EXHIBIT 10A(23)
EMPLOYMENT CONTINUATION AGREEMENT
THIS AGREEMENT by and between Atlantic Energy, Inc., a
New Jersey corporation (the "Company"), and Marilyn T. Powell
(the "Executive"), is hereby dated this 10th day of August, 1995.
W I T N E S S E T H:
WHEREAS, the Company or a subsidiary has employed the
Executive in an officer position and has determined that the
Executive holds an important position with the Company;
WHEREAS, the Company believes that, in the event it is
confronted with a situation that could result in a change in
ownership or control of the Company or Atlantic City Electric
Company ("Electric"), continuity of management will be essential
to its ability to evaluate and respond to such situation in the
best interests of shareholders;
WHEREAS, the Company understands that any such
situation will present significant concerns for the Executive
with respect to his financial and job security;
WHEREAS, the Company desires to assure itself of the
Executive's services during the period in which it is confronting
such a situation, and to provide the Executive certain financial
assurances to enable the Executive to perform the
responsibilities of his position without undue distraction and to
exercise his judgment without bias due to his personal
circumstances;
WHEREAS, to achieve these objectives, the Company and
the Executive desire to enter into an agreement providing the
Company and the Executive with certain rights and obligations
upon the occurrence of a Change of Control or Potential Change of
Control (as defined in Section 2);
NOW, THEREFORE, in consideration of the premises and
mutual covenants herein contained, it is hereby agreed by and
between the Company and the Executive as follows:
1. Operation of Agreement. (a) Effective Date. The
effective date of this Agreement shall be the earlier of the date
on which a Potential Change of Control or Change of Control
occurs (the "Effective Date"); provided, however, that if the
Executive is not employed by the Company or has received notice
of termination, on the Effective Date, this Agreement shall be
void and without effect.
(b) Termination of Agreement Following a Potential
Change of Control. Notwithstanding Section l(a), in the event
the Effective Date occurs upon a Potential Change of Control,
this Agreement shall cease to be effective upon (i) a good faith
determination by the Board of Directors of the Company ("Board")
that the events giving rise to a Potential Change of Control will
not result in the occurrence of a Change of Control or (ii) the
discontinuance or termination of the events which constituted the
Potential Change of Control without resulting in a Change of
Control including, but not limited to, a failed hostile takeover
attempt. Following such a determination by the Board, neither
the Company nor the Executive shall have any obligation to the
other under this Agreement, unless and until it thereafter again
becomes effective by reason of the occurrence of another
Potential Change of Control or any actual Change of Control.
2. Definitions. (a) Change of Control. For purposes of
this Agreement, a "Change of Control" shall be deemed to have
occurred:
(i when any "person" as defined in Section 3(a)(9)
of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") and as used in Section 13(d) and 14(d)
thereof, including a "group" as defined in Section 13(d) of
the Exchange Act but excluding the Company and any
subsidiary and any employee benefit plan sponsored or
maintained by the Company or any subsidiary (including any
trustee of such plan acting as trustee), directly or
indirectly, becomes the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), of securities of the
Company representing 20 percent or more of the combined
voting power of the Company's then outstanding securities;
or
(ii when, during any period of 24 consecutive months
during the Employment Period, the individuals who, at the
beginning of such period, constitute the Board (the
"Incumbent Directors") cease for any reason other than death
to constitute at least a majority thereof; provided,
however, that a director who is not a director at the
beginning of such 24-month period shall be deemed to have
satisfied such 24-month requirement (and be an Incumbent
Director) if such director was elected by, or on the
recommendation of or with the approval of, at least two-
thirds of the directors who then qualified as Incumbent
Directors either actually (because they were directors at
the beginning of such 24-month period) or by prior operation
of this Section; or
(iii) upon the occurrence of a transaction requiring
stockholder approval for the acquisition of the Company by
an entity other than the Company or a subsidiary through
purchase of assets, or by merger, or otherwise.
(b) Potential Change of Control. For purposes of this
Agreement, a Potential Change of Control shall be deemed to have
occurred:
(i upon the approval by shareholders of an
agreement by the Company, the consummation of which would
result in a Change of Control of the Company as defined in
(a) above; or
(ii upon the acquisition of beneficial ownership,
directly or indirectly by any entity, person or group (other
than the Company or a subsidiary or any Company employee
benefit plan, including any trustee of such plan acting as
such trustee) of securities of the Company representing 5%
or more of the combined voting power of the Company's
outstanding securities and the adoption by the Board of a
resolution to the effect that a Potential Change of Control
of the Company has occurred.
For purposes of this Section 2, if any of the above occur with
respect to Electric while the Executive is employed by Electric,
"Company" shall include Electric.
