in effect at
      the time of a Change of Control; (iv) sick leave in accordance with the
      Company’s policies in effect at the time of a Change of Control; and (v) the
      Company’s Retirement and Supplemental Retirement Plans or any successors
      thereto, any incentive compensation plans maintained by the Company or any
      successor thereto, the Company’s Deferred Compensation Plan for Certain
      Officers, any stock-based compensation plans maintained by the Company or
      successor plans thereto, any savings or thrift plan maintained by the Company,
      whether or not such plans or programs are subject to ERISA;

    


    (G)
        any
      action by the Company that eliminates, materially reduces or jeopardizes the
      ability of the Company to fulfill its obligations under the Company’s Deferred
      Compensation or Supplemental Retirement Plan, or both such plans, including
      by
      way of example and not of limitation, the sale or other disposition of assets
      of
      the Company, and all, or substantially all, of the proceeds from such sale
      or
      other disposition do not remain with the Company;

    


    (H)
        the
      failure of the Company to obtain a satisfactory agreement from any successor
      company to assume and agree to perform this Agreement, as contemplated in
      section 7 hereof;

    


    (I)
        any
      purported termination of your employment which is not effected pursuant to
      a
      Notice of Termination satisfying the requirements of subsection (iv) below
      (and
      if applicable, the requirements of subsection (ii) above); for purposes of
      this
      Agreement, no such purported termination shall be effective; or

    


    (J)
        your
      resignation, if tendered during the thirty days immediately following the first
      twelve months after a Change of Control; provided, however, that, if the Change
      of Control occurs pursuant to subsection 4(i)(C), your resignation must be
      tendered during the thirty days immediately following the first twelve months
      after the date the Company merges or consolidates with the corporation approved
      by the shareholders pursuant to subsection 4(i)(C) of this
      Agreement.

    


    Your
      right to terminate your employment pursuant to this subsection shall not be
      affected by your incapacity due to physical or mental illness. Your continued
      employment shall not constitute consent to, or a waiver of rights with respect
      to, any circumstance constituting Good Reason hereunder. For purposes of this
      subsection, any good faith determination of Good Reason made by you shall be
      conclusive.

    


    (iv) Notice
      of
      Termination. Any purported termination of your employment by the Company or
      by
      you shall be communicated by written Notice of Termination to the other party
      hereto in accordance with section 9 hereof. For purposes of this Agreement,
      a
“Notice of Termination” shall mean a notice which shall indicate the specific
      termination provision in this Agreement relied upon and shall set forth in
      reasonable detail the facts and circumstances claimed to provide a basis for
      termination of your employment under the provision so indicated.

    


    (v) Date
      of
      Termination. “Date of Termination” shall mean (A) if your employment is
      terminated for Long-Term Disability, thirty (30) days after Notice of
      Termination is given (provided that you shall not have returned to the full-time
      performance of your duties during such thirty (30) day period), and (B) if
      your
      employment is terminated pursuant to subsection (ii) or (iii) above or for
      any
      other reason (other than Long-Term Disability), the date specified in the Notice
      of Termination (which, in the case of a termination pursuant to subsection
      (ii)
      above shall not be less than thirty (30) days, and in the case of a termination
      pursuant to subsection (iii) above shall not be less than fifteen (15) nor
      more
      than sixty (60) days, respectively, from the date such Notice of Termination
      is
      given); provided that if within fifteen (15) days after any Notice of
      Termination (as determined without regard to this provision), 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 determined, either by mutual written agreement
      of
      the parties, by a binding arbitration award, or by a final judgment, order
      or
      decree of a court of competent jurisdiction (which is not appealable or with
      respect to which the time for appeal therefrom has expired and no appeal has
      been perfected); provided further that the Date of Termination shall be extended
      by a notice of dispute only if such notice is given in good faith and the party
      giving such notice pursues the resolution of such dispute with reasonable
      diligence. Notwithstanding the pendency of any such dispute, the Company will
      continue to pay you your full compensation in effect when the notice giving
      rise
      to the dispute was given (including, but not limited to, base salary) and
      continue you as a participant in all compensation, benefit and insurance plans
      in which you were participating when the notice giving rise to the dispute
      was
      given, until the dispute is finally resolved in accordance with this subsection.
      Amounts paid under this subsection are in addition to all other amounts due
      under this Agreement and shall not be offset against or reduce any other amounts
      due under this Agreement.

