EXHIBIT 10.9
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of February 12, 1999, by and between Bay
State Gas Company, a Massachusetts corporation ("Company"), and Xxxxx X. Xxxxx
("Executive").
RECITALS
1. Pursuant to the Agreement and Plan of Merger dated as of
December 18, 1997 ("Merger Agreement") by and among NIPSCO Industries, Inc.
("NIPSCO"), the Company (which was previously named Acquisition Gas Company) and
Bay State Gas Company, a Massachusetts corporation ("Bay State"), Bay State
merged on this date with and into the Company ("Merger").
2. Executive was Chairman of Bay State and will be Chairman of
the Company.
3. Company and Executive desire to enter into arrangements to
provide for the continuation of Executive's employment following consummation of
the Merger.
NOW THEREFORE, in consideration of the mutual covenants and promises
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and Executive, each intending to
be legally bound, agree as follows:
1. TERM
The term of employment ("Term") shall commence as of the date of this
Agreement and shall expire on the nine month anniversary thereof, unless sooner
terminated as set forth in Section 5 below.
2. DUTIES
Upon the terms and subject to the conditions set forth in this
Agreement, the Company agrees to employ Executive as Chairman of the Company.
Executive agrees to serve as Chairman of the Company and to perform such duties
in and consistent with that office as may reasonably be assigned to him by the
Company's Board of Directors.
Executive agrees to devote his full time, energy and skill to the
business of the Company except for periods of vacation and absences made
necessary because of illness, authorized leaves of absence and holidays and to
promote the Company's best interests during the Term. Executive further agrees
not to work for any other employer as an employee during the Term; provided,
however, that nothing in this Agreement shall preclude Executive from devoting
time during reasonable periods required for: (i) serving as a director or member
of a committee of any company or organization involving no conflict of interest
with the Company or any of its subsidiaries or affiliates; (ii) delivering
lectures and fulfilling speaking engagements; and (iii)
engaging in educational, charitable or community activities, provided that such
activities do not materially affect or interfere with the performance of
Executive's obligations to the Company.
3. COMPENSATION AND BENEFITS
During the Term, Executive shall be entitled to receive compensation
and benefits as follows:
(a) Base Compensation. Executive shall receive Base Compensation
from the Company during the Term of $641,000, payable monthly.
(b) Additional Benefits. During the Term and thereafter, Executive
and his dependents shall be entitled to participate in any health plan,
disability plan and life insurance plan or arrangement then made available by
the Company to its senior executives generally during the Term or subsequent
thereto, subject to and on a basis consistent with the terms, conditions and
overall administration of such plans and arrangements and the Company's
practices with respect to such plans. During the Term, Executive shall also be
entitled to all miscellaneous fringe benefits and perquisites provided to him or
for his benefit during the nine months preceding the date hereof, as described
in Schedule 3(b). However, Executive shall not be entitled to participate, from
this date forward, in any non-qualified retirement plan (or any other deferred
compensation plan) of the Company or NIPSCO, and no compensation payable to
Executive under this Agreement shall be considered compensation for purposes of
any non-qualified retirement plan (or any other deferred compensation plan) of
the Company or NIPSCO. Upon termination of employment, Executive shall be
entitled to receive his benefits from any qualified retirement plan of the
Company or NIPSCO in which he participates.
(c) Vacation. Upon commencement of the Term, Executive shall be
granted vacation of 4 weeks. Such vacations shall be taken at times mutually
convenient to the Company and Executive.
4. ADDITIONAL COMPENSATION
Executive is entitled to receive additional compensation pursuant to a
Severance Agreement between the Company and Executive dated December 12, 1996
(the "Severance Agreement"). The Company arid Executive agree that, with the
exception of compensation payable to Executive under the 0000 Xxx Xxxxx Stock
Performance Plan and the fringe benefits described in Section 3(b) of this
Agreement, the compensation provided in this Section 4 and the Noncompetition
Agreement by and between the Company and Executive dated the date hereof
("Noncompetition Agreement") is in lieu of any payment described in the
Severance Agreement and that Executive shall be entitled to no payments pursuant
to the Severance Agreement other than the compensation described in this Section
4, the 1997 Bay State Stock Performance Plan and the Noncompetition Agreement.
