Exhibit 10(ap)


 


Maine
& Maritimes Corporation


 


 


EMPLOYEE
RETENTION AGREEMENT


 


 


THIS
EMPLOYEE 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 to
as “Party” or collectively “Parties”).


 


RECITALS


 


WHEREAS,
the Executive, has been employed by the Company in a management capacity and is
now 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 in
the best interests of the stockholders of the Company, in order to encourage
the attention and dedication of the Executive to his assigned duties with the
Company without distraction in connection with potentially disruptive
circumstances arising from the possibility of a Change in Control (as defined
herein) or certain other events specified in this Agreement;


 


Now,
THEREFORE, in consideration of the mutual promises and covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged by the Parties, the Company and the
Executive agree as follows:


 


Section 1.                                            Certain Definitions


 


As
used herein, the following terms have the indicated meanings:


 


(1)          “Cause” for termination by the Company of the
Executive’s employment shall mean (i) the willful and continued failure by the
Executive to substantially perform his duties with the Company after a written
notice is delivered to the Executive by the Company, which notice specifically
identifies the manner in which the Company believes that the Executive has not
substantially performed the Executive’s duties; or (ii) the willful engaging by
the Executive in gross misconduct that is injurious to the Company, monetarily
or otherwise (including, without limitation, the Executive’s conviction, by a
court of competent jurisdiction, of a crime adversely reflecting on the
Executive’s honesty, trustworthiness or fitness to carry out the
responsibilities 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 not
done, by the Executive: (i) in the absence of good faith; or (ii) without a
reasonable belief that the Executive’s act, or failure to act, was in the best
interest of the Company.


 


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


 


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


 

















 


ownership
of stock of the Company) is or becomes the “beneficial owner” (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of securities of the Company representing fifty percent or more of
the combined voting power of the Company’s then outstanding voting securities;


 


(b)         a
change in the composition of the Board of Directors of the Company, as a result
of which fewer than a majority of the directors are persons who either (A) are
directors of the Company as of the date hereof or (B) were elected after
nomination by a majority of the directors of the Company on the date hereof and
directors so elected previously;


 


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


 


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


 


(B)                                any such merger or consolidation where such
merger or consolidation is effected to implement a recapitalization or
reincorporation 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 Exchange
Act of 1934, as amended) acquires fifty percent or more of the combined voting
power of the Company’s then-outstanding voting securities;


 


(d)         any
merger or consolidation of the Company in which the Company is not the
continuing or surviving corporation or pursuant to which shares of the
Company’s stock, would be converted into cash, securities or other property; other than a
merger or consolidation of the Company in which the stockholders of the Company
immediately prior to the merger or consolidation have substantially the same
proportionate ownership and voting control of the surviving corporation or
parent entity immediately after the merger or consolidation;


 


(e)          except
as described below, the Company ceases to be a reporting company pursuant to
Section 13 (a) of the Securities Exchange Act of 1934 as amended, or any
similar successor provision;


 


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


 


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


 


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


 

















 


(A)                              a
merger, consolidation or reorganization of the Company if, upon consummation of
such 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’s
common stock immediately prior to the transaction have substantially the same
proportionate ownership and voting control of the holding company.


 


(3)                                  “Good
Reason” for termination by the Executive of the Executive’s
employment shall mean the occurrence of any one of the following acts unless
such act is corrected prior to the Termination Date specified in the
Termination 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 four
months after notification by the Company to the Executive of the Company’s
intention to take the action contemplated by such paragraph (d):


 


(a)                                  the
assignment of duties to the Executive which:


 


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


 


(ii)                                  result in his having
significantly less authority or responsibility than he had prior to the Change
in Control;


 


(b)                                 the Executive’s
removal from, or any failure to re-elect him to, any position he held
immediately prior to the Change in Control;


 


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


 


(d)                                 the Company’s
transferring or assigning the Executive to a place of employment more than one
hundred miles from Presque Isle, Maine, except where: (1) such transfer or
assignment is to a subsidiary or affiliate entity location, consistent with the
Executive’s duties; and (2) in connection with required business travel to an
extent substantially consistent with the Executive’s business travel
obligations immediately prior to the Change in Control;


 


(e)                                  the Company’s failure
to provide the Executive with substantially the same health, life and other
employee benefit plans, programs and arrangements (specifically including the
Company’s compensation and incentive plans, as the same may be amended in the
future), and substantially the same perquisites of employment, as provided to
him immediately prior to the Change in Control or as the same may be increased
thereafter;


 


(f)                                    the Company’s
failure to provide the Executive with substantially the same support staff as
provided to him immediately prior to the Change in Control; or


 


(g)                                 the Company’s failure
to increase the Executive’s salary, employee benefits or perquisites of employment
in a manner or amount commensurate with increases provided to the Company’s
other executive officers.


 


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


 

















 


(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 by
reason of death, or at will termination) shall be communicated by a written
notice of the terminating party (a “Termination Notice”) in accordance with
Section 6 (2).


