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Exhibit 10.02
CHANGE OF CONTROL AGREEMENT
THIS AGREEMENT (the "Agreement") dated as of the 12th day of June, 2000
(the "Effective Date") by and between EQUITABLE RESOURCES, INC., a Pennsylvania
corporation with its principal place of business at Pittsburgh, Pennsylvania
(the "Company"), and, James M. Funk, an individual (the "Employee");
WHEREAS, the Board of Directors of the Company (the "Board"), believes
that it is in the best interest of the Company and its shareholders to assure
that the Company will have the continued dedication of the Employee,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined below) of the Company; that it is imperative to diminish the inevitable
distraction of the Employee by virtue of the personal uncertainties and risks
created by a pending or threatened Change of Control and to encourage the
Employee's full attention and dedication to the Company currently and in the
event of any threatened or pending Change of Control; and that it is appropriate
to provide the Employee with compensation and benefits arrangements upon a
Change of Control which ensure that the compensation and benefits expectations
of the Employee will be satisfied and which are competitive with those of other
corporations in the industry in which the Company's principal business activity
is conducted; and
WHEREAS, in order to more fully accomplish the foregoing objectives,
the Company and the Employee desire to enter into this Agreement, which provides
for certain benefits payable to the Employee if the Employee's employment
terminates in certain circumstances following a Change in Control of the
Company.
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, and intending to be legally bound hereby, the parties hereto
agree as follows:
1. Term. The term of this Agreement shall commence on the Effective Date
hereof and, subject to Sections 3(f), 5 and 8, shall terminate on the
earlier of (i) the date of the termination of Employee's employment by the
Company for any reason prior to a Change of Control; or (ii) unless further
extended as hereinafter set forth, the date which is thirty-six (36) months
after the Effective Date; provided, that, commencing on the last day of the
first full calendar month after the Effective Date and on the last day of
each succeeding calendar month, the term of this Agreement shall be
automatically extended without further action by either party (but not
beyond the date of the termination of Employee's employment prior to a
Change of Control) for one (1) additional month unless one party provides
written notice to the other party that such party does not wish to extend
the term of this Agreement. In the event that such notice shall have been
delivered, the term of this Agreement shall no longer be subject to
automatic extension and the term hereof shall expire on the date which is
thirty-six (36) calendar months after the last day of the month in which
such written notice is received.
2. Change of Control. Change of Control shall mean any of the following events
(each of such events being herein referred to as a "Change of Control"):
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(a) The sale or other disposition by the Company of all or substantially
all of its assets to a single purchaser or to a group of purchasers,
other than to a corporation with respect to which, following such sale
or disposition, more than eighty percent (80%) of, respectively, the
then outstanding shares of Company common stock and the combined
voting power of the then outstanding voting securities entitled to
vote generally in the election of the Board of Directors is then owned
beneficially, directly or indirectly, by all or substantially all of
the individuals and entities who were the beneficial owners,
respectively of the outstanding Company common stock and the combined
voting power of the then outstanding voting securities immediately
prior to such sale or disposition in substantially the same proportion
as their ownership of the outstanding Company common stock and voting
power immediately prior to such sale or disposition;
(b) The acquisition in one or more transactions by any person or group,
directly or indirectly, of beneficial ownership of twenty percent
(20%) or more of the outstanding shares of Company common stock or the
combined voting power of the then outstanding voting securities of the
Company entitled to vote generally in the election of the Board of
Directors; provided, however, that any acquisition by (x) the Company
or any of its subsidiaries, or any employee benefit plan (or related
trust) sponsored or maintained by the Company or any of its
subsidiaries or (y) any person that is eligible, pursuant to Rule
13d-1(b) under the Exchange Act (as such rule is in effect as of
November 1, 1995) to file a statement on Schedule 13G with respect to
its beneficial ownership of Company common stock and other voting
securities, whether or not such person shall have filed a statement on
Schedule 13G, unless such person shall have filed a statement on
Schedule 13D with respect to beneficial ownership of fifteen percent
or more of the Company's voting securities, shall not constitute a
Change of Control;
(c) The Company's termination of its business and liquidation of its
assets;
(d) There is consummated a merger, consolidation, reorganization, share