Executive shall be entitled to receive such payments as follows:
(a) Performance Incentive Bonus. Unless Executive is terminated
for cause (as defined below) during the Term, Executive shall be entitled to
receive an annual Performance Incentive Bonus equal to 3.75% of NIPSCO's
consolidated earnings before extraordinary items, losses from discontinued
operations, interest, taxes, depreciation and amortization ("EBITDA")
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for fiscal year 1999. The maximum amount of the Bonus payable to Executive for
the nine month period (without regard to interest) shall be $1,600,000 ("Maximum
Amount"). Except as provided in this Section 4(a), the Company shall pay
Executive the Bonus in the amounts shown in the column "Payment" and on the
dates set forth on Schedule 4(a) attached hereto. In the event Executive is not
a director of NIPSCO on June 30, 2002, and his failure to be a director is not
due to his death or resignation as a director, then the Company shall pay
Executive the Bonus in the amounts shown in the column "Payment" for June 2002
as set forth in Schedule 4(b) attached hereto. In the event Executive is not a
director of NIPSCO at any time between June 30, 1999 and June 30, 2005, and such
failure is due to Executive's resignation as a director, then the Company shall
pay to Executive in a lump sum the sum of the amounts set forth in the columns
"End Balance" and "Payment" on Schedule 4(a) which corresponds to the date of
the calendar quarter during which such resignation occurs. The payments set
forth on Schedules 4(a) and (b) are based on the assumption that the Maximum
Amount will be earned during 1999. The payments set forth on Schedules 4(a) and
(b) will be modified, consistent with the foregoing assumptions, in the event
that: (i) Executive is terminated for cause during the Term, in which case,
Executive shall not be entitled to any Bonus for or based on the fiscal year
during which such termination occurs; or (ii) Executive does not earn the
Maximum Amount in 1999, in which case, the payments set forth on Schedules 4(a)
and (b) shall be adjusted to reflect the amount of the Bonus earned and the
years in which the Bonus was actually earned. If Executive dies prior to the
payment by the Company of all of the amounts set forth on Schedule 4(a) and
Executive has a surviving spouse, at the option of Executive's surviving spouse,
the Company shall either (i) pay to Executive's surviving spouse in a lump sum
the sum of the amounts set forth on Schedule 4(a) in the columns "End Balance"
and "Payment" which corresponds to the date of the calendar quarter during which
Executive died or (ii) continue to pay to Executive's surviving spouse the Bonus
in the amounts and on the dates set forth on Schedule 4(a). If Executive dies
prior to the payment by the Company of all of the amounts set forth on Schedule
4(a) and Executive does not have a surviving spouse, the Company shall pay to
Executive's Beneficiary in a lump sum the sum of the amounts set forth on
Schedule 4(a) in the columns "End Balance" and "Payment" which corresponds to
the date of the calendar quarter during which Executive died.
(b) Gross-Up Payments. In the event it shall be determined that
any payment or distribution by the Company to or for the benefit of Executive,
whether paid or payable or distributed or distributable pursuant to the terms of
this Agreement or otherwise (a "Payment"), would be subject to the excise tax
imposed by Code Section 4999 or comparable state or local tax or any interest or
penalties with respect to such excise tax or comparable state or local tax (such
excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), then Executive shall be entitled
to receive an additional payment (a "Gross-Up Payment"). The Gross-Up Payment
shall be equal to the sum of the Excise Tax and all taxes (including any
interest or penalties imposed with respect to such taxes) imposed upon the
Gross-Up Payment.
