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W6-NY960920.111
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is dated as of the 26th day
of June, 1996, by and among PENNSYLVANIA ENTERPRISES, INC.
("PEI"), PG ENERGY, INC. ("PGE") and Xxxxxxx X. Xxxxxxx (the
"Executive"), an individual residing at 0000 Xxxxxxx Xxxxx, Xx.
Xxxxxxxxxx, Xxxxxxx 00000.
W I T N E S S E T H:
WHEREAS, PEI and PGE each desires to employ Executive
in the capacity of Chairman of its Board of Directors in
connection with the conduct of its business; and
WHEREAS, PEI and PGE are offering Executive this
Employment Agreement as an inducement to remain in their employ;
and
WHEREAS, Executive desires to accept such employment on
the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants contained herein, the parties hereto agree
as follows:
1. Employment.
PEI and PGE each hereby employs Executive as
Chairman of its Board of Directors, and Executive hereby accepts
such employment, upon the terms and conditions hereinafter set
forth.
2. Term.
The term of employment of Executive under this
Agreement (the "Term") shall commence on June 26, 1996 and shall
end on the date which is the third anniversary thereof unless
terminated in accordance with Section 6 or 7 hereof; provided,
however, that this Agreement shall terminate if and when
Executive is no longer a member of the Boards of Directors of PEI
(the "PEI Board") and PGE (the "PGE Board").
3. Office and Duties.
During the Term, Executive shall serve as the
Chairman of the PEI Board and as the Chairman of the PGE Board.
Executive shall preside at meetings of the PEI Board and the PGE
Board, play an active role in the management of PEI as assigned
to him by the PEI Board and in the management of PGE as assigned
to him by the PGE Board and in each case, perform such other
duties as are customary for the Chairman of the board of
directors of a company engaged in natural gas distribution and
energy-related services in the United States and consistent with
such position and status.
4. Compensation.
As compensation for the services to be rendered
hereunder by Executive, PEI and PGE collectively agree to pay to
Executive:
(a) an aggregate salary payable in cash in
accordance with PGE's usual payroll practices of $97,500 for the
first year of the Term, $97,500 for the second year of the Term
and $97,500 for the third year of the Term; and
(b) a grant of options under PEI's 1992 Stock
Option Plan (the "Stock Option Plan") to purchase 45,000 shares
of PEI's common stock, no par value, stated value $10.00 per
share ("Common Stock") to be made on September 1, 1996. Such
options shall become exercisable, subject to acceleration in the
event of a "Change of Control" of PEI (as defined in the Option
Plan) pursuant to the terms of the Option Plan, as follows:
options to purchase 15,000 shares shall become exercisable on
September 1, 1997, options to purchase an additional 15,000
shares shall become exercisable on September 1, 1998 and options
to purchase an additional 15,000 shares shall become exercisable
on September 1, 1999. Such options shall be exercisable for the
three years following the termination of Executive employment for
any reason, except for termination by PEI pursuant to Section
7(a) hereof for "Cause" (as defined in Section 7(a) hereof) or
termination by Executive pursuant to Section 7(d) hereof without
"Good Reason" (as defined in Section 7(c) hereof).
5. Benefits.
(a) Executive shall be entitled during the Term
to participate in (i) all employee benefit plans and programs as
are currently available and as shall become available from time
to time to other employees of PEI and/or PGE, including, without
limitation, any health, accident, disability or hospitalization
insurance and (ii) all executive plans and programs in each case,
to the extent that his position, tenure, compensation, age,
health and other qualifications make him eligible to participate,
and to continue to receive all perquisites as are currently
available to Executive.
(b) PEI and PGE shall each promptly reimburse
Executive for all business expenses and disbursements incurred by
Executive in the performance of Executive's duties during the
Term in accordance with its then current reimbursement policies.
