EXHIBIT 10.39
AQUA AMERICA, INC.
AMENDED AND RESTATED 2001 EMPLOYEE STOCK PURCHASE PLAN
(as amended and restated on January 1, 2006)
The purpose of the Aqua America, Inc. Amended and Restated 2001
Employee Stock Purchase Plan is to provide eligible employees of Aqua America,
Inc. (the "Company") and its subsidiaries an opportunity to purchase the common
stock of the Company. The Board of Directors of the Company believes that
employee participation in stock ownership will be to the mutual benefit of the
employees and the Company. The Plan must be approved by the stockholders of the
Company within 12 months after the date on which the Plan is adopted.
ARTICLE I
DEFINITIONS
SECTION 1.01 "Board of Directors" means the Board of Directors of the
Company.
SECTION 1.02 "Code" means the Internal Revenue Code of 1986, as
amended. References to specific sections of the Code shall be taken to be
references to corresponding sections of any successor statute.
SECTION 1.03 "Committee" means the committee appointed by the Board of
Directors to administer the Plan, as provided in Section 5.04.
SECTION 1.04 "Company" means Aqua America, Inc., a Pennsylvania
corporation, or any successor by merger or otherwise.
SECTION 1.05 "Compensation" means a Participant's base wages, overtime
pay, commissions, cash bonuses, premium pay and shift differential, before
giving effect to any compensation reductions made in connection with plans
described in section 401(k) or 125 of the Code.
SECTION 1.06 "Effective Date" shall mean March 6, 2001.
SECTION 1.07 "Election Date" means the first business day of each
calendar month during which the Plan is in effect, or such other dates as the
Committee shall specify; provided that the first Election Date for the Plan
shall be the Effective Date.
SECTION 1.08 "Eligible Employee" means each employee of the Employer:
(i) Who is employed by the Employer and (a) who is classified
by the Employer as an "active regular or part-time non-union
employee" or as an "active full or part-time union employee" and (b)
each person who is not so classified, if such person's customary
employment is for more than twenty (20) hours per week and for more
than five months per year, and
(ii) Who is not deemed for purposes of section 423(b)(3) of
the Code to own stock possessing five percent or more of the total
combined voting power or value of all classes of stock of the
Company or any subsidiary.
SECTION 1.09 "Employer" means the Company and each Subsidiary.
SECTION 1.10 "Exchange Act" means the Securities Exchange Act of 1934,
as amended, and as the same may hereafter be amended.
SECTION 1.11 "Market Value" means the average of the high and low
trading prices for the Stock as reported on the principal market on which the
Stock is traded for the date of reference. If there was no such price reported
for the date of reference, "Market Value" means the average of the high and low
trading prices for the Stock on the day next preceding the date of reference for
which such price was reported or, if there was no such reported price, the fair
market value as determined by the Committee.
SECTION 1.12 "Participant" means each Eligible Employee who elects to
participate in the Plan.
SECTION 1.13 "Plan" means the Aqua America, Inc. Amended and Restated
2001 Employee Stock Purchase Plan, as set forth herein and as hereafter amended.
SECTION 1.14 "Plan Year" means each calendar year during which the Plan
is in effect.
SECTION 1.15 "Purchase Agreement" means the instrument prescribed by
the Committee pursuant to which an Eligible Employee may enroll as a Participant
and subscribe for the purchase of shares of Stock on the terms and conditions
offered by the Company. The Purchase Agreement is intended to evidence the
Company's offer of an option to the Eligible Employee to purchase Stock on the
terms and conditions set forth therein and herein.
SECTION 1.16 "Purchase Date" means the last day of each Purchase
Period.
SECTION 1.17 "Purchase Period" means each one month period or other
period specified by the Committee, beginning on or after the Effective Date,
during which the Participant's Stock purchase is funded through payroll
deduction accumulations or a lump sum deposit under Section 3.05(b).
SECTION 1.18 "Purchase Price" means the purchase price for shares of
Stock purchased under the Plan, determined as set forth in Section 3.03.
SECTION 1.19 "Stock" means the common stock of the Company.
SECTION 1.20 "Subsidiary" means any present or future corporation which
(i) constitutes a "subsidiary corporation" of the Company as that term is
defined in section 424 of the Code and (ii) is designated as a participating
entity in the Plan by the Committee. Unless the Committee specifically
designates otherwise, a Canadian or other foreign subsidiary shall not be
considered a Subsidiary for purposes of the Plan, and employees of such a
subsidiary shall not be Eligible Employees.