    


    6. Compensation
      Upon Termination or During Short-Term Disability.
      Following a Change of Control, as defined by subsection 4(i), upon termination
      of your employment or during a period of Short-Term Disability you shall be
      entitled to the following benefits:

    


    (i) During
      any period that you fail to perform your full-time duties with the Company
      as a
      result of incapacity due to physical or mental illness (hereinafter “Short-Term
      Disability”) you shall continue to receive your base salary at the rate in
      effect at the commencement of the Short-Term Disability, together with all
      compensation and benefits payable or available to you and your family under
      any
      other plan in effect during such period, until this Agreement is terminated
      pursuant to subsection 5(i) hereof. Thereafter, or in the event your employment
      shall be terminated by the Company or by you for Long-Term Disability,
      Retirement, or by reason of your Death, your benefits and your family’s or
      heirs’ benefits, if applicable, shall be determined under the Company’s
      retirement, insurance and other compensation programs with respect to other
      peer
      executives and their families as in effect on the Date of Termination, or if
      more favorable to you, your family or your heirs, as in effect during the
      120-day period immediately preceding a Change of Control, in accordance with
      the
      terms of such programs. You, or, if applicable, your heirs or estate, shall
      also
      receive your full base salary through the Date of Termination at the rate in
      effect at the time Notice of Termination is given. 

    


    (ii) If
      your
      employment shall be terminated by the Company for Cause or by you other than
      for
      Good Reason, Long-Term Disability, Death or Retirement, the Company shall pay
      you your full base salary through the Date of Termination at the rate in effect
      at the time Notice of Termination is given, plus all other amounts to which
      you
      are entitled under any compensation or benefit plan of the Company at the time
      such payments are due, and the Company shall have no further obligations to
      you
      under this Agreement.

    


    (iii) If
      your
      employment by the Company shall be terminated (a) by the Company other than
      for
      Cause, Retirement, Death or Long-Term Disability or (b) by you for Good Reason,
      then you shall be entitled to the benefits provided below:

    


    (A) The
      Company shall pay you the following: the sum of (1) your full base salary
      through the Date of Termination to the extent not theretofore paid, (2) the
      product of (x) the higher of (I) your most recent annual bonus or variable
      compensation award and (II) the annual bonus or variable compensation award
      paid
      or payable, including any bonus or portion thereof which has been earned but
      deferred (and annualized for any fiscal year consisting of less than twelve
      full
      months or during which you were employed for less than twelve full months),
      for
      the most recently completed fiscal year since the Change of Control, if any,
      and
      (y) a fraction, the numerator of which is the number of days in the current
      fiscal year through the Date of Termination, and the denominator of which is
      365
      and (3) any accrued vacation or sick pay, in each case to the extent not
      theretofore paid;

    


    (B) In
      lieu
      of any further salary payments to you for periods subsequent to the Date of
      Termination, the Company shall pay as severance pay to you a lump sum severance
      payment (the "Severance Payment") equal to 2.0 times the sum of your base salary
      for the year in which your Date of Termination occurs plus the target short-term
      incentive bonus (or
      if
      there is no target short-term incentive bonus payable for such year, the actual
      amount of your most recent short-term incentive bonus)
      that
      would be payable for such year.

    


    (C) The
      Company shall pay to you all legal fees and expenses incurred by you as a result
      of such termination (including all such fees and expenses, if any, incurred
      in
      contesting or disputing any such termination or in seeking to obtain or enforce
      any right or benefit provided by this Agreement or in connection with any tax
      audit or proceeding to the extent attributable to the application of section
      4999 of the Code to any payment or benefit provided hereunder), such payment
      to
      be made at the later of the times provided in paragraph (D), below or within
      five (5) days after your request for payment accompanied with such evidence
      of
      fees and expenses incurred as the Company reasonably may require.

    


    (D) The
      payments provided for in paragraphs (B) and (C) above, shall (except as
      otherwise provided therein) be made not later than the fifth day following
      the
      Date of Termination, provided, however, that if the amounts of such payments
      cannot be finally determined on or before such day, the Company shall pay to
      you
      on such day an estimate, as determined in good faith by the Company, of the
      minimum amount of such payments and shall pay the remainder of such payments
      (together with interest at the rate provided in section 1274(b)(2)(B) of the
      Code) as soon as the amount thereof can be determined but in no event later
      than
      the thirtieth day after the Date of Termination. In the event that the amount
      of
      the estimated payments exceeds the amount subsequently determined to have been
      due, such excess shall constitute a loan by the Company to you, payable on
      the
      fifth day after demand by the Company (together with interest at the rate
      provided in section 1274(b)(2)(B) of the Code).

