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11. Upon receipt of a final Application for Payment, the OWNER will inspect the Work.

When he finds the Work acceptable and the Contract fully performed, the OWNER will
promptly issue a final Certificate for Payment.

12. Acceptance of final payment by the CONTRACTOR, a subcontractor or supplier shall

constitute a waiver of claims by that payee except those previously made in writing and
identified by that payee as unsettled at the time of final Application for Payment.

ARTICLE 11- RETAINAGE

1. The OWNER will retain a portion of the progress payment, each month, in accordance with
the following procedures:

a. The OWNER will establish an escrow account in the bank of the OWNER’s
choosing. The account will be established such that interest on the principal will be
paid to the CONTRACTOR. The principal will be the accumulated retainage paid
into the account by the OWNER. The principal will be held by the bank, available
only to the OWNER, until termination of the contract.

b. Until the work is 50% complete, as determined by the OWNER, retainage shall be
10% of the monthly payments claimed. The computed amount of retainage will be
deposited in the escrow account established above.

c. After the work is 50% complete, and provided the CONTRACTOR has satisfied
the OWNER in quality and tirneliness of the work, and provided further that there
is no specific cause for withholding additional retainage no further amount will be
withheld. The escrow account will remain at the same balance throughout the
remainder of the project.

2. Upon final completion and acceptance of the Work, OWNER shall hold 2% retainage

during the 1 (one) year warranty period and release it only after the project has been
accepted.

ARTICLE 12— PROTECTION OF PERSONS AND PROPERTY

1.

The CONTRACTOR shall be responsible for initiating, maintaining and supervising all
safety precautions and programs, including all those required by law in connection with
performance of the Contract. The CONTRACTOR shall promptly remedy damage and
loss to property caused in whole or in part by the CONTRACTOR, or by anyone for
whose acts the CONTRACTOR may be liable.

ARTICLE 13 - CORRECTION OF WORK

1,

The CONTRACTOR shall promptly correct Work rejected by the OWNER as failing to
conform to the requirements of the Contract Documents. The CONTRACTOR shall bear
the cost of correcting such rejected work

In addition to the CONTRACTOR’s other obligations including warranties under the
Contract, the CONTRACTOR shall, for a period of one year after Substantial Completion,
correct work not conforming to the requirements of the Contract Documents.

If the CONTRACTOR fails to correct nonconforming Work within a reasonable time, the
OWNER may correct it and the CONTRACTOR shall reimburse the OWNER for the
cost of the correction.

Page 8 of 12

ARTICLE 14 — PROHIBITED INTERESTS

CONTRACTOR shall not allow any officer or employee of the OWNER to have any indirect or
direct interest in this contract or the proceeds of this contract. CONTRACTOR warrants that no
officer or employee of the OWNER has any direct or indirect interest, whether contractual, non-
contractual, financial or otherwise, in this contract or in the business of the CONTRACTOR.
CONTRACTOR also warrants that it presently has no interest and that it will not acquire any
interest, direct or indirect, which would conflict in any manner or degree with the performance of
services required to be performed under this contract. CONTRACTOR further warrants that no
person having such an interest shall be employed in the performance of this contract. If any such
interest comes to the attention of CONTRACTOR at any time, a full and complete disclosure of
the interest shall be immediately made in writing to the OWNER. If OWNER determines that a
conflict exists and was not disclosed to the OWNER, it may terminate the contract at will or for
cause.

ARTICLE 15 — TERMINATION OF THE CONTRACT
TERMINATION, ABANDONMENT, OR SUSPENSION AT WILL

The OWNER, in its sole discretion, shall have the right to terminate, abandon, or suspend all or
part of the project and contract at will. Ifthe OWNER chooses to terminate, abandon, or suspend
all or part of the project, it shall provide CONTRACTOR 10 day’s written notice of its intent to
do so. If all or part of the project is suspended for more than 90 days, the suspension shall be
treated as a termination at will of all or that part of the project and contract.

Upon receipt of notice of termination, abandonment, or suspension at will, CONTRACTOR shall:

a. Immediately discontinue work on the date and to the extent specified in the notice.
b. Provide the OWNER with a list of all unperformed services.
C. Place no further orders or sub-contracts for materials, services, or facilities, other

than as may be necessary or required for completion of such portion of work under
the contract that is not terminated.

d. Immediately make every reasonable effort to obtain cancellation upon terms
satisfactory to the OWNER of all orders or sub contracts to the extent they relate to
the performance of work terminated, abandoned, or suspended under the notice,
assign to the OWNER any orders or sub contracts specified in the notice, and
revoke agreements specified in the notice.

e. Not resume work after the effective date of a notice of suspension until receipt of a
written notice from the OWNER to resume performance.