exchange, or similar transaction involving the Company (including a
triangular merger), in any case, unless immediately following such
transaction: (i) all or substantially all of the persons who were the
beneficial owners of the outstanding common stock and outstanding
voting securities of the Company immediately prior to the transaction
beneficially own, directly or indirectly, more than 60% of the
outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in
the election of directors of the corporation resulting from such
transaction (including a corporation or other person which as a result
of such transaction owns the Company or all or substantially all of
the Company's assets through one or more subsidiaries (a "Parent
Company")) in substantially the same proportion as their ownership of
the common stock and other voting securities of the Company
immediately prior to the consummation of the transaction, (ii) no
person (other than the Company, any employee benefit
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plan sponsored or maintained by the Company or, if reference was made
to equity ownership of any Parent Company for purposes of determining
whether clause (i) above is satisfied in connection with the
transaction, such Parent Company) beneficially owns, directly or
indirectly, 20% or more of the outstanding shares of common stock or
the combined voting power of the voting securities entitled to vote
generally in the election of directors of the corporation resulting
from such transaction and (iii) individuals who were members of the
Company's Board of Directors immediately prior to the consummation of
the transaction constitute at least a majority of the members of the
board of directors resulting from such transaction (or, if reference
was made to equity ownership of any Parent Company for purposes of
determining whether clause, (i) above is satisfied in connection with
the transaction, such Parent Company); or
(e) The following individuals cease for any reasons to constitute a
majority of the number of directors then serving: individuals who, on
the date hereof, constitute the entire Board of Directors and any new
director (other than a director whose initial assumption of office is
in connection with an actual or threatened election contest, including
but not limited to a consent solicitation, relating to the election of
directors of the Company) whose appointment or election by the Board
or nomination for election by the Company's shareholders was approved
by a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors on the date hereof or whose
appointment, election or nomination for election was previously so
approved.
3. Salary and Benefits Continuation.
(a) "Salary and Benefits Continuation" shall be defined to mean the
following: (i) payment of an amount of cash equal to three (3) times
the Employee's annual base salary in effect immediately prior to the
Change of Control or the termination of Employee's employment,
whichever is higher; (ii) payment of an amount of cash equal to three
(3) times the highest annual incentive (bonus) payment earned by the
Employee for any year in the three years prior to the termination of
Employee's employment; (iii) provision to Employee and his/her
eligible dependents of medical, long-term disability, dental and life
insurance coverage (to the extent such coverage was in effect
immediately prior to the Change of Control) for thirty-six (36)
months; (iv) contribution by the Company to Employee's account under
the Company's defined contribution retirement plan (known as the
Equitable Resources, Inc. Employee Savings Plan) of an amount of cash
equal to the amount that the Company would have contributed to such
plan had the Employee continued to be employed by the Company for an
additional thirty-six (36) months at a base salary equal to the
Employee's base salary immediately prior to the Change of Control or
the termination of Employee's employment, whichever is higher, such
contribution being deemed to be made immediately prior to the
termination of Employee's employment; provided, that to
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the extent that the amount of such contribution exceeds the amount
then allowed to be contributed to the plan under the applicable rules
relating to tax qualified retirement plans, then the excess shall be
paid to the Employee in cash; (v) reimbursement to Employee of
reasonable costs incurred by Employee for outplacement services in the
twenty-four (24) month period following termination of Employee's
employment.
(b) All amounts payable by the Company to the Employee in cash pursuant to
Section 3(a) shall be made in a lump sum unless the Employee otherwise
elects and notifies the Company in writing prior to the termination of
Employee's employment of Employee's desire to have all payments made
in accordance with the Company's regular salary and benefit payment
practices, provided that (i) the lump sum payment or first payment
shall be made within thirty (30) days after the Employee's termination
hereunder, and (ii) the Employee may elect to defer such payments
pursuant to the Company's then-existing deferred compensation plan(s).
All other amounts payable by the Company to the Employee pursuant to
Section 3 shall be paid or provided in accordance with the Company's
standard payroll and reimbursement procedures, as in effect
immediately prior to the Change of Control.