If Executive determines that a Gross-Up Payment is required, Executive
shall so notify the Company in writing, specifying the amount of Gross-Up
Payment required and details as to the calculation thereof. The Company shall,
within 30 days, either pay such Gross-Up Payment (net of applicable wage
withholding) to Executive or furnish an unqualified opinion from Independent Tax
Counsel (as defined below), addressed to Executive and the Company, that
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there is substantial authority (within the meaning of Section 6661 of the Code)
for the position that no Gross-Up Payment is required. "Independent Tax Counsel"
means a lawyer with expertise in the area of executive compensation tax law, who
shall be selected by Executive and shall be reasonably acceptable to the
Company, and whose fees and disbursements shall be paid by the Company.
If the Internal Revenue Service or other tax authority proposes in
writing an adjustment to the income tax of Executive which would result in a
Gross-Up Payment, Executive shall promptly notify the Company in writing and
shall refrain for at least thirty days after giving such notice, if so permitted
by law, from paying any tax (including interest, penalties and additions to tax)
asserted to be payable as a result of such proposed adjustment. Before the
expiration of such period, the Company shall either pay the Gross-Up Payment or
provide an opinion from Independent Tax Counsel to Executive and the Company as
to whether it is more likely than not that the proposed adjustment would be
successfully challenged if the matter were to be litigated. If the opinion
provides that a challenge would be more likely than not successful if the issue
were litigated, and the Company requests in writing that Executive contest such
proposed adjustment, Executive shall contest the proposed adjustment; provided
that Executive, after such consultation with the Company, shall determine in his
sole discretion the nature of all action to be taken to contest such proposed
adjustment, including (a) whether any such action shall initially be by way of
judicial or administrative proceedings, or both, (b) whether any such proposed
adjustment shall be contested by resisting payment thereof or by paying the same
and seeking a refund thereof, and (c) if the Executive shall undertake judicial
action with respect to such proposed adjustment, the court or other judicial
body before which such action shall be commenced and the court or other judicial
body to which any appeals should be taken. Executive agrees to take appropriate
appeals of any judicial decision that would require the Company to pay a
Gross-Up Payment, provided the Company requests in writing that Executive do so
and provides an opinion from Independent Tax Counsel to Executive and the
Company that it is more likely than not that the appeal would be successful.
Executive further agrees to settle, compromise or otherwise terminate a contest
with the Internal Revenue Service or other tax authority with respect to all or
a portion of the proposed adjustment giving rise to the Gross-Up Payment, if
requested by the Company in writing to do so at any time, in which case
Executive shall be entitled to receive from the Company the Gross-Up Payment. In
no event shall Executive compromise or settle all or any portion of a proposed
adjustment which would result in a Gross-Up Payment without the written consent
of the Company.
Executive shall not be required to take or continue any action pursuant
to this Section 4(b) unless the Company acknowledges its liability under this
Agreement in the event that the Internal Revenue Service of other tax authority
prevails in the contest. The Company hereby agrees to indemnify Executive in a
manner reasonably satisfactory to Executive for any fees, expenses, penalties,
interest or additions to tax which Executive may incur as a result of contesting
the validity of any Excise Tax and to pay Executive promptly upon receipt of a
written demand therefor all costs and expenses which Executive may incur in
connection with contesting such proposed adjustment (including reasonable fees
and disbursements of Independent Tax Counsel); provided, however, that the
Company shall not be required to pay any amount necessary to permit Executive's
institution of a claim for refund under this Section 4(b).
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If Executive shall have contested any proposed adjustment as above
provided, and for so long as Executive shall be required under the terms of this
paragraph to continue such contest, the Company shall not be required to pay a
Gross-Up Payment until there occurs a Final Determination (as defined below) of
the liability of Executive for the tax and any interest, penalties and additions
to tax asserted to be payable as a result of such proposed adjustment. A "Final
Determination" shall mean (a) a decision, judgment, decree or other order by any
court of competent jurisdiction, which decision, judgment, decree or other order
has become final after all allowable appeals by either party to the action have
been exhausted, the time for filing such appeal has expired or Executive has no
right under the terms hereof to request an appeal, (b) a closing agreement
entered into under Section 7121 of the Code or any other settlement agreement
entered into in connection with an administrative or judicial proceeding and
with the consent of Executive, or (c) the expiration of the time for instituting
a claim for refund, or if such a claim was filed, the expiration of the time for
instituting suit with respect thereto,
In the event Executive receives any refund from the Internal Revenue
Service or other tax authority on account of an overpayment of Excise Tax, such
amount, together with that part of any Gross-Up Payment attributable to such
amount, shall be promptly paid by Executive to the Company.