6. Termination for Death or Disability.
At the election of PEI and/or PGE, the employment
of Executive shall terminate in the event that Executive shall
fail to render and perform the services required of him under
this Agreement on a full-time basis because of any physical or
mental incapacity or disability as determined by a physician or
physicians acceptable to Executive and PEI and/or PGE for a total
of 180 days or more during any consecutive 12 month period
("Disability"). In the event Executive dies during the Term or
in the event PEI and/or PGE elects to terminate the employment of
Executive for Disability, all obligations of PEI and/or PGE under
this Agreement will cease as of the date of death or termination,
except that PEI and/or PGE collectively shall pay, and Executive
or his personal representative, as the case may be, shall be
entitled to receive (i) the unpaid portion of his salary accrued
through the end of the month in which such Disability is finally
determined, to be paid in accordance with Section 4(a) hereof and
(ii) vested, nonforfeitable amounts owing or accrued under any
benefit plans or programs set forth or referred to in
Section 5(a) hereof in which Executive participated as of his
termination under the terms and conditions of the plan or program
pursuant to which such benefits were granted.
7. Termination of Employment Other Than for Death or
Disability.
(a) Cause. PEI and/or PGE may terminate the
employment of Executive for "Cause" at any time in accordance
with the provisions of this Section 7. Termination for "Cause"
shall mean discharge by PEI and/or PGE on the grounds of
(i) Executive's willful misconduct or gross negligence in the
performance of his obligations under this Agreement, (ii) the
habitual intoxication of Executive, (iii) inexcusable repeated or
prolonged absence from work by Executive (other than pursuant to
the Disability of Executive), (iv) the commission by Executive of
an act of fraud or embezzlement, (v) any intentional or grossly
negligent unauthorized disclosure of Confidential Information (as
defined in Section 8(b) hereof) of PEI, PGE or any of their
respective affiliates, (vi) a conviction of Executive (including
entry of a guilty or nolo contendere plea) involving dishonesty
or moral turpitude or (vii) the willful failure of Executive to
perform faithfully the lawful duties which are assigned to him
which are within the scope of PEI's and/or PGE's respective
businesses and such failure is not cured by Executive within 14
days after written notice thereof from PEI and/or PGE to
Executive. Upon a termination for Cause, all obligations of PEI
and/or PGE under this Agreement will cease as of the date of
termination, except that PEI and/or PGE collectively shall pay
Executive, and Executive shall be entitled to receive, (x) the
unpaid portion of his salary pro rated through the date of
termination, to be paid in accordance with Section 4(a) hereof
and (y) vested, nonforfeitable amounts owing or accrued under any
benefit plans or programs set forth or referred to in Section
5(a) hereof in which Executive participated as of his termination
under the terms and conditions of the plan or program pursuant to
which such benefits were granted.
(b) Without Cause. In the event the Executive's
employment is terminated by PEI and/or PGE without Cause or the
Executive is no longer a member of the PEI Board or the PGE
Board, other than by reason of the death or Disability of
Executive or his resignation from the PEI Board or the PGE Board,
all obligations of PEI and/or PGE under this Agreement will cease
as of the date of termination, except that PEI and/or PGE
collectively shall pay Executive, and Executive shall be entitled
to receive either (i) in the event such termination does not
occur within three years following the date on which a "Change in
Control" (as defined below) of PEI occurs (A) the unpaid portion
of his salary to the end of the Term, to be paid in accordance
with Section 4(a) hereof and (B) vested, nonforfeitable amounts
owing or accrued under any benefit plans or programs set forth or
referred to in Section 5(a) hereof in which Executive
participated as of his termination under the terms and conditions
of the plan or program pursuant to which such benefits were
granted or (ii) in the event such termination occurs within three
years following the date on which a Change in Control of PEI
occurs (A) a Severance Payment equal to two times (2x)
Executive's annual salary for the year in which such termination
occurs to be paid in a lump sum within 10 days of such
termination, (B) the unpaid portion of Executive's salary with
respect to any additional years (other than the year in which
such termination occurs) remaining in Term to be paid in
accordance with Section 4(a) hereof, (C) a continuation for a
period of three years following the date on which a Change in
Control of PEI occurs of Executive's coverage at the expense of
PEI and/or PGE under life insurance, hospitalization and medical
plans providing benefits which are substantially comparable to
benefits provided to Executive under benefit plans of PEI, PGE
and their respective subsidiaries in effect immediately prior to
the Change in Control of PEI, and (D) vested, nonforfeitable
amounts owing or accrued under any other benefit plans or
programs set forth or referred to in Section 5(a) hereof in which
Executive participated as of his termination under the terms and
conditions of the plan or program pursuant to which such benefits
were granted.