(c) In the event that medical, long-term disability, dental and life
insurance benefits cannot be provided under appropriate Company group
insurance policies, an amount equal to the premium necessary for the
Employee to purchase directly the same level of coverage in effect
immediately prior to the Change of Control shall be added to the
Company's payments to Employee pursuant to Section 3(a) (payable in
the manner elected by the Employee pursuant to Section 3(b)).
(d) If there is a Change of Control as defined above, the Company will
provide Salary and Benefits Continuation if at any time during the
first twenty-four (24) months following the Change of Control, either
(i) the Company terminates the Employee's employment other than for
Cause as defined in Section 4 below or (ii) the Employee terminates
his/her employment for "Good Reason" as defined below.
(e) For purposes of this Agreement, "Good Reason" is defined as:
(i) Removal of the Employee from the position he/she held
immediately prior to the Change of Control (by reason other
than death, disability or Cause);
(ii) The assignment to the Employee of any duties inconsistent with
those performed by the Employee immediately prior to the Change
of Control or a substantial alteration in the nature or status
of the Employee's responsibilities which renders the Employee's
position to be of less dignity, responsibility or scope;
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(iii) A reduction by the Company in the Employee's annual base salary
as in effect on the date hereof or as the same may be increased
from time to time, except for proportional across-the-board
salary reductions similarly affecting all executives of the
Company and all executives of any person in control of the
Company, provided, however, that in no event shall the
Employee's annual base salary be reduced by an amount equal to
ten percent or more of the Employee's annual base salary as of
the end of the calendar year immediately preceding the year in
which the Change of Control occurs, without the Employee's
consent;
(iv) The failure to grant the Employee an annual salary increase
reasonably necessary to maintain such salary as reasonably
comparable to salaries of senior executives holding positions
equivalent to the Employee's in the industry in which the
Company's then principal business activity is conducted;
(v) The Company requiring the Employee to be based anywhere other
than the Company's principal executive offices in the city in
which the Employee is principally located immediately prior to
the Change of Control, except for required travel on the
Company's business to an extent substantially consistent with
the Employee's business travel obligations prior to the Change
of Control;
(vi) Any material reduction by the Company of the benefits enjoyed
by the Employee under any of the Company's pension, retirement,
profit sharing, savings, life insurance, medical, health and
accident, disability or other employee benefit plans, programs
or arrangements, the taking of any action by the Company which
would directly or indirectly materially reduce any of such
benefits or deprive the Employee of any material fringe
benefits, or the failure by the Company to provide the Employee
with the number of paid vacation days to which he/she is
entitled on the basis of years of service with the Company in
accordance with the Company's normal vacation policy, provided
that this paragraph (f) shall not apply to any proportional
across-the-board reduction or action similarly affecting all
executives of the Company and all executives of any person in
control of the Company; or
(vii) The failure of the Company to obtain a satisfactory agreement
from any successor to assume and agree to perform this
Agreement, as contemplated in Section 15 hereof, or any other
material breach by the Company of its obligations contained in
this Agreement.
(f) The Employee's right to Salary and Benefits Continuation shall accrue
upon the occurrence of either of the events specified in (i) or (ii)
of Section 3(d) and shall
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continue as provided, notwithstanding the termination or expiration of
this Agreement pursuant to Section 1 hereof. The Employee's subsequent
employment, death or disability within the thirty-six (36) month
period following the Employee's termination of employment in
connection with a Change of Control shall not affect the Company's
obligation to continue making Salary and Benefits Continuation
payments. The Employee shall not be required to mitigate the amount of
any payment provided for in this Section 3 by seeking employment or
otherwise. The rights to Salary and Benefits Continuation shall be in
addition to whatever other benefits the Employee may be entitled to
under any other agreement or compensation plan, program or arrangement
of the Company; provided, that the Employee shall not be entitled to
any separate or additional severance payments pursuant to the
Company's severance plan as then in effect and generally applicable to
similarly situated employees. The Company shall be authorized to
withhold from any payment to the Employee, his/her estate or his/her
beneficiaries hereunder all such amounts, if any, that the Company may
reasonably determine it is required to withhold pursuant to any
applicable law or regulation.