    


    (iv) If
      your
      employment shall be terminated (A) by the Company other than for Cause,
      Retirement or Disability or (B) by you for Good Reason, then for a thirty-six
      (36) month period after such termination, the Company shall provide you and
      your
      family at Company expense with group life, disability, medical and dental
      insurance benefits substantially similar to those which you and your family
      are
      receiving immediately prior to the Notice of Termination. The Company shall
      pay
      any applicable premiums on behalf of you and your family for continuation of
      medical coverage under the Consolidated Omnibus Budget Reconciliation Act of
      1985, as amended (“COBRA”). Benefits otherwise receivable by you and your family
      pursuant to this subsection 6(iv) shall be reduced to the extent comparable
      benefits are actually received by you and your family during the thirty-six
      (36)
      month period following your termination, and any such benefits actually received
      by you and your family shall be reported to the Company. 

    


    (v) If
      your
      employment shall be terminated (A) by the Company other than for Cause,
      Retirement or Long-Term Disability or (B) by you for Good Reason, then in
      addition to the retirement benefits to which you are entitled under the
      Company’s Retirement Plan and Supplemental Retirement Plan or any successor
      plans thereto, the Company shall pay you in cash at the time and in the manner
      provided in paragraph (D) of subsection 6(iii), a lump sum equal to the
      actuarial equivalent of the excess of (x) the retirement pension (determined
      as
      a straight life annuity commencing at age sixty-five) which you would have
      accrued under the terms of the Company’s Retirement Plan without regard to any
      amendment to the Company’s Retirement Plan made subsequent to a Change of
      Control and on or prior to the Date of Termination, which amendment adversely
      affects in any manner the computation of retirement benefits thereunder,
      determined as if you were fully vested thereunder and had accumulated (after
      the
      Date of Termination) thirty-six (36) additional months of service credit
      thereunder at your highest annual rate of compensation during the twelve (12)
      months immediately preceding the Date of Termination over (y) the retirement
      pension (determined as a straight life annuity commencing at age sixty-five)
      which you had then accrued pursuant to the provisions of the Company’s
      Retirement Plan. For the purposes of this subsection, “actuarial equivalent”
shall be determined using the same methods and assumptions utilized under the
      Company’s Retirement Plan immediately prior to the Change of
      Control.

    


    (vi) The
      Company shall, at its sole expense as incurred, provide you with outplacement
      services the scope and provider of which shall be selected by you in your sole
      discretion. The Company shall be required to provide you with outplacement
      services for a reasonable period of time and at a reasonable cost.

    


    	(vii)  	
            Offsets
              Against Severance Payment. 

          


    


    (A) The
      Severance Payment to which you are entitled under this Agreement may be reduced
      under this subsection, but not below zero. Reductions in the Severance Payment
      must be made under this subsection in the manner herein described. The Company
      must make any required determination or calculation in good faith.

    


    (B) You
      are
      not required to seek or accept any employment that is not Comparable Employment.
      If you obtain any employment during the months remaining in your employment
      period after the Date of Termination, the Severance Payment must be reduced
      by
      all amounts actually earned by you from such employment during those months;
      except that no such reduction may be made because of earnings from employment
      in
      which you could have engaged while you were employed by the Company. For
      example, the Severance Payment may not be reduced because of your fees for
      service as a director of a corporation other than the Company or your earnings
      from part-time employment or from any other employment that would not have
      impaired your ability to perform the duties described in section 2 of this
      Agreement.

    


    (C) During
      the months remaining in your employment period after the Date of Termination
      and
      unless you are then eligible to retire under the Company’s Retirement Plan, you
      must seek and accept any Comparable Employment that is offered to you. If the
      Company establishes that Comparable Employment was offered to you and that
      you
      did not accept it, the full amount of wages that you could have earned from
      Comparable Employment reduces the Severance Payment to which you are entitled
      under this Agreement.

