Membership, Meetings and Compensation

The Compensation Committee shall be appointed by the Board of Directors annually and shall consist of three (3) or more independent, non-employee members of the Board of Directors. The members of the Compensation Committee shall meet the independence requirements of the listing standards of the American Stock Exchange, the rules of the Securities and Exchange Commission, and all other applicable laws and regulations. Under these requirements, each member of the Compensation Committee shall be free from any relationship that would interfere with the exercise of independent judgment as a member of the Compensation Committee. The existence of the Compensation Committee may be terminated, or its powers and authority modified, at any time by vote of the Board of Directors.

The Compensation Committee shall keep regular minutes of its proceedings and report the same to the Board of Directors when required. Unless otherwise determined by the Board of Directors, the Compensation Committee may appoint a chairman and a secretary and such other officers of the Compensation Committee as it may deem advisable, and may determine (a) the time and place of each meeting thereof, (b) the notice of meetings to be given to members and (c) all other procedural questions which may arise in connection with the work of the Compensation Committee.

The Compensation Committee generally meets at least four times a year. Additional meetings may be scheduled as needed. The Compensation Committee may request members of management or others to attend meetings or to provide relevant information. The Compensation Committee shall periodically meet in executive session, absent all members of management.

Members of the Compensation Committee shall be entitled to receive a fee for attendance at meetings of the Committee, and all members shall be entitled to reimbursement for expenses incurred in connection with meeting attendance.

The Compensation Committee represents the Board of Directors, discharging its oversight responsibilities by carrying out the following functions:

Duties & Responsibilities

	(a)		Authority to establish objectives and interpret the terms of the Company's compensation policies with regard to base salary, incentive compensation, equity compensation, and all other benefits programs.
	(b)		Administration of the Company's Restricted Stock Plan, Stock Option Plan, and Key Employee Stock Option Plan; administration of merit, incentive, and commission compensation plans for all appropriate personnel.
	(c)		Review and approval of annual performance measures based on established corporate goals and strategic objectives; approval of annual incentive compensation plan awards; approval of grants under the Restricted Stock Plan.
	(d)		Annual approval of executive-level base salaries; approval and recommendation to the Board of Directors of base salaries for Unitil Corporation named executive officers.
	(e)		Review and approval of the Employment Agreement for the Chief Executive Officer, as required, and recommendation for approval to the Board of Directors.
	(f)		Annual review and approval of the Compensation Discussion and Analysis ("CD&A"); recommendation to the Board of Directors that the CD&A be included in the Company's proxy statement and annual report to shareholders.
	(g)		Annual review and approval of the Compensation Committee Report for inclusion in the Company's proxy statement.
	(h)		Authority to retain and/or engage outside counsel, special consultants or experts to advise the Committee as the Committee may deem appropriate or necessary in its sole discretion, and receive funding from the Company to engage such advisors, and have sole authority to approve related fees and retention terms.
	(i)		Annual review and assessment of the adequacy and accuracy of the Compensation Committee Charter.

The existence and activities of the Committee do not alter the traditional roles and responsibilities of the Company's management. The Compensation Committee may delegate authority to individuals or subcommittees when it deems appropriate. However, in delegating authority it shall not absolve itself from the responsibilities it bears under the terms of this Charter.

The Compensation Committee shall undertake any other action or exercise such other powers, authority and responsibilities as necessary or appropriate to the discharge of the responsibilities and duties set forth in this Charter or the Company's Bylaws, or otherwise required by the listing standards of the American Stock Exchange or other applicable laws, rules or regulations, or as shall otherwise be determined by the Board of Directors.