4. Termination of Employee for Cause.
(a) Upon or following a Change of Control, the Company may at any time
terminate the Employee's employment for Cause. Termination of
employment by the Company for "Cause" shall mean termination upon: (i)
the willful and continued failure by the Employee to substantially
perform his/her duties with the Company (other than (A) any such
failure resulting from Employee's disability or (B) any such actual or
anticipated failure resulting from Employee's termination of his/her
employment for Good Reason), after a written demand for substantial
performance is delivered to the Employee by the Board of Directors
which specifically identifies the manner in which the Board of
Directors believes that the Employee has not substantially performed
his/her duties, and which failure has not been cured within thirty
days (30) after such written demand; or (ii) the willful and continued
engaging by the Employee in conduct which is demonstrably and
materially injurious to the Company, monetarily or otherwise, or (iii)
the breach by the Employee of the confidentiality provision set forth
in Section 8 hereof.
(b) For purposes of this Section 4, no act, or failure to act, on the
Employee's part shall be considered "willful" unless done, or omitted
to be done, by the Employee in bad faith and without reasonable belief
that such action or omission was in the best interest of the Company.
Notwithstanding the foregoing, the Employee shall not be deemed to
have been terminated for Cause unless and until there shall have been
delivered to him/her a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters of the entire
membership of the Board of Directors at a meeting of the Board of
Directors called and held for that purpose (after reasonable notice to
the Employee and an opportunity for the Employee,
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together with his/her counsel, to be heard before the Board of
Directors) finding that in the good faith opinion of the Board of
Directors the Employee is guilty of the conduct set forth above in
clauses (a)(i), (ii) or (iii) of this Section 4 and specifying the
particulars thereof in detail.
5. Prior Termination. Anything in this Agreement to the contrary
notwithstanding, if the Employee's employment with the Company is
terminated prior to the date on which a Change of Control occurs either (i)
by the Company other than for Cause or (ii) by the Employee for Good
Reason, and it is reasonably demonstrated by Employee that such termination
of employment (a) was at the request of a third party who has taken steps
reasonably calculated to effect the Change of Control, or (b) otherwise
arose in connection with or anticipation of the Change of Control, then for
all purposes of this Agreement the termination shall be deemed to have
occurred upon a Change of Control and the Employee will be entitled to
Salary and Benefits Continuation as provided for in Section 3 hereof.
6. Employment at Will. Subject to the provisions of any other agreement
between the Employee and the Company, the Employee shall remain an employee
at will and nothing herein shall confer upon the Employee any right to
continued employment and shall not affect the right of the Company to
terminate the Employee for any reason not prohibited by law; provided,
however, that any such removal shall be without prejudice to any rights the
Employee may have to Salary and Benefits Continuation hereunder.
7. Construction of Agreement.
(a) Governing Law. This Agreement shall be governed by and construed under
the laws of the Commonwealth of Pennsylvania without regard to its
conflict of law provisions.
(b) Severability. In the event that any one or more of the provisions of
this Agreement shall be held to be invalid, illegal or unenforceable,
the validity, legality or enforceability of the remaining provisions
shall not in any way be affected or impaired thereby.
(c) Headings. The descriptive headings of the several paragraphs of this
Agreement are inserted for convenience of reference only and shall not
constitute a part of this Agreement.
8. Covenant as to Confidential Information.
(a) Confidentiality of Information and Nondisclosure. The Employee
acknowledges and agrees that his/her employment by the Company under
this Agreement necessarily involves his/her knowledge of and access to
confidential and proprietary information pertaining to the business of
the Company and its subsidiaries. Accordingly, the Employee agrees
that at all times during the term
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of this Agreement and for a period of two (2) years after the
termination of the Employee's employment hereunder, he/she will not,
directly or indirectly, without the express written authority of the
Company, unless directed by applicable legal authority having
jurisdiction over the Employee, disclose to or use, or knowingly
permit to be so disclosed or used, for the benefit of himself/herself,
any person, corporation or other entity other than the Company, (i)
any information concerning any financial matters, customer
relationships, competitive status, supplier matters, internal
organizational matters, current or future plans, or other business
affairs of or relating to the Company and its subsidiaries, (ii) any
management, operational, trade, technical or other secrets or any
other proprietary information or other data of the Company or its
subsidiaries, or (iii) any other information related to the Company or
its subsidiaries or which the Employee subsidiaries which has not been
published and is not generally known outside of the Company. The
Employee acknowledges that all of the foregoing, constitutes
confidential and proprietary information, which is the exclusive
property of the Company.