5. TERMINATION OF EMPLOYMENT
(a) Termination for Cause. The Company shall have the right to
terminate Executive's employment with the Company for cause. For purposes of
this Agreement, "cause" shall mean the following: (i) Executive's conviction for
the commission of a felony or in the event of Executive's fraud or dishonesty
which has resulted or is likely to result in material economic damage to the
Company or any of its affiliates, as determined in good faith by the Directors
of the Company at a meeting of the Board of Directors at which Executive is
provided an opportunity to be heard; or (ii) Executive's violation or breach of
any material provision of this Agreement or the Noncompetition Agreement and the
continuation thereof after the receipt by Executive of written notice from the
Company. In the event it is being proposed by the Company that Executive be
terminated for cause, Executive shall be entitled to a hearing at the Board of
Directors meeting during which the Executive's proposed termination will be
acted upon, and Executive and his legal counsel (whose reasonable legal fees
shall be paid by the Company) shall be entitled to be present at such meeting.
(b) Termination by Executive. Executive shall have the right, at
any time during the term of this Agreement, and for any reason, to terminate his
employment with the Company upon giving 30-days' written Notice of Termination
as set forth below to the Company; provided, however that Executive's employment
shall not be deemed terminated by Executive as a result of the actual of
proposed assignment or reassignment by the Company of Executive to another place
of employment more than 50 miles from Executive's current place of employment,
(c) Compensation in the Event of Termination for Cause or by
Executive. If Executive's employment with the Company is terminated by the
Company for cause, or if Executive's employment with the Company is terminated
by Executive, then (i) the Base Compensation provided for in Section 3 shall
cease to accrue as of the date of termination of Executive's employment with the
Company ("Termination Date") specified in the Notice of
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Termination as set forth below; (ii) the Company shall pay to Executive any
compensation payable in the amount, at the time and in the manner set forth in
Sections 3 and 4 and specifically shall pay the Bonus described in Section 4(a)
plus any accrued interest thereon if termination is other than for cause; and
(iii) Executive and his dependents shall cease to participate in the benefit
plans and programs, as provided for in Section 3, as of the Termination Date
specified in the Notice of Termination. Any benefits payable under insurance or
health plans as a result of Executive's participation in such plans through the
Termination Date shall be paid when due under those plans.
(d) Disability. The company shall have the right to terminate
Executive's employment effective after the determination that Executive is
unable to work due to a Disability. If Executive's employment is terminated
pursuant to this Section 5(d), then: (i) the Base Compensation provided for in
Section 3 shall cease to accrue as of the Termination Date specified in the
Notice of Termination as set forth below; (ii) the Company shall pay to
Executive any compensation payable in the amount, at the time and in the manner
set forth in Sections 3 and 4 and, specifically, shall pay the amount described
in Section 4(a); and (iii) at the option of Executive, Executive and his
dependents may continue to participate in the benefit plans as provided for in
Section 3 to the extent Executive and his dependents are eligible to participate
in such benefit plans pursuant to the terms of such benefit plans. Any benefits
payable under insurance and health plans as a result of Executive's
participation in such plans through the Termination Date shall be paid when due
under those plans. Following the Termination Date, the Company is not obligated
to provide Executive or his dependents the benefits provided for in Section 3 in
the event that Executive or his dependents are not eligible for participation in
such plans pursuant to the terms of such plans due to the termination of
Executive's employment with the Company or for any other reason.
For purposes of this Agreement, "Disability" shall mean a physical or
mental disability, as determined by an independent physician selected by the
Company, that renders Executive incapable of performing his duties under this
Agreement for 180 days or more within any 365-day period, of which at least 90
days are consecutive. The Termination Date pursuant to this Section 5(d) shall
be no earlier than the date of the first day following the 180-day period
described in this paragraph.