ARTICLE II
ADMISSION TO PARTICIPATION
SECTION 2.01 Initial Participation. An Eligible Employee may elect to
participate in the Plan and may become a Participant effective as of any
Election Date, by executing and filing with the Committee a Purchase Agreement
at such time in advance of the Election Date as the Committee shall prescribe.
The Purchase Agreement shall remain in effect until it is modified through
discontinuance of participation under Section 2.02 or a change under Section
3.05.
SECTION 2.02 Discontinuance of Participation.
(a) A Participant may voluntarily cease his or her
participation in the Plan and stop payroll deductions at any time by
filing a notice of cessation of participation on such form and at such
time in advance of the Purchase Date as the Committee shall prescribe.
A Participant who ceases contributions during a Purchase Period may
make additional contributions to the Plan during the Purchase Period.
The Participant may again elect to make payroll deductions on the next
Election Date, if the Participant is then an Eligible Employee. A
Participant who ceases contributions during a Purchase Period may
request payment of any funds held in his or her account under the Plan.
Any funds remaining in the Participant's account on the Purchase Date
shall be used to purchase Stock pursuant to Section 3.04, if the
Participant remains an Eligible Employee.
(b) If a Participant ceases to be an Eligible Employee, his or
her participation automatically shall cease, no further purchase of
Stock shall be made for the Participant, and the Participant shall
receive payment of any funds held in his or her account under the Plan.
SECTION 2.03 Readmission to Participation. Any Eligible Employee who
has previously been a Participant, who has discontinued participation (whether
by cessation of eligibility or otherwise), and who wishes to be reinstated as a
Participant may again become a Participant by executing and filing with the
Committee a new Purchase Agreement. Reinstatement to Participant status shall be
effective as of any Election Date, provided the Participant files a new Purchase
Agreement with the Committee at such time in advance of the Election Date as the
Committee shall prescribe.
SECTION 2.04 Leave of Absence. A Participant who is on an approved
leave of absence may continue to participate in the Plan during the leave of
absence by making cash payments to the Company, at such times as the Committee
determines, equal to the payroll deductions that would have been made had the
leave of absence not occurred.
ARTICLE III
STOCK PURCHASE AND RESALE
SECTION 3.01 Reservation of Shares. There shall be 300,000 shares of
Stock reserved for issuance or transfer under the Plan, subject to adjustment in
accordance with Section 4.02. Except as provided in Section 4.02, the aggregate
number of shares of Stock that may be purchased under the Plan shall not exceed
the number of shares of Stock reserved under the Plan. The shares of Stock may
be (i) Treasury or newly issued shares of the Company or (ii) purchased by the
Company on the open market.
SECTION 3.02 Limitation on Shares Available.
(a) The maximum number of shares of Stock that may be
purchased for each Participant on a Purchase Date is the lesser of (a)
the number of whole and fractional shares of Stock that can be
purchased by applying the full balance of the Participant's withheld
funds to the purchase of shares of Stock at the Purchase Price, or the
Participant's proportionate part of the maximum number of shares of
Stock available under the Plan, as stated in Section 3.01.
(b) Notwithstanding the foregoing, if any person entitled to
purchase shares pursuant to any offering under the Plan would be deemed
for purposes of section 423(b)(3) of the Code to own stock (including
any number of shares of Stock that such person would be entitled to
purchase under the Plan) possessing five percent or more of the total
combined voting power or value of all classes of stock of Company, the
maximum number of shares of Stock that such person shall be entitled to
purchase pursuant to the Plan shall be reduced to that number which,
when added to the number of shares of stock that such person is deemed
to own (excluding any number of shares of Stock that such person would
be entitled to purchase under the Plan), is one less than such five
percent. Any amounts withheld from a Participant's compensation that
cannot be applied to the purchase of Stock by reason of the foregoing
limitation shall be returned to the Participant as soon as practicable.
(c) A Participant may not purchase shares of Stock having an
aggregate Market Value of more than $25,000, determined at the
beginning of each Purchase Period, for any calendar year in which one
or more offerings under this Plan are outstanding at any time, and a
Participant may not purchase a share of Stock under any offering after
the expiration of the Purchase Period for the offering.
SECTION 3.03 Purchase Price of Shares.
(a) Unless the Committee determines otherwise, the Purchase
Price per share of the Stock to be sold to Participants under the Plan
shall be the lower of:
(i) 85% of the Market Value of such share on the first
day of the Purchase Period, or
(ii) 85% of the Market Value of such share on the
Purchase Date.
