Exhibit 10(s)

SALE PARTICIPATION AGREEMENT

SLT Form

February 1, 2008

 

To: The Person whose name is

set forth on the signature page hereof

Dear Sir or Madam:

Concurrently with entering into this letter agreement, you are entering into a
Management Stockholder’s Agreement with Energy Future Holdings Corp., a Texas
corporation formerly known as “TXU Corp.” (the “Company”) and Texas Energy
Future Holdings Limited Partnership, a Delaware limited partnership (“Parent”)
(the “Stockholder’s Agreement”) relating to (i) your acquisition or continued
ownership of common stock, no par value, of the Company, including, without
limitation, such common stock, no par value, of the Company hereafter acquired
upon the exercise of Options or subsequently issued to a Management Stockholder
Entity pursuant to a distribution under the terms of the EFH Salary Deferral
Plan (“Common Stock”) and/or (ii) the grant by the Company to you of new options
(the “Options”) to purchase shares of Common Stock.

Parent hereby agrees with you as follows:

1. (a) In the event that at any time on or after the date hereof (i) Parent or
(ii) any member of the Sponsor Group (as defined in the Stockholder’s Agreement)
solely to the extent that such member of the Sponsor Group is selling limited
partnership units of Parent (“LP Units”) in connection with a sale (or series of
related sales) of outstanding LP Units to a transferee that is not an Affiliate
of any member of the Sponsor Group and other than such sales (or series of
related sales) prior to December 31, 2009 that do not exceed the Indirect Sale
Threshold (as defined below) (each a “Selling Entity”) proposes to sell directly
for cash or any other consideration (x) in the case of clause (i) any shares of
Common Stock owned by Parent and (y) in the case of clause (ii) any LP Units, in
any transaction other than a Public Offering (as defined in the Stockholder’s
Agreement) or a sale, directly or indirectly, to an Affiliate of Parent, then,
unless such Selling Entity is entitled to and does exercise the drag-along
rights pursuant to Paragraph 7 below and a Drag Transaction (as defined below)
is consummated, Parent will notify you or your Management Stockholder’s Estate
or Management Stockholder’s Trust (as such terms are defined in the
Stockholder’s Agreement, and collectively with you, the “Management Stockholder
Entities”), as the case may be, in writing (a “Notice”) of such proposed sale (a
“Proposed Sale”) specifying the principal terms and conditions of the Proposed
Sale (the “Material Terms”) including (A) the number of Shares of Common Stock
or LP Units proposed to be included in the Proposed Sale, (B) the percentage of
the outstanding Common Stock or LP Units at the time the Notice is given that is
represented by the number of shares of Common Stock or LP Units proposed to be
included in the Proposed Sale, (C) the price per share

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of Common Stock subject to the Proposed Sale (where the event triggering the
Notice is a sale of LP Units, such price per share of Common Stock shall be
deemed to be equal to the price per LP Unit subject to the proposed sale,
subject to equitable adjustment for stock or unit dividends or splits,
recapitalizations or similar events), including a description of any pricing
formulae and of any non-cash consideration sufficiently detailed to permit the
valuation thereof, (D) the Tag Along Sale Percentage (as defined below) of the
Selling Entity and (E) the name and address of the Person (as defined in the
Stockholder’s Agreement) to whom the Common Stock or LP Units is proposed to be
sold.

“Indirect Sale Threshold” means (1) prior to December 31, 2008, any sales of LP
Units that, together with prior sales of LP Units to a transferee that is not an
Affiliate of any member of the Sponsor Group, are of less than 50% of the LP
Units, and that are at a cash price of less than 120% of the Base Price, and
(2) from December 31, 2008 through December 31, 2009, any sales of LP Units
that, together with other sales of LP Units from December 31, 2008 through
December 31, 2009 to a transferee that is not an Affiliate of any member of the
Sponsor Group, are of less than 20% of the LP Units, and that for all such sales
prior to December 31, 2009 under clause (1) and this clause (2) are less than
50% of the LP Units in the aggregate, and that are at a cash price of less than
120% of the Base Price.