(e) Death. If Executive dies during the term of this Agreement,
the Company shall (i) pay Executive's Base Compensation for the period ending on
the date of his death to his Beneficiary; and (ii) pay to Executive's
Beneficiary any compensation payable in the amount, at the time and in the
manner set forth in Sections 3 and 4 and specifically shall pay the amounts
described in Section 4(a). Executive's dependents may continue to participate in
the benefit plans as provided for in Section 3 to the extent Executive's
dependents are eligible to participate in such benefit plans pursuant to the
terms of such benefit plans. Following the Termination Date, the Company is not
obligated to provide Executive's dependents the benefits provided for in Section
3 in the event that Executive's dependents are not eligible for participation in
such plans pursuant to the terms of such plans due to the termination of
Executive's employment with the Company or for any other reason.
For purposes of this Agreement, Executive's "Beneficiary" shall be any
person, trust or other entity designated in writing by Executive, or if not so
designated, the personal
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representative of Executive's estate or if no such representative shall be
appointed within six months after the date of Executive's death, Executive's
heirs under the laws of descent and distribution in effect in the state in which
Executive is domiciled at the date of his death).
(f) Other Termination. If Executive's employment with the Company
is terminated other than pursuant to Sections 5(a), (b), (d) or (e), then (i)
the Base Compensation provided for in Section 3 shall continue being paid
through the nine month anniversary of the date of this Agreement as if Executive
had continued to be employed through such period; and (ii) the Company shall pay
to Executive any compensation described in Section 4. If Executive's employment
with the Company is terminated due to Executive's retirement, at the option of
Executive, Executive and his dependents may continue to participate in the
benefit plans as provided for in Section 3 to the extent Executive and his
dependents are eligible to participate in such benefit plans pursuant to the
terms of such benefit plans. The participation of Executive and his dependents
in such plans shall cease as of the date Executive becomes employed by another
employer. Following the Termination Date, the Company is not obligated to
provide Executive or his dependents the benefits provided for in Section 3 in
the event that Executive or his dependents are not eligible for participation in
such plans pursuant to the terms of such plans due to the termination of
Executive's employment with the Company or for any other reason.
(g) Notice of Termination. Any termination of Executive's
employment with the Company pursuant to this Section 5 (except in the
circumstances of Executive's death) shall be communicated by a written notice of
termination by the terminating party to the other party ("Notice of
Termination") and shall indicate the Termination Date. The Notice of Termination
by the Company for termination for cause shall indicate the specific provisions
of this Agreement relied upon and shall set forth the reason for such
termination.
(h) Survival of Obligations Provided for in Section 6 and
Noncompetition Agreement. If Executive's employment with the Company is
terminated for any reason, Executive's obligations, duties and responsibilities,
as provided for in Section 6 and the Noncompetition Agreement shall survive the
termination of Executive's employment and shall continue as set forth therein.
6. CONFIDENTIALITY
(a) Covenant Concerning Confidentiality. Executive agrees that he
shall not disclose, during the Term and thereafter, without the prior written
consent of NIPSCO, to anyone outside of the Company, NIPSCO and its subsidiaries
any confidential matters of the Company, NIPSCO or its subsidiaries or their
predecessors for as long as such matters remain confidential and not generally
known to the public, including without limitation, trade secrets, customer
lists, pricing policies, operating methods, any proprietary information of any
nature or any information concerning the business of, or any customer,
representative, agent or employee of, the Company, NIPSCO or its subsidiaries or
their predecessors that was obtained by Executive in the course of his
employment by the Company, NIPSCO or its subsidiaries or their predecessors,
unless such disclosure is made as a proper part of performing his duties for the
Company. Executive further agrees that if his employment by the Company is
terminated for any reason, he will not take with him, but will leave with and
deliver to the Company, any and all records and papers of whatever nature that
relates to his employment by the Company or bears any information about the
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Company, NIPSCO or its subsidiaries or their predecessors. In the event
Executive violates this provision, the Company shall be entitled to any and all
its remedies at law or in equity but shall not be entitled, unless directed by a
court of law, to withhold payment of any amounts due Executive hereunder.