In the event of a termination, abandonment, or suspension at will, CONTRACTOR shall receive
all amounts due and not previously paid to CONTRACTOR for work satisfactorily completed in
accordance with the contract prior to the date of the notice and compensation for work thereafter
completed as specified in the notice. No amount shall be allowed or paid for anticipated profit on
unperformed services or other unperformed work.

Page 9 of 12

The aggregate principal payment requirements subsequent to December 31, 2020 are as
follows:

(in thousands) Amount

2021 § 6,018
2022 6,272
2023 7,508
2024 6,721
2025 7,013
2026 and thereafter 211,351
Total S 244,883

Several of Pennichuck Water’s loan agreements contain a covenant that prevents Pennichuck
Water from declaring dividends if Pennichuck Water does not maintain a minimum net
worth of $4.5 million. As of December 31, 2020 and 2019, Pennichuck Water’s net worth was
$103.6 million and $107.4 million, respectively.

The 2014A, 20148, 2015A, 2015B, 2018A, 2018B, 2019A, 2020A, 2020B and 2020C bonds
were issued under a new bond indenture and loan and trust agreement, established with the
issuance of the 2014 Series Bonds, which contains certain covenant obligations upon
Pennichuck Water, which are as follows:

Debt to Capital Covenant - Pennichuck Water cannot create, issue, incur, assume or
guarantee any short-term debt if (1} the sum of the short-term debt plus its funded debt
(“Debt”) shall exceed 85% of the sum of its short-term debt, funded debt and capital stock
plus surplus accounts (“Capital”), unless the short-term debt issued in excess of the 85%
is subordinated to the Series 2014 bonds. Thereby, the ratio of Debt to Capital must be
equal to or less than 1.0. As of December 31, 2020 and 2019, Pennichuck Water has a
Debt to Capital Coverage ratio of 0.6 and 0.6, respectively.

All Bonds Test - Additionally, Pennichuck Water cannot create, issue, incur, assume or
guarantee any new funded debt, if the total outstanding funded debt (“Total Funded
Debt”) will exceed the sum of MARA (as defined in Note 14 of these consolidated financial
statements) and 85% of its Net Capital Properties (“MARA and Capital Properties”), and
unless net revenues or EBITDA (earnings before interest, taxes, depreciation and
amortization) shall equal or exceed for at Jeast 12 consecutive months out of the 15
months preceding the issuance of the new funded debt by 1.1 times the maximum
amount for which Pennichuck Water will be obligated to pay in any future year (“Max
Amount Due”), as a result of the new funded debt being incurred. Thereby, the ratio of
Total Funded Debt to MARA and Capital Properties must be equal to or less than 1.0; as
of December 31, 2020 and 2019, this coverage ratio was 0.6 and 0.5, respectively. Also,
the ratio of EBITDA to the Max Amount Due must be equal to or greater than 1.1; as of
December 31, 2020 and 20139, this ratio was 2.6 and 1.5, respectively.

125

TERMINATION FOR CAUSE

This agreement may be terminated by the OWNER on 10 calendar day’s written notice to
CONTRACTOR in the event of a failure by CONTRACTOR to adhere to any or all the terms
and conditions of the contract or for failure to satisfactorily, in the sole opinion of the OWNER, to
complete or make sufficient progress on the work in a timely and professional manner.
CONTRACTOR shall be given an opportunity for consultation with the OWNER prior to the
effective date of the termination. CONTRACTOR may terminate the contract on 10 calendar
days written notice if, through no fault of CONTRACTOR, the OWNER fails to pay
CONTRACTOR for 45 days after the date of approval by the OWNER of any Application for
Payment.

Upon receipt of notice of termination for cause, CONTRACTOR shall:

1. Immediately discontinue work on the date and to the extent specified in the notice.

2. Provide the OWNER with a list of all unperformed services.

3. Place no further orders or sub-contracts for materials, services, or facilities, other than as
may be necessary or required for completion of such portion of work under the contract
that is not terminated.

4. Immediately make every reasonable effort to obtain cancellation upon terms satisfactory to
the OWNER of all orders or sub contracts to the extent they relate to the performance of
work terminated, abandoned, or suspended under the notice, assign to the OWNER any
orders or sub contracts specified in the notice, and revoke agreements specified in the
notice.

5. Not resume work after the effective date of a notice of termination unless and until receipt
of a written notice from the OWNER to resume performance.

In the event of a termination for cause, CONTRACTOR shall receive all amounts due and not
previously paid to CONTRACTOR for work satisfactorily completed in accordance with the
contract prior to the date of the notice, less all previous payments. No amount shall be allowed or
paid for anticipated profit on unperformed services or other unperformed work. Any such payment
may be adjusted to the extent of any additional costs occasioned to the OWNER by reasons of
CONTRACTOR's failure. CONTRACTOR shall not be relieved of liability to the OWNER for
damages sustained from the failure, and the OWNER may withhold any payment to the
CONTRACTOR until such time as the exact amount of damages due to the OWNER is
determined. All claims for payment by the CONTRACTOR must be submitted to the OWNER
within 30 days of the effective date of the notice of termination.