3. Employment Period. Subject to Section 6 of this
Agreement, if the Executive is employed on the Effective Date,
the Company agrees to continue the Executive in its employ, and
the Executive agrees to remain in the employ of the Company, for
the period (the "Employment Period") commencing on the Effective
Date and ending on the second anniversary of the date on which a
Change of Control occurs (the "Change of Control Date").
Notwithstanding the foregoing, if, prior to the Effective Date,
the Executive is demoted to a lower position than the position
held on the date first set forth above, the Board may declare
that this Agreement shall be without force and effect by written
notice delivered to the Executive within 30 days following such
demotion and prior to the occurrence of a Potential Change of
Control or a Change of Control. Nothing contained herein is
intended to create a contract of employment between the Executive
and the Company prior to the Effective Date.
4. Position and Duties. (a) No Reduction in Position.
During the Employment Period, the Executive's position (including
titles), authority and responsibilities shall be at least
commensurate with those held, exercised and assigned immediately
prior to the Effective Date; provided, however, that, during the
period from the occurrence of a Potential Change of Control until
the Change of Control Date (the "Pre-Change Effective Period"),
the Company may, in its discretion, reduce, modify or otherwise
change the Executive's position, authority or responsibilities,
and such reduction, modification or change shall not constitute
Good Reason. Any subsequent reductions, modification or change
in the Executive's position, authority or responsibilities after
a Change of Control shall be governed by the provisions of
Article 6(d). During the Pre-Change Effective Period the
Executive's services shall be performed at the location where the
Executive was employed immediately preceding the Effective Date.
(b) Business Time. From and after the Effective Date,
the Executive agrees to devote his full business time during
normal business hours to the business and affairs of the Company
and to use his best efforts to perform faithfully and efficiently
the responsibilities assigned to him hereunder, to the extent
necessary to discharge such responsibilities, except for (i) time
spent in managing his personal, financial and legal affairs and
serving on corporate, civic or charitable boards or committees,
in each case only if and to the extent not substantially
interfering with the performance of such responsibilities, and
(ii) periods of vacation and sick leave to which he is entitled.
It is expressly understood and agreed that the Executive's
continuing to serve on any boards and committees on which he is
serving or with which he is otherwise associated immediately
preceding the Effective Date which is not in violation of any
Company policy shall not be deemed to interfere with the
performance of the Executive's services to the Company.
5. Compensation. (a) Base Salary. During the
Employment Period, the Executive shall receive a base salary
("Base Salary") at an annual rate at least equal to the annual
salary paid to the Executive by the Company and any of its
affiliated companies immediately prior to the Effective Date.
The Base Salary shall be reviewed at least once each year after
the Effective Date, and may be increased (but not decreased) at
any time and from time to time by action of the Board or any
committee thereof or any individual having authority to take such
action in accordance with the Company's regular practices. Once
increased, any reference to Base Salary herein shall be a
reference to such increased amount. Neither the Base Salary nor
any increase in Base Salary after the Effective Date shall serve
to limit or reduce any other obligation of the Company hereunder.
(b) Annual Bonus. During the Employment Period, in
addition to the Base Salary, for each fiscal year of the Company
ending during the Employment Period, the Executive shall have the
opportunity to receive an annual bonus ("Annual Bonus
Opportunity"), based on the achievement of target levels of
performance, at least equal to the target percentage of his Base
Salary that could have been earned by, or awarded to, the
Executive in respect of the fiscal year in which the Effective
Date occurs. Without limiting the generality of the foregoing,
following any Change of Control, the amount actually payable to
the Executive as an annual bonus shall not be less than an amount
equal to the higher of the bonus paid to the Executive for the
most recently ended fiscal year of the Company or the target
bonus for the relevant fiscal year (the "Minimum Bonus Amount").
Any amount payable in respect of the Annual Bonus Opportunity or
the Minimum Bonus Amount shall be paid not later than sixty (60)
days after the close of the fiscal year for which the amount (or
prorated portion) is earned or awarded, unless electively
deferred by the Executive pursuant to any deferral programs or
arrangements that the Company may make available to the
Executive.
(c) Long-term Incentive Compensation Programs and Equity
Programs. During the Employment Period, the Executive shall par-
ticipate in all long-term incentive compensation programs and
equity programs for key executives at a level that is
commensurate with the Executive's participation in such plans
immediately prior to the Effective Date, or, if more favorable to
the Executive, at the level made available to the Executive or
other similarly situated executive officers of the Company and
its affiliated companies at any time thereafter; provided,
however, that, during the Pre-Change Effective Period, the
Company may reduce the Executive's level of participation to the
extent that such reduction is part of a cost reduction program
that applies generally to all officers of the Company and such
reduction is in proportion to similar reductions applicable to
such other officers within the terms of the respective plan(s).
