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PENNICHUCK

PENNICHUCK CORPORATION
25 Manchester Street
Merrimack, New Hampshire 03054

PROXY STATEMENT

2017 Annual Meeting of Sole Shareholder
To be Held on May 6, 2017

This Proxy Statement is furnished to the City of Nashua, New Hampshire (the “City”), in its
capacity as the Sole Shareholder of Pennichuck Corporation (“Pennichuck Corporation” or the
“Company”), by the Board of Directors of Pennichuck Corporation, in connection with the
solicitation of a proxy to be voted at the Annual Meeting of Sole Shareholder for the purpose set
forth in the accompanying Notice of Annual Meeting of Sole Shareholder.

The Annual Meeting will be held at the Crowne Plaza, 2 Somerset Parkway, Nashua, New
Hampshire, on Saturday, May 6, 2017 at 9:00 a.m.

Matter to be Voted Upon at the Annual Meeting

At the Annual Meeting, the City, in its capacity as the Sole Shareholder of Pennichuck Corporation,
is being asked to consider and vote upon the following:

(1) To elect James P. Dore, Elizabeth A. Dunn, Paul A. Indeglia and John M.
Murphy as directors, each for a three-year term, and until their successors are
elected and qualified.

Voting at the Annual Meeting

Background. Pennichuck Corporation was acquired by the City on January 25, 2012. This
acquisition was accomplished pursuant to an Agreement and Plan of Merger reached between the
City and Pennichuck Corporation dated November 11, 2010 (the “Merger Agreement”). The
transaction, in which the City issued $150.6 million of general obligation bonds to acquire the
outstanding stock of Pennichuck Corporation and pay all transaction costs, was authorized by
special legislation enacted by the State Legislature in 2007 and 2010. The Mayor and the Board
of Aldermen unanimously approved the acquisition pursuant to this special legislation on

January 11,2011. The New Hampshire Public Utilities Commission approved the Merger
Agreement on November 23, 2011, concluding that “the transaction is in the public interest and
will not have an adverse effect on rates, terms, service, or operation of the utilities.”

Corporate Structure. As part of the acquisition, the corporate structure of Pennichuck
Corporation and its utility subsidiaries was retained. Under this structure, the City is the sole
shareholder of Pennichuck Corporation. Pennichuck Corporation continues to own five
corporate subsidiaries, including three regulated public utilities (Pennichuck Water Works, Inc.,
Pennichuck East Utility, Inc., and Pittsfield Aqueduct Company, Inc.), an unregulated service
company (Pennichuck Water Service Corporation), and a real estate holding company (The
Southwood Corporation).

Election of the Board of Directors. Under this corporate governance system, the City exercises
its control over Pennichuck Corporation in its capacity as the Company’s Sole Shareholder in
accordance with the Articles of Incorporation, the By-Laws and the New Hampshire laws
governing business corporations. In accordance with these rules, Pennichuck Corporation’s
business affairs are managed and overseen by a Board of Directors. One of the most important
responsibilities of the City, in its capacity as Sole Shareholder, is to elect members of the Board
of Directors from individuals nominated by the Pennichuck Corporation Board of Directors at
the Company’s Annual Meeting.

Voting at the Annual Meeting. It is important to remember that the City itself is the Sole
Shareholder, not any individual person who may hold an office with the City. The City must
exercise its responsibilities as Sole Shareholder through public meetings of the City’s Board of
Aldermen and Mayor, acting in accordance with applicable New Hampshire laws and the
provisions of the City Charter. As a municipal entity, the City is not typically in a position to
“attend” an annual meeting, or any other meeting of the Sole Shareholder, “in person.”

Traditional corporate law principles provide a ready solution for this type of “institutional”
voting of shares. As the Sole Shareholder, the City may review the proposed vote and take
action at appropriate City meetings determined by the City. The City may then either designate
an individual person to attend the Annual Meeting in person with the authority to vote the City’s
shares in accordance with the City’s determination, or the City may vote its shares by proxy.