(b) Company Remedies. The Employee acknowledges and agrees that any breach
of this Agreement by him/her will result in immediate irreparable harm
to the Company, and that the Company cannot be reasonably or
adequately compensated by damages in an action at law. In the event of
an actual or threatened breach by the Employee of the provisions of
this Section 8, the Company shall be entitled, to the extent
permissible by law, immediately to cease to pay or provide the
Employee or his/her dependents any compensation or benefit being, or
to be, paid or provided to him pursuant to Section 3 of this
Agreement, and also to obtain immediate injunctive relief restraining
the Employee from conduct in breach or threatened breach of the
covenants contained in this Section 8. Nothing herein shall be
construed as prohibiting the Company from pursuing any other remedies
available to it for such breach or threatened breach, including the
recovery of damages from the Employee.
9. Reimbursement of Fees. The Company agrees to pay, to the full extent
permitted by law, all legal fees and expenses which the Employee may
reasonably incur as a result of any contest by the Company, Internal
Revenue Service or others regarding the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of
performance thereof (including as a result of any contest by the Employee
about the amount of any payment pursuant to Section 3 of this Agreement) or
in connection with any dispute arising from this Agreement, regardless of
whether Employee prevails in any such contest or dispute.
10. Tax Gross-Up.
(a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payment or distribution by the
Company to or for the
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benefit of the Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise) (a
"Payment") (i) would be subject to the excise tax imposed by section
4999 of the Code or any interest or penalties are incurred by the
Employee with respect to the excise tax (such excise tax, together
with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax") or (ii) is made pursuant to a Change
of Control, then the Employee shall be entitled to receive an
additional payment (a "Gross-Up Payment") in an amount such that after
payment by the Employee of all taxes (including any interest or
penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties imposed
with respect thereto) and Excise Tax imposed on the Payment and
Gross-Up Payment, the Employee retains an amount equal to (x) the
Payment plus (y) the Excise Tax (if any) imposed upon the Payment and
the Gross-Up Payment.
(b) Subject to the provisions of Section 10(c), all determinations
required to be made under this Section 10, including whether and when
a Gross-Up Payment is required and the amount of such Gross-Up
Payment, shall be made by a nationally recognized accounting firm
designated by the Company (the "Accounting Firm") which shall provide
detailed supporting calculations both to the Company and the Employee
within fifteen (15) business days after there has been a Payment, or
such earlier time as requested by the Company. In the event that the
Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change in Control, the
Company shall appoint another nationally recognized accounting firm to
make the determinations required hereunder (which accounting firm
shall then be referred to as the Accounting Firm hereunder). All fees
and expenses of the Accounting Firm shall be borne solely by the
Company. Any Gross-Up Payment, as determined pursuant to this Section
10, shall be paid by the Company to the Employee within five days of
the receipt of the Accounting Firm's determination. Any determination
by the Accounting Firm shall be binding upon the Company and the
Employee. As a result of the uncertainty in the application of section
4999 of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been made
("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies
pursuant to Section 10(c) and the Employee thereafter is required to
make a payment of any Excise Tax, the Accounting Firm shall determine
the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the
benefit of the Employee.
