**Exhibit 10(ap)**

 

**Maine& Maritimes Corporation**

 

 

**EMPLOYEERETENTION AGREEMENT**

 

 

THISEMPLOYEE RETENTION AGREEMENT dated as of September 5, 2003 (this “Agreement”) is entered into between Maine &Maritimes Corporation, a Maine corporation (the “Company”), and Larry E.LaPlante (the “Executive”) (the Company and Executive are sometimes referred toas “Party” or collectively “Parties”).

 

**RECITALS**

 

WHEREAS,the Executive, has been employed by the Company in a management capacity and isnow its Vice President, Chief Accounting Officer, Controller, Clerk, Asst.Treasurer and Asst. Secretary; and

 

WHEREAS,the Board of Directors of the Company has determined this Agreement to be inthe best interests of the stockholders of the Company, in order to encouragethe attention and dedication of the Executive to his assigned duties with theCompany without distraction in connection with potentially disruptivecircumstances arising from the possibility of a Change in Control (as definedherein) or certain other events specified in this Agreement;

 

Now,THEREFORE, in consideration of the mutual promises and covenants containedherein and for other good and valuable consideration, the receipt andsufficiency of which is hereby acknowledged by the Parties, the Company and theExecutive agree as follows:

 

Section 1.                                            **Certain Definitions**

 

Asused herein, the following terms have the indicated meanings:

 

(1)*         **“Cause”*for termination by the Company of theExecutive’s employment shall mean (i) the willful and continued failure by theExecutive to substantially perform his duties with the Company after a writtennotice is delivered to the Executive by the Company, which notice specificallyidentifies the manner in which the Company believes that the Executive has notsubstantially performed the Executive’s duties; or (ii) the willful engaging bythe Executive in gross misconduct that is injurious to the Company, monetarilyor otherwise (including, without limitation, the Executive’s conviction, by acourt of competent jurisdiction, of a crime adversely reflecting on theExecutive’s honesty, trustworthiness or fitness to carry out theresponsibilities of his position with the Company). An act, or failure to act,on the Executive’s part shall be deemed “willful” where such act is done, or notdone, by the Executive: (i) in the absence of good faith; or (ii) without areasonable belief that the Executive’s act, or failure to act, was in the bestinterest of the Company.

 

(2)          For the purpose of this definition *(“Change inControl”)*only, the term “Company,” first defined above, shall alsobe defined to include Maine Public Service Company in addition to its parent,Maine & Maritime Corporation. *A “Change in Control “*shall be deemed tohave occurred if the conditions set forth in any one of the followingparagraphs shall have been satisfied:

 

(a)          any“person” (as such term is used in Sections 13(d) and 14(d) of the SecuritiesExchange Act of 1934, as amended) (other than the Company, any trustee or otherfiduciary holding securities under any employee benefit plan of the Company, orany corporation owned directly or indirectly by the stockholders of the Companyin substantially the same proportion as their

 

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ownershipof stock of the Company) is or becomes the “beneficial owner” (as defined in Rule13d-3 under the Securities Exchange Act of 1934, as amended), directly orindirectly, of securities of the Company representing fifty percent or more ofthe combined voting power of the Company’s then outstanding voting securities;

 

(b)         achange in the composition of the Board of Directors of the Company, as a resultof which fewer than a majority of the directors are persons who either (A) aredirectors of the Company as of the date hereof or (B) were elected afternomination by a majority of the directors of the Company on the date hereof anddirectors so elected previously;

 

(c)          anymerger or consolidation of the Company, approved by the stockholders of theCompany, with any other corporation; *other than:*

 

(A)                              any such merger or consolidation that wouldresult in the voting securities of the Company outstanding immediately prior tothe merger or consolidation, continuing to represent (either by remainingoutstanding or by being converted into voting securities of the surviving orparent entity) more than fifty percent of the combined voting power of thevoting securities (entitled to vote generally for the election of directors) ofthe Company or such surviving or parent entity outstanding immediately aftersuch merger or consolidation, or subsequently at any time as contemplated by oras a result of, such merger or consolidation; or

 

(B)                                any such merger or consolidation where suchmerger or consolidation is effected to implement a recapitalization orreincorporation of the Company (or similar transaction) in which no “person”(as such term is used in Sections 13(d) and 14(d) of the Securities ExchangeAct of 1934, as amended) acquires fifty percent or more of the combined votingpower of the Company’s then-outstanding voting securities;

 

(d)         anymerger or consolidation of the Company in which the Company is not thecontinuing or surviving corporation or pursuant to which shares of theCompany’s stock, would be converted into cash, securities or other property; *other than*amerger or consolidation of the Company in which the stockholders of the Companyimmediately prior to the merger or consolidation have substantially the sameproportionate ownership and voting control of the surviving corporation orparent entity immediately after the merger or consolidation;