(b) If, within 10 Business Days after the delivery of Notice under Paragraph
1(a), Parent receives from a Management Stockholder Entity a written request (a
“Request”) to include Common Stock held by such Management Stockholder Entity in
the Proposed Sale (which Request shall be irrevocable except (a) as set forth in
clauses (c) and (d) of this Paragraph 1 below or (b) if otherwise mutually
agreed to in writing by the Management Stockholder Entity and Parent), the
Common Stock held by such Management Stockholder Entities plus all shares of
Common Stock which you are then entitled to acquire under any unexercised
portion of Options, to the extent such Option is then exercisable or would
become exercisable as a result of the consummation of the Proposed Sale (not in
any event, other than as provided for below in Paragraph 2(a) in respect of the
first (if any) Proposed Sale of LP Units that exceeds the Indirect Sale
Threshold, to exceed the Tag Along Sale Percentage of the Selling Entity
multiplied by the total number of shares of Common Stock held by the Management
Stockholder Entities in the aggregate, including all shares of Common Stock
which you are then entitled to acquire under any unexercised portion of Options,
to the extent such Option is then exercisable or would become exercisable as a
result of the consummation of the Proposed Sale) will be so included as provided
herein. Promptly after the execution of the definitive sale agreement, if any,
for such Proposed Sale (the “Sale Agreement”), Parent will furnish each
Management Stockholder Entity with a copy of the Sale Agreement, if any. For
purposes of this Agreement, the “Tag Along Sale Percentage” shall mean the
fraction, expressed as a percentage, determined by dividing the number of shares
of Common Stock or LP Units, as applicable, to be purchased from the Selling
Entity by the total number of shares of Common Stock or LP Units, as applicable,
owned directly by the Selling Entity.

(c) Notwithstanding anything to the contrary contained in this Agreement, if any
of the economic terms of the Proposed Sale change, including without limitation
if the per share price will be less than the per share price disclosed in the
Notice, or any of the other principal terms or conditions will be materially
less favorable to the selling Management Stockholder Entities than those
described in the Notice, Parent will provide written notice thereof

 

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to each Management Stockholder Entity who has made a Request and each such
Management Stockholder Entity will then be given an opportunity to withdraw the
offer contained in such holder’s Request (by providing prompt (and in any event
within five (5) Business Days; provided that, notwithstanding the foregoing, if
the proposed closing with respect to the Proposed Sale is to occur within five
(5) Business Days or less, no later than three (3) Business Days prior to such
closing) written notice of such withdrawal to Parent), whereupon such
withdrawing Management Stockholder Entity will be released from all obligations
thereunder.

(d) If the Selling Entity does not complete the Proposed Sale by the end of the
120th day following the date of the effectiveness of the Notice, each selling
Management Stockholder Entity may elect on or prior to such date to be released
on and after such date from all obligations under the applicable Request by
notifying Parent and any Selling Entity (if not Parent) in writing of its desire
to so withdraw. Upon receipt of that withdrawal notice, the Notice of the
relevant Management Stockholder Entity shall be null and void, and it will then
be necessary for a separate Notice to be furnished, and the terms and provisions
of clauses (a) and (b) of this Paragraph 1 separately complied with, in order to
consummate such Proposed Sale pursuant to this Paragraph 1, unless the failure
to complete such Proposed Sale resulted from any failure by any selling
Management Stockholder Entity to comply with the terms of this Paragraph 1.

(e) Notwithstanding anything to the contrary in the foregoing provisions of this
Paragraph 1, the Selling Entity may, in its sole discretion, decide whether or
not to pursue, consummate, postpone or abandon the Proposed Sale and the terms
and conditions thereof. None of the Company, the Selling Entities or any of
their respective Affiliates shall have any liability to any Management
Stockholder Entity arising from, relating to or in connection with the pursuit,
consummation, postponement, abandonment or terms and conditions of any such
Proposed Sale.

2. (a) The number of shares of Common Stock that you will be permitted to
include in a Proposed Sale pursuant to a Request will be the lesser of (A) the
number of shares of Common Stock that you have offered to sell in the Proposed
Sale as set forth in the Request and (B) the product of (i) the aggregate number
of shares of Common Stock or LP Units, as applicable, to be included in the
Proposed Sale multiplied by (ii) a fraction the numerator of which is the number
of shares of Common Stock owned by you plus all shares of Common Stock which you
are then entitled to acquire under any unexercised portion of Options, to the
extent such Option is then exercisable or would become exercisable as a result
of the consummation of the Proposed Sale and the denominator of which is the
total number of shares of Common Stock owned by you and all other Persons
participating in such sale as tag-along sellers pursuant to Other Management
Stockholders Agreements (as defined in the Stockholder’s Agreement) or other
agreements (all such other participants, the “Tag Along Sellers”) plus the total
number of shares of Common Stock which you and such Tag Along Sellers are then
entitled to acquire under any unexercised portion of Options, to the extent such
Options are then exercisable or would become exercisable as a result of the
consummation of the Proposed Sale, plus all shares of Common Stock or LP Units,
as applicable, owned by Parent; provided, that in the case of either of (A) or
(B) above, for the first (if any) Proposed Sale of LP Units that exceeds the
Indirect Sale Threshold, the number of shares of Common Stock you will be
permitted to include

