EXHIBIT 10.2
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CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (the "Agreement") is entered into
effective as of the 1st day of October, 1994 (the "Effective
Date ), by and between ATMOS ENERGY CORPORATION, a Texas
corporation (the "Company") and XXXXXXX X. XXXXXXX (the
"Consultant").
RECITALS
A. Consultant is a former employee of the Company who has
retired from the employ of the Company.
B. Consultant was formerly chief executive officer of the
Company, and as such possesses certain experience, knowledge and
skills and certain historic information regarding the operation
of the Company which the Board of Directors of the Company
desires to retain the ability to use, as needed.
C. Consultant has agreed to act as a consultant for the
Company and to provide such consulting services as requested from
time to time by the Board of Directors of the Company during the
term of this Agreement.
NOW, THEREFORE, in consideration of the premises and other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1. Consulting Relationship. The Board of Directors of the
Company (the "Board") hereby retains Consultant and Consultant
hereby agrees to be retained by the Board, as an independent
contractor and not as an employee. The Company and Consultant
understand and agree that each will take all actions and file all
appropriate tax returns and other forms consistent with
Consultant's status as an independent contractor.
2. Consulting Services. Consultant agrees that during
the term of this Agreement, he shall perform such consulting
services as requested by the Board from time to time, subject to
the following:
(a) Consultant shall not be obligated to render any
services under this Agreement during any period of temporary
illness or injury or if Consultant's doctor provides the
Board with written notice that Consultant cannot perform the
requested services at the time requested due to his
temporary disability. For purposes hereof, "temporary"
disability or illness shall mean a physical or mental
incapacity of such a nature that it prevents Consultant from
performing the consulting services requested by the Board on
a continuing and sustained basis for a period of not more
than six (6) substantially consecutive months.
(b) The consulting services to be performed by
Consultant shall not require skills which are inconsistent
with Consultant's qualifications and experience. Consultant
shall use his best skills and judgment to accomplish the
assigned tasks, and under no circumstances shall the Board
or the Company exercise any control over the manner in which
Consultant performs his services hereunder.
(c) Consultant shall be available to render consulting
services to the Company under this Agreement as the Board
shall request.
(d) The parties understand and agree that Consultant
shall report directly to the Board. Consultant may perform
the consulting services hereunder at places other than the
principal offices of the Company.
Consultant's failure to perform the requested consulting services
for any of the reasons set forth in subparagraphs (a) or (b)
above, shall not relieve or diminish the Company's obligation to
pay Consultant the fees provided in paragraph 3.
3. Consulting Fees and Benefits.
(a) The Company agrees to pay Consultant for his
services under this Agreement an amount for the period
beginning on each October 1 and ending the following
September 30 (the "Consulting Year") during the term of this
Agreement as follows, whether or not services are actually
rendered under this Agreement:
Consulting Year Amount
October 1, 1994 - September 30, 1995 $320,000
October 1, 1995 - September 30, 1996 $280,000
October 1, 1996 - September 30, 1997 $240,000
October 1, 1997 - September 30, 1998 $160,000
October 1, 1998 - September 30, 1999 $100,000
Beginning on October 1, 1994, and thereafter on each April 1
and October 1, during the term of this Agreement, Consultant
shall be paid in a lump sum one-half of the annual amount
due him for the Consulting Year in which such October 1 or
April 1 occurs. Consultant also shall be entitled to
reimbursement for expenses incurred by Consultant in the
performance of his duties hereunder, so long as such
expenses would, if Consultant were the Chief Executive
Officer of the Company, be eligible for reimbursement or
payment under the Company's policies regarding such expenses
as in effect from time to time during the term of this
Agreement.
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(b) Except as otherwise provided herein, Consultant
shall not be entitled to participate or receive benefits
under any Company programs maintained for its employees as a
result of the services rendered under this Agreement;
however, nothing contained in this Agreement shall affect
Consultant's coverage under any of the Company's benefit
programs as a result of his status as a former employee of
the Company or any other benefits Consultant may receive
under other agreements Consultant may have with the Company.
The Company also shall not provide worker's compensation
insurance coverage for Consultant.
4. Term of Agreement.
(a) Subject to subparagraph 4(b) hereof, the term of
this Agreement shall begin on the Effective Date of this
Agreement and shall end on September 30, 1999; however, by
mutual written agreement, the Board and Consultant may
extend the Agreement for additional one-year periods on such
terms and for such annual compensation as agreed to by said
parties. During the term of the Agreement the Board may
terminate this Agreement at any time and for any reason,
other than as set forth in subparagraph 4(b) hereof, upon 90
days' prior written notice delivered to Consultant; however,
in the event of such termination, the Company shall pay to
Consultant, within 15 days of such termination, a lump sum
amount equal to the remaining payments which would be owing
under subparagraph 3(a) hereof for the remainder of the term
of this Agreement as if this Agreement had not terminated.
(b) This Agreement shall terminate upon the death of
Consultant. In addition, if Consultant becomes totally
disabled (as hereinafter defined), the Board may, in its
discretion, at any time after such total disability, upon
five (5) days' prior written notice to Consultant, terminate
this Agreement. "Total disability" shall mean a physical or
mental incapacity of such a nature that it prevents
Consultant from performing the consulting services requested
by the Board on a continuing and sustained basis for a
period of more than six (6) substantially consecutive
months. The lump sum payment referred to in subparagraph
4(a) above shall not be owing upon the termination of this
Agreement pursuant to this subparagraph (b).
