EXHIBIT NO.10b(17)
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
April 1, 1993, by and between Carolina Power & Light Company ("Employer") and
Xxxxxxx X. Xxxxx ("Employee").
WHEREAS, Employer desires to retain Employee and Employee desires to be
retained by Employer as Executive Vice President - Nuclear of Employer, on the
terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein, the parties agree as follows:
SECTION 1 - EMPLOYMENT
Employee shall be employed as Executive Vice President Nuclear by
Employer, and shall devote his full business time and best efforts to the
performance of the duties that are necessary and appropriate as such. Employee
will also perform all duties and obligations as President/Chief Operating
Officer of the Company and the Board of Directors may from time to time
specifically require, including without limitation, those duties and obligations
in this Agreement. Employee shall be responsible and report directly to the
President/Chief Operating Officer of the Company. Employee agrees to such
employment upon the terms and conditions in this Agreement.
SECTION 2 - TERM OF EMPLOYMENT
This employment is similar to the employment of other senior executives
of Employer and is at the continued will of both parties. If it should be
terminated by either party, then the provisions of Section 7 herein shall apply.
SECTION 3 - COMPENSATION
In consideration of all the services to be rendered by Employee to
Employer under this Agreement, Employer shall compensate Employee as follows:
(a) Employee shall be paid an aggregate annual salary, exclusive of
fringe benefits and benefits provided under employee benefit plans, of $280,000,
payable at such intervals, but not less frequently than monthly, as Employer may
determine. Such salary shall be subject to periodic review and adjustment by
Employer commencing in calendar year 1993 and thereafter, at the same time and
in the same manner as other executive officer salaries are reviewed and adjusted
by Employer;
(b) Employee shall receive 2,000 shares of Employer common stock, plus
such additional amounts as are necessary to pay the amount of federal, state and
local taxes due on the value of such stock;
(c) Employee shall receive short-term incentive compensation payments
of: (i) $50,000, to be paid on or before August 31, 1993, with respect to
Employee's services in 1993; and (ii) $50,000, to be paid on or before March 15,
1994, with respect to Employee's services in calendar year 1993. Such cash
payments shall be in lieu of amounts that might otherwise be payable to Employee
with respect to calendar year 1993 under Employer's Management Incentive
Compensation Program or any similar program adopted in lieu thereof. With
respect to calendar years after 1993, Employee shall be eligible to participate
in Employer's Management Incentive Compensation Program with a present maximum
payout of 30 percent of base salary or any similar program adopted in lieu
thereof and Employee's entitlement to any such short-term incentive compensation
shall be determined under such program;
(d) Employee shall be entitled to such long-term incentive compensation
payments or awards under plans or programs adopted from time to time by the
Board of Directors of the Employer which covers eligible executive officers,
including Employee;
(e) Employee shall be eligible to participate in certain employee
pension benefit programs (including certain deferred compensation plans or
agreements) as described in Section 4 of this agreement;
(f) Employee shall be eligible to participate in certain employee
welfare benefit plans or programs and shall be entitled to certain fringe
benefits as described in Section 5 of this Agreement. Such fringe benefits shall
be taxable to the extent required by law, and Employee shall not receive any
additional amounts to pay the taxes due on any taxable fringe benefits except as
otherwise provided in Section 5.
SECTION 4 - PENSION AND DEFERRED COMPENSATION BENEFITS
(a) Employee shall be entitled to participate in and be eligible for
such pension and deferred compensation benefit plans or programs available
generally to senior executives of Employer, including by way of illustration,
but not by way of limitation, the Stock Purchase-Savings Plan, the Supplemental
Retirement Plan for Employees, the Supplemental Executive Retirement Plan
("SERP"), the Executive Deferred Compensation Plan, and the Deferred
Compensation Plan for Key Management Employees. Employee shall be entitled to
participate in such plans and programs on the same terms and conditions as other
executive employees, except as follows:
(i) Employee shall be entitled to three annual payments of
$50,000 each for calendar years 1993, 1994, and 1995, which shall be deferred
and paid to Employee as if they were deferred under the Deferred Compensation
Plan for Key Management Employees as a one-year deferral for calendar year 1993.
This amount shall be utilized to provide retirement income to Employee of
$151,100 per year for 15 years payable monthly, commencing upon Employee's
attainment of age 65 (or $112,911 per year for 15 years at age 60). As of his
date of employment, Employee shall also be credited with 9 years of service for
purposes of determining his benefits thereunder. In addition, reduced payments
shall be made pursuant to an agreed-upon schedule if Employee dies before
reaching age 65.
(ii) If Employee's employment is terminated at age 55,
employee shall be entitled, under the severance provisions of the Deferred
Compensation Plan for Key Management Employees, to a one-time option of a
lump-sum payment of $225,000. If Employee elects this option, payment of said
lump sum shall terminate Employee's participation and any future benefits
thereunder.
(iii) With respect to the SERP, Employee shall become
immediately eligible to participate and shall be fully vested in benefits
thereunder as of his date of employment.
SECTION 5 - WELFARE AND FRINGE BENEFITS
(a) Employee shall be entitled to participate in all such welfare
benefit programs and plans that exist or may hereafter be instituted by
Employer, and shall receive all other fringe benefits available generally to
senior executives of Employer. These welfare benefit plans and programs and
other fringe benefits include, by way of illustration, but not by way of
limitation, group health insurance benefits, life insurance benefits, long-term
and short-term disability benefits, vacation days, and annual Employer holidays.
(b) Employee shall be entitled to receive the following additional
welfare benefits and fringe benefits on the same terms and conditions as other
executive employees, except as follows:
(i) Employee shall be provided with split-dollar life
insurance coverage in an amount equal to $790,000, plus such additional amounts
as necessary to pay the amount of federal, state and local taxes due on the
value of such life insurance. The cost of such coverage shall be included in
Employee's taxable income in accordance with applicable regulations. This
split-dollar insurance coverage shall be in addition to $50,000 in group-term
life insurance provided to all senior executives with split-dollar life
insurance coverage and shall be in lieu of any other insurance coverage
available to Company employees under the Company's group-term life insurance
program.
(ii) Employee shall have the opportunity to obtain estate
planning counseling provided through the trust department of Wachovia Bank of
North Carolina, N.A.;
(iii) Employee shall be entitled to four (4) weeks of annual
vacation and additional vacation days as approved on a discretionary basis by
the President/Chief Operating Officer of the Company;
(iv) Employer shall pay initiation fees and dues for the
Employee at the Capital City Club;
(v) Employee shall be entitled to membership in the Xxx
Hospital Wellness Center, with the initiation fee and monthly dues to be paid by
Employer;
(vi) Employer shall pay for one annual physical, to be
provided by a physician of Employee's choice;
(vii) Employee shall be provided an automobile of the class
available to senior executives of Employer, with a cellular telephone. Insurance
and maintenance for the vehicle will be provided by Employer, and all base
monthly telephone charges and the incremental charges for all business calls on
the cellular telephone will be paid by Employer.
(viii) Employee shall be entitled to utilize chartered
aircraft service pursuant to the Employer's policies as needed, and, pursuant to
Employee's discretion, first class commercial air travel;
(ix) Employee shall be provided with a personal computer at
his home for business use;
(x) Employee shall be reimbursed for relocation expenses as
described in Attachment A hereto;
(xi) Employee shall be reimbursed for temporary living
expenses, in addition to the 30 days provided by the Relocation Program, and for
travel expenses to and from Detroit, Michigan through September 9, 1993, or
until family relocation, whichever occurs first; and
(xii) Upon retirement from employment anytime after age 55
with the Employer, Employee shall be entitled to the same medical and dental
coverage provided other future retirees of the Employer, such as the
Chairman/Chief Executive Officer; provided, however, that to the extent that any
such benefits may not be provided to Employee due to statutory or regulatory
limitations, Employer shall obtain substantially equivalent coverage on an
insured basis.
SECTION 6 - REIMBURSEMENT OF BUSINESS EXPENSES
Employer shall reimburse Employee for all reasonable business
expenditures incurred by Employee in the ordinary and necessary performance of
his duties hereunder in accordance with reasonable practices established from
time to time by Employer, upon timely presentation by Employee of an itemized
account of such expenditures. In addition, Employee shall be entitled to
reimbursement for travel expenses of Employee's spouse when she accompanies him
to business meetings when spousal attendance is customary.
SECTION 7 - TERMINATION
(a) Employee's employment may be terminated at any time by either
Employee or Employer and for any reason. No advance notice of such termination
shall be required to be provided by either party. Upon termination of Employee's
employment, Employee shall be entitled to such benefits under Employer's
established benefit programs as determined under such programs and this Section
7 of this Agreement.
(b) If Employee's employment is terminated, or constructively
terminated, by the Employer for any reason other than good cause, then to the
extent vested, Employee will retain all benefit rights under all established
benefit programs as well as all benefits described herein. Employee shall also
be entitled to receive the following benefits: (i) if there is termination of
employment by the Company for any reason other than good cause within the first
two years of employment, the Employee shall be entitled to salary continuation
of 50 percent of his full base monthly salary for 24 months following such
termination. During such 24-month period, Employee shall be entitled to
continued coverage under the medical, dental, life insurance, and disability
programs provided, however, that to the extent any such employee benefits may
not be provided to Employee due to statutory or regulatory nondiscrimination
rules, Employer shall obtain for Employee substantially equivalent coverage on
an insured basis. The cost of any such medical, dental, life insurance, or
disability coverage shall be included in Employee's taxable income, if required
by and in accordance with applicable regulations: (ii) if termination occurs
after the employee has attained age 55 but before attaining age 60, Employer
agrees to pay the employee a severance benefit of $153,912 per year (less any
benefits payable under the SERP), for the remainder of the Employee's life. Such
severance benefit shall terminate at the employee's death.
(c) At the option of the Employee, to be exercised within one year of
the occurrence of the event, Employee may deem any of the following events to be
a constructive termination of Employee's employment by Employer:
(i) Change in form of ownership of Employer (e.g., Employer is
acquired, enters into a business combination with another company or otherwise
changes form of ownership).
(ii) Change in the present Chairman of the Board/Chief
Executive Officer of the Employer or a material change in his responsibilities.
(d) If Employee's employment is terminated by Employee for any reason
other than death or disability, Employee shall retain all vested benefits,
calculated as of the date of termination, but shall not be entitled to any form
of salary or benefit continuance.
SECTION 8 - COOPERATION AFTER TERMINATION
Following any termination of employment by Employee, Employee shall
fully cooperate with Employer in all matters relating to the completion of
Employee's pending work on behalf of Employer and the orderly transfer of any
such pending work to other employees of Employer as may be designated by
Employer. Employer shall be entitled to such full-time or part-time services of
Employee as Employer may reasonably require during all or any part of the 90-day
period following any notice of termination by the Employee. In such event,
Employee shall be compensated at a per diem rate equivalent to his previous base
salary with Employer.
SECTION 9 - CONFIDENTIALITY
All confidential information acquired by Employee during his employment
with Employer shall be regarded as confidential and solely for the benefit of
Employer.
SECTION 10 - ARBITRATION
In case of any dispute or disagreement arising out of or connected with
this Agreement, the parties hereto hereby agree to submit said dispute or
disagreement to the American Arbitration Association in Raleigh, North Carolina,
for a resolution within 120 days after submission thereof by three arbitrators
to be designated by said American Arbitration Association. Any decision or award
by said arbitrators shall be binding, and except in cases of gross fraud or
misconduct by one or more of the arbitrators, the decision or award rendered
with respect to such dispute or disagreement shall not be appealable. In
addition, the prevailing party in such an arbitration proceeding shall be
entitled to recover his attorney's fees, all reasonable out-of-pocket costs and
disbursements, as well as any and all charges which may be made for the cost of
the arbitration and fees of the arbitrators.
SECTION 11 - SEVERABILITY
If, for any reason, any provision of this Agreement is held invalid,
such invalidity shall not affect any other provisions of this Agreement not held
so invalid, and each such other provision shall, to the full extent consistent
with law, continue in full force and effect.
SECTION 12 - ASSIGNMENT
Rights and duties of the parties hereunder shall not be assignable by
either party except that this Agreement and all the rights hereunder may be
assigned by Employer to any corporation or other business entity which succeeds
to all or substantially all of the business of Employer through merger,
consolidation, corporate reorganization or by acquisition of all or
substantially all of the assets of Employer and which assumes Employer's
obligations under this Agreement.
SECTION 13 - ENTIRE AGREEMENT
This Agreement supersedes all prior agreements between the parties
concerning the subject matter hereof and this Agreement constitutes the entire
agreement between the parties with respect thereto. This Agreement may be
modified only with a written instrument duly executed by each of the parties. No
person has any authority to make any representation or promise on behalf of any
of the parties not set forth herein and this Agreement has not been executed in
reliance upon any representation or promise except those contained herein. No
waiver by any party of any breach of this Agreement shall be deemed to be a
waiver of any preceding or succeeding breach.
SECTION 14 - GOVERNING LAW
This Agreement is made and entered into in the State of North Carolina,
and the laws of North Carolina shall govern its validity and interpretation and
the performance by the parties hereto of their respective duties and obligations
hereunder. This Agreement shall be binding upon the Employer and the Employee as
approved by the Board of Directors of the Employer.
SECTION 15 - HEADINGS
Section and other headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
WITNESS: EMPLOYER:
/S/Xxxx X. Day
-------------------- By: /S/ Xxxxxxx X. Xxxxxx
Xxxx X. Day -----------------------
Xxxxxxx X. Xxxxxx
Title: Executive Vice President
EMPLOYEE:
/S/ Xxxxxxx X. Xxxxx
-----------------------
Xxxxxxx X. Xxxxx