 

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shall be increased by the number of shares of Common Stock that you would have
been entitled to include in all prior sales of LP Units that would have been
Proposed Sales if they had exceeded the Indirect Sale Threshold, calculated as
if those sales of LP Units had exceeded the Indirect Sale Threshold and were
subject to these tag-along provisions. Each Tag Along Seller shall be permitted
to conditionally exercise then-exercisable Options such that if the Proposed
Sale in not consummated, such exercise shall be void and such Options shall
remain exercisable on the same terms and conditions as prior to such conditional
exercise.

(b) If one or more Tag Along Sellers elect not to include the maximum number of
shares of Common Stock which such Tag Along Seller would have been permitted to
include in a Proposed Sale pursuant to Paragraph 2(a) (such non-included shares,
the “Eligible Shares”), then you and each of the remaining Tag Along Sellers, or
any of them, will have the right to sell in the Proposed Sale a number of
additional shares of Common Stock equal to your pro rata portion of the number
of Eligible Shares, based on the relative number of shares of Common Stock then
held by you and each such Tag Along Seller plus all shares of Common Stock which
you and such Tag Along Seller are then entitled to acquire under any unexercised
portion of the Option, to the extent such Option is then exercisable or would
become exercisable as a result of the consummation of the Proposed Sale. Such
additional shares of Common Stock which you and such Tag Along Seller propose to
sell shall not be included in any calculation made pursuant to Paragraph 2(a)
for the purpose of determining the number of shares of Common Stock which you
will be permitted to include in a Proposed Sale. Notwithstanding any of the
foregoing, the Selling Entity will have the right to sell in the Proposed Sale
additional shares of Common Stock or LP Units, as applicable, owned by it equal
to the number, if any, of the total remaining Eligible Shares, which will not be
included in any calculation made pursuant to Paragraph 2(a) for the purpose of
determining the number of shares of Common Stock which you will be permitted to
include in a Proposed Sale.

3. Except as may otherwise be provided herein, shares of Common Stock subject to
a Request will be included in a Proposed Sale pursuant hereto and in any
agreements with purchasers relating thereto on the same terms and subject to the
same conditions applicable to the shares of Common Stock or LP Units which the
Selling Entity proposes to sell in the Proposed Sale. Such terms and conditions
shall include, without limitation: the sale price; the payment of fees,
commissions and expenses; the provision of, and customary representations and
warranties as to, information reasonably requested by the Selling Entity
covering matters regarding the Management Stockholder Entities’ ownership of
shares; and the provision of requisite indemnification; provided that any
indemnification provided by the Management Stockholder Entities shall be pro
rata in proportion with the number of shares of Common Stock or LP units to be
sold; provided, further, that no Management Stockholder Entity shall be required
to (x) indemnify any Person for an amount, in the aggregate, in excess of the
gross proceeds received in such Proposed Sale, or (y) agree to any non-compete
or non-solicit provisions that are more restrictive than such similar agreement
between the Company and the applicable Management Stockholder. Notwithstanding
anything to the contrary in the foregoing, if the consideration payable for
shares of Common Stock is securities and the acquisition of such securities by a
Management Stockholder Entity would reasonably be expected to be prohibited
under U.S., foreign or state securities laws, such Management Stockholder Entity
shall be entitled to receive an amount in cash equal to the value of any such
securities such Person would otherwise be entitled to receive.

 

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4. Upon delivering a Request, the Management Stockholder Entities will, if
requested by Parent, execute and deliver a custody agreement and power of
attorney in form and substance reasonably satisfactory to Parent with respect to
the shares of Common Stock which are to be sold by the Management Stockholder
Entities pursuant hereto (a “Custody Agreement and Power of Attorney”). The
Custody Agreement and Power of Attorney will contain customary provisions and
will provide, among other things, that the Management Stockholder Entities will
deliver to and deposit in custody with the custodian and attorney-in-fact named
therein a certificate or certificates (if such shares are certificated)
representing such shares of Common Stock (duly endorsed in blank by the
registered owner or owners thereof) and irrevocably appoint said custodian and
attorney-in-fact as the Management Stockholder Entities’ agent and
attorney-in-fact with full power and authority to act under the Custody
Agreement and Power of Attorney on the Management Stockholder Entities’ behalf
with respect to the matters specified therein.