(c) Upon the termination of this Agreement, all the
liabilities and obligations of the Company and Consultant
under the Agreement shall cease, except as follows:
(i) Consultant shall remain subject to the
obligations imposed by paragraph 5; and
(ii) Subject to subparagraph 6(b) hereof, the
Company shall remain obligated to pay Consultant any
fees, expense reimbursements or other amounts owing for
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periods prior to the date of termination of this
Agreement, including, if applicable, any lump sum
amount owing upon the Board's election to terminate
this Agreement pursuant to subparagraph 4(a) above and
any fee owing but not yet paid pursuant to subparagraph
3(a) above for the six-month portion of the Consulting
Year in which such termination occurs; and
(iii) Consultant shall not be obligated to
return any portion of the fee he was paid (or which is
owing to him), for the six-month portion of the
Consulting Year beginning on October 1 or April 1, as
the case may be, during which such termination occurs,
on account of the termination of this Agreement prior
to the end of said Consulting Year or six-month
portion, as the case may be.
5. Noncompetition Agreement.
(a) Consultant acknowledges that Consultant has
acquired, and in the course of providing the consulting
services hereunder, Consultant will acquire valuable
proprietary data and other confidential information with
respect to the Company's business, and will occupy a
position of trust and confidence with respect to the
Company's affairs, products and services.
(b) Consultant understands and agrees that, during the
term of this Agreement and for a period of five (5) years
after this Agreement terminates, Consultant shall not (1)
participate, directly or indirectly, as an employee,
consultant, agent, representative, officer, director,
stockholder, partner, joint venturer, or otherwise or (2)
have any direct or indirect financial interest in any form
in any business that sells or offers for sale, directly or
indirectly, any products or services that are competitive
with the products or services sold or offered for sale by
the Company in any state in the United States in which the
Company shall be doing business during the term of this
Agreement; provided, however, that the ownership by
Consultant of any stock listed on a national securities
exchange of any corporation conducting a competing business
shall not be deemed a violation of this Agreement if the
aggregate amount of such stock owned by Consultant does not
exceed one percent (1%) of the total outstanding stock of
such corporation.
(c) In the event of a breach or threatened breach of the
provisions of this paragraph 5 by Consultant, the Company
shall be entitled (as an absolute right and without the
necessity of proving irreparable injury or damages and in
addition to any other remedies available) to an injunction
restraining Consultant from such violation.
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6. Miscellaneous Provisions.
(a) At Consultant's request, the Company shall, at its
expense, provide Consultant with appropriate and sufficient
assigned office space and secretarial services to allow
Consultant to perform his duties hereunder.
(b) Consultant shall be responsible to pay all
federal, state and local taxes (including but not limited to
income taxes and self-employment taxes) as may be imposed or
levied upon the income earned or derived by him under this
Agreement. It is expressly understood and agreed that the
Company shall not withhold any such taxes from the
compensation paid to Consultant.
(c) All tangible materials (whether original or
duplicates), other information in the possession or control
of Consultant and all knowledge acquired by Consultant which
in any way relate or pertain to the Company's business,
including the business of any subsidiaries or affiliates of
the Company, whether furnished to Consultant by the Company
or prepared, compiled or acquired by Consultant while an
employee of the Company or during the term of this Agreement
and which derive economic value from not being generally
known to the public or to people who can obtain economic
value from their use or development, shall be preserved by
Consultant as confidential material, information or
knowledge and shall not be disclosed to others, either
during the term of this Agreement or thereafter, without the
prior written consent of the Board.
(d) If any provision of this Agreement shall, for any
reason, be adjudged by any court of competent jurisdiction
to be invalid or unenforceable, such judgment shall not
affect, impair, or invalidate the remainder of this
Agreement but shall be confined in its operation to the
provisions of this Agreement directly involved in the
controversy in which such judgment shall have been rendered.
To the extent that the provisions of this Agreement are
adjudged to be invalid or unenforceable, this Agreement
shall be construed and (in the absence of such construction)
reformed so as to allow the maximum benefit of the
provisions of this Agreement permitted by law. If, however,
the provisions of paragraph 5 of this Agreement shall for
any reason be held by a court of competent jurisdiction to
be excessively broad as to time, duration, geographical
scope, activity, or subject matter, they shall be construed
by limiting and reducing them so as to be enforceable to the
extent compatible with the applicable laws as they shall
then appear.
(e) All notices and other communications hereunder
must be delivered in writing and shall be deemed to have
been given if delivered by hand or mailed by first class,
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registered mail, return receipt requested, postage and
registered fees prepaid, and addressed as follows:
(i) if to the Company:
Atmos Energy Corporation
P. O. Box 650205
Dallas, Texas 75265-0205
Attention: General Counsel
(ii) if to Consultant:
Xxxxxxx X Xxxxxxx
0000 Xxxxx Xxxxx Xxxx
Xxxxxx, Xxxxx 00000
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(f) This Agreement embodies the entire understanding
between the parties hereto respecting the subject matter
hereof and no change, alteration or modification may be made
except by authorization of the Board and except in writing
signed by both parties hereto.
(g) This Agreement shall in all respects be construed
and enforced in accordance with the laws of the State of
Texas.
(h) The Company agrees to pay any and all legal fees
and expenses incurred by Consultant in seeking to obtain or
enforce any of the provisions of this Agreement.
(i) Any successor to the Company shall be bound by the
terms of this Agreement in the same manner and to the same
extent as the Company, and this Agreement shall be binding
upon Consultant, his heirs and legal representatives.
IN WITNESS WHEREOF, the Company and Consultant have each
duly executed this Agreement the 11th day of May, 1994, effective
as of the date and year first written above.
COMPANY:
ATMOS ENERGY CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
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Chairman, Human Resources Committee
of the Board of Directors
CONSULTANT:
/s/Xxxxxxx X. Xxxxxxx
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XXXXXXX X. XXXXXXX
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