(b) Limitation on Covenant Concerning Confidentiality. Executive's
obligations pursuant to this Section shall not apply to any confidential
information if and to the extent Executive is required pursuant to any statute,
law, ordinance, rule, resolution or order of the U.S. Congress, any state or
local legislature, a judge or an administrative law judge to testify in or to a
legislative, judicial or regulatory proceeding or otherwise to disclose such
confidential information. All such information is and will remain the exclusive
property of NIPSCO. For purposes of this Agreement, the terms "trade secrets"
and "confidential information" include, but are not limited to, processes,
methods, techniques, systems, formulas, patents, models, devices, compilations,
customer lists or any information of whatever nature that gives to the Company,
Bay State and its subsidiaries an opportunity to obtain an advantage over a
competitor who did not know or use it, but excludes matters which, without
breach of Executive's obligations, are generally known to the public.
(c) Judicial Modification of Covenant Concerning Confidentiality.
If any provision contained in this Section shall for any reason be held invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this Section, rather
this Section shall be construed as if such invalid, illegal or unenforceable
provision had never been contained herein. It is the intention of the parties
that if any of the restrictions or covenants contained herein is held to any
extent invalid, such provisions shall not be construed to be null, void or of no
effect, but, to the extent such provision would be valid or enforceable under
applicable law if limited in scope, a court of competent jurisdiction shall
construe and interpret or reform this Section to provide for a covenant having
the maximum enforceable scope and other provisions (not greater than those
contained herein) as shall be valid and enforceable under such applicable law.
7. NO ASSIGNMENT
No interest or amount payable to Executive, his spouse or any other
beneficiary under this Agreement shall be assignable (in law or equity) by
Executive or such beneficiary and shall not be subject to any manner of
alienation, sale, transfer, assignment, claims of creditors, pledge, attachment,
garnishment, levy, execution or encumbrance of any kind. No such interest or
amount payable or right to receive a payment or distribution may be taken,
voluntarily or involuntarily, for the satisfaction of the obligations or debts
of, or other claims against, Executive or his spouse or other beneficiary,
including claims for alimony, support, separate maintenance and claims in
bankruptcy proceedings. This Agreement is personal in nature and, except as set
forth in Section 13, neither this Agreement nor any rights or obligations under
it may be assigned or delegated by either party without the express written
consent of the other.
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8. INDEMNITY
Executive shall be indemnified under the Company's By-Laws and covered
by officers liability insurance policies to the extent the Company or NIPSCO
provides such coverage for its other officers.
9. NOTICES
Any notice or communication given pursuant to this Agreement must be in
writing and shall be effective only if delivered personally; or sent by
facsimile transmission; or delivered by overnight courier service; or sent by
certified mail, postage paid, return receipt requested, to the recipient at the
address indicated below or to such other address as the party being notified may
have previously furnished to the other party by written notice pursuant to this
Section 9:
If to the Company, to:
NIPSCO Industries, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attn: Chairman, President and Chief Executive Officer
If to Executive, to:
Xxxxx X. Xxxxx
000 Xxxx Xxxxxx
X.X. Xxx 00
Xxxxxxxx, Xxxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Notices under this Agreement shall be effective and deemed received on
the date of personal delivery or facsimile transmission (as evidenced by
facsimile confirmation of transmission); on the day after sending by overnight
courier service (as evidenced by the shipping invoice signed by a representative
of the recipient); or on the date of actual delivery to the party to whom such
notice or communication was sent by certified mail, postage prepaid, return
receipt requested (as evidenced by the return receipt signed by a representative
of such party).
10. ENTIRE AGREEMENT; AMENDMENT
This Agreement and the Noncompetition Agreement represent the entire
agreement of the Company and Executive with respect to the matters set forth in
them. No amendment or modification of the terms of this Agreement shall be
binding upon the parties unless reduced to writing and signed by each of the
parties.
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11. SEVERABILITY
Any provision of this Agreement prohibited by law or deemed
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions.