For purposes of this Agreement, a "Change in Control"
of PEI shall be deemed to have occurred if and when:
(w) there shall be consummated either (i) any
consolidation or merger of PEI in which PEI is not the continuing
or surviving corporation or pursuant to which shares of PEI's
Common Stock are converted into cash, securities or other
property, other than a consolidation or merger of PEI in which
each holder of PEI's Common Stock immediately prior to the merger
has upon consummation of the merger the same proportionate
ownership of Common Stock of the surviving corporation as such
holder had of PEI's common stock immediately prior to the merger,
or (ii) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged
by any party as a single plan) of all or substantially all of the
assets of PEI;
(x) the shareholders of PEI shall approve any
plan or proposal for the liquidation or dissolution of PEI;
(y) any person (as such term is used in
Sections 13(d) and 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Exchange Act")), other than any trustee
under any employee benefit plan of PEI or any of its
subsidiaries, and persons (as such term is so used) who are then
affiliates (as defined on June 26, 1996 in Rule 12b-2 under the
Exchange Act) of such person, or any one of them, shall after the
date hereof become the beneficial owner or owners (as defined on
June 26, 1996 in Rules 13d-3 and 13d-5 under the Exchange Act),
directly or indirectly, of securities of PEI representing in the
aggregate 20% or more of the voting power of all then outstanding
securities of PEI having the right under ordinary circumstances
to vote in an election of the PEI Board (without limitation, any
securities of PEI having such voting power that any such person
has the right to acquire pursuant to any agreement, or upon
exercise of conversion rights, warrants or options, or otherwise,
shall be deemed beneficially owned by such person); or
(z) during any period of 13 consecutive months,
individuals who at the beginning of such period constitute the
entire PEI Board and any new directors whose election by the PEI
Board, or whose nomination for election by PEI's shareholders,
shall have been 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 the period or whose election or nomination
for election shall previously have been so approved shall cease
for any reason to constitute a majority of the members of the PEI
Board.
(c) For Good Reason. Executive may terminate his
employment for "Good Reason" upon 90 days' written notice to PEI
and/or PGE. For purposes of this Agreement "Good Reason" shall
mean (i) an adverse change in Executive's title, (ii) an
assignment of duties to Executive which are inconsistent with his
status as Chairman of the PEI Board or the PGE Board, (iii) a
substantial adverse alteration in Executive's status, nature of
responsibilities or authority within PEI and/or PGE,
(iv) following a Change in Control of PEI, a failure by PEI, PGE
or any of their respective subsidiaries either to continue in
effect any incentive or compensation plan or arrangement in which
Executive shall be participating at the time of the Change in
Control of PEI or to provide other plans or arrangements
providing Executive with substantially comparable benefits or the
taking by PEI, PGE or any of their respective subsidiaries of any
action which would directly or indirectly materially adversely
affect Executive's participation in or materially reduce
Executive's benefits under any such plan or arrangement, (v) any
breach by PEI and/or PGE of any material provision of this
Agreement or (vi) following a Change in Control of PEI, any
failure by PEI and PGE to obtain from any successor to PEI a
satisfactory agreement to assume and perform this Agreement. In
the event that Executive terminates his employment for Good
Reason, all obligations of PEI and/or PGE under this Agreement
will cease as of the date of termination, except that PEI and/or
PGE collectively shall pay Executive and Executive shall be
entitled to receive either (x) in the event such termination does
not occur within three years following the date on which a Change
in Control of PEI occurs (A) the unpaid portion of his salary to
the end of the Term, to be paid in accordance with Section 4(a)
hereof and (B) vested, nonforfeitable amounts owing or accrued
under any benefit plans or programs set forth or referred to in
Section 5(a) hereof in which Executive participated as of his
termination under the terms and conditions of the plan or program
pursuant to which such benefits were granted or (y) in the event
such termination occurs within three years following the date on
which a Change in Control of PEI occurs (A) a Severance Payment
equal to two times (2X) Executive's annual salary for the year in
which such termination occurs to be paid in a lump sum within 10
days of such termination, (B) the unpaid portion of Executive's
salary with respect to any additional years (other than the year
in which such termination occurs) remaining in the Term to be
paid in accordance with Section 4(a) hereof, (C) a continuation
for a period of three years following the date on which a Change
in Control of PEI occurs of Executive's coverage at the expense
of PEI and/or PGE under life insurance, hospitalization and
medical plans providing benefits which are substantially
comparable to benefits provided to Executive under benefit plans
of PEI, PGE or any of their respective subsidiaries in effect
immediately prior to the Change in Control of PEI and (D) vested
nonforfeitable amounts owing or accrued under any other benefit
plans or programs set forth or referred to in Section 5(a) hereof
in which Executive participated as of his termination under the
terms and conditions of the plan or program pursuant to which
such benefits were granted.