    


    (D) For
      purposes of this Agreement, Comparable Employment means employment that entitles
      you to the same (or higher) total compensation (including employment related
      benefits) to which you were entitled immediately prior to a Change of Control
      and to similar status, title(s), office(s), and management responsibilities;
      employment with a general character and grade similar to the general character
      and grade of your former employment with the Company; and employment suited
      to
      your education, training, and experience. For purposes of the Agreement,
      employment is not Comparable Employment if such employment is located more
      than
      forty miles from the location at which you are based on the Date of Termination;
      is short-term or temporary employment; entitles you to total compensation that
      is less than the total compensation (including employment related benefits)
      to
      which you were entitled immediately prior to a Change of Control; requires
      you
      to take serious bodily or financial risks; entitles you to a lower status,
      title(s), office(s), and management responsibilities; or would not have impaired
      your ability to perform the duties described in section 2 of this
      Agreement.

    


    (E) To
      prevent hardship, repayment of the Severance Payment under this section may
      be
      made by you in installments, determined in the Company’s sole discretion, but a
      repayment arrangement may not be used as a disguised loan.

    


    (viii) In
      addition to all other amounts payable to you under this section 6, you shall
      be
      entitled to receive all benefits payable to you under the Company’s Retirement
      Plan, Savings and Thrift Plan, Supplemental Retirement Plan and any other plan
      or agreement relating to retirement benefits. 

    


    (ix) Subject
      to the Company satisfying its obligations described in this Section 6, you
      agree
      that for twelve (12) months following receipt of your Severance Payment, you
      will not, without prior written consent of the Company: (A) personally engage
      in
      Competitive Activities (as defined below); or (B) work for, own, manage,
      operate, control, or participate in the ownership, management, operation, or
      control of, or provide consulting or advisory services to or permit your name
      to
      be used in connection with, any individual, partnership, firm, corporation,
      or
      institution engaged in Competitive Activities, or any company or person
      affiliated with such person or entity engaged in Competitive Activities;
      provided that your purchase or holding, for investment purposes, of securities
      of a publicly-traded company shall not constitute "ownership" or "participation
      in ownership" for purposes of this paragraph so long as your equity interest
      in
      any such company is less than five percent (5%).

    


    (x) For
      purposes of this Agreement, "Competitive Activities" means business activities
      in New England which are the same or similar or competitive with those engaged
      in by the Company and its subsidiaries and affiliates (and, for any period
      while
      you are an employee of the Company those subsidiaries, affiliates and businesses
      of the Company that cease to be affiliates, subsidiaries or businesses of the
      Company while you are an employee of the Company) or which relate to products
      or
      services of the same or similar type as the products or services (i) which
      are
      sold (or, pursuant to an existing business plan, will be sold) to customers
      of the Company and its subsidiaries or affiliates, (and, for any period
      while you are an employee of the Company, those subsidiaries, affiliates and
      businesses of the Company that cease to be affiliates, subsidiaries or
      businesses of the Company while you are an employee of the Company) and (ii)
      for
      which you then have responsibility to plan, develop, manage, market, or oversee,
      or had any such responsibility within your most recent twelve (12) months of
      employment with the Company. 

    


    (xi) Subject
      to the Company satisfying its obligations described in this Section 6, you
      agree
      that for twelve (12) months following receipt of your Severance Payment, you
      will not, without the written consent of the Company: (A) recruit or solicit
      any
      employee of the Company or its subsidiaries or affiliates for employment or
      for
      retention as a consultant or service provider; (B) hire or participate (with
      another company or third party) in the process of hiring any person who is
      then
      an employee of the Company or its subsidiaries or affiliates, or provide names
      or other information about Company employees or employees of the Company's
      subsidiaries or affiliates to any person or business under circumstances which
      could lead to the use of that information for purposes of recruiting or hiring;
      (C) interfere with the relationship of the Company or its subsidiaries or
      affiliates with any of its employees, agents, or representatives; (D) solicit
      or
      induce, or in any manner attempt to solicit or induce, any client, customer,
      or
      prospect of the Company or its subsidiaries or affiliates (1) to cease being,
      or
      not to become, a customer of the Company or its subsidiaries or affiliates,
      or
      (2) to divert any business of such customer or prospect from the Company or
      its
      subsidiaries or affiliates; (E) otherwise interfere with, disrupt, or attempt
      to
      interfere with or disrupt, the relationship, contractual or otherwise, between
      the Company and its subsidiaries or affiliates and any of their customers
      clients, prospects, suppliers, consultants, or employees or (F) make or publish
      any statement which is, or may reasonably be considered to be, disparaging
      to
      the Company or any of its subsidiaries or affiliates, or directors, officers,
      employees or the operations or products of the Company or any of its
      subsidiaries or affiliates.