If after termination for the failure of CONTRACTOR to adhere to any of the terms and conditions
of the contract or for failure to satisfactorily, in the sole opinion of the OWNER, to complete or
make sufficient progress on the work in a timely and professional manner, it is determined that
CONTRACTOR had not so failed, the termination shall be deemed to have been a termination at
will. In that event, the OWNER shall, if necessary, make an adjustment in the compensation paid
to CONTRACTOR such that CONTRACTOR receives total compensation in the same amount
as it would have received in the event of a termination-at-will.

Page 10 of 12

GENERAL PROVISIONS FOR TERMINATION

Upon termination of the contract, the OWNER may take over the work and prosecute it to
completion by agreement with another party or otherwise. Upon termination of the contract or in
the event CONTRACTOR shall cease conducting business, the OWNER shall have the right to
solicit applications for employment from any employee of the CONTRACTOR assigned to the
performance of the contract. Neither party shall be considered in default of the performance of
such obligations is prevented or delayed by any cause, existing or future, which is beyond the
reasonable control of such party. Delays arising from the actions or inactions of one or more of
CONTRACTOR 's principals, officers, employees, agents, subcontractors, sub consultants,
vendors, or suppliers are expressly recognized to be within CONTRACTOR's control.

ARTICLE 16—- DISPUTE RESOLUTION

The parties shall attempt to resolve any dispute related to this contract as follows. Either party
shall provide to the other party, in writing and with full documentation to verify and substantiate
its decision, its stated position concerning the dispute. No dispute shall be considered submitted
and no dispute shall be valid under this provision unless and until the submitting party has
delivered the written statement of its position and full documentation to the other party. The
parties shall then attempt to resolve the dispute through good faith efforts and negotiation between
the OWNER Representative and the CONTRACTOR Representative. At all times,
CONTRACTOR shall carry on the work under this contract and maintain and complete work in
accordance with the requirements of the contract or determination or direction of the OWNER. If
the parties are unable to resolve their dispute as described above within 30 days, the parties may
request that the dispute be submitted to the Board of Public Works for resolution. If the parties are
dissatisfied with the decision of the Board of Public Works, the parties’ reserve the right to pursue
any available legal and/or equitable remedies for any breaches of this contract except as that right
may be limited by the terms of this contract.

ARTICLE 17— CHOICE OF LAW AND VENUE

This contract shall be governed exclusively by the laws of the State of New Hampshire and any
claim or action brought relating to this contract, the work performed or contracted to be performed
thereunder, or referable in anyway thereto shall be brought in Hillsborough County (New
Hampshire) Superior Court Southern Judicial District or in the New Hampshire 9th Circuit
Court—Nashua and not elsewhere

ARTICLE 18— MISCELLANEOUS PROVISIONS

1. Neither party to the Contract shall assign the Contract as a whole without written consent
of the other.

2. Tests, inspections and approvals of portions of the Work required by the Contract
Documents or by laws, ordinances, rules, regulations or orders of public authorities having
jurisdiction shall be made at an appropriate time.

3. If additional testing is required, the CONTRACTOR shall perform these tests.

4. The OWNER shall pay for tests except for testing Work found to be defective for which
the CONTRACTOR shall pay.

Page 11 of 12

IN WITNESS WHEREOF, the parties hereto have caused this contract to be signed and intend to be
legally bound thereby.

City of Nashua, NH (signature) William P. Davis Excavation, LLC
(signature)

James Donchess, Mayor
(Printed Name and Title) (Printed Name and Title)

Date Date

Page 12 of 12

| THE CITY OF NASHUA “The Gate Chy

Division of Public Works

Eingneering Department EXHIBIT A

REQUEST FOR BIDS
Vegetation Removal of the Nashua Levee

The City of Nashua Division of Public Works invites qualified vendors to submit a proposal for the
removal of vegetation along a rip-rap area located on the Merrimack River — Right Bank Flood Damage
Reduction Systems, known as the Nashua levee system.

|. Background

About 1948, The US Army Corps of Engineers (USACE) constructed a levee system to protect 70 low lying
areas at the confluence of the Nashua and Merrimack Rivers. Once constructed, the City became the
owner of the levee system with the USACE retaining the right to inspect and regulate the operation of
the system. Recent inspections of the levee system has identified a need to remove unwanted
vegetation from the rip-rap slope of the embankment and bridge abutment and the concrete floodwall
areas as shown on Figure 1 and 2, respectively.

ll. Project Time Line

Item Date Location/Time
Mandatory Pre-Bid Meeting 5/14/18 60 Crown Street @ 9:00 am
Deadline for Question to be Submitted 5/15/18 4:00 pm
Bid Due 5/18/18 Engineering Department DPW

Vendors are encouraged to submit questions via email however; the City of Nashua assumes no liability
for assuring accurate/complete email transmission/receipt and is not responsible to acknowledge
receipt. Inquires must be submitted in writing to:

Mark Saunders, Assistant Construction Engineer,
City of Nashua, Division of Public Works
Email: Saundersm@NashuaNH.gov

Ill. Project Description

This work shall include the remove of all vegetation growing in the rip-rap slope and concrete floodwall
areas as described above and shown on Figure 1 and 2.