(c) The Employee shall notify the Company in writing of any claim by the
Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification
shall be given as soon as practicable but no later than ten (10)
business days after the Employee is informed in writing
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of such claim and shall apprise the Company of the nature of such
claim and the date on which such claim is requested to be paid. The
Employee shall not pay such claim prior to the expiration of the
30-day period following the date on which it gives such notice to the
Company (or such shorter period ending on the date any payment of
taxes with respect to such claim is due). If the Company notifies the
Employee in writing prior to the expiration of such period that it
desires to contest such claim, the Employee shall:
(i) give the Company any information reasonably requested by
the Company relating to such claim;
(ii) take such action in connection with contesting such claim
as the Company shall reasonably request in writing from
time to time, including, without limitation, accepting
legal representation with respect to such claim by an
attorney reasonably selected by the Company;
(iii) cooperate with the Company in good faith in order
effectively to contest such claim; and
(iv) permit the Company to participate in any proceedings
relating to such claim;
provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold
the Employee harmless, on an after-tax basis, for any Excise Tax or
income tax (including interest and penalties with respect thereto)
imposed as a result of such representation and payment of costs and
expenses. Without limitation on the foregoing provisions of this
Section 10(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or
forego any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and
may, at its sole option, either direct the Employee to pay the tax
claimed and sue for a refund or contest the claim in any permissible
manner, and the Employee agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company
directs the Employee to pay such claim and sue for a refund, the
Company shall advance the amount of such payment to the Employee, on
an interest-free basis, and shall indemnify and hold the Employee
harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with
respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of
the statute of limitations relating to payment of taxes for the
taxable year of the Employee with respect to which such contested
amount is claimed to
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be due is limited solely to such contested amount. Furthermore, the
Company's control of the contest shall be limited to issues with
respect to which a Gross-Up Payment would be payable hereunder and the
Employee shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other
taxing authority.
(d) If, after the receipt by the Employee of an amount advanced by the
Company pursuant to Section 10(c), the Employee becomes entitled to
receive any refund with respect to such claim, the Employee shall
(subject to the Company's complying with the requirements of Section
10) promptly pay to the Company the amount of such refund (together
with any interest paid or credited thereon after taxes applicable
thereto). If, after the receipt by the Employee of an amount advanced
by the Company pursuant to Section 10(c), a determination is made that
the Employee shall not be entitled to any refund with respect to such
claim and the Company does not notify the Employee in writing of its
intent to contest such denial of refund prior to the expiration of 30
days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance
shall offset, to the extent thereof, the amount of Gross-Up Payment
required to be paid.
(e) The payments provided for in this Section 10 hereof shall be made not
later than the tenth (10th) day following the termination of the
Employee's employment; provided, however, that if the amounts of such
payments cannot be finally determined on or before such day, the
Company shall pay to the Employee on such day an estimate, as
determined in good faith by the Employee of the minimum amount of such
payments to which the Employee is clearly entitled and shall pay the
remainder of such payments (together with interest at 120% of the rate
provided in section 1274(b)(2)(B) of the Code) as soon as the amount
thereof can be determined but in no event later than the thirtieth
(30th) day after the termination of the Employee's employment. In the
event that the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall constitute
a loan by the Company to the Employee, payable on the fifth (5th)
business day after demand by the Company (together with interest at
120% of the rate provided in section 1274(b)(2)(B) of the Code). In
the event the Company should fail to pay when due the amounts
described in this Section 10, the Employee shall also be entitled to
receive from the Company an amount representing interest on any unpaid
or untimely paid amounts from the due date, as determined under this
Section 10, to the date of payment at a rate equal to 120% of the rate
provided in section 1274(b)(2)(B) of the Code.
11. Resolution of Differences Over Breaches of Agreement. Except as otherwise
provided herein, in the event of any controversy, dispute or claim arising
out of, or relating to this Agreement, or the breach thereof, or arising
out of any other matter relating to the Employee's employment with the
Company or the termination of such employment, the
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parties may seek recourse only for temporary or preliminary injunctive
relief to the courts having jurisdiction thereof and if any relief other
than injunctive relief is sought, the Company and the Employee agree that
such underlying controversy, dispute or claim shall be settled by
arbitration conducted in Pittsburgh, Pennsylvania in accordance with this
Section 11 of this Agreement and the Commercial Arbitration Rules of the
American Arbitration Association ("AAA"). The matter shall be heard and
decided, and awards rendered by a panel of three (3) arbitrators (the
"Arbitration Panel"). The Company and the Employee shall each select one
arbitrator from the AAA National Panel of Commercial Arbitrators (the
"Commercial Panel") and AAA shall select a third arbitrator from the
Commercial Panel. The award rendered by the Arbitration Panel shall be
final and binding as between the parties hereto and their heirs, executors,
administrators, successors and assigns, and judgment on the award may be
entered by any court having jurisdiction thereof.