(d) Without Good Reason. Executive may terminate
his employment without Good Reason by giving PEI and/or PGE 90
days' written notice. Upon termination by Executive without Good
Reason, all obligations of PEI and/or PGE under this Agreement
will cease as of the date of termination except that PEI and/or
PGE collectively shall pay Executive and Executive shall be
entitled to receive (i) the unpaid portion of his salary pro
rated through the date of termination to be paid in accordance
with Section 4(a) hereof and (ii) vested,, nonforfeitable amounts
owing or accrued under any benefit plans or programs set forth or
referred to in Section 5(a) hereof in which Executive
participated as of his termination under the terms and conditions
of the plan or program pursuant to which such benefits were
granted.
8. Covenant Not to Compete; Confidentiality;
Litigation Support.
In consideration for PEI and PGE's execution and
delivery of this Agreement:
(a) Executive hereby agrees that during the
period from the date of this Agreement through the end of the
first year after the termination of Executive's employment with
PEI and/or PGE for any reason other than (x) termination by PEI
and/or PGE without Cause or (y) termination by Executive for Good
Reason, Executive will not:
(i) carry on or engage in any business that
competes, directly or indirectly with the business of
distributing natural gas, or any other business being conducted
by PEI and/or PGE at the date of Executive's termination
(collectively, a "Competing Business") anywhere in the United
States;
(ii) become a stockholder of a corporation or
a member of a partnership or act as a consultant to or provide
any assistance to any enterprise which carries on or engages in a
Competing Business or which otherwise competes with PEI and/or
PGE anywhere in the United States; provided, however, that
Executive may own shares of stock of a corporation that is
engaged in a Competing Business provided, that (A) Executive does
not own more than one-half of one percent of the outstanding
shares of stock of such corporation, (B) such shares are publicly
traded on a United States natural securities exchange, NASDAQ or
any over-the-counter public securities market and (C) Executive
does not directly or indirectly acquire or assume any management
responsibilities in such corporation;
(iii) solicit, raid, entice or induce any
person, firm or corporation that presently is or at any time
during the Term shall be a client or customer of PEI, PGE or any
of their respective affiliates to become a client or customer of
any other person, firm or corporation engaged in a Competing
Business anywhere in the United States; or
(iv) solicit, raid, entice or induce any
person who presently is or at any time during the Term shall be
an employee of PEI, PGE or any of their respective affiliates to
become employed by any other person, firm or corporation engaged
in a Competing Business anywhere in the United States.
(b) Executive acknowledges that during the Term
he will have access to confidential information of PEI, PGE and
their respective affiliates, including plans for future
developments and information about costs, customers, profits,
markets, key personnel, pricing policies, operational methods,
and other business affairs and methods and other information not
available to the public or in the public domain (hereinafter
referred to as "Confidential Information"). In recognition of
the foregoing, Executive covenants and agrees that, except as
required by his duties to PEI and/or PGE, or as required by law
or pursuant to legal process, Executive will keep secret all
Confidential Information of PEI, PGE and their respective
affiliates and will not, directly or indirectly, either during
the Term of his employment hereunder or at any time thereafter,
disclose or disseminate to anyone or make use of, for any purpose
whatsoever, any Confidential Information, and upon termination of
his employment, Executive will promptly deliver to PEI and/or PGE
all tangible Confidential Information (including all copies
thereof, whether prepared by Executive or others) which he may
possess or control.