 

(e)          exceptas described below, the Company ceases to be a reporting company pursuant toSection 13 (a) of the Securities Exchange Act of 1934 as amended, or anysimilar successor provision;

 

(f)            thenumber of the Company’s Outside Directors, as defined below, is decreased bymore than fifty percent in any twenty-five month period or the number of theCompany’s directors increased in such a manner that the Outside Directorsconstitute less than a majority of the Board;

 

(g)         thestockholders of the Company approve a plan of complete liquidation of theCompany or an agreement for the sale, lease, exchange, liquidation, dispositionor other transfer (in one transaction or a series of transactions) by theCompany of all or substantially all of the Company’s assets (or any transactionhaving a similar effect).

 

(h)         further,*a “Changein Control”*shall *not*be deemed to occur if the conditionsset forth in the following sub-paragraph shall have been satisfied:

 

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(A)                              amerger, consolidation or reorganization of the Company if, upon consummation ofsuch transaction all of the outstanding voting stock of the Company is owned,directly or indirectly, by a holding company, and the holders of the Company’scommon stock immediately prior to the transaction have substantially the sameproportionate ownership and voting control of the holding company.

 

(3)                                  *“GoodReason”*for termination by the Executive of the Executive’semployment shall mean the occurrence of any one of the following acts unlesssuch act is corrected prior to the Termination Date specified in theTermination Notice given in respect thereof or, in the case of paragraph (d)below, such act is not objected to in writing by the Executive within fourmonths after notification by the Company to the Executive of the Company’sintention to take the action contemplated by such paragraph (d):

 

(a)                                  theassignment of duties to the Executive which:

 

(i)                                     are materiallydifferent from his duties immediately prior to the Change in Control, or

 

(ii)                                  result in his havingsignificantly less authority or responsibility than he had prior to the Changein Control;

 

(b)                                 the Executive’sremoval from, or any failure to re-elect him to, any position he heldimmediately prior to the Change in Control;

 

(c)                                  a reduction of theExecutive’s annual base salary in effect on the date of the Change in Controlor as the same may be increased from time to time thereafter;

 

(d)                                 the Company’stransferring or assigning the Executive to a place of employment more than onehundred miles from Presque Isle, Maine, except where: (1) such transfer orassignment is to a subsidiary or affiliate entity location, consistent with theExecutive’s duties; and (2) in connection with required business travel to anextent substantially consistent with the Executive’s business travelobligations immediately prior to the Change in Control;

 

(e)                                  the Company’s failureto provide the Executive with substantially the same health, life and otheremployee benefit plans, programs and arrangements (specifically including theCompany’s compensation and incentive plans, as the same may be amended in thefuture), and substantially the same perquisites of employment, as provided tohim immediately prior to the Change in Control or as the same may be increasedthereafter;

 

(f)                                    the Company’sfailure to provide the Executive with substantially the same support staff asprovided to him immediately prior to the Change in Control; or

 

(g)                                 the Company’s failureto increase the Executive’s salary, employee benefits or perquisites of employmentin a manner or amount commensurate with increases provided to the Company’sother executive officers.

 

(4)*                                  “OutsideDirectors”*an *“Outside Director”*as of a given date, shall mean a memberof the Company’s board of directors who has been a director of the Companythroughout the six month period prior to such date and who has not been anemployee of the Company at any time during such six month period.

 

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(5)*                                 **“Termination Date”*shall have the meaning stated in Section 2(2).

 

(6)*                                 **“Termination Notice”*shall have the meaning stated in Section 2(1).

 

Section 2.                                            **Termination Procedures**

 

(1)*                                 **Termination Notice.*Any purported termination of the Executive’s employment (other than byreason of death, or at will termination) shall be communicated by a writtennotice of the terminating party (a “Termination Notice”) in accordance withSection *6 (2).*

 

(2)*                                 **Termination Date.*“Termination Date” shall mean the date as of which the Executive’semployment is to terminate as specified in the Termination Notice, which, inthe case of a termination by the Company otherwise than for Cause, may be thesame date of the Termination Notice and, in the case of a termination by theExecutive, shall not be less than fourteen days nor more than sixty days,respectively, from the date the Termination Notice is given, unless otherwiseagreed to by the parties.

