AMENDMENT NO.1
TO
EMPLOYMENT AGREEMENT
This Amendment dated as of January 1, 1999 to that certain
Employment Agreement entered into as of September 30, 1991 by and between Fall
River Gas Company, a Massachusetts corporation with an office at 155 North Main
Street, Fall River, Massachusetts 02722 (hereinafter called the "Company") and
Bradford J. Faxon of Westport, Massachusetts (hereinafter called the
"Executive").
RECITALS
Whereas, the Executive and the Company are parties to an
employment agreement entered into as of September 30, 1991 (the "Employment
Agreement"); and
Whereas, the Company desires to assure the continued service of
Executive, and Executive is desirous of committing himself to continued service
to the Company; and
Whereas, the Executive and the Company desire to amend certain
provisions of the Employment Agreement;
AGREEMENTS
NOW, THEREFORE, for valuable consideration, the receipt and
sufficiency of which is acknowledged by the Company and the Executive, the
Company and the Executive hereby agree as follows:
1. Section 7 shall be amended by the addition of a new
Section 7(f) which shall read as follows:
"(f) CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY. Company
shall pay to the Executive, on a monthly basis, an amount (the "Medicare Tax
Reimbursement") equal to the hospital insurance tax (the "Medicare Tax") imposed
upon the Executive pursuant to Section 3101(b) of the Internal Revenue Code of
1986, as amended (the "Code") with respect to all wages received by the
Executive from the Company. In addition, the Company shall pay the Executive an
additional payment (the "Gross-Up Payment") in an amount such that after payment
by the Executive of all taxes imposed upon the Medicare Tax Reimbursements and
the Gross-Up Payment, the Executive retains from the Medicare Tax Reimbursements
and the Gross-Up Payment an amount equal to the Medicare Tax imposed upon the
Executive for the tax year."
2. Section 7 shall be amended by the addition of a new
Section 7(g), which shall read as follows:
"(g) EXCESS PENSION BENEFIT.
(i) COMMENCEMENT OF EXCESS PENSION BENEFIT AT
RETIREMENT. The Executive shall be entitled to receive an excess pension
benefit (as determined pursuant to Section 7(g)(iii) hereof) (the "Excess
Pension Benefit"), commencing as of the date the Executive terminates employment
and first becomes eligible to receive benefits under the Pension Plan for
Salaried and Non-Union Hourly Employees of Fall River Gas Company
("Pension Plan") (the "Commencement Date"), even if such Executive elects not to
commence receiving such Pension Plan benefits at that time.
(ii) FORM OF PAYMENT. The Executive will receive
his Excess Pension Benefit hereunder in the same form as the Executive receives
or has elected to receive, as the case may be, his retirement benefit under the
Pension Plan. The company shall have the right to deduct from all benefits
accrued and/or from payments made under this Section 7(g) any taxes required by
law to be paid or withheld.
(iii) AMOUNT OF BENEFIT. The Excess Pension Benefit
shall be an amount equal to the following:
(A) the Executive's annual retirement benefit
calculated under Section V of the Pension Plan,
and payable in accordance with Section VI of
the Pension Plan, notwithstanding any
restrictions imposed by Sections XXI and XXII
of the Pension Plan and notwithstanding the
limitations provided in Section 415(b), 415(e),
and/or 401(a)(17) of the code, less
(B) the actual amount of annual retirement
benefit calculated under Section V of the
Pension Plan, and payable to the Executive in
accordance with Section VI of the Pension Plan
after application of any restrictions imposed
by Sections XXI and XXII of the Pension Plan
and the limitations provided in Sections
415(b), 415(e), and/or 401(a)(17) of the Code.
(iv) ACCRUED EXCESS PENSION BENEFIT. The
Executive's accrued Excess Pension Benefit (the "Accrued Excess Pension
Benefit") on any date prior to retirement shall equal the amount determined
under Section 7(g)(i) hereof based upon his "Compensation" (as defined in
Section I of the Pension Plan) and "Year of Service" (as defined in Section I of
the Pension Plan as of such date.