(c) Executive acknowledges that the restrictions
contained in this Section 8 are a reasonable and necessary
protection of the immediate interests of PEI and PGE, that any
violation of these restrictions would cause substantial injury to
PEI and PGE and that PEI and PGE would not have entered into this
Agreement without receiving the additional consideration offered
by Executive by binding himself to these restrictions. In the
event of a breach or threatened breach by Executive of any of
these restrictions, PEI and/or PGE shall be entitled to apply to
any court of competent jurisdiction for an injunction restraining
Executive from such breach or threatened breach; provided,
however, that the right to apply for an injunction shall not be
construed as prohibiting PEI and/or PGE from pursuing any other
available remedies for such breach or threatened breach. In the
event that, notwithstanding the foregoing, a covenant included in
this Section 8 shall be deemed by any court to be unreasonably
broad in any respect, it shall be modified in order to make it
reasonable and shall be enforced accordingly. Without limitation
of, and notwithstanding, the foregoing, in the event that, in any
judicial proceeding, a court shall refuse to enforce any of the
covenants contained in this Section 8, then the unenforceable
covenant shall be deemed eliminated from the provisions of this
Section 8 for the purpose of those proceedings to the extent
necessary to permit the remaining covenants to be enforced. If
any one or more of the provisions of this Section 8 shall be held
to be invalid, illegal or unenforceable, the validity, legality
or enforceability of the remaining provisions of this Section
shall not be effected thereby. To the extent permitted by
applicable law, each party hereto waives any provision of law
which renders any provision of this Section 8 invalid, illegal or
unenforceable in any respect.
(d) Executive agrees that during the Term and
thereafter Executive shall be available to PEI and PGE and shall
assist PEI and PGE in connection with any litigation brought by
or against PEI and/or PGE relating to the period during which
Executive was employed by PEI and/or PGE; provided, however, that
all costs and expenses in connection with the foregoing shall be
borne by PEI and/or PGE .
(e) The provisions of this Section 8 shall
survive the termination or expiration of this Agreement in
accordance with the terms hereof.
9. Governing Law.
This Agreement is governed by and is to be
construed and enforced in accordance with the laws of the
Commonwealth of Pennsylvania without regard to conflicts of law
principles. If under such law, any portion of this Agreement is
at any time deemed to be in conflict with any applicable statute,
rule, regulation or ordinance, such portion shall be deemed to be
modified or altered to conform thereto or, if that is not
possible, to be omitted from this Agreement. The invalidity of
any such portion shall not affect the force, effect and validity
of the remaining portion hereof.
10. Arbitration.
If a dispute arises between the parties respecting
the terms of this Agreement or Executive's employment by PEI
and/or PGE, such dispute shall be settled by binding arbitration
in Xxxxxx-Xxxxx, Pennsylvania, in accordance with the rules of
the American Arbitration Association. Each party shall bear its
own expense of any such arbitration; provided, however, that
Executive shall be entitled to receive reimbursement of his
reasonable legal fees and out-of-pocket expenses from PEI and/or
PGE with respect to any claim or dispute relating to the
interpretation or enforcement of this Agreement promptly after
invoices for such fees and expenses are rendered unless the
position taken by Executive is determined by a court of competent
jurisdiction to be frivolous.
11. Additional Payments.
(a) In the event that any payment or benefit
(within the meaning of Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended (the "Code")), to Executive or for his
benefit paid or payable or distributed or distributable pursuant
to the terms of this Agreement or otherwise in connection with,
or arising out of, his employment with PEI and/or PGE (a
"Payment" or "Payments"), would be subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties
are incurred by Executive with respect to such excise tax (such
excise tax, together with any such interest and penalties, are
hereinafter collectively referred to as the "Excise Tax"), then
Executive will be entitled to receive an additional payment (a
"Gross-Up Payment") in an amount such that after payment by
Executive of all taxes (including any interest or penalties,
other than interest and penalties imposed by reason of
Executive's failure to file timely a tax return or pay taxes
shown due on his return), imposed with respect to such Gross-Up
Payment and the Excise Tax, including any Excise Tax imposed upon
the Gross-Up Payment, Executive retains an amount of the Gross-Up
Payment equal to the Excise Tax imposed upon the Payments.