 

Section 3.                                            **Benefits Upon Certain Terminations**

 

(1)*                                 **General.*Ifa Change of Control occurs and, within one year following the occurrence ofsuch Change of Control (i) the Company terminates the Executive’s employmentfor any reason other than for Cause, or (ii) the Executive terminates hisemployment for Good Reason, then in lieu of any further salary payments to theExecutive for periods subsequent to the Termination Date, the Company shallprovide the Executive with the following:

 

(a)                                  Within thirty business days after theTermination Date, a lump sum cash payment equal to the sum of: (i) two hundredpercent (200%) of the Executive’s annual base salary in effect upon the Changein Control or the date of the Termination Notice, whichever is higher, and (ii)two hundred percent (200%) of the bonus award the Executive would have receivedfor the year in which such termination occurs pursuant to the Company’sIncentive Compensation Plan, assuming that his employment had not terminatedand that for such year all applicable performance goals will be met. In theevent any portion of this award depends on goals that cannot be determineduntil the close of the plan year, then payment of that amount shall be madewithin thirty days after the goal has been determined.

 

(b)                                 The continuation of the Executive’sparticipation and the participation of his dependants (to the extent they wereparticipating on the date of the Termination Notice) in the Company’s health,life, disability and other employee benefit plans, programs and arrangements(excluding the Pension Plan and the Non-Union Retirement Savings Plan) for aperiod of twenty-four (24) months after such termination as if he were still employedduring such period; provided, however, if such participation in any such plan,program or arrangement is specifically prohibited by the terms thereof, theCompany shall provide the Executive (and his dependants) with benefitssubstantially similar to those which he was entitled to receive under suchplan, program or arrangement immediately prior to his termination ofemployment. Additionally, at the end of any period of such coverage, theExecutive shall have the right to have assigned to him, for the cash surrendervalue thereof, any assignable insurance owned by the Company on the life of theExecutive. For purposes of this paragraph 3(b), any employee benefit determinedwith reference to the Executive’s compensation or earnings shall be based on hisannual base salary unless otherwise provided under the terms of the applicableemployee benefit plan, program or arrangement.

 

(2)*                                 **Death, at will termination.*Notwithstanding any provision of thisAgreement to the contrary, no benefits are payable hereunder upon theExecutive’s death prior to: (1) the involuntary

 

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termination of his employment with the Company for Cause or otherwise,or (2) the voluntary termination by the Executive of the Executive’s employmentwith the Company for Good Reason. No benefits are payable hereunder upon theCompany’s at will termination of employment for reasons other than those setforth in this Agreement.

 

Section 4.                                            **Term ofAgreement**

 

This Agreement initially shall continue in effect until the thirdanniversary of the date hereof.

 

Section 5.                                            **Successors**

 

In addition to any obligations imposed by law upon any successor to theCompany, the Company will require any successor (whether direct or indirect, bypurchase, merger, consolidation or otherwise) to all or substantially all ofthe business and/or assets of the Company to expressly assume and agree toperform this Agreement in the same manner and to the same extent that theCompany 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 theeffectiveness of any such succession shall be a breach of this Agreement andshall entitle the Executive to compensation from the Company in the same amountand on the same terms as the Executive would be entitled to hereunder if theExecutive were to terminate the Executive’s employment for Good Reason, exceptthat, for purposes of implementing the foregoing, the date on which any suchsuccession becomes effective shall be deemed the Termination Date.

 

Section 6.                                          **Miscellaneous**

 

(1)*                                  Amendments.*This Agreement may not be amended, modified or supplemented by the partieshereto in any manner, except by an instrument in writing signed on behalf ofeach of the parties hereto.

 

(2)*                                  Notices.*Any notice, request, instruction or other document to be given hereunder byany party to the other shall be in writing and delivered personally or sent bycertified mail, postage prepaid, by facsimile (with receipt confirmed), or bycourier service and shall be effective upon receipt if addressed or sent asfollows:

 
| To the Company:   |   | Maine & Maritimes Corporation          |
|-------------------|--------|--------------------------------------------|
|              |   | P. 0. Box 789, Presque Isle, ME 04769-0789 |
|              |   | Fax:                                       | 207-760-2498 |   |
|              |   | Attention:                                 | J. Nick Bayne |   |
|              |   |                                       |
| To the Executive: |   | Larry E. LaPlante                          |
|              |   | 125 Fleetwood Street                       |
|              |   | Presque Isle, ME 04769-3031                |
|              |   | Fax:                                       | 207-760-2498 |   |
|                   |        |                                            |  |  |  |  |

 

or to such other address or person as may be designated in writing by aparty, by a notice given to the others as aforesaid.

 

(3)*                                  NoAdditional Effect.*Except as expressly provided herein, nothing containedherein shal be construed to provide the Executive with any specific period ofemployment, right to be retained in the service of the Company or other rights,nor shall this Agreement be construed to otherwise limit the right: of theCompany to discharge or take other action with respect to the Executive. TheExecutive hereb3 acknowledges that he or she remains an employee at will of theCompany and that any rights of the

 

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Executive arising under this Agreement arise only upon thecircumstances specifically set forth in this Agreement.