5. Your right pursuant hereto to participate in a Proposed Sale shall be
contingent on your material compliance with each of the provisions hereof and
your willingness to execute such documents in connection therewith as may be
reasonably requested by the Selling Entity.

6. If the consideration to be paid in exchange for shares of Common Stock in a
Proposed Sale pursuant to Paragraph 1 includes any securities, and the receipt
thereof by the Selling Entity and a Management Shareholder Entity would require
under applicable law (a) the registration or qualification of such securities or
of any Person as a broker or dealer or agent with respect to such securities or
(b) the provision to any selling Management Shareholder Entity of any
information regarding the Company, its subsidiaries, such securities or the
issuer thereof that would not be required to be delivered in an offering solely
to a limited number of “accredited investors” under Regulation D promulgated
under the Securities Act of 1933, as amended, and the rules and regulations in
effect thereunder, the Selling Entity and such Management Shareholder Entity
shall not, subject to the following sentence, have the right to sell shares of
Common Stock in such proposed sale. In such event, the Selling Entity shall have
the right to cause to be paid to such selling Management Shareholder Entity in
lieu thereof, against surrender of the shares of Common Stock which would have
otherwise been sold by such selling Management Shareholder Entity to the
prospective buyer in the proposed sale, an amount in cash equal to the Fair
Market Value (as defined in the Stockholder’s Agreement) of such shares of
Common Stock as of the date such securities would have been issued in exchange
for such shares of Common Stock.

7. (a) If any Selling Entity that directly owns shares of Common Stock or LP
Units proposes to transfer, directly or indirectly (whether by means of a
merger, consolidation, reorganization or recapitalization, sale, transfer or
otherwise), a number of shares of Common Stock or LP Units equal to 50% or more
of the outstanding Common Stock or LP Units, as applicable (such Person, the
“Drag-Along Purchaser”), then if requested by such Selling Entity, each
Management Stockholder Entity shall be required to sell a number of shares of
Common Stock equal to the aggregate number of shares of Common Stock held by the
Management Stockholder Entities (including shares of Common Stock underlying
exercisable Options) multiplied by the Tag Along Sale Percentage (such
transaction, a “Drag Transaction”).

 

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(b) Shares of Common Stock held by the Management Stockholder Entities included
in a Drag Transaction will be included in any agreements with the Drag-Along
Purchaser relating thereto on the same terms and subject to the same conditions
applicable to the shares of Common Stock or LP Units, as applicable, which the
Drag-Along Purchaser proposes to sell in the Drag Transaction. Such terms and
conditions shall include, without limitation: the pro rata reduction of the
number of shares of Common Stock or LP Units to be sold by the Drag-Along
Purchaser and the Management Stockholder Entities to be included in the Drag
Transaction if required by the Drag-Along Purchaser; the sale price; the payment
of fees, commissions and expenses; the provision of, and representation and
warranty as to, information reasonably requested by the Drag-Along Purchaser
covering matters regarding the Management Stockholder Entities’ ownership of
shares of Common Stock; and the provision of requisite indemnification; provided
that any indemnification provided by the Management Stockholder Entities shall
be pro rata in proportion with the number of shares of Common Stock or LP Units
to be sold; provided, further, that no Management Stockholder Entity shall be
required to (x) indemnify any Person for an amount, in the aggregate, in excess
of the gross proceeds received in such Proposed Sale, or (y) agree to any
non-compete or non-solicit provisions that are more restrictive than such
similar agreement between the Company and the applicable Management Stockholder.

(c) Your pro rata share of any amount to be paid pursuant to Paragraph 3 or 7(b)
shall be based upon the number of shares of Common Stock intended to be
transferred by the Management Stockholder Entities plus the number of shares of
Common Stock you would have the right to acquire under any unexercised portion
of the Option which is then vested or would become vested as a result of the
Proposed Sale or Drag Transaction, assuming that you receive a payment in
respect of such Option.

(d) Notwithstanding anything to the contrary in the foregoing, if the
consideration payable to Management Stockholder Entities for shares of Common
Stock is securities and the acquisition of such securities by a Management
Stockholder Entity would reasonably be expected to be prohibited under U.S.,
foreign or state securities laws, such Management Stockholder Entity shall be
entitled to receive an amount in cash equal to the value of any such securities
such Person would otherwise be entitled to receive.