To facilitate these options, the Pennichuck Corporation Board of Directors has prepared this

Proxy Statement which contains details of the business to be conducted at the Annual Meeting.
If the City determines to vote its shares by proxy, it should cause the enclosed proxy card to be
completed and returned to Pennichuck Corporation prior to the Annual Meeting. By executing
the enclosed proxy card, the City will be designating the actions it has determined to take with
respect to the matters to be heard at the Annual Meeting and will be authorizing the officers of
the Company named on the proxy card to act as the City’s proxy to vote on the City’s behalf at

the Annual Meeting in accordance with the instructions set forth on the proxy card.

Corporate Governance Matters

Current Board of Directors. Our Board of Directors is divided into three classes, each class
serving for three years following their election and until their successors have been elected and
qualified.

The Pennichuck Corporation Board currently has eleven directors. Of the eleven directors, four
have terms ending in 2017 (Class B), three have terms ending in 2018 (Class C), and four have
terms ending in 2019 (Class A).

On April 22, 2016, James McMahon resigned from the Board. Ata Special Meeting of the Sole
Shareholder held on March 24, 201 7, John Murphy was elected as a Class B director to fill the
vacancy resulting from the resignation of James McMahon.

The current members of the Company’s Board of Directors are as follows:

Term Expiring 2017 Term Expiring 2018 Term Expiring 2019
Class B Class C Class A
James P. Dore David P. Bernier C. George Bower
Elizabeth A. Dunn Stephen D. Genest Jay N. Lustig
Paul A. Indeglia Thomas J. Leonard John D. McGrath
John M. Murphy Preston J. Stanley, Jr.

Board Meetings, Committee Meetings and Attendance. In 2016, the Company’s Board of
Directors held twelve meetings. Each member of the Board participated in all Board meetings
held, except for three directors who missed one Board meeting, and one director who missed two
Board meetings. All members of the Board of Directors attended the 2016 Annual Meeting of
Sole Shareholder.

In 2016, twenty-two Board Committee meetings were held. Each member of the Board of
Directors participated in all meetings of the Committees on which they served, except for six
directors, who each missed one Committee meeting.

Board Compensation. In 2016, each director, with the exception of James McMahon and John
Murphy, received an annual retainer of $12,000. Mr. McMahon, who served on the Board until
his resignation on April 22, 2016, received four month’s compensation of $4,000 for his services
as a director. Mr. Murphy was not a director in 2016. .

Annual Performance Evaluation. The Board of Directors conducts an annual self-evaluation
of the Board and its Committees to determine whether they are functioning effectively. Each
Committee is also required to evaluate their performance.

Corporate Code of Conduct. The Company has adopted a written Corporate Code of Conduct
that applies to its directors, officers and employees. A current copy of the Corporate Code of
Conduct can be found on the Company’s website at www.pennichuck.com, under the “Board of
Directors” caption, under the “Corporate Governance” heading.

Board Committees. The Board of Directors has established four standing committees: the
Audit, Finance and Risk Committee, the Communications Committee, the Compensation and
Benefits Committee, and the Nominating and Governance Committee.

Each Committee has adopted a written Charter which sets forth its purpose, membership,
duties and responsibilities. A copy of each Charter can be found on the Company’s website at
www.pennichuck.com, under the “Board of Directors” caption, under the “Corporate
Governance” heading.

The current members of the Board Committees are as follows:

Audit, Finance and Risk Committee Communications Committee
James P. Dore, Chairman Jay N. Lustig, Chairman
Paul A. Indeglia C. George Bower
Thomas J. Leonard Thomas J. Leonard
John D. McGrath Preston J. Stanley, Jr.

John M. Murphy (Appointed 3/24/17)

Compensation and Benefits Committee Nominating and Governance Committee
Stephen D. Genest, Chairman Paul A. Indeglia, Chairman
David P. Bernier Elizabeth A. Dunn
C. George Bower Stephen D. Genest
Elizabeth A. Dunn Thomas J. Leonard
Thomas J. Leonard Preston J. Stanley, Jr.