(b) An initial determination as to whether a
Gross-Up Payment is required pursuant to this Agreement and the
amount of such Gross-Up Payment shall be made at PEI's and/or
PGE's expense by an accounting firm selected by PEI and PGE and
reasonably acceptable to Executive which is designated as one of
the five largest accounting firms in the United States (the
"Accounting Firm"). The Accounting Firm shall provide its
determination (the "Determination"), together with detailed
supporting calculations and documentation, to PEI and/or PGE and
Executive within five days of the date on which Executive's
employment with PEI and/or PGE is terminated if applicable, or
such other time as requested by PEI and/or PGE or by Executive
(provided Executive reasonably believes that any of the Payments
may be subject to the Excise Tax) and if the Accounting Firm
determines that no Excise Tax is payable by Executive with
respect to a Payment or Payments, it shall furnish Executive with
an opinion reasonably acceptable to Executive that no Excise Tax
will be imposed with respect to any such Payment or Payments.
Within ten days of the delivery of the Determination to
Executive, Executive shall have the right to dispute the
Determination (the "Dispute"). The Gross-Up Payment, if any, as
determined pursuant to this Section 11(b) shall be paid by PEI
and/or PGE collectively to Executive within five days of the
receipt of the Determination. The existence of the Dispute shall
not in any way affect Executive's right to receive the Gross-Up
Payment in accordance with the Determination. If there is no
Dispute, the Determination shall be binding, final and conclusive
upon PEI and/or PGE and Executive subject to the application of
Section 11(c) below.
(c) As a result of the uncertainty in the
application of Sections 4999 and 280G of the Code, it is possible
that a Gross-Up Payment (or a portion thereof) will be paid which
should not have been paid (an "Excess Payment") or a Gross-Up
Payment (or a portion thereof) which should have been paid will
not have been paid (an "Underpayment"). An Underpayment shall be
deemed to have occurred (i) upon notice (formal or informal) to
Executive from any governmental taxing authority that Executive's
tax liability (whether in respect of Executive's current taxable
year or in respect of any prior taxable year) may be increased by
reason of the imposition of the Excise Tax on a Payment or
Payments with respect to which PEI and/or PGE has failed to make
a sufficient Gross-Up Payment, (ii) upon a determination by a
court, (iii) by reason of determination by PEI and/or PGE (which
shall include the position taken by PEI and/or PGE, together with
their respective consolidated groups, on their respective federal
income tax returns) or (iv) upon the resolution of the Dispute to
Executive's satisfaction. If an Underpayment occurs, Executive
shall promptly notify PEI and/or PGE and PEI and/or PGE shall
promptly, but in any event, at least five days prior to the date
on which the applicable government taxing authority has requested
payment, pay to Executive an additional Gross-Up Payment equal to
the amount of the Underpayment plus any interest and penalties
(other than interest and penalties imposed by reason of
Executive's failure to file timely a tax return or pay taxes
shown due on Executive's return) imposed on the Underpayment. An
Excess Payment shall be deemed to have occurred upon a Final
Determination (as hereinafter defined) that the Excise Tax shall
not be imposed upon a Payment or Payments (or portion thereof)
with respect to which Executive had previously received a Gross-
Up Payment. A "Final Determination" shall be deemed to have
occurred when Executive has received from the applicable
government taxing authority a refund of taxes or other reduction
in Executive's tax liability by reason of the Excise Payment and
upon either (x) the date a determination is made by, or an
agreement is entered into with, the applicable governmental
taxing authority which finally and conclusively binds Executive
and such taxing authority, or in the event that a claim is
brought before a court of competent jurisdiction, the date upon
which a final determination has been made by such court and
either all appeals have been taken and finally resolved or the
time for all appeals has expired or (y) the statute of
limitations with respect to Executive's applicable tax return has
expired. If an Excess Payment is determined to have been made,
the amount of the Excess Payment shall be treated as a loan by
PEI and/or PGE to Executive and Executive shall pay to PEI and/or
PGE on demand (but not less than 10 days after the determination
of such Excess Payment and written notice has been delivered to
Executive) the amount of the Excess Payment plus interest at an
annual rate equal to the Applicable Federal Rate provided for in
Section 1274(d) of the Code from the date the Gross-Up Payment
(to which the Excess Payment relates) was paid to Executive until
the date of repayment to PEI and/or PGE.