    


    7. Agreement
      Binding on Successors.
      

    


    (i) The
      Company will require any successor (whether direct or indirect, by purchase,
      merger, consolidation or otherwise) to all or substantially all of the business
      and/or assets of the Company to expressly assume and agree to perform this
      Agreement in the same manner and to the same extent that the Company would
      be
      required to perform it if no such succession had taken place. Failure of the
      Company to obtain such assumption and agreement prior to the effectiveness
      of
      any such succession shall be a breach of this Agreement and shall entitle you
      to
      compensation from the Company in the same amount and on the same terms as you
      would be entitled to hereunder if you terminate your employment for Good Reason
      following a Change of Control, except that for purposes of implementing the
      foregoing, the date on which any such succession becomes effective shall be
      deemed the Date of Termination. As used in this Agreement, “Company” shall mean
      the Company as herein before defined and any successor to its business and/or
      assets as aforesaid which assumes and agrees to perform this Agreement by
      operation of law, or otherwise.

    


    (ii) This
      Agreement shall inure to the benefit of and be enforceable by your personal
      or
      legal representatives, executors, administrators, successors, heirs,
      distributees, devisees and legatees. If you should die while any amount would
      still be payable to you hereunder if you had continued to live, all such
      amounts, unless otherwise provided herein, shall be paid in accordance with
      the
      terms of this Agreement to your devisee, legatee or other designee or, if there
      is no such designee, to your estate.

    


    8. Subsidiary
      Corporations.
      Upon
      approval of the Board of Directors of the appropriate wholly-owned subsidiary,
      this Agreement shall apply to an executive of any wholly-owned subsidiary of
      the
      Company with the same force and effect as if said executive were employed
      directly by the Company. Upon approval by said subsidiary’s Board of Directors,
      the executive of the wholly-owned subsidiary shall be entitled to the same
      benefits from the Company as those granted to executives of the Company. For
      purposes of this Agreement the transfer of an employee from the Company to
      any
      wholly-owned subsidiary of the Company, or from any wholly-owned subsidiary
      to
      the Company, or from one wholly-owned subsidiary to another shall not constitute
      a termination of such employee’s employment. As applied to an executive of a
      wholly-owned subsidiary, the duties and obligations of the Company shall,
      wherever appropriate, refer to the duties and obligations of the Company’s
      wholly-owned subsidiary which employs the executive; provided, however, that
      the
      Company rather than the wholly-owned subsidiary shall remain liable to the
      executive for payment of benefits due hereunder.

    


    9. Notice.
      For the
      purpose of this Agreement, notices and all other communications provided for
      in
      this Agreement shall be in writing and shall be deemed to have been duly given
      when delivered or mailed by United States registered mail, return receipt
      requested, postage prepaid, addressed to the respective addresses set forth
      on
      the first page of this Agreement, provided that all notice to the Company shall
      be directed to the attention of the Board with a copy to the Secretary of the
      Company, or to such other address as either party may have furnished to the
      other in writing in accordance herewith, except that notice of change of address
      shall be effective only upon receipt.

    


    10. Miscellaneous.
      No
      provision of this Agreement may be modified, waived or discharged unless such
      waiver, modification, or discharge is agreed to in writing and signed by you
      and
      such officer as may be specifically designated by the Board. No waiver by either
      party hereto at any time of any breach by the other party hereto of, or
      compliance with, any condition or provision of this Agreement to be performed
      by
      such other party shall be deemed a waiver of similar or dissimilar provisions
      or
      conditions at the same or at any prior or subsequent time. This Agreement
      supersedes any previous agreements between the Company and you on the matters
      herein addressed. No agreements or representations, oral or otherwise, express
      or implied, with respect to the subject matter hereof have been made by either
      party which are not expressly set forth in this Agreement. The validity,
      interpretation, construction and performance of this Agreement shall be governed
      by the laws of the State of Vermont. All reference to sections of the Exchange
      Act or the Code shall be deemed also to refer to any successor provisions to
      such sections. Any payments provided for hereunder shall be paid net of any
      applicable withholding required under federal, state or local law. The
      obligations of the Company under section 6 shall survive the expiration of
      the
      term of this Agreement.