 


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


 


Section 3.                                            Benefits Upon Certain Terminations


 


(1)                                  General. If
a Change of Control occurs and, within one year following the occurrence of
such Change of Control (i) the Company terminates the Executive’s employment
for any reason other than for Cause, or (ii) the Executive terminates his
employment for Good Reason, then in lieu of any further salary payments to the
Executive for periods subsequent to the Termination Date, the Company shall
provide the Executive with the following:


 


(a)                                  Within thirty business days after the
Termination Date, a lump sum cash payment equal to the sum of: (i) two hundred
percent (200%) of the Executive’s annual base salary in effect upon the Change
in 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 received
for the year in which such termination occurs pursuant to the Company’s
Incentive Compensation Plan, assuming that his employment had not terminated
and that for such year all applicable performance goals will be met. In the
event any portion of this award depends on goals that cannot be determined
until the close of the plan year, then payment of that amount shall be made
within thirty days after the goal has been determined.


 


(b)                                 The continuation of the Executive’s
participation and the participation of his dependants (to the extent they were
participating 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 a
period of twenty-four (24) months after such termination as if he were still employed
during such period; provided, however, if such participation in any such plan,
program or arrangement is specifically prohibited by the terms thereof, the
Company shall provide the Executive (and his dependants) with benefits
substantially similar to those which he was entitled to receive under such
plan, program or arrangement immediately prior to his termination of
employment. Additionally, at the end of any period of such coverage, the
Executive shall have the right to have assigned to him, for the cash surrender
value thereof, any assignable insurance owned by the Company on the life of the
Executive. For purposes of this paragraph 3(b), any employee benefit determined
with reference to the Executive’s compensation or earnings shall be based on his
annual base salary unless otherwise provided under the terms of the applicable
employee benefit plan, program or arrangement.


 


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


 

















 


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


 


Section 4.                                            Term of
Agreement


 


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


 


Section 5.                                            Successors


 


In addition to any obligations imposed by law upon any successor to the
Company, 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 the Executive to compensation from the Company in the same amount
and on the same terms as the Executive would be entitled to hereunder if the
Executive were to terminate the Executive’s employment for Good Reason, except
that, for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Termination Date.


 


Section 6.                                          Miscellaneous


 


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


 


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


 


	
  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 a
party, by a notice given to the others as aforesaid.


 


(3)                                  No
Additional Effect. Except as expressly provided herein, nothing contained
herein shal be construed to provide the Executive with any specific period of
employment, 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 the
Company to discharge or take other action with respect to the Executive. The
Executive hereb3 acknowledges that he or she remains an employee at will of the
Company and that any rights of the


 

















 


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


 


(4)                                  Construction.
The headings in this Agreement are included only for convenience and shall
not affect the meaning or interpretation of this Agreement. The words “herein”
and “hereof’ and other words of similar import refer to this Agreement as a
whole and not to any particular part of this Agreement. The word “including” as
used herein shall not be construed so as to exclude any other thing not
referred to or described. The Outside Directors shall have the authority to
construe and interpret this Agreement on behalf of the Company, and any such
determination by the Outside Directors shall be the conclusive construction on
behalf of the Company.


 


(5)                                  Entire
Agreement, Assignability, etc. This Agreement (i) constitutes the entire
agreement, and supersedes all other prior agreements, including without
limitation prior employee continuity agreements, and understandings, both
written and oral, between the parties with respect to the subject matter
hereof, (ii) is not intended to confer upon any person other than the parties
hereto any rights or remedies hereunder, except as otherwise expressly provided
herein, and (iii) shall not be assignable by operation of law or otherwise. No
provisions of this Agreement are intended, nor will be interpreted, to provide
or create any third party beneficiary rights or any other rights of any kind in
any person unless specifically provided otherwise herein, and, except as so
provided, all provisions hereof will be personal solely among the parties to
this Agreement.


 


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


 


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


 


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


 


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


 


(10)                            Limitation
on Amount to be Paid. If payment of any amount under this Agreement would
cause the Executive to be subject to an excise tax pursuant to Section 4999 of
the Internal Revenue Code (as amended from time to time) or the regulations
thereunder, then such amount shall not be paid to the extent necessary to avoid
the imposition of such tax. The preceding sentence shall apply only if the
aggregate amount payable to the Executive or for his or her benefit under this
Agreement, after payment of such excise tax, would be less than the aggregate
amount payable in accordance with the preceding sentence.


 


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


 


(a)                                  Any
arbitration under this Agreement, and any related judicial proceeding, shall be
initiated and shall proceed pursuant to the provisions of the Maine Uniform
Arbitration Act (the “Act”) and, to the extent consistent with the Act, the
then prevailing rules of the American Arbitration Association (the
“Association”) for labor and employment contracts. To initiate arbitration
hereunder, demand shall be given in writing to the Association and the other
Party no later than one year after the


 

















 


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


 


(b)                                 Any arbitration under this Agreement shall be
before a single arbitrator mutually acceptable to the Parties, and an award in
such arbitration may include only damages which the arbitrator determines to be
due under express provisions of this Agreement. The arbitrator shall have no
authority to award any other damages including without limitation,
consequential and exemplary damages. Any award in arbitration shall be subject
to enforcement and appeal pursuant to the Act.


 


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


 


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


 


IN
WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first above written.


 


 


	
   

  	
  MAINE & MARITIMES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Nathan L. Grass

  	
   

  
	
   

  	
  By:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Larry E. LaPlante

  	
   

  
	
   

  	
  Name: