EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT made and entered into as of the 24th
day of October, 1994, by and among Cinergy Corp., a Delaware
Corporation ("Cinergy"), Cinergy Services, Inc., a Delaware
Corporation ("Cinergy Services"), The Cincinnati Gas & Electric
Company, an Ohio Corporation ("CG&E"), PSI Energy, Inc., an
Indiana Corporation ("PSI"), and Xxxxxx X. Xxxxx (the
"Executive"). Cinergy, Cinergy Services, CG&E, and PSI will
sometimes be referred to in this Employment Agreement
collectively as the "Corporation".
WHEREAS, the Corporation desires that the Executive become
an employee in accordance with this Employment Agreement;
WHEREAS, the Executive is willing to commit herself to the
employ of the Corporation and any successor thereto, on the terms
and conditions set forth in this Employment Agreement and thus to
forego opportunities elsewhere; and
WHEREAS, the parties desire to enter into this Employment
Agreement as of the date first set forth above setting forth the
terms and conditions for the employment relationship of the
Executive;
NOW, THEREFORE, IN CONSIDERATION of the mutual premises,
covenants and agreements set forth below, it is hereby agreed as
follows:
1.Employment and Term.
a.The Corporation agrees to employ the Executive, and the
Executive agrees to be employed, in accordance with the
terms and provisions of this Employment Agreement for
the period set forth below (the "Employment Period").
b.The Employment Period of the Executive as provided in
Section 1(a) will commence on October 24, 1994 (the
"Effective Date") and shall continue until December 31,
1997; provided, however, commencing on January 1, 1996,
and each January 1 thereafter (the "Renewal Date"), the
Employment Period of this Employment Agreement may
automatically be extended for one (1) additional year
if the Corporation shall have given notice to the
Executive of its intent to extend this Employment
Agreement prior to such Renewal Date and the Executive
shall not have objected to such extension in writing
within ten (10) business days of receipt of such
notice.
2.Duties and Powers of Executive.
a.Position. The Executive shall serve the Corporation in
such responsible executive capacity or capacities as
the Board of Directors of Cinergy or Cinergy Services
(the Board of Directors of Cinergy or Cinergy Services,
as the case may be, may be referred to sometimes as the
"Board") or the Chief Executive Officer of Cinergy or
the Chief Operating Officer of Cinergy may from time to
time determine and shall have such responsibilities,
duties and authority as may be assigned to her from
time to time during the Employment Period by the Board
or the Chief Executive Officer of Cinergy or the Chief
Operating Officer of Cinergy that are consistent with
such responsibilities, duties and authority. Upon the
Effective Date of this Employment Agreement, the
Executive shall initially serve as Vice President,
General Counsel and Corporate Secretary for the
Corporation, but consistent with the foregoing
provisions of this Section 2(a), may be assigned to any
other position or positions by either the Board or the
Chief Executive Officer of Cinergy or the Chief
Operating Officer of Cinergy during the Employment
Period.
x.Xxxxx of Performance. In connection with the Executive's
employment, the Executive shall be based at the
principal executive offices of the Corporation, 000
Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx, and, except for
required business travel to an extent substantially
consistent with the present business travel obligations
of executives of the Corporation who have positions of
authority comparable to that of the Executive, the
Executive shall not be required to relocate to a new
principal place of business which is more that thirty
(30) miles from the current principal place of business
of the Corporation.
3.Compensation. The Executive shall receive the following
compensation for her services under this Employment
Agreement.
a.Salary. The Executive's annual base salary (the "Annual
Base Salary"), payable not less often than semi-
monthly, shall be at the annual rate of not less than
$230,000.00. The Board may, from time to time, direct
such upward adjustments in the Annual Base Salary as
the Board deems to be necessary or desirable, including
without limitation adjustments in order to reflect
increases in the cost of living. Any increase in the
Annual Base Salary shall not serve to limit or reduce
any other obligation of the Corporation under this
Employment Agreement. The Annual Base Salary shall not
be reduced after any increase thereof except for
across-the-board salary reductions similarly affecting
all management personnel of Cinergy, Cinergy Services,
PSI or CG&E.
b.Retirement, Incentive, Welfare Benefit Plans and Other
Benefits. During the Employment Period and so long as
the Executive is employed by the Corporation, the
Executive shall be eligible, and the Corporation shall
take such actions as may be necessary or required to
cause the Executive to become eligible, to participate
in all short-term and long-term incentive, stock
option, restricted stock, performance unit, savings,
retirement and welfare plans, practices, policies and
programs applicable generally to employees and/or other
senior executives of the Corporation, including but not
limited to Cinergy's Annual Incentive Plan, Cinergy's
Performance Shares Plan, Cinergy's Executive
Supplemental Life Insurance Program, Cinergy's Stock
Option Plan, PSI's Pension Plan, PSI's Supplemental
Retirement Plan and PSI's Excess Benefit Plan, or any
successors thereto, except with respect to any plan,
practice, policy or program to which the Executive has
waived her rights in writing.
c.Fringe Benefits and Perquisites. During the Employment
Period and so long as the Executive is employed by the
Corporation, the Executive shall be entitled to the
following additional fringe benefits:
(i)The Corporation shall furnish to the Executive an
automobile and shall pay all of the related
expenses for gasoline, insurance, maintenance and
repairs,
(ii)The Corporation shall pay the initiation fee and
the annual dues, assessments and other membership
charges of the Executive for membership charges of
the Executive for membership in a country club
selected by the Executive,
(iii)The Corporation shall provide paid vacation for
four (4) weeks per year (or longer if permitted by
the Corporation's policy), and
(iv)The Corporation shall furnish to the Executive
annual financial planning and tax preparation
services. In addition, the Executive shall be
entitled to receive such other fringe benefits in
accordance with the plans, practices, programs and
policies of the Corporation from time to time in
effect, commensurate with her position and at
least comparable to those received by other senior
executives of the Corporation.
d.Expenses. The Corporation agrees to reimburse the
Executive for all expenses, including those for travel
and entertainment, properly incurred by her in the
performance of her duties under this Employment
Agreement in accordance with the policies established
from time to time by the Board.
e.Relocation Benefits. The Executive shall be entitled to
reimbursement from the Corporation pursuant to the
terms of the Corporation Relocation Program in effect
as of the day and year first written above, as well as
all actual expenses for temporary housing until such
time as she has moved into a new primary residence in
the general area of the Corporation's principal
corporate office located in Cincinnati, Ohio. The
expenses described in this Section shall be "grossed
up" to provide for adverse tax consequences to the
Executive.
4.Termination of Employment.
a.Death. The Executive's employment shall terminate
automatically upon the Executive's death during the
Employment Period.
x.Xx the Corporation for Cause. The Corporation may
terminate the Executive's employment during the
Employment Period for Cause. For purposes of this
Employment Agreement, "Cause" shall mean:
(i)The willful and continued failure by the Executive
to substantially perform the Executive's duties
with the Corporation (other than any such failure
resulting from Executive's incapacity due to
physical or mental illness or any such actual or
anticipated failure after the issuance of a Notice
of Termination for Good Reason by the Executive
pursuant to Section 4(c) after a written demand
for substantial performance is delivered to the
Executive by the Board, which demand specifically
identifies the manner in which the Board believes
that the Executive has not substantially performed
the Executive's duties, or
(ii)The breach by the Executive of the confidentiality
provisions set forth in Section 8 of this
Employment Agreement, or
(iii)The conviction of the Executive for the commission
of a felony, including the entry of a guilty or
nolo contendere plea, or any willful or grossly
negligent action or inaction by the Executive that
has a materially adverse effect on the
Corporation. For purposes of this definition of
"Cause", no act, or failure to act, on the
Executive's part shall be deemed "willful" unless
done, or omitted to be done, by the Executive not
in good faith and without reasonable belief that
the Executive's act, or failure to act, was in the
best interest of the Corporation. Notwithstanding
the above definition of "Cause", the Corporation
may terminate the Executive's employment during
the Employment Period for a reason other than
Cause, but the obligations placed upon the
Corporation in Section 5 shall apply.
x.Xx the Executive for Good Reason. The Executive may
terminate her employment during the Employment Period
for Good Reason. For purposes of this Employment
Agreement, "Good Reason" shall mean:
(i)The reduction in the Executive's Annual Base Salary
as specified in Section 3(a) of this Employment
Agreement, or any other benefit or payment
described in Section 3 of this Employment
Agreement, except for across-the-board salary
reductions similarly affecting all management
personnel of Cinergy, Cinergy Services, CG&E, and
PSI, and changes to the employee benefits programs
affecting all management personnel of those
Corporations, provided that such changes (either
individually or in the aggregate) will not result
in a material adverse change with respect to the
benefits which the Executive was entitled to
receive as of the Effective Date;
(ii)The material reduction without her consent of the
Executive's title, authority, duties or
responsibilities from those in effect immediately
prior to the reduction;
(iii)Any breach by the Corporation of any other
material provision (including but not limited to
the place of performance as specified in Section
2(b);
(iv)The Executive's disability due to physical or
mental illness or injury which precludes the
Executive from performing any job for which she is
qualified and able to perform based upon her
education, training or experience; or
(v)Any event which constitutes a "Change in Control" as
defined in Section 4(f) of this Employment
Agreement.
d.Notice of Termination. Any termination by the Corporation
for cause, or by the Executive for Good Reason, shall
be communicated by Notice of Termination to the other
party to this Employment Agreement given in accordance
with Section 10(b) of this Employment Agreement. For
purposes of this Employment Agreement, a "Notice of
Termination" means a written notice which:
(i)Indicates the specific termination provision in this
Employment Agreement relied upon,
(ii)To the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to
provide a basis for termination of the Executive's
employment under the provision so indicated, and
(iii)If the Date of Termination (as defined in Section
4(e)) is other than the date of receipt of such
notice, specifies the termination date (which date
shall be not more than thirty (30) days after the
giving of such notice). The failure by the
Executive or the Corporation to set forth in the
Notice of Termination any fact or circumstances
which contributes to a showing of Good Reason or
Cause shall not waive any right of the Executive
or the Corporation under this Employment Agreement
or preclude the Executive or the Corporation from
asserting such fact or circumstances in enforcing
the Executive's or the Corporation's rights under
this Employment Agreement.
x.Xxxx of Termination. "Date of Termination" means:
(i)If the Executive's employment is terminated by the
Corporation for Cause, or by the Executive for
Good Reason, the date of receipt of the Notice of
Termination or any later date specified therein,
as the case may be,
(ii)If the Executive's employment is terminated by the
Corporation other than for Cause, the date on
which the Corporation notifies the Executive of
such termination, and
(iii)If the Executive's employment is terminated by
reason of death, the date of death.
f.Change in Control. A "Change in Control" shall be deemed
to have occurred if any of the following events occur
after the Effective Date:
(i)Any corporation, person, other entity or group
becomes the "beneficial owner" (as defined in Rule
13d-3 under the Securities Exchange Act of 1934)
of more than fifty percent (50%) of the then
outstanding voting stock of Cinergy otherwise than
through a transaction arranged by, or consummated
with, the prior approval of the Board;
(ii)The shareholders of Cinergy approve a definite
agreement to merge or consolidate with or into
another corporation in a transaction in which
neither Cinergy nor any of its subsidiaries or
affiliates will be the surviving corporation, or
to sell or otherwise dispose of all or
substantially all of Cinergy's assets to any
person or group other than Cinergy or any of its
subsidiaries or affiliates, other than a merge or
a sale which will result in the voting securities
of Cinergy outstanding prior to the merger or sale
continuing to represent at least fifty percent
(50%) of the combined voting power of the voting
securities of the corporation surviving the merger
or purchasing the assets; or
(iii)During any period of two (2) consecutive years,
individuals who at the beginning of such period
constitute the Board of Directors of Cinergy (and
any new director whose election by the Board of
Directors of Cinergy or whose nomination for
election by Cinergy's stockholders was approved by
a vote of at least two thirds (2/3) of the
directors then still in office who either were
directors at the beginning of such period or whose
election or nomination for election was previously
so approved) cease for any reason to constitute a
majority of Cinergy's Board of Directors.
g.Person. "Person" shall have the meaning given in Section
3(a)(9) of the Securities Exchange Act of 1934, as
modified and used in Sections 13(d) and 14(d) thereof;
however, a Person shall not include:
(i)The Corporation or any of its subsidiaries,
(ii)A trustee or other fiduciary holding securities
under an employee benefit plan of Cinergy or any
of its subsidiaries,
(iii)An underwriter temporarily holding securities
pursuant to an offering of such securities, or
(iv)A corporation owned, directly or indirectly, by the
stockholders of Cinergy in substantially the same
proportions as their ownership of stock of the
Corporation.
5.Obligations of the Corporation Upon Termination.
a.Certain Terminations. During the Employment Period, if
the Corporation shall terminate the Executive's
employment (other than in the case of a termination for
Cause), the Executive shall terminate her employment
for Good Reason or the Executive's employment shall
terminate by reason of death (termination in any such
case referred to as "Termination"):
(i)The Corporation shall pay to the Executive a lump
sum amount, in case, equal to the sum of:
(1)the Executive's Annual Base Salary through the
Date of Termination to the extent not
previously paid,
(2)an amount equal to the Cinergy Annual Incentive
Plan target percentage benefit for the fiscal
year that includes the Date of Termination
multiplied by a fraction the numerator of
which shall be the number of days from the
beginning of such fiscal year to and
including the Date of Termination and the
denominator of which shall be three hundred
and sixty-five (365),
(3)an amount equal to her vested accrued benefit
under the Cinergy Performance Shares Plan,
and
(4)any compensation previously deferred by the
Executive (together with any accrued interest
or earnings thereon) and any accrued vacation
pay, in each case to the extent not
previously paid.
(The amounts specified in clauses (1), (2),
(3) and (4) shall be referred to in this
Employment Agreement as the "Accrued
Obligations".) The amounts specified in this
Section 5(a)(i) shall be paid within thirty
(30) days after the Date of Termination. The
Accrued Obligations described in this Section
are payable to the Executive regardless of
whether a Change in Control has occurred.
(ii)Prior to the occurrence of a Change in Control, and
in the event of Termination other than by reason
of the Executive's death, then:
(1)the Corporation shall pay to the Executive a
lump sum amount, in cash, equal to the
present value discounted using an interest
rate equal to the prime rate promulgated by
CitiBank, N.A. and in effect as of the Date
of Termination (the "Prime Rate") of the
Annual Base Salary, and the Cinergy Annual
Incentive Plan target percentage payable
through the end of the Employment Period,
each at the rate, and using the same goals
and factors, in effect at the time Notice of
Termination is given, and paid within thirty
(30) days of the Date of Termination;
(2)the Corporation shall pay to the Executive the
present value (discounted at the Prime Rate)
of all amounts to which the Executive would
have been entitled had she remained in
employment with the Corporation until the end
of the Employment Period, each, where
applicable, at the rate of the Annual Base
Salary, and using the same goals and factors,
in effect at the time Notice of Termination
is given, under the Cinergy Performance
Shares Plan and the Cinergy Executive
Supplemental Life Insurance Program minus the
present value (discounted at the Prime Rate)
of the benefits to which she is actually
entitled under the above mentioned plans and
programs;
(3)the Corporation shall pay the value of all
deferred compensation amounts and all
executive life insurance benefits whether or
not then vested or payable; and
(4)the Corporation shall continue, until the end
of the Employment Period, medical and welfare
benefits to the Executive and/or the
Executive's family at least equal to those
which would have been provided if the
Executive's employment had not been
terminated (excluding benefits to which the
Executive has waived her rights in writing),
such benefits to be in accordance with the
most favorable medical and welfare benefit
plans, practices, programs or policies (the
"M&W Plans") of the Corporation as in effect
and applicable generally to other senior
executives of the Corporation and their
families during the ninety (90) day period
immediately preceding the Date of
Termination; provided, however, that if the
Executive becomes employed with another
employer and is eligible to receive medical
or other welfare benefits under another
employer-provided plan, the benefits under
the M&W Plans shall be secondary to those
provided under such other plan during such
applicable period of eligibility.
(iii)From and after the occurrence of a Change in
Control and in the event of Termination other than
by reason of the Executive's death, then in lieu
of any further salary payments to the Executive
for periods subsequent to the Date of Termination
and in lieu of any other benefits payable pursuant
to Section 5(a)(ii) of this Employment Agreement:
(1)The Corporation shall pay to the Executive a
lump sum severance payment, in cash, equal to
the greater of:
(A)the present value of all amounts and
benefits that would have been due under
Sections 5(a)(ii) of this Employment
Agreement, excluding Section
5(a)(ii)(4), and
(B)three (3) times the sum of (x) the higher
of the Executive's Annual Base Salary in
effect immediately prior to the
occurrence of the event or circumstance
upon which the Notice of Termination is
based or in effect immediately prior to
the Change in Control, and (y) the
higher of the amount paid to the
Executive pursuant to all incentive
compensation or bonus plans or programs
maintained by the Corporation, in the
year preceding that in which the Date of
Termination occurs or in the year
preceding that in which the Change in
Control occurs; and
(2)For a thirty-six (36) month period after the
Date of Termination, the Corporation shall
arrange to provide the Executive with life,
disability, accident and health insurance
benefits substantially similar to those which
the Executive is receiving immediately prior
to the Notice of Termination (without giving
effect to any reduction in such benefits
subsequent to a Change in Control which
reduction constitutes Good Reason), except
for any benefits that were waived by the
Executive in writing. Benefits otherwise
receivable by the Executive pursuant to this
Section 5(a)(iii)(2) shall be reduced to the
extent comparable benefits are actually
received by or made available to the
Executive without cost during the thirty-six
(36) month period following the Executive's
termination of employment (and any such
benefits actually received by the Executive
shall be reported to the Corporation by the
Executive).
The Executive's employment shall be deemed to
have been terminated following a Change in
Control of Cinergy without Cause or by the
Executive for Good Reason if, in addition to
all other applicable Terminations, the
Executive's employment is terminated prior to
a Change in Control without Cause at the
direction of a Person who has entered into an
agreement with Cinergy or any of its
subsidiaries or affiliates, the consummation
of which will constitute a Change in Control
or if the Executive terminates her employment
for Good Reason prior to a Change in Control
if the circumstances or event which
constitutes Good Reason occurs at the
direction of such Person.
b.Termination by the Corporation for Cause or by the
Executive Other Than for Good Reason. Subject to the
provisions of Section 7 of this Employment Agreement,
if the Executive's employment shall be terminated for
Cause during the Employment Period, or if the Executive
terminates employment during the Employment Period
other than a termination for Good Reason, the
Corporation shall have no further obligations to the
Executive under this Employment Agreement other than
the obligation to pay to the Executive the Accrued
Obligations and the amounts determined under Section
5(c), plus any other earned but unpaid compensation, in
each case to the extent not previously paid.
c.Retirement Benefits on Termination. In addition to
retirement benefits under PSI's Pension Plan, PSI's
Supplemental Retirement Plan, and PSI's Excess Benefit
Plan, or any successor thereto, the Executive shall be
eligible to participate in any supplemental executive
retirement plan (commonly referred to as a "SERP")
sponsored by the Corporation.
d.Survival of Section 5(c). The provisions of Section 5(c)
shall survive the expiration or termination of this
Employment Agreement for any reason.
e.Certain Tax Consequences. In the event that the Executive
becomes entitled to the payments and benefits described
in this Section 5 (the "Severance Benefits"), if any of
the Severance Benefits will be subject to any excise
tax (the "Excise Tax") imposed under Section 4999 of
the Internal Revenue Code of 1986, as amended (the
"Code"), the Corporation shall pay to the Executive an
additional amount (the "Gross-Up Payment") such that
the net amount retained by the Executive, after
deduction of an Excise Tax on the Severance Benefits
and any federal, state and local income and employment
tax and Excise Tax upon the payment provided for by
this Section 5, shall be equal to the Severance
Benefits. For purposes of determining whether any of
the Severance Benefits will be subject to the Excise
Tax and the amount of such Excise Tax,
(i) any other payments or benefits received or to be
received by the Executive in connection with a
Change in Control or the Executive's termination
of employment (whether pursuant to the terms of
this Employment Agreement or any other plan,
arrangement or agreement with the Corporation, any
Person whose actions result in a Change in Control
or any Person affiliated with the Corporation or
such Person) shall be treated as "parachute
payments" within the meaning of Section 280G(b)(2)
of the Code, and all "excess parachute payments"
within the meaning of Section 280G(b)(1) of the
Code shall be treated as subject to the Excise
Tax, unless in the opinion of tax counsel selected
by the Corporation's independent auditors and
reasonably acceptable to the Executive such other
payments or benefits (in whole or in part) do not
constitute parachute payments, including by reason
of Section 280G(b)(4)(A) of the Code, or such
excess parachute payments (in whole or in part)
represent reasonable compensation for services
actually rendered, within the meaning of Section
280G(b)(4)(B) of the Code, in excess of the Base
Amount as defined in Section 280G(b)(3) of the
Code allocable to such reasonable compensation, or
are otherwise not subject to the Excise Tax,
(ii)the amount of the Severance Benefits that shall be
treated as subject to the Excise Tax shall be
equal to the lesser of
(1)the total amount of the Severance Benefits, or
(2)the amount of excess parachute payments within
the meaning of Section 280G(b)(1) of the Code
(after applying clause (i), above), and
(iii)the value of any non-cash benefits or any deferred
payment or benefit shall be determined by the
Corporation's independent auditors in accordance
with the principles of Section 280G(d)(3) and (4)
of the Code. For purposes of determining the
amount of the Gross-Up Payment, the Executive
shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment
is to be made and state and local income taxes at
the highest marginal rate of taxation in the state
and locality of the Executive's residence on the
Date of Termination, net of the maximum reduction
in federal income taxes which would be obtained
from deduction of such state and local taxes. In
the event that the Excise Tax is subsequently
determined to be less than the amount taken into
account hereunder at the time of termination of
the Executive's employment, the Executive shall
repay to the Corporation, at the time that the
amount of such reduction in Excise Tax is finally
determined, the portion of the Gross-Up Payment
attributable to such reduction (plus that portion
of the Gross-Up Payment attributable to the Excise
Tax and federal, state and local income and
employment tax imposed on the Gross-Up Payment
being repaid by the Executive to the extent that
such repayment results in a reduction in Excise
Tax and/or a federal, state or local income or
employment tax deduction) plus interest on the
amount of such repayment at the rate provided in
Section 1274(b)(2)(B) of the Code. In the event
that the Excise Tax is determined to exceed the
amount taken into account hereunder at the time of
the termination of the Executive's employment
(including by reason of any payment the existence
or amount of which cannot be determined at the
time of the Gross-Up Payment), the Corporation
shall make an additional Gross-Up Payment in
respect of such excess (plus any interest,
penalties or additions payable by the Executive
with respect to such excess) at the time that the
amount of such excess is finally determined. The
Executive and the Corporation shall each
reasonably cooperate with the other in connection
with any administrative or judicial proceedings
concerning the existence or amount of liability
for Excise Tax with respect to the Severance
Benefits.
f.Other Fees and Expenses. The Corporation also shall pay
to the Executive all legal fees and expenses incurred
by the Executive as a result of a termination which
entitles the Executive to the Severance Benefits
(including all such fees and expenses, if any, incurred
in disputing any such termination or in seeking in good
faith to obtain or enforce any benefit or right
provided by this Employment Agreement). Such payments
shall be made within five (5) business days after
delivery of the Executive's written requests for
payment accompanied with such evidence of fees and
expenses incurred as the Corporation reasonably may
require.
6.Non-exclusivity of Rights. Nothing in this Employment
Agreement shall prevent or limit the Executive's continuing
or future participation in any benefit, plan, program,
policy or practice provided by the Corporation and for which
the Executive may qualify (except with respect to any
benefit to which the Executive has waived her rights in
writing), nor shall anything herein limit or otherwise
affect such rights as the Executive may have under any other
contract or agreement entered into after the date hereof
with the Corporation. Amounts which are vested benefits or
which the Executive is otherwise entitled to receive under
any benefit, plan, program, policy or practice of, or any
contract or agreement entered into after the date hereof
with, the Corporation at or subsequent to the Date of
Termination, shall be payable in accordance with such
benefit, plan, program, policy or practice, or contract or
agreement, except as explicitly modified by this Employment
Agreement.
7.Full Settlement: Mitigation. Except as provided in Sections
5(a)(ii)(4) and 5(a)(iii)(2) of this Employment Agreement,
the Corporation's obligation to make the payments provided
for in this Employment Agreement and otherwise to perform
its obligations under this Employment Agreement shall not be
affected by any set-off, counterclaim, recoupment, defense
or other claim, right or action which the Corporation may
have against the Executive or others. In no event shall the
Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts (including
amounts for damages for breach) payable to the Executive
under any of the provisions of this Employment Agreement and
such amounts shall not be reduced whether or not the
Executive obtains other employment. If the Executive
finally prevails with respect to any dispute between the
Corporation, the Executive or others as to the
interpretation, terms, validity or enforceability of
(including any dispute about the amount of any payment
pursuant to) this Employment Agreement, the Corporation
agrees to pay all legal fees and expenses which the
Executive may reasonably incur as a result of any such
dispute.
8.Confidential Information. The Executive shall hold in a
fiduciary capacity for the benefit of Cinergy, all of its
subsidiary companies and affiliates, as well as all
successors and assigns thereof (the "Cinergy Companies"),
all secret, confidential information, knowledge or data
relating to the Cinergy Companies, and their respective
businesses, that shall have been obtained by the Executive
during the Executive's employment by the Corporation and
that shall not have been or now or subsequently have become
public knowledge (other than by acts by the Executive or
representatives of the Executive in violation of this
Employment Agreement). During the Employment Period and
thereafter, the Executive shall not, without the prior
written consent of the Corporation or as may otherwise by
required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the
Corporation and those designated by it. The Executive
understands that during the Employment Period, the Cinergy
Companies may be required from time to time to make public
disclosure of the terms or existence of the Executive's
employment relationship in order to comply with various laws
and legal requirements. In addition to all other remedies
available to the Corporation in law and equity, this
Employment Agreement is subject to termination by the
Corporation for Cause under Section 4(b) in the event the
Executive violates any provision of this Section 8.
9.Successors.
a.This Employment Agreement is personal to the Executive
and, without the prior written consent of the
Corporation, shall not be assignable by the Executive
otherwise than by will or the laws of descent and
distribution. This Employment Agreement shall insure
to the benefits of and be enforceable by the
Executive's legal representatives.
b.This Employment Agreement shall inure to the benefit of
and be binding upon the Corporation, and its successors
and assigns.
c.The Corporation shall require any successor (whether
direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the
business and/or assets of the Corporation to assume
expressly and agree to perform this Employment
Agreement in the same manner and to the same extent
that the Corporation would be required to perform it if
no such succession had taken place.