Jay N. Lustig

Audit, Finance and Risk Committee. The Audit, Finance and Risk Committee is responsible for
the appointment, compensation and retention of the independent auditors; preapproval of all
audit and non-audit services to be provided by the independent auditors; review and approval of
all related party transactions; review and evaluation of the qualifications, performance and
independence of the lead partner of the independent auditors; oversight of the integrity of the
Company’s financial staternents; oversight of Company financing activities; oversight of the
policies and procedures established to assess, monitor and control operational and financial risk;
and oversight of the Company’s insurance programs. The Audit, Finance and Risk Committee
held 5 meetings in 2016.

Communications Committee. The Communications Committee develops and assists with the
policies and strategies of external communications between the Board, the Company and the
Sole Shareholder, other stakeholders, and the public, as needed. The Communications
Committee held 3 meetings in 2016.

Compensation and Benefits Committee. The Compensation and Benefits Committee is
responsible for annually reviewing and approving corporate goals and objectives relevant to
Chief Executive Officer compensation; evaluating the Chief Executive Officer’s performance in
light of those goals and objectives, and determining and recommending to the Board of Directors
the Chief Executive Officer’s compensation based on evaluation of performance; reviewing and
approving executive salaries; reviewing and approving any employment agreements, special
compensation and benefits, or severance arrangements as they pertain to executive officers other
than the Chief Executive Officer; overseeing the Company’s compensation and benefit policies;
and establishing, terminating or amending existing compensation and employee benefit plans.
The Compensation and Benefits Committee held 5 meetings in 2016.

Nominating and Governance Committee. The Nominating and Governance Committee is
responsible for identifying individuals qualified to become Board members; recommending to
the Board the persons to be nominated by the Board for election as directors at the Annual
Meeting of Sole Shareholder; developing and recommending to the Board of Directors a set of
corporate governance principles; and overseeing an annual self-evaluation of the Board. The
Nominating and Governance Committee is authorized to retain advisors and consultants and to
compensate them for their services. The Nominating and Governance Committee did not retain
such advisors or consultants during 2016. The Nominating and Governance Committee held

9 meetings in 2016.

As part of the nomination process, the Nominating and Governance Committee reviewed the
current composition of the Board as a whole, and reviewed the qualifications and performance of
the incumbent directors who are up for re-election to the Board in 2017. Also, due to the
resignation of James McMahon as a director in 2016, the Nominating and Governance
Committee began a process to identify and evaluate potential candidates to fill the vacancy on
the Board. The process included requests to Board members for recommendations, the
placement of an advertisement for director candidates in two local newspapers, meetings from
time to time to evaluate biographical and background information received from potential
candidates and interviews of selected candidates by members of the Nominating and Governance
Committee.

The Nominating and Governance Committee considers whether to nominate any candidate for
director in accordance with the criteria set forth in its Charter, subject to the restrictions set forth
in the Company’s By-Laws. These criteria include the candidate’s integrity, business acumen,
knowledge of the Company’s business and industry, experience, diligence, conflicts of interest,
and the ability to act in the interests of the Sole Shareholder. The Committee does not assign
specific weights to particular criteria and no particular criterion is a prerequisite for each
prospective nominee. The backgrounds and qualifications of the Company’s directors,
considered as a group, should provide a composite mix of experience, knowledge and abilities
that will allow the Board of Directors to fulfill its responsibilities.