(d) Benefit Plans. During the Employment Period, the
Executive (and, to the extent applicable, his dependents) shall
be entitled to participate in or be covered under all pension,
retirement, supplemental retirement or excess benefit (it being
understood that Executive's participation in the Supplemental
Retirement or Excess Benefit Plans shall be limited to
participation in the Supplemental Excess Retirement Plan II)
(collectively, the "Supplemental Retirement Benefits"), deferred
compensation, savings, medical, dental, health, disability, group
life, accidental death and travel accident insurance plans and
programs of the Company and its affiliated companies at a level
that is commensurate with the Executive's participation in such
plans immediately prior to the Effective Date (except for the
Medical Executive Reimbursement Plan (the "MERP"), it being
understood that the MERP shall be terminated as of September 30,
1995), or, if more favorable to the Executive, at the level made
available to the Executive or other similarly situated executive
officers of the Company at any time thereafter; provided,
however, that, during the Pre-Change Effective Period, the
Company may reduce the Executive's level of participation (and
that of his dependents) to the extent that such reduction is part
of a cost reduction program that applies generally to all
officers of the Company and such reduction is in proportion to
similar reductions applicable to such other officers within the
terms of the respective plan(s).
(e) Expenses. During the Employment Period, the
Executive shall be entitled to receive prompt reimbursement for
all reasonable expenses incurred by the Executive in accordance
with the policies and procedures of the Company as in effect from
time to time during the Pre-Change Effective Period and, after
the occurrence of a Change in Control, as in effect immediately
prior to the Change of Control Date. Notwithstanding the
foregoing, the Company may apply the policies and procedures in
effect after the Change of Control Date to the Executive, if such
policies and procedures are more favorable to the Executive than
those in effect immediately prior to the Change of Control Date.
(f) Vacation and Fringe Benefits. During the
Employment Period, the Executive shall be entitled to paid
vacation and fringe benefits at a level that is commensurate with
the paid vacation and fringe benefits available to the Executive
immediately prior to the Effective Date, or, if more favorable to
the Executive, at the level made available from time to time to
the Executive or other similarly situated executive officers at
any time thereafter.
(g) Indemnification. During and after the Employment
Period, the Company shall indemnify the Executive and hold the
Executive harmless from and against any claim, loss or cause of
action arising from or out of the Executive's performance as an
officer, director or employee of the Company or any of its
Subsidiaries or in any other capacity, including any fiduciary
capacity, in which the Executive serves at the request of the
Company to the maximum extent permitted by applicable law and the
Company's Certificate of Incorporation and By-Laws (the
"Governing Documents"), provided that in no event shall the
protection afforded to the Executive hereunder be less than that
afforded under the Governing Documents as in effect immediately
prior to the Effective Date.
6. Termination. (a) Death, Permanent Disability or
Retirement. Subject to the provisions of Section 1 hereof, this
Agreement shall terminate automatically upon the Executive's
death, Permanent Disability (as defined in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended (the "Code"),
except that a six month period shall be substituted for the
twelve month period provided for therein) or voluntary retirement
under any of the Company's retirement plans as in effect from
time to time.
(b) Voluntary Termination. Notwithstanding anything
in this Agreement to the contrary, following a Change of Control
the Executive may, upon not less than 60 days' written notice to
the Company, voluntarily terminate employment for any reason
(including early retirement under the terms of any of the
Company's retirement plans as in effect from time to time);
provided, however, that any termination by the Executive pursuant
to Section 6(d) on account of Good Reason (as defined therein)
shall not be treated as a voluntary termination under this
Section 6(b). The Executive expressly acknowledges and agrees
that any voluntary termination (other than a retirement under the
terms of any of the Company's plans) during the Pre-Change
Effective Period shall constitute a material breach of this
Agreement.
(c) Cause. The Company may terminate the Executive's
employment for Cause. For purposes of this Agreement, "Cause"
means (i) the Executive's conviction or plea of nolo contendere
to a felony; (ii) the Executive's willful engagement in
misconduct in connection with employment which results in
material damage to the Company's business or reputation; or (iii)
material breach of Executive's duties hereunder which result in
material damage to the Company's business or reputation, in each
of (i) through (iii) above, upon 30 days written notice to the
Executive, the opportunity for the Executive to be heard by the
Board and the good faith determination by at least two-thirds of
the Company's non-employee directors that Cause exists.