10.Miscellaneous.
a.This Employment Agreement shall be governed by and
construed in accordance with the laws of the State of
Ohio, without reference to principles of conflict of
laws. The captions of this Employment Agreement are
not part of the provisions hereof and shall have no
force or effect. This Employment Agreement may not be
amended, modified, repealed, waived, extended or
discharged except by an agreement in writing signed by
the party against whom enforcement of such amendment,
modification, repeal, waiver, extension or discharge is
sought. No person, other than pursuant to a resolution
of the Board or a committee thereof, shall have
authority on behalf of the Corporation to agree to
amend, modify, repeal, waive, extend or discharge any
provision of this Employment Agreement or anything in
reference thereto.
b.All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the
other party or by registered or certified mail, return
receipt requested, postage prepaid, addressed as
follows:
If to the Executive:
Xxxxxx X. Xxxxx
Cinergy Corp.
000 Xxxx Xxxxxx Xxxxxx
X. X. Xxx 000
Xxxxxxxxxx, Xxxx 00000-0000
If to the Corporation:
Cinergy Corp.
000 Xxxx Xxxxxx Xxxxxx
P. O. Xxx 000
Xxxxxxxxxx, Xxxx 00000-0000
Attn: Chief Executive Officer
or to such other address as either party shall have
furnished to the other in writing in accordance with
this Employment Agreement. All notices and
communications shall be effective when actually
received by the addressee.
c.The invalidity or unenforceability of any provision of
this Employment Agreement shall not affect the validity
or enforceability of any other provision of this
Employment Agreement.
d.The Corporation may withhold from any amounts payable
under this Employment Agreement such federal, state or
local taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
e.The Executive's or the Corporation's failure to insist
upon strict compliance with any provision of this
Employment Agreement or the failure to assert any right
the Executive or the Corporation may have under this
Employment Agreement, including without limitation the
right of the Executive to terminate employment for Good
Reason pursuant to Section 4(c) of this Employment
Agreement, or the right of the Corporation to terminate
the Executive's employment for Cause pursuant to
Section 4(b) of this Employment Agreement, shall not be
deemed to be a waiver of such provision or right or any
other provision or right of this Employment Agreement.
f.This instrument contains the entire agreement of the
Executive and the Corporation with respect to the
subject matter hereof; and all promises,
representations, understandings, arrangements and prior
agreements are merged into this Employment Agreement
and accordingly superseded.
g.This Employment Agreement may be executed in counterparts,
each of which shall be deemed to be an original but all
of which together will constitute one and the same
instrument.
h.The Corporation and the Executive agree that Cinergy shall
be authorized to act for the Corporation with respect
to all aspects pertaining to the administration and
interpretation of this Employment Agreement.
IN WITNESS WHEREOF, the Executive and the Corporation have
caused this Employment Agreement to be executed as of the day and
year first above written.
CINERGY CORP.
By: Xxxxxxx X. Xxxxxxxx
(Xxxxxxx X. Xxxxxxxx)
Chairman and Chief Executive Officer
CINERGY SERVICES, INC.
By: Xxxxxxx X. Xxxxxxxx
(Xxxxxxx X. Xxxxxxxx)
Chairman and Chief Executive Officer
THE CINCINNATI GAS & ELECTRIC COMPANY
By: Xxxxxxx X. Xxxxxxxx
(Xxxxxxx X. Xxxxxxxx)
Chairman and Chief Executive Officer
PSI ENERGY, INC.
By: Xxxxxxx X. Xxxxxxxx
(Xxxxxxx X. Xxxxxxxx)
Chairman and Chief Executive Officer
EXECUTIVE
Xxxxxx X. Xxxxx
(Xxxxxx X. Xxxxx)