(b) The Committee may determine that the Purchase Price shall
be the Market Value, or a percentage of the Market Value, on either of
the first day of the Purchase Period or the Purchase Date, or the lower
of such values, so long as the percentage shall not be lower than 85%
of such Market Value.
SECTION 3.04 Exercise of Purchase Privilege.
(a) As of the first day of each Purchase Period, each
Participant shall be granted an option to purchase shares of Stock at
the Purchase Price specified in Section 3.03. The option shall continue
in effect through the Purchase Date for the Purchase Period. Subject to
the provisions of Section 3.02 above, on each Purchase Date, the
Participant shall automatically be deemed to have exercised his or her
option to purchase shares of Stock, unless he or she notifies the
Committee, in such manner and at such time in advance of the Purchase
Date as the Committee shall prescribe, of his or her desire not to make
such purchase.
(b) Subject to the provisions of Section 3.02, there shall be
purchased for the Participant on each Purchase Date, at the Purchase
Price for the Purchase Period, the largest number of whole shares of
Stock and fractional shares as can be purchased with the amounts
withheld from the Participant's Compensation or deposited by the
Participant as described in Section 3.05(b) during the Purchase Period.
Each such purchase shall be deemed to have occurred on the Purchase
Date occurring at the close of the Purchase Period for which the
purchase was made. Any amounts that are withheld from a Participant's
Compensation in a Purchase Period and that remain after the purchase of
whole shares of Stock on a Purchase Date will be held in the
Participant's account, without interest, and applied on the
Participant's behalf to purchase Stock on the next Purchase Date.
SECTION 3.05 Payroll Deductions and Deposits.
(a) Each Participant shall authorize payroll deductions from
his or her Compensation for the purpose of funding the purchase of
Stock pursuant to his or her Purchase Agreement. In the Purchase
Agreement, each Participant shall authorize an after-tax payroll
deduction from each payment of Compensation during the Purchase Period
of an amount (i) not less than $5.00 per paycheck for a Participant who
is paid on a weekly payroll period basis or $10.00 per paycheck for a
Participant who is paid biweekly or semi-monthly payroll period basis,
and (ii) not more than ten percent (10%) of such Participant's
Compensation, rounded to the next highest whole dollar amount. A
Participant may change the deduction to any permissible level effective
as of any Election Date. A change shall be made by filing with the
Committee a notice in such form and at such time in advance of the
Election Date on which the change is to be effective as the Committee
shall prescribe.
(b) The Committee may allow Participants to deposit funds with
the Company to be used for the purpose of purchasing Stock pursuant to
their Purchase Agreements, instead of or in addition to payroll
deductions pursuant to Section 3.05(a) subject to the following: (i)
only one deposit as described in this paragraph shall be accepted in
Purchase Period, (ii) the minimum amount that a Participant may
contribute to the Plan pursuant to this paragraph shall be twenty-five
dollars ($25) per Purchase Period and (iii) the total amount that the
Participant may contribute to the Plan pursuant to this paragraph
together with all payroll deductions pursuant to paragraph (a) above
may not exceed the $25,000 limitation specified in paragraph (d) of
Section 3.02 above. The Committee shall designate the dates by which
any such deposits must be made for a Purchase Period.
(c) Dividends will be paid on all whole and fractional shares
purchased by a Participant. Unless otherwise directed by the
Participant, all dividends paid with respect to shares purchased by
each Participant will be automatically be reinvested under the Aqua
America, Inc. Dividend Reinvestment and Direct Stock Purchase Plan.
SECTION 3.06 Payment for Stock. The Purchase Price for all shares of
Stock purchased by a Participant under the Plan shall be paid out of the
Participant's authorized payroll deductions and any deposits made by a
Participant pursuant to Section 3.05(b). All funds received or held by the
Company under the Plan are general assets of the Company, shall be held free of
any trust or other restriction, and may be used for any corporate purpose.
SECTION 3.07 Share Ownership; Issuance of Certificates.
(a) The shares of Stock purchased by a Participant on a
Purchase Date shall, for all purposes, be deemed to have been issued or
sold at the close of business on the Purchase Date. Prior to that time,
none of the rights or privileges of a stockholder of the Company shall
inure to the Participant with respect to such shares of Stock. All the
shares of Stock purchased under the Plan shall be delivered by the
Company in a manner as determined by the Committee.