(d) Good Reason. Following the occurrence of a Change
of Control, the Executive may terminate his employment for Good
Reason. For purposes of this Agreement, "Good Reason" means the
occurrence of any of the following, without the express written
consent of the Executive, after the occurrence of a Potential
Change of Control or a Change of Control:
(i (A) the assignment to the Executive of any
duties inconsistent in any material adverse respect with the
Executive's position, authority or responsibilities as
contemplated by Section 4 of this Agreement, or (B) any
other material adverse change in such position, including
titles, authority or responsibilities;
(ii reduction of Executives's base salary or bonus
opportunities, or any other material breach by the Company
of this Agreement;
(iii the Company's requiring the Executive to be
based at any office or location more than 25 miles from that
location at which he performed his services specified under
the provisions of Section 4 immediately prior to the Change
of Control, except for travel reasonably required in the
performance of the Executive's responsibilities; or
(iv any failure by the Company to obtain the
assumption and agreement to perform this Agreement by a
successor as contemplated by Section 12(b), provided,
however, that the successor has had actual written notice of
the existence of this Agreement and its terms and an op-
portunity to assume the Company's responsibilities under
this Agreement during a period of 10 business days after
receipt of such notice.
In no event shall the mere occurrence of a Change of Control,
absent any further impact on the Executive, be deemed to
constitute Good Reason.
(e) Notice of Termination. Any termination by the
Company for Cause or by the Executive for Good Reason shall be
communicated by Notice of Termination to the other party hereto
given in accordance with Section 13(f). For purposes of this
Agreement, a "Notice of Termination" means a written notice
given, in the case of a termination for Cause, within 10 business
days of the Company's having actual knowledge of the events
giving rise to such termination, and in the case of a termination
for Good Reason, within 180 days of the later of (x) the
occurrence of a Change of Control and (y) the Executive's having
actual knowledge of the events giving rise to such termination,
and which (i) indicates the specific termination provision in
this Agreement relied upon, (ii) 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 termination date is other than the
date of receipt of such notice, specifies the termination date of
this Agreement (which date shall be not more than 15 days after
the giving of such notice). The failure by the Executive to set
forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason shall not waive any right
of the Executive hereunder or preclude the Executive from
asserting such fact or circumstance in enforcing his rights
hereunder.
(f) Date of Termination. For purposes of this
Agreement, the term "Date of Termination" means (i) in the case
of a termination for which a Notice of Termination is required,
the date of receipt of such Notice of Termination or, if later,
the date specified therein, as the case may be, and (ii) in all
other cases, the actual date on which the Executive's employment
terminates during the Employment Period. On or as soon as
practicable following the Date of Termination, the Executive
shall return to the Company all property of the Company and all
copies thereof in the Executive's possession or under his
control.
7. Obligations of the Company upon Termination.
(a) Death, Permanent Disability or Retirement. If the
Executive's employment is terminated during the Employment Period
by reason of the Executive's death, Permanent Disability or
voluntary retirement this Agreement shall terminate without
further obligations to the Executive or the Executive's legal
representatives under this Agreement other than those obligations
accrued hereunder at the Date of Termination, and the Company
shall pay or provide to the Executive or the Executive's legal
representatives under this Agreement the following amounts either
in a lump sum or in such other form of payment as is provided or
elected by the Executive under the operative plan:
(i) the Executive's full Base Salary through the Date
of Termination (the "Earned Salary");
(ii) the Supplemental Retirement Benefits, it being
understood that upon the occurrence of a Change of
Control, Executive's vested interest in such benefits
shall accelerate, and the amount otherwise payable to
or in respect of the Executive under the Company's
otherwise applicable long-term incentive compensation
and equity plans and programs (the "Incentive and
Equity Amounts"), all of which shall be fully
accelerated and deemed earned upon the occurrence of a
Change of Control, prorated through the Date of
Termination in the event of death or disability, and,
in the event of retirement, prorated through the date
of retirement; and
(iii) an amount (the "Pro-Rated Bonus") equal to the
product of (x) times (y), minus (z):
(x) the Minimum Bonus Amount;
(y) a fraction, the numerator of which is the
number of days in the then current calendar year
which have elapsed as of the Date of Termination,
and the denominator of which is 365;
(z) if Executive's termination occurs in the same
calendar year as the Change of Control Date, an
amount equal to the amount paid to the Executive
under the Company's applicable bonus plan (the
"Actual Bonus Payment")
(iv) all other vested amounts or benefits owing to the
Executive under the Company's otherwise applicable
employee benefit plans and programs, including any
compensation previously deferred by the Executive
(together with any accrued earnings thereon) and not
yet paid by the Company and any accrued vacation pay
not yet paid by the Company (the "Accrued
Obligations").