A large amount of vine growth exists, including but not limited to poison ivy. To the maximum extent
possible all vines must be cut and removed from the area. All trees of, including saplings will be cut.

9 Riverside Street * Nashua, New Hampshire 03062 * Phone (603) 589-3120 * Fax (603)
589-3169

Where possible all roots systems of trees, shrubs and vines must be removed. Trees larger than 2 inches
may be cut at the base of the trunk. No herbicide spraying will be done at this location due to the
proximately to the Merrimack River. All rip-rap must be restored to existing conditions.

IV. Scope
A. Work Completion

Hired vendor will remove any vegetation as describe above and as noted by City. The City will inspect
work for completeness and approval.

B. Debris Removal

The vendor is solely responsible to remove all vegetation clippings off of the project location. The
clippings shall be chipped and brought to and disposed of at the City’s landfill.

C. Landfill

All debris shall be chipped and then brought to the City of Nashua Landfill. Before the start of the
project the landfill needs to be contacted and delivery schedule arranged. All deliveries shall be a
coordinated effort between the Vendor and City of Nashua Landfill. Contact information for the City of
Nashua Landfill:

Jeffrey Lafleur, Superintendent of Solid Waste
City of Nashua, Solid Waste Department
Email: Lafleur] @NashuaNH.gov

D. Walk through

A mandatory pre-bid meeting will be held on May 14, 2018 at the site location near 60 Crown Street at
1:00pm. All vendors are required to send a representative to the pre bid meeting. This walk through is
an opportunity for the City to answer any questions relating to the project and allow vendors to view
the current condition and the scope of work. The walk through will include work zone boundaries,
understanding the scope of work, vehicle and machine/equipment access points, and working
conditions.

E. Access Roads

Access to the rip-rap work zone is a service road located off of Bancroft Street. See attached Figure 1 for
the location of the service road. This service road is parallel with Bridge Street and next to the new
Renaissances Development.

Access to the concrete floodwall is through Sanders Street. See attached figure 2 for the location of the
service road.

Vehicles and machine/equipment access maybe limited due to steep grading for both access roads.

9 Riverside Street * Nashua, New Hampshire 03062 « Phone (603) 589-3120 » Fax (603)
589-3169

F. Safety

It will be the Vendor's responsibility to ensure proper safety measures are taken while performing the
work. All workers shall have on the proper personal protective equipment for the task being performed.
All machinery shall be in good working order and used within the manufactures specifications.

V. Insurances

Certificates of liability and Workmen’s Compensations Insurance must be filed by the successful bidder
prior to commencement of work.

Liability Limits are as follows:
General Liability $1,000,000 per occurrence; $2,000,000 aggregate

Automotive Liability $1,000,000 combined single limit
Coverage must include all owned, non-owned and hired vehicles

Workers’ Compensations Employers’ Liability according to NH State Statutes
$100,000 / $500,000 / $100,000

The City of Nashua must be named as an additional insured on all liability certificates.
VI. Payment
Payment will be issued on completion of the project.
VII. Closing

Vendors are responsible to furnish all equipment in good working order and labor to remove and
dispose of the vegetation at the locations described above. The vegetation clipping can be chipped and
disposed of at the City’s landfill. All rip-rap must be restored to existing conditions.

The vendor must have completed at least three (3) similar jobs (type of work and scale) executed within
the last five (5) years. Please provide references, if requested.

All bids are binding for sixty (60) days following deadline for bids, or until effective date of any bidding
resulting contract, whichever is later.

A contract will be awarded to the bidder that is designated by the City of Nashua as the lowest
responsive and responsible bidder. The City of Nashua may reject any or all of the bids on any basis and
without disclosure of a reason. The failure to make such disclosure shall not result in accrual of any right,
claim or cause of action by any unsuccessful bidder against the City of Nashua.

The job must be completed by August 31, 2018.

See attached Bid Form, Project Locus, Figures 1 and 2

9 Riverside Street * Nashua, New Hampshire 03062 « Phone (603) 589-3120 + Fax (603)
589-3169

Nashua Levee — Location of Vegetation Removal

Two Shrub
Groupings

Meeting location
for mandatory
prebid — near 60
Crown St