(b) The Committee, in its sole discretion, may determine that
shares of Stock shall be delivered by (i) issuing and delivering to the
Participant a certificate for the number of shares of Stock purchased
by the Participant, (ii) issuing and delivering certificates for the
number of shares of Stock purchased to a firm which is a member of the
National Association of Securities Dealers, as selected by the
Committee from time to time, which shares shall be maintained by such
firm in a separate brokerage account for each Participant, or (iii)
issuing and delivering certificates for the number of shares of Stock
purchased by Participants to a bank or trust company or affiliate
thereof, as selected by the Committee from time to time, which shares
may be held by such bank or trust company or affiliate in street name,
but with a separate account maintained by such entity for each
Participant reflecting such Participant's share interests in the Stock.
Each certificate or account, as the case may be, may be in the name of
the Participant or, if he or she so designates on the Participant's
Purchase Agreement, in the Participant's name jointly with the
Participant's spouse, with right of survivorship, or in such other form
as the Committee may permit.
(c) The Committee, in its sole discretion, may impose such
restrictions or limitations as it shall determine on the resale of
Stock, the issuance of individual stock certificates or the withdrawal
from any stockholder accounts established for a Participant.
SECTION 3.08 Distribution of Shares or Resale of Stock.
(i) In accordance with the procedures established by the
Committee, a Participant may request a distribution of shares
of Stock purchased for the Participant under the Plan or order
the sale of such shares at any time by making a request in
such form and at such time as the Committee shall prescribe.
(ii) If a Participant terminates his or her employment
with the Employer or otherwise ceases to be an Eligible
Employee, the Participant shall receive a distribution of his
or her shares of Stock held in any stockholder account
established pursuant to Section 3.07(b), unless the
Participant elects to have the shares of Stock sold in
accordance with such procedures as the Committee shall
prescribe.
(b) If a Participant is to receive a distribution of shares of
Stock, or if shares are to be sold, the distribution or sale shall be
made in whole shares of Stock, with fractional shares paid in cash. Any
brokerage commissions resulting from a sale of Stock shall be deducted
from amounts payable to the Participant.
ARTICLE IV
SPECIAL ADJUSTMENTS
SECTION 4.01 Shares Unavailable. If, on any Purchase Date, the
aggregate funds available for the purchase of Stock would purchase a number of
shares in excess of the number of shares of Stock then available for purchase
under the Plan, the following events shall occur:
(a) The number of shares of Stock that would otherwise be
purchased by each Participant shall be proportionately reduced on the
Purchase Date in order to eliminate such excess;
(b) The Plan shall automatically terminate immediately after
the Purchase Date as of which the supply of available shares is
exhausted; and
(c) Any amounts remaining shall be repaid the Participants.
SECTION 4.02 Anti-Dilution Provisions. The aggregate number of shares
of Stock reserved for purchase under the Plan, as provided in Section 3.01, the
maximum number of shares that may be purchased by a Participant as provided in
Section 3.02(b), and the calculation of the Purchase Price per share may be
appropriately adjusted by the Committee to reflect any increase or decrease in
the number of issued shares of Stock resulting from a subdivision or
consolidation of shares or other capital adjustment, or the payment of a stock
dividend, or other increase or decrease in such shares, if effected without
receipt of consideration by the Company.
SECTION 4.03 Effect of Certain Transactions. Subject to any required
action by the stockholders, if the Company shall be the surviving corporation in
any merger or consolidation, any offering hereunder shall pertain to and apply
to the shares of Stock of the Company. However, in the event of a dissolution or
liquidation of the Company, or of a merger or consolidation in which the Company
is not the surviving corporation, the Plan and any offering hereunder shall
terminate upon the effective date of such dissolution, liquidation, merger or
consolidation, unless the Board determines otherwise, and the balance of any
amounts withheld from a Participant's Compensation or deposited pursuant to
Section 3.05(b) which have not by such time been applied to the purchase of
Stock shall be returned to the Participant.
ARTICLE V
MISCELLANEOUS
SECTION 5.01 Non-Alienation. Except as set forth below, the right to
purchase shares of Stock under the Plan is personal to the Participant, is
exercisable only by the Participant during the Participant's lifetime and may
not be assigned or otherwise transferred by the Participant. If a Participant
dies, unless the executor, administrator or other personal representative of the
deceased Participant directs otherwise, any amounts previously withheld from the
Participant's Compensation or deposited pursuant to Section 3.05(b) before the
Participant's death during the Purchase Period in which the Participant dies
shall be used to purchase Stock on the Purchase Date for the Purchase Period.
After that Purchase Date, there shall be delivered to the executor,
administrator or other personal representative of the deceased Participant all
shares of Stock and such residual amounts as may remain to the Participant's
credit under the Plan.
SECTION 5.02 Administrative Costs. The Company shall pay the
administrative expenses associated with the operation of the Plan (other than
brokerage commissions resulting from sales of Stock directed by Participants).
