Document:

Exhibit 10.1

                 SUMMARY OF NON-EMPLOYEE DIRECTORS' COMPENSATION
                      ARRANGEMENTS OUTSIDE OF FORMAL PLANS

                     As amended, effective December 15, 2005

ANNUAL RETAINER FEE
-------------------

On  January 1 of each  year he or she  serves on the  board,  each  non-employee
director  will  receive an annual  retainer  fee of $40,000  cash or a number of
stock units, payable in equal quarterly installments. Each non-employee director
must  irrevocably  elect by December 31 of the prior year whether to receive his
or her retainer in cash or units.

MEETING FEES AND ANNUAL STIPENDS
--------------------------------

Each  non-employee  director will receive $2,000 for his or her participation in
each regular  board and  committee  meeting.  Each  non-employee  director  will
receive  $1,000  for his or her  participation  in  each  telephonic  board  and
committee meeting.  The Chairman of the Board, each Committee Chair and the Lead
Director will receive an additional  annual stipend,  payable in equal quarterly
installments  on  the  first  business  day of the  succeeding  quarter,  in the
following amounts:

   Chairman of the Board                                       $30,000
   Lead Director                                               $15,000
   Audit Committee Chair                                       $25,000
   Compensation Committee Chair                                $15,000
   Nominating and Corporate Governance Committee Chair          $7,500
   Retirement Plan Committee                                    $5,000

Each  non-employee  director must elect by December 31 of the prior year whether
to receive his or her meeting fees and annual stipend, when applicable,  in cash
or stock units, or a combination of the two forms of compensation.Exhibit 10.2

                                 Amendment No. 1
                                     to the
                           Citizens Utilities Company
                Non-Employee Directors' Deferred Fee Equity Plan
                  (as Amended and Restated as of May 18, 2004)

1.  Section  6.1 of  the  Citizens  Utilities  Company  Non-Employee  Directors'
Deferred  Fee Equity  Plan (as Amended  and  Restated  as of May 18,  2004) (the
"Plan") shall be amended and restated in its entirety as follows:

          "Crediting Stock Plan Accounts.

               The Stock Plan  Account of each Stock Plan  Participant  shall be
          credited as of each Accounting Date with Plan Units equal to the total
          cash value of fees  earned in a quarter  divided by 85% of the average
          of the high and low  prices of the stock on the first  trading  day of
          the year the  election is in effect  ("Initial  Market  Value").  Plan
          Units  will be  credited  to the  director's  account  as of the first
          business day of the fiscal  quarter  following  the fiscal  quarter in
          which such Stock Plan Fees were earned. The quarterly crediting of the
          Plan Units has been established for administrative  convenience. As of
          the date of any  payment  of a stock  dividend  or stock  split by the
          Company, a participant's Stock Plan Account will be credited with Plan
          Units  equal to the  number  of  shares  of  Common  Stock  (including
          fractional share  entitlements)  which are payable by the Company with
          respect  to  the  number  of  shares   (including   fractional   share
          entitlements)  equal  to the  number  of Plan  Units  credited  to the
          Participant's  Stock Plan  Account  on the record  date for such stock
          dividend  or stock  split.  As of the date of any  dividend in cash or
          property or other distribution payable to holders of Common Stock, the
          Participant's  Stock Plan Account  shall be credited  with  additional
          Plan units  equal to the number of shares of Common  Stock  (including
          fractional share  entitlements)  that could have been purchased at the
          Fair Market  Value as of such payment date with the amount which would
          have been  received  as a dividend  or  distribution  on the number of
          shares  (including  fractional share  entitlements)  equal to the Plan
          Units  credited  to the  Participant's  Stock  Plan  Account as of the
          record date."

2. This Amendment shall be effective as of December 15, 2005.

3. Except as specifically  provided herein,  the Plan shall remain in full force
and effect.Employment Offer Letter - John E. Panichella

    

    

    

    

    
      
        

      

    

    December
      8, 2005

    

    Mr.
      John
      E. Panichella

    3771
      Sablewood Drive

    Doylestown,
      PA 18901

    

    Dear
      John:

    

    I
      am
      pleased to confirm the terms and conditions of your offer to join Hercules
      Incorporated effective January 1, 2006 in the position of President Aqualon
      Division of Hercules and Vice President, Hercules Incorporated. This position
      will report to Craig A. Rogerson, President and Chief Executive Officer.

