EMPLOYMENT AGREEMENT
Exhibit 10.2
THIS EMPLOYMENT AGREEMENT dated as of May 1, 2006, by and between PIEDMONT NATURAL GAS
COMPANY, INC., a North Carolina corporation (the “Corporation”), and, XXXXX X. X’XXXX, (the
“Officer”).
Executive Officer of the Corporation. It is understood that the Officer’s continued election as an
officer of the Corporation is dependent upon action by the Board of Directors of the
Corporation from time to time and that, subject to the provisions of Section 7 of this Agreement,
the Officer’s title and/or duties may change from time to time; provided that following a Change in
Control and during the term of the Severance Agreement any action affecting a change in title
and/or duties shall be subject to the Severance Agreement.
The Officer shall also be entitled to participate in any other fringe benefits which are now
or may be or become applicable to the Corporation’s executive employees, including the payment of
reasonable expenses for attending annual and periodic meetings of trade associations, and any other
benefits which are commensurate with the duties and responsibilities to be performed by the Officer
under this Agreement. Additionally, the Officer shall be entitled to such vacation and sick leave
as shall be established under uniform employee policies promulgated by the Board of Directors. The
Corporation shall reimburse the Officer for all out-of-pocket reasonable and necessary business
expenses which the Officer may incur in connection with his service on behalf of the Corporation.
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extended, then upon such notice, the Agreement shall terminate on
the anniversary of the date of notice. Provided, further, no extension shall cause this Agreement to extend beyond
the date on which the Officer reaches 65 years of age. Upon any extension, the base salary of the
extended agreement shall be the base salary in effect on the effective date of such extension.
(a) The Officer shall devote his best efforts to the performance of his duties and
responsibilities under this Agreement.
(b) During the term of this Agreement, or any renewals hereof, the Officer agrees he will not,
own, manage, operate, join, control or participate in the management, operation or control of, or
be employed by or connected in any manner with any business which competes with the Corporation or
any of its subsidiary corporations without the prior written consent of the Corporation.
Notwithstanding the foregoing, the Officer shall be free, without such consent, to purchase or hold
as an investment or otherwise, up to five percent of the outstanding stock or other securities of
any corporation which has its securities publicly traded on any recognized securities exchange or
in any established over-the-counter market.
The Officer shall hold in confidence all knowledge or information of a confidential nature
with respect to the business of the Corporation or any subsidiary of the Corporation received by
him during the term of this Agreement and will not disclose or make use of such information without
the prior written consent of the Corporation.
The Officer acknowledges that it would not be possible to ascertain the amount of monetary
damages in the event of a breach by the Officer under the provisions of this Section 5 and agrees
that, in the event of a breach of this Section, injunctive relief enforcing the terms of this
Section is an appropriate remedy.
(a) Change of Control. Following a Change in Control and during the term of the
Severance Agreement, this Agreement shall become null and void except with respect to any rights or
obligations accruing prior to the Change in Control and the rights and obligations of the Officer
and the Company, including any termination of the Officer, shall be subject to the provisions of
the Severance Agreement.
(b) By Death. The Officer’s employment under this Agreement shall be terminated upon
the death of the Officer during the term of this Agreement, in which event the
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Officer’s estate
shall be entitled to receive all compensation due the Officer through the last day of the calendar
month
in which his death shall have occurred.
(c) By Total Disability. Except for that period of time following a Change in Control
and during the term of the Severance Agreement, the Officer’s employment under this Agreement shall
be terminated upon the total permanent disability of the Officer during the term of this Agreement,
in which event the Officer shall receive all compensation, including bonuses, through the date of
determination of such disability and for a period of 90 days thereafter. For purposes of this
Section, the Officer shall be deemed to have suffered permanent disability upon the determination
of such status by the United States Social Security Administration or a certification to such
effect by the Officer’s regular physician.
(d) By Officer. Except as provided in Section 4 of the Severance Agreement, the
Officer’s employment under this Agreement may be terminated at any time by the Officer upon 60
days’ written notice to the Board of Directors. Upon such termination, the Officer shall be
entitled to receive all compensation, including bonuses, through the effective date of such
termination.
(e) By Corporation. Except for that period of time following a Change of Control and
during the term of the Severance Agreement, the Board of Directors may terminate the Officer’s
employment at any time, but any such termination by the Board of Directors, other than termination
for cause, shall not prejudice the Officer’s right to continue to receive payment of all
compensation and the continuance of benefits for a period of 12 months from the effective date of
termination or until such time as the Officer reaches 65 years of age (whichever is less) as
provided below. The Officer shall have no right to receive compensation or other benefits (other
than vested benefits) for any period after “termination for cause.” Termination for cause shall
mean termination because of the Officer’s personal dishonesty, incompetence, willful material
misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform
stated duties, willful material violation of a law, rule or regulation (other than traffic or
traffic-related violations or similar offenses) or final cease-and-desist order, or material breach
of any provisions of this Agreement.
(f) Costs and Expenses. In the event any dispute shall arise between the Officer and
the Corporation as to the terms or interpretation of this Agreement, including this Section 7,
whether instituted by formal legal proceedings or otherwise, including any action taken by Officer
to enforce the terms of this Section 7 or in defending against any action taken by the Corporation,
the Corporation shall reimburse the Officer for all costs and expenses, proceedings or actions in
the event the Officer prevails in any such action.
(a) This Employment Agreement shall inure to the benefit of and be binding upon any corporate
or other successor of the Corporation that shall acquire, directly or indirectly, by conversion,
merger, consolidation, purchase or otherwise, all or substantially all of the assets of the
Corporation.
(b) Since the Corporation is contracting for the unique and personal skills of the
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Officer, the Officer shall be precluded from assigning or delegating his rights or duties hereunder
without first obtaining the written consent of the Corporation.
10. Applicable Law. This Agreement shall be governed in all respects whether as to
validity, construction, capacity, performance or otherwise, by the laws of North Carolina.
CORPORATION: | ||||||||
ATTEST: | Piedmont Natural Gas Company, Inc. | |||||||
/s/ Xxxxxx X. Xxxxxxxxxx |
||||||||
Secretary | By: | /s/ Xxxxxx X. Xxxxxx | ||||||
Xxxxxx X. Xxxxxx | ||||||||
President & CEO | ||||||||
OFFICER: | ||||||||
By: | /s/ Xxxxx X. X’Xxxx | |||||||
Name of Officer | ||||||||
Address: | ||||||||
Employment Agreement reviewed and approved by the Board of Directors this 7th Day of June,
2006.
By: | /s/ Xxxx X. Xxxxxx
|
|||||
Chairman of Compensation Committee |
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