12. Treatment of Certain Incentive Awards. All "Awards" held by the Employee
under the Company's 1999 Long-Term Incentive Plan (the "1999 Plan") or any
business unit breakthrough incentive plan (the "Breakthrough Plan") shall,
upon a Change of Control, be treated in accordance with the terms of those
Plans as in effect on the date of this Agreement, without regard to the
subsequent amendment of those Plans. For purposes of this Section 12, the
terms "Award" and "Change of Control" shall have the meanings ascribed to
them in the 1999 Plan and the Breakthrough Plan, as the case may be.
13. Release. The Employee hereby acknowledges and agrees that prior to the
Employee's or his/her dependents' right to receive from the Company any
compensation or benefit to be paid or provided to him/her or his/her
dependents pursuant to Section 3 of this Agreement, the Employee may be
required by the Company, in its sole discretion, to execute a release in a
form reasonably acceptable to the Company, which releases any and all
claims (other than amounts to be paid to Employee as expressly provided for
under this Agreement) the Employee has or may have against the Company or
its subsidiaries, agents, officers, directors, successors or assigns
arising under any public policy, tort or common law or any provision of
state, federal or local law, including, but not limited to, the
Pennsylvania Human Relations Act, the Americans with Disabilities Act,
Title VII of the Civil Rights Act of 1964, the Civil Rights Protection Act,
Family and Medical Leave Act, the Fair Labor Standards Act, or the Age
Discrimination in Employment Act of 1967.
14. Waiver. The waiver by a party hereto of any breach by the other party
hereto of any provision of this Agreement shall not operate or be construed
as a waiver of any subsequent breach by a party hereto.
15. Assignment. This Agreement shall be binding upon and inure to the benefit
of the successors and assigns of the Company. The Company shall be
obligated to require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all
of the Company's business or assets, by a written agreement in
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<PAGE> 13
form and substance satisfactory to the Employee, to expressly assume and
agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform if no succession had taken
place. This Agreement shall inure to the extent provided hereunder to the
benefit of and be enforceable by the Employee or his/her legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. The Employee may not delegate any of
his/her duties, responsibilities, obligations or positions hereunder to any
person and any such purported delegation by him shall be void and of no
force and effect with respect to matters relating to his/her employment and
termination of employment. Without limiting the foregoing, the Employee's
rights to receive payments and benefits hereunder shall not be assignable
or transferable, other than a transfer by Employee's will or by the laws of
descent and distribution.
16. Notices. Any notices required or permitted to be given under this Agreement
shall be sufficient if in writing, and if personally delivered or when sent
by first class certified or registered mail, postage prepaid, return
receipt requested -- in the case of the Employee, to his/her residence
address as set forth below, and in the case of the Company, to the address
of its principal place of business as set forth below, in care of the
Chairman of the Board -- or to such other person or at such other address
with respect to each party as such party shall notify the other in writing.
17. Pronouns. Pronouns stated in either the masculine, feminine or neuter
gender shall include the masculine, feminine and neuter.
18. Entire Agreement. This Agreement contains the entire agreement of the
parties concerning the matters set forth herein and all promises,
representations, understandings, arrangements and prior agreements
regarding the subject matter hereof are merged herein and superseded
hereby. The provisions of this Agreement may not be amended, modified,
repealed, waived, extended or discharged except by an agreement in writing
signed by the party against whom enforcement of any amendment,
modification, repeal, waiver, extension or discharge is sought. No person
acting other than pursuant to a resolution of the Board of Directors shall
have authority on behalf of the Company to agree to amend, modify, repeal,
waive, extend or discharge any provision of this Agreement or anything in
reference thereto or to exercise any of the Company's rights to terminate
or to fail to extend this Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its officers thereunto duly authorized, and the Employee has hereunto set
his/her hand, all as of the day and year first above written.
ATTEST: EQUITABLE RESOURCES, INC.
/s/ JEAN F. MARKS By: /s/ GREGORY R. SPENCER
---------------------------------- --------------------------------
Jean F. Marks Gregory R. Spencer
Sr. Vice President and Chief
Administrative Officer
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<PAGE> 14
Address:
One Oxford Centre
Suite 3300
Pittsburgh, PA 15219
WITNESS:
/s/ ESTELLE E. CHRISTIAN /s/ JAMES M. FUNK
-------------------------------- -----------------------------------
Estelle E. Christian James M. Funk
Address:
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