 

(4)*                                  Construction.*The headings in this Agreement are included only for convenience and shallnot affect the meaning or interpretation of this Agreement. The words “herein”and “hereof’ and other words of similar import refer to this Agreement as awhole and not to any particular part of this Agreement. The word “including” asused herein shall not be construed so as to exclude any other thing notreferred to or described. The Outside Directors shall have the authority toconstrue and interpret this Agreement on behalf of the Company, and any suchdetermination by the Outside Directors shall be the conclusive construction onbehalf of the Company.

 

(5)*                                  EntireAgreement, Assignability, etc.*This Agreement (i) constitutes the entireagreement, and supersedes all other prior agreements, including withoutlimitation prior employee continuity agreements, and understandings, bothwritten and oral, between the parties with respect to the subject matterhereof, (ii) is not intended to confer upon any person other than the partieshereto any rights or remedies hereunder, except as otherwise expressly providedherein, and (iii) shall not be assignable by operation of law or otherwise. Noprovisions of this Agreement are intended, nor will be interpreted, to provideor create any third party beneficiary rights or any other rights of any kind inany person unless specifically provided otherwise herein, and, except as soprovided, all provisions hereof will be personal solely among the parties tothis Agreement.

 

(6)*                                  Validity.*The invalidity or unenforceability of any provisions of this Agreementshall not affect the validity or enforceability of any other provisions of thisAgreement, each of which shall remain in full force and effect.

 

(7)*                                  GoverningLaw.*This Agreement shall be governed by the laws of the State of Maine,regardless of the laws that otherwise might govern under applicable principlesof conflicts of laws thereof.

 

(8)*                                  Counterparts.*This Agreement may be executed in counterparts, each of which shall bedeemed to be an original but both of which together shall constitute one andthe same instrument.

 

(9)*                                  Funding.*This Agreement shall not be construed to create or require the Company tocreate a trust or to otherwise act to fund the amounts payable hereunder.

 

(10)*                            Limitationon Amount to be Paid.*If payment of any amount under this Agreement wouldcause the Executive to be subject to an excise tax pursuant to Section *4999*ofthe Internal Revenue Code (as amended from time to time) or the regulationsthereunder, then such amount shall not be paid to the extent necessary to avoidthe imposition of such tax. The preceding sentence shall apply only if theaggregate amount payable to the Executive or for his or her benefit under thisAgreement, after payment of such excise tax, would be less than the aggregateamount payable in accordance with the preceding sentence.

 

(11)*                            Arbitration.*The Parties agree to resolve all disputes arising under this Agreement inarbitration as follows:

 

(a)                                  Anyarbitration under this Agreement, and any related judicial proceeding, shall beinitiated and shall proceed pursuant to the provisions of the Maine UniformArbitration Act (the “Act”) and, to the extent consistent with the Act, thethen prevailing rules of the American Arbitration Association (the“Association”) for labor and employment contracts. To initiate arbitrationhereunder, demand shall be given in writing to the Association and the otherParty no later than one year after the

 

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claimarises. Any claim for which such demand is not made within one year after theclaim arises shall be barred and discharged.

 

(b)                                 Any arbitration under this Agreement shall bebefore a single arbitrator mutually acceptable to the Parties, and an award insuch arbitration may include only damages which the arbitrator determines to bedue under express provisions of this Agreement. The arbitrator shall have noauthority to award any other damages including without limitation,consequential and exemplary damages. Any award in arbitration shall be subjectto enforcement and appeal pursuant to the Act.

 

(c)                                  The Parties shall share equally all costs andfees charged by the Association or the arbitrator.

 

(12)*                           **Execution of Further Documents.*In the event the Executive receives paymentsor benefits pursuant to this Agreement and the Company’s legal counsel deems itnecessary for the Company to receive a release or other acknowledgement theExecutive agrees to execute any such document as may be reasonably required asa condition of his/her receipt of such payment or benefits.

 

INWITNESS WHEREOF, the parties have duly executed this Agreement as of the datefirst above written.

 

 
|   | **MAINE & MARITIMES CORPORATION** |
|--------|---------------------------------------|
|   |                                  |
|   |                                  |
|   | **/s/ Nathan L. Grass**               |   |
|   | **By:**                               |
|   | **Title:**                            |
|   |                                  |
|   |                                  |
|   | **EXECUTIVE**                         |
|   |                                  |
|   |                                  |
|   | **/s/ Larry E. LaPlante**             |   |
|   | **Name:**                             |

 

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