SECTION 5.03 No Interest. No interest shall be payable with respect to
amounts withheld or deposited under the Plan.
SECTION 5.04 Committee. The Board of Directors shall appoint the
Committee, which shall have the authority and power to administer the Plan and
to make, adopt, construe, and enforce rules and regulations not inconsistent
with the provisions of the Plan. The Committee shall adopt and prescribe the
contents of all forms required in connection with the administration of the
Plan, including, but not limited to, the Purchase Agreement, payroll withholding
authorizations, requests for distribution of shares, and all other notices
required hereunder. The Committee shall have the fullest discretion permissible
under law in the discharge of its duties. The Committee's interpretations and
decisions with respect to the Plan shall be final and conclusive.
SECTION 5.05 Withholding of Taxes; Notification of Transfer.
(a) All acquisitions and sales of Stock under the Plan shall
be subject to applicable federal (including FICA), state and local tax
withholding requirements if the Internal Revenue Service or other
taxing authority requires such withholding. The Company may require
that Participants pay to the Company (or make other arrangements
satisfactory to the Company for the payment of) the amount of any
federal, state or local taxes that the Company is required to withhold
with respect to the purchase of Stock or the sale of Stock acquired
under the Plan, or the Company may deduct from the Participant's wages
or other compensation the amount of any withholding taxes due with
respect to the purchase of Stock or the sale of Stock acquired under
the Plan.
(b) A Participant shall be required to advise the Committee
immediately if the Participant transfers (by sale, gift or other
manner) any shares of Stock acquired under the Plan within two years
after the beginning of the Purchase Period in which the Stock is
purchased.
SECTION 5.06 Amendment of the Plan. The Board of Directors may, at any
time and from time to time, amend the Plan in any respect, except that any
amendment that is required to be approved by the stockholders under Section 423
of the Code shall be submitted to the stockholders of the Company for approval.
SECTION 5.07 Expiration and Termination of the Plan. The Plan shall
continue in effect for ten years from the Effective Date, unless terminated
prior to that date pursuant to the provisions of the Plan or pursuant to action
by the Board of Directors. The Board of Directors shall have the right to
terminate the Plan at any time without prior notice to any Participant and
without liability to any Participant. Upon the expiration or termination of the
Plan, the balance, if any, then standing to the credit of each Participant from
amounts withheld from the Participant's Compensation or deposited by the
Participant which has not, by such time, been applied to the purchase of Stock
shall be refunded to the Participant.
SECTION 5.08 No Employment Rights. Participation in the Plan shall not
give an employee any right to continue in the employment of an Employer, and
shall not affect the right of the Employer to terminate the employee's
employment at any time, with or without cause.
SECTION 5.09 Repurchase of Stock. The Company shall not be required to
purchase or repurchase from any Participant any of the shares of Stock that the
Participant acquires under the Plan.
SECTION 5.10 Notice. A Purchase Agreement and any notice that a
Participant files pursuant to the Plan shall be on the form prescribed by the
Committee and shall be effective only when received by the Committee. Delivery
of such forms may be made by hand or by certified mail, sent postage prepaid, to
the Company's corporate headquarters, or such other address as the Committee may
designate. Delivery by any other mechanism shall be deemed effective at the
option and discretion of the Committee.
SECTION 5.11 Government Regulation. The Company's obligation to sell
and to deliver the Stock under the Plan is at all times subject to all approvals
of any governmental authority required in connection with the authorization,
issuance, sale or delivery of such Stock.
SECTION 5.12 Internal Revenue Code and ERISA Considerations. The Plan
is intended to constitute an "employee stock purchase plan" within the meaning
of Section 423 of the Internal Revenue Code of 1986, as amended. The Plan is not
intended and shall not be construed as constituting an "employee benefit plan,"
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended.
SECTION 5.13 Headings, Captions, Gender. The headings and captions
herein are for convenience of reference only and shall not be considered as part
of the text. The masculine shall include the feminine, and vice versa.
SECTION 5.14 Severability of Provisions, Prevailing Law. The provisions
of the Plan shall be deemed severable. In the event any such provision is
determined to be unlawful or unenforceable by a court of competent jurisdiction
or by reason of a change in an applicable statute, the Plan shall continue to
exist as though such provision had never been included therein (or, in the case
of a change in an applicable statute, had been deleted as of the date of such
change). The Plan shall be governed by the laws of the Commonwealth of
Pennsylvania to the extent such laws are not in conflict with, or superseded by,
federal law.
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