Senior Management. The members of the Company’s Senior Management team are as follows:
Larry D. Goodhue, Chief Executive Officer, Chief Financial Officer and Treasurer

Mr. Goodhue has been the Chief Executive Officer, Chief Financial Officer and Treasurer
of Pennichuck Corporation and its subsidiaries since November 6, 2015, and the Chief
Financial Officer, Treasurer and Controller from March 2012 through November 2015. He
was Controller from December 2006 to March 2012. Mr. Goodhue served as a financial
consultant to Metrobility Optical Systems, Inc. from July 2006 to October 2006 and to
Pennichuck Corporation from October 2006 to November 2006. From October 2005 to
June 2006, he was the Vice President of Finance and Administration for Metrobility
Optical Systems, Inc. and the Corporate Controller from September 2000 to September
2005. From May 2000 to August 2000, he served as Acting Chief Operating Officer for
Annalee Mobilitee Dolls, Inc. and was the Controller from J anuary 1998 to April 2000.
Mr. Goodhue holds a Bachelor of Science degree in Business Administration from
Merrimack College, and is a Certified Public Accountant in the State of New Hampshire
(for which his certification is currently in an inactive status). Mr. Goodhue’s base salary
for the fiscal year ended 2016 was $190,000.

Donald L. Ware, Chief Operating Officer

Mr. Ware has been the Chief Operating Officer of Pennichuck Corporation since

January 27, 2012. He was the Senior Vice President of Operations and Engineering of
Pennichuck Corporation from 2004 to January 2012, and Chief Engineer and Vice
President from 1995 to 2004. Mr. Ware is also the Chief Operating Officer of Pennichuck
Water Works, Inc. and the Company’s other water utilities. From 1986 to 1995, Mr. Ware
was General Manager for the Augusta Water District in Augusta, Maine. Mr. Ware holds a
Bachelor of Science degree in Civil Engineering from Bucknell University and a Master of
Business Administration degree from the Whittemore Business School at the University of
New Hampshire. Mr. Ware’s base salary for the fiscal year ended 2016 was $193,003.

Summary of Proposal to be Voted Upon at the Annual Meeting

PROPOSAL 1 —- ELECTION OF DIRECTORS

On March 24, 2017, the Company’s Board of Directors took action to recommend that the Sole
Shareholder elect James P. Dore, Elizabeth A. Dunn, Paul A. Indeglia and John M. Murphy as

directors, each for a three-year term and until their successors are elected and qualified.

Ms. Dunn and Dr. Indeglia have been directors of the Company since January 2012. Mr. Dore
has been a director of the Company since May 2014 and Mr. Murphy has been a director of the
Company since March 2017.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” EACH OF THESE
FOUR NOMINEES.

Information regarding the professional backgrounds for each nominee follows:
Nominees for Director:
James P. Dore

Mr. Dore has been the Chief Financial Officer of PageFlex, Inc. (a software developer and
marketer of publishing and browsing software products and technolo gies) since March
2012 and a Director since February 2017. He was the Chief Financial Officer of Bitstream
Inc. from March 2003 to March 2012, and Corporate Controller from June 1999 to March
2003. He was the Chief Financial Officer of Celerity Solutions, Inc. from April 1999 to
June 1999, and Corporate Controller from January 1997 to March 1999. Mr. Dore has
experience in both publicly traded and privately held companies. Mr. Dore is a Certified
Public Accountant. Mr. Dore holds a Bachelor of Science degree, with distinction, from
Clarkson University.

Elizabeth A. Dunn

Ms. Dunn was a Commissioner of the New Hampshire Victim’s Assistance Commission
from May 2002 to 2011. She was an Assistant Attorney General with the State of New
Hampshire, Department of Justice, from December 2001 to September 2007. She was an
Assistant County Attorney with the Office of the Rockingham County Attorney in
Brentwood, NH, from May 1999 to December 2001, and an Associate Attorney with the
law firm of Boutin & Associates from February 1998 to May 1999. Ms. Dunn previously
served as a member of the Board of Selectmen and the Zoning Board of Adjustment for the
Town of Windham, NH. Ms. Dunn holds a Juris Doctor degree from the University of
New Hampshire Law School and a Bachelor of Science degree in Education from
Framingham State College.