(d) Notwithstanding anything contained in this
Agreement to the contrary, in the event that, according to the
Determination, an Excise Tax will be imposed on any Payment or
Payments, PEI and/or PGE collectively shall pay to the applicable
government taxing authorities as Excise Tax withholding, the
amount of the Excise Tax that PEI and/or PGE has actually
withheld from the Payment or Payments.
12. Allocation of Responsibility to Make Certain
Payments
Responsibility for payment of the amounts payable
by PEI and/or PGE pursuant to Sections 4(a), 6, 7, 8(d), 10 and
11 of this Agreement shall be allocated between PEI and PGE as
agreed upon from time to time by PEI and PGE.
13. Miscellaneous.
(a) This Agreement cancels and supersedes any and
all prior agreements and understandings between or among any or
all of the parties hereto with respect to the employment of
Executive by PEI and PGE. This Agreement constitutes the entire
agreement among the parties with respect to the matters herein
provided, and no modification or waiver of any provision hereof
shall be effective unless in writing and signed by the parties
hereto.
(b) Neither this Agreement nor the rights or
obligations hereunder of any party hereto shall be assignable
without the written consent of (i) PEI and PGE, with respect to
an assignment or attempted assignment by Executive and
(ii) Executive, with respect to an assignment or attempted
assignment by PEI and/or PGE; provided, however, that no consent
of Executive shall be required for any assignment by PEI and/or
PGE whereby the assignee, by operation of law or otherwise,
continues to carry on substantially the business of PEI and/or
PGE, as the case may be, prior to the assignment. This Agreement
shall be binding upon and inure to the benefit of the successors
and permitted assigns of PEI and PGE.
(c) Whenever under this Agreement it becomes
necessary to give notice, such notice shall be in writing, signed
by the party or parties giving or making the same, and shall be
served on the person or persons for whom it is intended or who
should be advised or notified, by Federal Express or other
similar overnight service or by certified or registered mail,
return receipt requested, postage prepaid and addressed to such
party at the address set forth below or at such other address as
may be designated by such party by like notice:
If to PEI:
Pennsylvania Enterprises, Inc.
Xxxxxx-Xxxxx Center
00 Xxxxxx Xxxxxx
Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Secretary
If to PGE:
PG Energy, Inc.
Xxxxxx-Xxxxx Center
00 Xxxxxx Xxxxxx
Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Secretary
If to Executive:
Xxxxxxx X. Xxxxxxx
0000 Xxxxxxx Xxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
In the case of Federal Express or other similar overnight
service, such notice or advice shall be effective when sent, and,
in the cases of certified or registered mail, shall be effective
2 days after delivery to the U.S. Post Office.
(d) The invalidity of any portion of this
Agreement shall not be deemed to render the remainder of this
Agreement invalid.
(e) The headings of this Agreement are for
convenience of reference only and do not constitute a part
hereof.
(f) The failure of any party at any time to
require performance by any other party of any provision hereof or
to resort to any remedy provided herein or at law or in equity
shall in no way affect the right of such party to require such
performance or to resort to such remedy at any time thereafter,
nor shall the waiver by any party of a breach of any of the
provisions hereof be deemed to be a waiver of any subsequent
breach of such provisions. No such waiver shall be effective
unless in writing and signed by the party against whom such
waiver is sought to be enforced.
(g) The amounts required to be paid by PEI and/or
PGE to Executive pursuant to this Agreement shall not be subject
to offset.
(h) In the event that Executive's employment with
PEI and/or PGE is terminated for any reason, Executive shall not
be required to seek other employment or otherwise to mitigate
Executive's damages under this Agreement.
IN WITNESS WHEREOF, Executive has hereunto set his hand
and PEI and PGE have caused this instrument to be duly executed
as of the day and year first above written.
PENNSYLVANIA ENTERPRISES, INC.
By:
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
PG ENERGY, INC.
By:
Name: Xxxxxx X. Xxxxx
Title: Executive Vice President
Executive
Xxxxxxx X. Xxxxxxx
Approved:
Compensation Committee of
the Board of Directors of
Pennsylvania Enterprises,
Inc.
By:
Name: Xxxx X. XxXxxxxx
Title: Chairman