    


    11. Non-exclusivity
      of Rights.
      Nothing
      in this Agreement shall prevent or limit your continuing or future participation
      in any plan, program, policy or practice provided by the Company or any of
      its
      affiliated companies and for which you may qualify. Amounts which are vested
      benefits or which you are otherwise entitled to receive under any plan, policy,
      practice or program of or any contract or agreement with the Company or any
      of
      its affiliated companies at or subsequent to a Change of Control shall be
      payable in accordance with such plan, policy, practice or program or contract
      or
      agreement except as explicitly modified by this Agreement.

    


    12. Confidentiality.

    


    (i) Confidential
      information. You must hold in a fiduciary capacity for the benefit of the
      Company all secret or confidential information, knowledge, or data relating
      to
      the Company and its business, which is obtained by you during your employment
      by
      the Company and which is not public knowledge (other than by acts by you or
      your
      representatives in violation of this Agreement). After the termination of your
      employment with the Company, you must not, without the Company’s prior written
      consent, communicate or divulge any such information, knowledge, or data to
      anyone other than the Company and those designated by it to receive such
      information, knowledge, or data. In no event may an asserted violation of this
      section constitute a basis for deferring or withholding any amounts otherwise
      payable to you under this Agreement.

    


    (ii) Records
      and files. All records and files concerning the Company or the Company’s clients
      and customers belong to and remain the property of the Company.

    


    13. Termination
      of Employment Prior to a Change of Control of the Company.
      You and
      the Company acknowledge that prior to a Change of Control or a Potential Change
      of Control, your employment may be terminated by the Company in accordance
      with
      the notice provisions set forth in section 1 of this Agreement, and by you
      at
      any time, in which case you shall have no further rights under this
      Agreement.

    


    14. Anti-assignment.
      You may
      not assign, alienate, anticipate, or otherwise encumber any rights, duties,
      or
      amounts that you might be entitled to receive under this Agreement.

    


    15. Validity.
      The
      invalidity or unenforceability of any provision of this Agreement shall not
      affect the validity or enforceability of any other provision of this Agreement,
      which shall remain in full force and effect.

    


    16. Funding.
      The
      Company is not required to establish a trust or other funding vehicle to pay
      benefits under this Agreement, except to the extent otherwise required by the
      Code or ERISA with respect to any employee benefit plan.

    


    17. Counterparts.
      This
      Agreement may be executed in several counterparts, each of which shall be deemed
      to be an original but all of which together will constitute one and the same
      instrument. 

    


    18. Arbitration.
      Any
      dispute or controversy arising under or in connection with this Agreement shall
      be settled exclusively by arbitration in Burlington, Vermont in accordance
      with
      the rules of the American Arbitration Association then in effect. Judgment
      may
      be entered on the arbitrator’s award in any court having jurisdiction; provided,
      however, that you shall be entitled to seek specific performance of your right
      to be paid until the Date of Termination during the pendency of any dispute
      or
      controversy arising under or in connection with this Agreement.

    


    19. Governing
      Law. This
      Agreement shall be governed by the laws of State of Vermont.

    



    
      
         

      

      
         

        
          

        

      

      
         

      

    


    ACKNOWLEDGMENT
      OF ARBITRATION

    


    The
      parties hereto understand that this Agreement contains an agreement to
      arbitrate. After signing this document, the parties understand that they will
      not be able to bring a lawsuit concerning any dispute that may arise which
      is
      covered by the arbitration agreement, unless it involves a question of
      constitutional or civil rights. Instead the parties agree to submit any such
      dispute to an impartial arbitrator.

    


    This
      letter is submitted in duplicate. If it sets forth our agreement on the subject
      matter hereof, kindly sign both copies and return one copy to me within thirty
      (30) days (after which this offer of severance benefits will lapse). These
      letters will then constitute our agreement on this subject. 

    


    


    


    By:        
       /s/Nordahl
      L. Brue   

    Nordahl
      L. Brue, Chairman

    Board
      of
      Directors

    Green
      Mountain Power Corporation

    


    


    


    


    Agreed
      to
      this 3rd day of April, 2006

    


    


    


    /s/
      Dawn D. Bugbee   

    Dawn
      D.
      Bugbee

    Chief
      Financial Officer

    


    Form
      Approved: /s/
      Donald J. Rendall, Jr.

    General
      Counsel