Paul A. Indeglia

Dr. Indeglia has been the Managing Member of Indeglia Environmental Services &
Engineering, PLLC since October 2014. He was a Principal and Civil and Environmental
Engineer of Peak Development Consulting Inc. from 2004-2013; a Civil and
Environmental Engineer and Project Manager with RWA, Inc. from 2001-2004; and a Civil
and Environmentai Engineer with Environmental Resources Management, Inc. from 1998-
2001. Dr. Indeglia holds a Doctorate of Philosophy in Environmental Toxicology from the
University of Florida; a Master of Science degree in Environmental Systems from
Humboldt State University; a Bachelor of Engineering degree in Environmental
Engineering Sciences from the University of Florida; and a Bachelor of Architecture
degree from the University of Notre Dame. Dr. Indeglia is on the faculty of the University
of New Hampshire Department of Engineering Technology, as well as Pontificia
Universidad Catolica del Ecuador Sede Esmeraldas Department of Biology.

John M. Murphy

Mr. Murphy has been a Senior Research Analyst with Fidelity Investments in
Merrimack, New Hampshire, since 2005. He is responsible for the credit analysis
of municipal and government owned water and sewer utilities in the United States
and for the credit analysis of public power and investor owned utilities as well as
environmental service companies. Mr. Murphy was a Senior Bond Trader for
Fidelity Investments from 1999 to 2005. From 1993 to 1999, Mr. Murphy was Vice
President-Trading and Structured Products for JP Morgan Securities in New York.
Mr. Murphy holds a Bachelor of Business Administration in Finance and
Management from Baruch College; and a Master of Science in Banking and Money
Management from Adelphi University.

COPY — FOR INFORMATION ONLY

Va PENNICHUCK

PROXY CARD
PENNICHUCK CORPORATION

PROXY for Annual Meeting of Sole Shareholder - May 6, 2017

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

L. WARE, as proxies to represent and vote as designated hereon, all shares fe gnmon stock of Pennichuck
Corporation (the “Company”) which the Sole Shareholder would be entitled to i e if personally present at the
Annual Meeting of Sole Shareholder of the Company to be held at the Crowne Piiga, 2 Somerset Parkway, Nashua,
New Hampshire, on Saturday, May ¥fhis proxy will be voted as
directed by the Sole Shareholder. %

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The Sole Shareholder, the City of Nashua, New Hampshire, hereby “Sos nm D. GOODHUE or DONALD

The Board of Directors recommends a vote “ gach of the 1 amed in Proposal 1
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This Proxy Card is Valid Only When Signed and Dated

V2 PENNICHUCK

March 30, 2017
ANNUAL REPORT TO THE SOLE SHAREHOLDER

Dear Shareholder:

The Annual Meeting of Pennichuck Corporation will be held at 9:00 a.m. on Saturday, May 6,
2017 at the Crowne Plaza, 2 Somerset Parkway, Nashua, New Hampshire.

Background on the City’s Acquisition and Our Corporate Structure. The City’s acquisition of
the shares of Pennichuck Corporation was completed on January 25,2012. As part of the
acquisition, the corporate structure of Pennichuck Corporation and its subsidiaries was retained.
Under the structure, the City of Nashua is the sole shareholder of Pennichuck Corporation.
Under the Company’s By-Laws, the City in its capacity as shareholder makes its decisions
through actions by its Board of Aldermen, in accordance with the City’s Charter. No single
person — the Mayor or any individual member of the Board of Aldermen — is him or herself a
shareholder; rather, the entity of the City itself is the sole shareholder of Pennichuck Corporation
represented by the Board of Aldermen and the Mayor.

Pennichuck continues to own five corporate subsidiaries, including three regulated utilities
(Pennichuck Water Works, Inc., Pennichuck East Utility, Inc., and Pittsfield Aqueduct Company,
Inc.), an unregulated service company (Pennichuck Water Service Corporation), and a real estate
holding company (The Southwood Corporation).

As unanimously approved by the City’s Board of Aldermen at the time of the acquisition, the
corporate structure was retained for several reasons.

First, the City’s Mayor and Board of Aldermen desired to maintain some stability and continuity
for all of the customers and employees of the Pennichuck companies. Retaining the existing
corporate structure minimized the need for any radical changes to the utility companies and
operations and encouraged support by all of the communities served by the utilities.