Any Earned Salary, Accrued Obligations and Pro-Rated Bonus shall
be paid in cash in a single lump sum as soon as practicable (but
in no event more than 20 days) following the Date of Termination.
Any Incentive and Equity Amounts and Supplemental Retirement
Benefits accrued by the Executive shall be payable in accordance
with the terms of the underlying plans.
(b) Cause and Voluntary Termination. If, during the
Employment Period, the Executive's employment shall be terminated
for Cause or voluntarily terminated by the Executive (other than
on account of Good Reason following a Change of Control), the
Company shall pay the Executive the Earned Salary and the Accrued
Obligations (including, but not limited to, the Incentive and
Equity Amounts and Supplemental Retirement Benefits, each in
accordance with the terms of the underlying plan) in cash in a
single lump sum as soon as practicable (but in no event more than
20 days) following the Date of Termination, or in accordance with
the terms of the underlying plan.
(c) Termination by the Company other than for Cause
and Termination by the Executive for Good Reason.
(i Payments. If, during the Employment Period, the
Company terminates the Executive's employment other than for
Cause, or after the occurrence of a Change of Control the
Executive terminates his employment for Good Reason, the
Company shall pay to the Executive the following amounts,
either in a lump sum or in such other form of payment as is
provided or elected by the Executive under the operative
plan:
(A) the Executive's Earned Salary;
(B) a cash amount (the "Severance Amount") equal to
two times the sum of
(1) the Executive's annual Base Salary; and
(2) the Minimum Bonus Amount;
(C) the Pro-Rated Bonus;
(D) the Incentive and Equity Amounts, all of which
shall be fully accelerated and deemed earned, and
all applicable performance targets thereunder
shall be deemed to have been met upon the
occurrence of a Change of Control;
(E) the Supplemental Retirement Benefits, which shall
be determined based on the granting of service
credit for a period of two years and, after such
credit has been granted, to be computed based upon
the deemed age of the Executive at the end of such
two year period, it being understood that upon the
occurrence of a Change of Control, Executive's
vested interest in such benefits shall accelerate
and that for purposes of the calculation of
Supplemental Retirement Benefits, Final Annual
Compensation (as defined in the underlying plans)
shall be equal to the Final Compensation as of the
Date of Termination; and
(F) the Accrued Obligations.
Any Earned Salary, Severance Amount, Accrued Obligations,
and Pro-Rated Bonus shall be paid in cash, or in the case of
the Incentive and Equity Amounts, in kind if so provided
under the relevant plan, in a single lump sum as soon as
practicable (but in no event more than 20 days) following
the Date of Termination. The Supplemental Retirement
Benefits shall be payable in accordance with the terms of
the underlying plans (after giving effect to the
acceleration and granting of service credit provided for
herein), and the elections of the Executive thereunder.
(ii Continuation of Benefits. If, during the
Employment Period, the Company terminates the Executive's
employment other than for Cause, or the Executive terminates
his employment for Good Reason:
(A) the Executive (and, to the extent applicable, his
dependents) shall be entitled, after the Date of
Termination until the earlier of (i) the second
anniversary of the Date of Termination or (ii) the
date on which the Executive is covered under any
comparable plans of a subsequent employer (the
"End Date"), to continue participation (including,
but not limited to, vesting and accruals) in all
of the Company's employee and executive pension,
welfare and fringe benefit plans, excluding the
Supplemental Retirement Benefits (the "Benefit
Plans"). To the extent any such benefits cannot
be provided under the terms of the applicable
plan, policy or program, the Company shall provide
a comparable benefit under another plan or from
the Company's general assets. The Executive's
participation in the Benefit Plans will be on the
same terms and conditions that would have applied
had the Executive continued to be employed by the
Company through the End Date;
(B) the Executive (or, in the event of the Executive's
death during such period, the Executive's
beneficiary or estate) shall have the right to
exercise any outstanding options to purchase
shares of Common Stock of the Company then
exercisable by the Executive or which would become
exercisable in accordance with the applicable
option agreement and the applicable equity
incentive plan of the Company (such agreements and
plans referred to collectively as the "Equity
Documents") for the period of time permitted in
accordance with the generally applicable terms of
the governing Equity Documents after the Date of
Termination; and
(C) for purposes of the Benefit Plans and the Equity
Documents, the Executive will be deemed to have
terminated employment under mutually satisfactory
conditions.
(d) Discharge of the Company's Obligations.