(v) EXCESS PENSION PRE-RETIREMENT DEATH BENEFIT. If
the Executive dies prior to the Commencement Date, any Accrued Excess Pension
Benefit shall be paid to the Executive's surviving spouse or, if there is no
surviving spouse, to the beneficiary, if any, designated pursuant to the terms
of the Pension Plan by the Executive to receive the Executive's retirement
benefits under the Pension Plan (the "Designated Beneficiary") (and if no such
beneficiary is designated, to the Executive's estate). Such benefits shall be
paid at the same time and in the same form as the death benefit provided under
the Pension Plan.
(vi) DEATH ON OR AFTER RETIREMENT. If the Executive
dies on or after the commencement Date, the Executive's surviving spouse or, if
there is no surviving spouse, the Designated Beneficiary (and if there is no
Designated Beneficiary, the Executive's estate) shall receive the Excess Pension
Benefit that the Executive would have received. Such benefit shall be paid at
the same time and in the same form as the payments the Executive would have
received.
(vii) SUSPENSION OF EXCESS PENSION BENEFIT. The
payment of an Excess Pension Benefit otherwise due on behalf of the Executive
shall be suspended for any calendar month in which his Pension Benefit under the
Pension Plan is suspended, provided that payment of an Excess Pension Benefit
which has been so suspended shall commence or resume when the Pension Benefits
under the Pension Plan resume. Notice of suspension of payment of any Excess
Pension Benefit shall be given to the Executive and such suspension of payment
shall be governed by procedures established by the administrator of the Pension
Plan.
3. Section 7 shall be amended by the addition of a new Section
7(h), which shall read as follows:
"(h) CONTINUATION OF WELFARE BENEFITS. For a period
commencing with the month in which termination of
employment for other than Cause (as defined in the
Agreement) shall have occurred, and ending the later of the
date of the Executive's or the Executive's spouse's death,
the Executive, his spouse and any dependents shall
continue to be entitled to receive all health and dental
care benefits under the company's welfare benefit plans
(within the meaning of Section 3(1) of the Employee
Retirement Income Security Act of 1974, as amended), at no
cost to the Executive and at the same level that the
Executive, his spouse and his dependents were receiving or
were entitled to receive at the time of termination of
employment (if and to the extent that such benefits shall
not
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be payable or provided under any Company plan, the
Company shall pay or provide equivalent benefits on an
individual basis)."
4. Section 10 shall be deleted in its entirety, and in its
place shall be added the following:
"10. CHANGE IN CONTROL. If, and only if, the
Executive's employment is terminated following a Change in
Control of the Company (as that term is defined in the
Severance Agreement between the Executive and the Company,
dated the 1st day of January, 1999 (the "Severance
Agreement")), the provisions in this Section shall be
superceded by the terms of the Severance Agreement and any
other applicable Company plan, policy, arrangement or
agreement (other than this Agreement)."
5. Section 12 shall be deleted in its entirety.
6. A new Section 12 shall be added, which shall read as
follows:
"12. SOURCE OF PAYMENTS. All payments provided for
in this Agreement shall be paid in cash from the general
funds of the Company; provided, however, such payments shall
be reduced by the amount of any payments made to the
Executive or the Executive's dependents, beneficiaries, or
estate from any trust or special or separate fund
established by the Company to assure such payments. The
Company shall not be required to establish a special or
separate fund or other segregation of assets to assure such
payments, and, if the company shall make any investments to
aid it in meeting its obligations hereunder, the Executive
shall have no right, title, or interest whatsoever in or to
any such investments except as may otherwise be expressly
provided in a separate written instrument relating to such
investments. Nothing contained in this Agreement, and no
action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind or a fiduciary
relationship between the Company and the Executive or any
other person. To the extent that any person acquires a right
to receive payments from the Company pursuant to this
Agreement, such right shall be no greater than the right of
an unsecured creditor of the Company."
All the provisions of the Agreement not specifically mentioned in
this First Amendment shall be considered modified to the extent necessary to be
consistent with the changes made in this First Amendment.
Date: ______________________________ The Company
By __________________________
Its
The Executive
_____________________________
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