12. GOVERNING LAW
This Agreement shall be interpreted and construed under the laws of the
State of Indiana.
13. SUCCESSORS AND ASSIGNS
This Agreement shall be binding upon and inure to the benefit of the
Company and its successors and assigns.
14. WAIVER
No waiver by any party at any time of any breach by the other party of,
or compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of any other provisions or
conditions at the same time or at any prior or subsequent time.
15. SURVIVAL OF PROVISIONS
The provisions of Sections 6, 8, 10, 11, 12, 13, 14 and 15 of this
Agreement and the Noncompetition Agreement shall survive the termination of
Executive's employment with the Company and the expiration or termination of
this Agreement.
16. COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be
deemed an original.
17. WITHHOLDING
The Company may withhold from any payment that it is required to make
under this Agreement amounts sufficient to satisfy applicable withholding
requirements under any federal, state or local law.
18. LITIGATION EXPENSES
In the event of any litigation or other proceeding between the Company
and Executive with respect to the subject matter of this Agreement and the
enforcement of rights hereunder, the Company shall reimburse Executive for all
reasonable costs and expenses relating to such litigation or other proceeding as
they are incurred, including reasonable attorneys fees and expenses, regardless
of whether such litigation results in any settlement or judgment or order in
favor of any party; provided, however, that any claim or action initiated by
Executive relating to this Agreement shall have been made or brought after
reasonable inquiry and shall be well-
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grounded, in fact, and warranted by existing law or a good faith argument for
the extension, modification or reversal of existing law, and that is not
interposed for any improper purpose, such as to harass or to cause unnecessary
delay or needless increase in the cost of litigation.
Notwithstanding any provision of Indiana law to the contrary, in no
event shall Executive be required to reimburse the Company for any of the costs
and expenses relating to such litigation or other proceeding. The obligation of
the Company under this paragraph 18 shall survive the termination for any reason
of this Agreement (whether such termination is by the Company by Executive, upon
expiration of this Agreement or otherwise).
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IN WITNESS WHEREOF, the parties, intending to be legally bound hereby,
have duly executed this Agreement as of the day and year first set forth above.
BAY STATE GAS COMPANY
By: /s/ Xxxxxxx X. Xxxxx
Title: President and CEO
/s/ Xxxxx X. Xxxxx
XXXXX X. XXXXX
The undersigned hereby guarantees the performance of the Company of its
obligations hereunder.
NIPSCO INDUSTRIES, INC.
By: /s/ Xxxx X. Xxxxxx
Title: Vice President, Human
Resources
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SCHEDULE 4(a)
Xxxxx Xxxxx Performance Incentive
Ending Date First Period 3/31/00