    

    Our
      offer
      includes the following components:

    

    
      	 	
              1.

            	
              Annual
                Base Salary: $315,000
                payable in 12 equal monthly installments. Pursuant to our salary
                administration policy, salary reviews are conducted each March
                1st.
                Your first scheduled review will be March
                2007.

            

    

    

    
      	2.  	
              2006
                MICP Target Opportunity:
                Your target annual incentive opportunity under the Hercules Management
                Incentive Compensation Plan (MICP) is 50% of your base salary. In
                recognition of your current variable compensation minimum grant,
                your 2006
                MICP award will be subject to a minimum payout of $110,000. The maximum
                payout is 2 times your target and, of course, aside from the above
                2006
                minimum, the minimum is zero. Any payouts above the target amount
                may be
                made in restricted stock. 

            

    

    

    
      	3.  	
              Long-Term
                Incentive:
                In this position, you are eligible to receive annual grants under
                the
                Hercules Long-Term Incentive Compensation Plan (LTICP). Your first
                year
                target award value will be $250,000 subject to Board approval and
                adjustments reference below. Future awards will be determined based
                on
                competitive practice for your position at that time but are expected
                to be
                $300,000 in 2007, and $350,000 in
                2008.

            

    

    

    
      	4.  	
              Benefits:
                Your benefits will be covered under the current Hercules Incorporated
                plan
                per the enclosed Benefits overview. Your previous Hercules credited
                service will be immediately reinstated upon joining Hercules and
                will be
                used for benefit eligibility and
                calculation.

            

    

    

    
      	5. 
               	
              Should
                you forfeit your current variable compensation award that otherwise
                would
                be paid for 2005, we will pay the amount forfeited up to $108,000
                subject
                to the following adjustments taken against your LTICP awards in 2006,
                2007
                and 2008: 

            

    

    

    “2006
      LTICP award value will be reduced by 50% of the forfeiture reimbursement.
      However, the number of shares so reduced shall be reinstated
      with the 2007 LTICP grant provided you are employed as of
      such
      date.”

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	6.  	
              Executive
                Stock Purchase Program: You
                will become eligible to participate in the Executive Stock Purchase
                Program. This program, under the LTICP, provides you with the option
                of
                converting salary and target MICP amounts into Hercules Restricted
                Stock
                at a 15% discount. The program also provides for the exchange of
                Nonqualified Savings Plan balances for restricted stock with no discount.
                More information will be provided to you on this program through
                the
                Corporate Human Resources
                Department.

            

    

    

    
      	7.  	
              Relocation
                Benefits:
                The Hercules Relocation Benefits Plan applicable to homeowner employees
                (copy enclosed) will apply for 12 months beginning January 1,
                2006.

            

    

    

    
      	8.  	
              Change
                in Control Several Benefit:
                Your Severance Pay Plan benefits entitlement will be adjusted to
                one
                year’s base salary in the event of a Change in Control, as defined in
                the
                Hercules LTICP. The LTICP also provides for immediate vesting of
                all
                outstanding awards in the event of a Change in
                Control.

            

    

    

    

    This
      offer is contingent upon three issues. You must successfully pass our standard
      pre-placement physical examination before your anticipated starting date. A
      part
      of this examination will be a test to detect the use of drugs or alcohol. If
      you
      are currently using prescription drugs, please bring your prescription with
      you
      to the physical. In addition, we must verify employment eligibility under the
      Immigration Reform and Control Act. Finally, any agreement with former employers
      must not inhibit your freedom to perform the duties of the President of Aqualon
      position.

    

    I
      am
      excited about having you as part of the Hercules team in this critical role.
      I
      look forward to working with you to make this a personally and professionally
      rewarding opportunity.

    

    To
      indicate your review and acceptance with the above terms please sign a copy
      of
      this letter and return it to me within three days.

    

    Best
      regards,

    

    /s/
      Edward V. Carrington

    Edward
      V.
      Carrington, Vice President

    Human
      Resources and Corporate Resources

    

    Accepted
      by:

    

    /s/
      John E. Panichella

    John
      E.
      Panichella

    

    

    

    

    

    

    

    Encolosures

    Offer
      Letter.doc

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