8. The obligations of Parent hereunder shall extend only to you and your
transferees (“Permitted Transferees”) who (a) are party to a Stockholder’s
Agreement with the Company and (b) have acquired Common Stock pursuant to clause
(ii) of the definition of a Permitted Transfer (as defined in the Stockholder’s
Agreement), and none of the Management Stockholder Entities’ successors or
assigns, with the exception of any Permitted Transferee and only with respect to
the Common Stock acquired by such Permitted Transferee pursuant to a Permitted
Transfer, shall have any rights pursuant hereto.

9. This Agreement shall terminate and be of no further force and effect on the
occurrence of the earlier of (A) the consummation of a Qualified Public Offering
(as defined in the Stockholder’s Agreement) and (B) the later of the fifth
anniversary of the Closing Date and a Change in Control (as defined in the
Stockholder’s Agreement).

 

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10. All notices and other communications required or permitted hereunder shall
be in writing and shall be deemed effectively given: (a) upon personal delivery
to the party to be notified, (b) when sent by confirmed facsimile if sent during
normal business hours of the recipient, if not, then on the next Business Day,
(c) five (5) days after having been sent by registered or certified mail, return
receipt requested, postage prepaid or (d) one (1) Business Day after deposit
with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to such
party’s address as set forth below or at such other address or to such other
person as the party shall have furnished to each other party in writing in
accordance with this provision:

If to Parent, at the following address:

Texas Energy Future Holdings Limited Partnership

c/o TPG Capital, L.P.

301 Commerce Street, Suite 3300

Fort Worth, Texas 76102

Attention: Clive Bode

Telecopy: (817) 871-4000

with a copy to:

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, New York 10017

Attention: Alvin H. Brown, Esq.

                 Andrew W. Smith, Esq.

Telecopy: (212) 455-2502

If to you, to you at the address set forth on the signature page hereto;

If to your Management Stockholder’s Estate or Management Stockholder’s Trust, to
the address provided to the Company by such entity in writing.

11. In determining the applicable ownership thresholds and ownership percentages
referenced in the Paragraphs above, appropriate adjustments shall be made for
any stock or unit dividends, splits, combinations, recapitalizations or any
other adjustment in the number of outstanding shares of Common Stock or LP Units
in order to maintain, as nearly as practicable, the intended operation of the
provisions herein.

12. The laws of the State of Texas shall govern the interpretation, validity and
performance of the terms of this Agreement. In the event of any controversy
among the parties hereto arising out of, or relating to, this Agreement which
cannot be settled amicably by the parties, such controversy shall be finally,
exclusively and conclusively settled by mandatory arbitration conducted
expeditiously in accordance with the American Arbitration Association rules, by
a single independent arbitrator. Such arbitration process shall take place in
Dallas, Texas. The decision of the arbitrator shall be final and binding upon
all parties hereto and shall be rendered pursuant to a written decision, which
contains a detailed recital of the arbitrator’s

 

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reasoning. Judgment upon the award rendered may be entered in any court having
jurisdiction thereof. Each party shall bear its own legal fees and expenses,
unless otherwise determined by the arbitrator; provided that if the Management
Stockholder substantially prevails on any of his or her substantive legal
claims, Parent shall reimburse all legal fees and arbitration fees incurred by
the Management Stockholder to arbitrate the dispute. Each party hereto hereby
irrevocably waives any right that it may have had to bring an action in any
court, domestic or foreign, or before any similar domestic or foreign authority
with respect to this Agreement.

13. This Agreement may be executed in counterparts, and by different parties on
separate counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.

14. This Agreement may be amended by Parent at any time upon notice to the
Management Stockholder thereof; provided that any amendment (i) that materially
disadvantages the Management Stockholder shall not be effective unless and until
the Management Stockholder has consented thereto in writing and (ii) that
disadvantages the Management Stockholders in more than a de minimis way but less
than a material way shall require the consent of Management Stockholders holding
a majority of the equity interests held by the Management Stockholders.

15. Capitalized terms used by not defined herein shall have the meaning ascribed
to such terms in the Stockholder’s Agreement.

[Signatures on following pages]

 

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If the foregoing accurately sets forth our agreement, please acknowledge your
acceptance thereof in the space provided below for that purpose.

 

Very truly yours, TEXAS ENERGY FUTURE HOLDINGS LIMITED PARTNERSHIP By:   TEXAS
ENERGY FUTURE CAPITAL HOLDINGS LLC,   its general partner By:  

/s/ Michael MacDougall

Name:   Title:  

 

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Accepted and agreed as of the date first written above.

/s/ John F. Young

Name: John F. Young Address:

[Signature page to Sale Participation Agreement]

 

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