Except as expressly provided in the last sentence of this Section
7(d), the amounts payable to the Executive pursuant to this
Section 7 following termination of his employment shall be in
full and complete satisfaction of the Executive's rights under
this Agreement and any other claims he may have in respect of his
employment by the Company or any of its Subsidiaries. Such
amounts shall constitute liquidated damages with respect to any
and all such rights and claims and, upon the Executive's receipt
of such amounts, the Company shall be released and discharged
from any and all liability to the Executive in connection with
this Agreement or otherwise in connection with the Executive's
employment with the Company and its Subsidiaries. Nothing in
this Section 7(d) shall be construed to release the Company from
its commitment to indemnify the Executive and hold the Executive
harmless from and against any claim, loss or cause of action
arising from or out of the Executive's performance as an officer,
director or employee of the Company or any of its Subsidiaries or
in any other capacity, including any fiduciary capacity, in which
the Executive served at the request of the Company to the maximum
extent permitted by applicable law and the Governing Documents.
(e) Limitation on Payments.
(i) If any amounts payable to Executive pursuant to
this Agreement are deemed to constitute Parachute Payments
(as hereinafter defined) when added to any other payments
which are deemed to constitute Parachute Payments, would
result in the imposition on Executive of an excise tax under
Section 4999 of the Code, such amounts shall be reduced by
the smallest amount necessary to avoid the imposition of
such excise tax; provided, however, that such amounts shall
be so reduced only if, by reason of such reduction,
Executive's Net After Tax Benefit (as hereinafter defined)
shall exceed the Net After Tax Benefit if such reduction
were not made. The foregoing calculations (including any
calculations required pursuant to the definition of Net
After-Tax Benefit) shall be made by a certified public
accountant mutually agreeable to the Company and the
Executive. In the event it becomes necessary to limit any
payments to the Executive under this Agreement, Executive's
health and life insurance shall be the last payments so
limited.
(ii) For purposes of subparagraph (e)(i) above, the
terms "Net After Tax Benefit" and "Parachute Payment" shall
have the meanings set forth below:
(a) "Net After Tax Benefit" means the sum of (i) the
total amounts payable to Executive under this
Agreement, plus (ii) all other payments and benefits
which Executive receives or is entitled to receive from
the Company which would constitute a Parachute Payment,
less (iii) the amount of federal income taxes payable
with respect to the foregoing calculated at the maximum
marginal income tax rate for each year in which the
foregoing shall be paid to Executive (based upon the
rate in effect for such year as set forth in the Code
on the Date of Termination), less (iv) the amount of
excise taxes imposed with respect to the payments and
benefits described in (i) and (ii) above by Section
4999 of the Code;
(b) "Parachute Payment" means any payment deemed to
constitute a "parachute payment" as defined in Section
280G of the Code.
8. Non-exclusivity of Rights. Except as expressly
provided herein, nothing in this Agreement shall prevent or limit
the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by
the Company or any of its affiliated companies and for which the
Executive may qualify, nor shall anything herein limit or
otherwise prejudice such rights as the Executive may have under
any other agreements with the Company or any of its affiliated
companies, including employment agreements or stock option
agreements. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or
program of the Company or any of its affiliated companies at or
subsequent to the Date of Termination shall be payable in
accordance with such plan or program.
9. Full Settlement. The Company's obligation to make
the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any
circumstances, including, without limitation, any set-off,
counterclaim, recoupment, defense or other right which the
Company may have against the Executive or others whether by
reason of the subsequent employment of the Executive or
otherwise, provided that, if the Executive's employment is
terminated during the Pre-Change Effective Period, the Company
reserves the right to assert any counterclaim it has against
Executive arising out of Executive's intentional or willful
misconduct (including, without limitation, fraud). In the event
that the Executive shall in good faith give a Notice of
Termination for Good Reason and it shall thereafter be determined
that Good Reason did not exist, the employment of the Executive
shall, unless the Company and the Executive shall otherwise mu-
tually agree, be deemed to have terminated, at the date of giving
such purported Notice of Termination, by mutual consent of the
Company and the Executive and, except as provided in the last
preceding sentence, the Executive shall be entitled to receive
only his Earned Salary and the Accrued Obligations.
10. Legal Fees and Expenses. If the Executive asserts
any claim in any contest (whether initiated by the Executive or
by the Company) as to the validity, enforceability or
interpretation of any provision of this Agreement, the Company
shall pay the Executive's legal expenses (or cause such expenses
to be paid) including, without limitation, his reasonable
attorney's fees, on a quarterly basis, upon presentation of proof
of such expenses in a form acceptable to the Company.