Deferral 0 quarters
Interest Only 0 quarters
Principal 22 quarters
Interest Rate 6.76% 1.69%
Quarter Beg. End
Period Ending Balance Interest Principal Payment Balance
------------- --------- -------- --------- --------- ---------
1 Mar-00 1,600,000 27,040 -2,040 25,000 1,602,040
2 Jun-00 1,602,040 27,074 -2,074 25,000 1,604,114
3 Sep-00 1,604,114 27,110 -2,110 25,000 1,606,224
4 Dec-00 1,606,224 27,145 -2,145 25,000 1,608,369
5 Mar-01 1,608,369 27,181 -2,181 25,000 1,610,551
6 Jun-01 1,610,551 27,218 -2,218 25,000 1,612,769
7 Sep-01 1,612,769 27,256 -2,256 25,000 1,615,025
8 Dec-01 1,615,025 27,294 -2,294 25,000 1,617,319
9 Mar-02 1,617,319 27,333 -2,333 25,000 1,619,651
10 Jun-02 1,619,651 27,372 -2,372 25,000 1,622,023
11 Sep-02 1,622,023 27,412 -2,412 25,000 1,624,436
12 Dec-02 1,624,436 27,453 -2,453 25,000 1,626.889
13 Mar-03 1,626,889 27,494 -2,494 25,000 1,629,383
14 Jun-03 1,629,383 27,537 -2,537 25,000 1,631,920
15 Sep-03 1,631,920 27,579 -2,579 25,000 1,634,499
16 Dec-03 1,634,499 27,623 -2,623 25,000 1,637,122
17 Mar-04 1,637,122 27,667 -2,667 25,000 1,639,789
18 Jun-04 1,639,789 27,712 -2,712 25,000 1,642,502
19 Sep-04 1,642,502 27,758 -2,758 25,000 1,645,260
20 Dec-04 1,645,260 27,805 -2,805 25,000 1,648,065
21 Mar-05 1,648,065 27,852 -2,852 25,000 1,650,917
22 Jun-05 1,650,917 27,901 1,650,917 1,678,818 0
23 Sep-05 0 0 0 0 0
24 Dec-05 0 0 0 0 0
25 Mar-06 0 0 0 0 0
26 Jun-06 0 0 0 0 0
27 Sep-06 0 0 0 0 0
28 Dec-06 0 0 0 0 0
29 Mar-07 0 0 0 0 0
30 Jun-07 0 0 0 0 0
31 Sep-07 0 0 0 0 0
32 Dec-07 0 0 0 0 0
33 Mar-08 0 0 0 0 0
34 Jun-08 0 0 0 0 0
35 Sep-08 0 0 0 0 0
36 Dec-08 0 0 0 0 0
37 Mar-09 0 0 0 0 0
38 Jun-09 0 0 0 0 0
39 Sep-09 0 0 0 0 0
40 Dec-09 0 0 0 0 0
SCHEDULE 4(b)
Xxxxx Xxxxx Performance Incentive
Ending Date First Period 3/31/00
Deferral 0 quarters
Interest Only 0 quarters
Principal 22 quarters
Interest Rate 6.76% 1.69%
Quarter Beg. End
Period Ending Balance Interest Principal Payment Balance
------------- --------- -------- --------- --------- ---------
1 Mar-00 1,600,000 27,040 -2,040 25,000 1,602,040
2 Jun-00 1,602,040 27,074 -2,074 25,000 1,604,114
3 Sep-00 1,604,114 27,110 -2,110 25,000 1,606,224
4 Dec-00 1,606,224 27,145 -2,145 25,000 1,608,369
5 Mar-01 1,608,369 27,181 -2,181 25,000 1,610,551
6 Jun-01 1,610,551 27,218 -2,218 25,000 1,612,769
7 Sep-01 1,612,769 27,256 -2,256 25,000 1,615,025
8 Dec-01 1,615,025 27,294 -2,294 25,000 1,617,319
9 Mar-02 1,617,319 27,333 -2,333 25,000 1,619,651
10 Jun-02 1,619,651 27,372 1,619,651 1,647,023 0
11 Sep-02 0 0 0 0 0
12 Dec-02 0 0 0 0 0
13 Mar-03 0 0 0 0 0
14 Jun-03 0 0 0 0 0
15 Sep-03 0 0 0 0 0
16 Dec-03 0 0 0 0 0
17 Mar-04 0 0 0 0 0
18 Jun-04 0 0 0 0 0
19 Sep-04 0 0 0 0 0
20 Dec-04 0 0 0 0 0
21 Mar-05 0 0 0 0 0
22 Jun-05 0 0 0 0 0
23 Sep-05 0 0 0 0 0
24 Dec-05 0 0 0 0 0
25 Mar-06 0 0 0 0 0
26 Jun-06 0 0 0 0 0
27 Sep-06 0 0 0 0 0
28 Dec-06 0 0 0 0 0
29 Mar-07 0 0 0 0 0
30 Jun-07 0 0 0 0 0
31 Sep-07 0 0 0 0 0
32 Dec-07 0 0 0 0 0
33 Mar-08 0 0 0 0 0
34 Jun-06 0 0 0 0 0
35 Sep-06 0 0 0 0 0
36 Dec-08 0 0 0 0 0
37 Mar-09 0 0 0 0 0
38 Jun-09 0 0 0 0 0
39 Sep-09 0 0 0 0 0
40 Dec-09 0 0 0 0 0