11. Confidential Information; Company Property. By
and in consideration of the salary and benefits to be provided by
the Company hereunder, including the severance arrangements set
forth herein, the Executive agrees that:
(a) Confidential Information. The Executive shall
hold in a fiduciary capacity for the benefit of the Company all
secret or confidential information, knowledge or data relating to
the Company or any of its affiliated companies, and their
respective businesses, (i) obtained by the Executive during his
employment by the Company or any of its affiliated companies and
(ii) not otherwise public knowledge (other than by reason of an
unauthorized act by the Executive). After termination of the
Executive's employment with the Company, the Executive shall not,
without the prior written consent of the Company, unless
compelled pursuant to an order of a court or other body having
jurisdiction over such matter, communicate or divulge any such
information, knowledge or data to anyone other than the Company
and those designated by it.
(b) Injunctive Relief and Other Remedies with Respect
to Covenants. The Executive acknowledges and agrees that the
covenants and obligations of the Executive with respect to
confidentiality and Company property relate to special, unique
and extraordinary matters and that a violation of any of the
terms of such covenants and obligations will cause the Company
irreparable injury for which adequate remedies are not available
at law. Therefore, the Executive agrees that the Company shall
(i) be entitled to an injunction, restraining order or such other
equitable relief (without the requirement to post bond)
restraining Executive from committing any violation of the
covenants and obligations contained in this Section 11 and (ii)
have no further obligation to make any payments to the Executive
hereunder following any material violation of the covenants and
obligations contained in this Section 11. These remedies are
cumulative and are in addition to any other rights and remedies
the Company may have at law or in equity. In connection with the
foregoing provisions of this Section 11, the Executive represents
that his economic means and circumstances are such that such
provisions will not prevent him from providing for himself and
his family on a basis satisfactory to him. In no event shall an
asserted violation of the provisions of this Section 12
constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement.
12. Successors. (a) This Agreement is personal to the
Executive and, without the prior written consent of the Company,
shall not be assignable by the Executive otherwise than by will
or the laws of descent and distribution. This Agreement shall
inure to the benefit of and be enforceable by the Executive's
legal representatives.
(b) This Agreement shall inure to the benefit of and
be binding upon the Company and its successors. The Company
shall require any successor to all or substantially all of the
business and/or assets of the Company, whether direct or
indirect, by purchase, merger, consolidation, acquisition of
stock, or otherwise, by an agreement in form and substance
satisfactory to the Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent
as the Company would be required to perform if no such succession
had taken place.
13. Miscellaneous. (a) Effect of this Agreement on
Existing Employment Agreements. Any other agreements between the
Executive and the Company or any of its Subsidiaries relating to
Executive's employment by any such entity shall be automatically
superseded upon the occurrence of the Effective Date.
(b) Applicable Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New
Jersey, applied without reference to principles of conflict of
laws.
(c) Arbitration. Any dispute or controversy arising
under or in connection with this Agreement shall be resolved by
binding arbitration. The arbitration shall be held in the City
of Atlantic City, New Jersey or in the City of Pennsylvania and
except to the extent inconsistent with this Agreement, shall be
conducted in accordance with the Voluntary Labor Arbitration
Rules of the American Arbitration Association then in effect at
the time of the arbitration, and otherwise in accordance with
principles which would be applied by a court of law or equity.
The arbitrator shall be acceptable to both the Company and the
Executive. If the parties cannot agree on an acceptable
arbitrator, the dispute shall be heard by a panel of three
arbitrators, one appointed by each of the parties and the third
appointed by the other two arbitrators.
(d) Amendments. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal
representatives.
(e) Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to the
matters referred to herein. No other agreement relating to the
terms of the Executive's employment by the Company, oral or
otherwise, shall be binding between the parties unless it is in
writing and signed by the party against whom enforcement is
sought. There are no promises, representations, inducements or
statements between the parties other than those that are
expressly contained herein. The Executive acknowledges that he
is entering into this Agreement of his own free will and accord,
and with no duress, that he has read this Agreement and that he
understands it and its legal consequences.
(f) Notices. 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: at the home address of the
Executive noted on the records of
the Company
If to the Company: Atlantic Energy, Inc.
6801 Black Horse Pike
Pleasantville, New Jersey 08232
Attention: Secretary
with a copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, York, NY 10019
Attention: Alvin H. Brown, Esq.
or to such other address as either party shall have furnished to
the other in writing in accordance herewith. Notice and
communications shall be effective when actually received by the
addressee.
(g) Tax Withholding. The Company may withhold from
any amounts payable under this Agreement such Federal, state or
local taxes as shall be required to be withheld pursuant to any
applicable law or regulation.
(h) Severability; Reformation. In the event that one
or more of the provisions of this Agreement shall become invalid,
illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein
shall not be affected thereby. In the event that any of the
provisions of any of Section 11(a) are not enforceable in
accordance with its terms, the Executive and the Company agree
that such Section shall be reformed to make such Section
enforceable in a manner which provides the Company the maximum
rights permitted at law.
(i) Waiver. Waiver by any party hereto of any breach
or default by the other party of any of the terms of this
Agreement shall not operate as a waiver of any other breach or
default, whether similar to or different from the breach or
default waived. No waiver of any provision of this Agreement
shall be implied from any course of dealing between the parties
hereto or from any failure by either party hereto to assert its
or his rights hereunder on any occasion or series of occasions.
(j) Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original but all
of which together shall constitute one and the same instrument.
(k) Captions. The captions of this Agreement are not
part of the provisions hereof and shall have no force or effect.
IN WITNESS WHEREOF, the Executive has hereunto set her
hand and the Company has caused this Agreement to be executed in
its name on its behalf, and its corporate seal to be hereunto
affixed and attested by its Secretary, all as of the day and year
first above written.
ATTEST: Atlantic Energy, Inc.
By:/s/ J. Michael Galvin, Jr.
Secretary J. Michael Galvin, Jr.
(Seal) Title: Chairman, Personnel &
Benefits Committee
By:/s/ J. L. Jacobs
J. L. Jacobs
Title: President & Chief
Executive Officer
EXECUTIVE:
/s/ Marilyn T. Powell
Marilyn T. Powell
SUPPLEMENT TO EMPLOYMENT AGREEMENT
BETWEEN
ATLANTIC ENERGY, INC. and MARILYN T. POWELL
Dated November 9, 1995
THIS AGREEMENT SUPPLEMENT is entered into this 9th day of
November, 1995 by and between ATLANTIC ENERGY, INC., a New Jersey
corporation (the "Company") and MARILYN T. POWELL (the
"Executive") and is a supplement to that Employment Agreement
dated the same date hereof (the "Employment Agreement").
In consideration of the mutual promises and covenants herein
contained and as contained in the Employment Agreement, the
adequacy and sufficiency of which is deemed by the parties to be
fair and reasonable and to constitute due consideration, the
Company and the Executive hereby agree as follows:
1. Capitalized Terms. Capitalized terms, when used
herein, shall have the same meaning as in the Employment
Agreement.
2. Agreement Not To Compete. The Executive hereby
represents, covenants and warrants to the Company that, for a
period of one (1) year following the Date of Termination
Executive shall not undertake any activity, employment, task or
assignment, whether through ownership, employment, consulting
arrangement or otherwise, with any person or entity engaged in
any business activity in competition with the Company or any of
its subsidiaries or affiliates. This covenant not to compete is
limited to the geographic area which, as of the date of this
Agreement Supplement, comprises the Pennsylvania-New Jersey-
Maryland Interconnection area and is also intended to include the
southeastern portion of the State of New York which lies south of
the northern most boundary line of the Commonwealth of
Pennsylvania.
It is the intent of this covenant not to compete that
the Executive will not, during the one year period following Date
of Termination and within the geographical limits hereinabove
described, directly or indirectly engage, participate or make any
financial investments in, or become employed by or render
(whether or not for compensation) any consulting, advisory or
other services to or for the benefit of any person, firm or
corporation, or otherwise engage in any business activity which
directly or indirectly competes with any of the business
operations or activities in which the Company or any of its
subsidiaries or affiliates is engaged as of the Date of
Termination, nor any business in which the Company or any of its
subsidiaries or affiliates is actively engaged in pursuing or
developing as of the Date of Termination.
Nothing contained herein is intended to restrict the
Executive from making any investments in any corporation,
partnership or other business enterprise whose outstanding
capital stock or other equity interests are listed or admitted to
unlisted trading privileges on a national securities exchange or
included for quotation through an inter-dealer quotation system
of a registered national securities association, provided that
such investment (i) represents less than five percent (5%) of the
aggregate outstanding capital stock or other equity interests of
such corporation, partnership or business enterprise and (ii)
does not otherwise provide Executive or any affiliate of
Executive with the right or power (whether or not exercised) to
influence, direct or cause the direction of the management
policies and/or affairs of any such business or enterprise which
is or might directly or indirectly compete with any business,
operations or activities of the Company or any of its
subsidiaries and affiliates.
IN WITNESS WHEREOF, intending to be legally bound the
Executive has hereunto set his hand and the Company has caused
this Agreement to be executed in its name on its behalf, and its
corporate seal to be hereunto affixed and attested by its
Secretary, all as of the day and year first above written.
ATTEST: ATLANTIC ENERGY, INC.
(Seal)
____________________________
BY:______________________________
J. Michael Galvin, Jr.
Chairman, Personnel & Benefits
Committee
BY:/s/ J. L. Jacobs
J. L. Jacobs
President & Chief Executive Officer
EXECUTIVE:
/s/ Marilyn T. Powell
Marilyn T. Powell