Exhibit 10(l)
 
EMPLOYMENT AGREEMENT
 
THIS EMPLOYMENT AGREEMENT (“Agreement”) is made by and between TXU CORP.
(“Company”), and David Campbell (“Executive”), and is dated as of May 14, 2004
(“Effective Date”). The Agreement is designed to strengthen the link between
Executive’s compensation and long-term shareholder value.
 
WITNESSETH:
 
WHEREAS, Company desires to employ Executive and Executive desires to accept
such employment commencing on the Effective Date, in each case on the terms and
conditions set forth herein;
 
NOW, THEREFORE, for and in consideration of the mutual promises, covenants and
obligations contained herein, Company and Executive agree as follows:
 
ARTICLE 1:   EMPLOYMENT AND DUTIES
 
1.1  Employment; Effective Date. Company agrees to employ Executive and
Executive agrees to be employed by Company, beginning on the Effective Date and
continuing for the period of time set forth in Article 2 of this Agreement,
subject to the terms and conditions of this Agreement. Executive understands and
agrees that this Agreement is subject to final ratification and approval by the
Organization and Compensation Committee of the Board of Directors of Company and
by the Board of Directors of Company.
 
1.2  Positions. From and after the Effective Date, Company shall employ
Executive in the position of Executive Vice President of Corporate Planning,
Strategy, and Risk. This position will have responsibility for (i) the oversight
and coordination of corporate financial planning and related performance
management scorecards, (ii) the coordination and oversight of corporate
strategic planning, and (iii) the coordination and oversight of enterprise-level
risk assessment and mitigation planning.
 
1.3  Duties and Services. Executive agrees to serve in the positions referred to
in paragraph 1.2. Executive agrees to perform diligently and to the best of his
abilities the duties and services appropriate to such offices which the parties
mutually may agree upon from time to time.
 
ARTICLE 2:   TERM AND TERMINATION OF EMPLOYMENT
 
2.1  Term. Unless sooner terminated pursuant to other provisions hereof, Company
agrees to employ Executive for a five-year period beginning on the Effective
Date (“Term”), provided that the Term shall be automatically renewed for
successive one-year periods following the expiration of the five-year period
described above, unless either party provides the other party with notice (at
least one year before the expiration of the applicable Term) of its (or his)
intention not to renew the Term, in which case the Term shall expire at the end
of the current Term. Notwithstanding anything to the contrary herein, (i) in the
event of a Change in Control (as defined below) when there is less than two (2)
years left to the Term, or (ii) if, at the time this Agreement would otherwise
expire, Company is in the process of negotiating, with the approval of the Board
of Directors or a committee thereof, with a third party pursuant to a letter of
intent, memorandum of understanding, confidentiality agreement or other similar
evidence of active negotiation concerning a potential transaction or event
which, if consummated, would constitute a Change in Control (“Contemplated
Change in Control”), in either case (i) or (ii) above this Agreement shall not
expire and the Term shall automatically be extended to the earlier of (a) sixty
(60) days after a formal decision by Company or the third party to cease
negotiations concerning such Contemplated Change in Control, such formal
decision to be evidenced by correspondence between Company and the third party,
or a resolution of the Board of Directors or a committee thereof; or (b) two (2)
years following the consummation of the Change in Control described in clause
(i) above or resulting from such negotiation as described in clause (ii) above.
 

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2.2  Company’s Right to Terminate. Notwithstanding the provisions of paragraph
2.1, Company shall have the right to terminate Executive’s employment under this
Agreement at any time for any of the following reasons:
 
(a)  upon Executive’s death;
 
(b)  upon Executive’s becoming disabled within the meaning of Company’s
Long-Term Disability Plan, provided such plan requires Executive to be unable to
perform his duties hereunder due to sickness or injury for a period of at least
180 consecutive days (a “Disability”);
 
(c)  if, in carrying out his duties hereunder, Executive engages in conduct that
constitutes (i) a breach of his fiduciary duty to Company or its shareholders,
(ii) gross neglect or (iii) gross misconduct resulting, in any case, in material
economic harm to Company, or upon the conviction of Executive for a felony or
other crime involving moral turpitude; or
 
(d)  for any other reason whatsoever, in the sole discretion of Company.
 
For purposes of this Agreement, a termination by Company under clause (c) above
shall constitute a termination by Company for “Cause.” Notwithstanding the
foregoing, Company may not terminate Executive’s employment for Cause unless
Company has provided Executive with written notice specifying the reason(s) for
such termination, and if the circumstances surrounding such termination may be
cured by Executive, Company has given Executive a period of not less than thirty
(30) days from the date of such notice during which Executive has failed to cure
the matter to the reasonable satisfaction of Company.
 
2.3  Executive’s Right to Terminate. Notwithstanding the provisions of paragraph
2.1, Executive shall have the right to terminate his employment under this
Agreement at any time for any of the following reasons:
 
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(a)  the assignment to Executive of duties materially inconsistent with the
duties associated with the positions described in paragraph 1.2 as such duties
are constituted as of the Effective Date, or the removal of him from any such
positions;
 
(b)  a material diminution in the nature or scope of Executive’s authority,
responsibilities, or titles from those applicable to him as of the Effective
Date;
 
(c)  the occurrence of acts or conduct on the part of Company or any of its
affiliates, or their board of directors, officers, representatives or
stockholders, which prevent Executive from, or substantively hinder Executive
in, performing his duties or responsibilities pursuant to this Agreement;
 
(d)  Company requiring Executive’s permanent office to be located more than
fifty (50) miles from its current location;
 
(e)  the taking of any action by Company that would materially adversely affect
the corporate amenities enjoyed by Executive on the Effective Date;
 
(f)  a material breach by Company of any provision of this Agreement which, if
correctable, remains uncorrected for 30 days following written notice by
Executive of such breach to Company, it being agreed that any reduction in
Executive’s then current annual base salary, any reduction in Executive’s Target
Bonus (as defined below) or any failure to make the annual awards provided for
in Section 3.4, shall constitute a material breach by Company of this Agreement;
and
 
(g)  for any other reason whatsoever, in the sole discretion of Executive.
 
For purposes of this Agreement: (i) a termination of employment by Executive
under any of clauses (a) through (f), shall constitute a termination of
employment by Executive for “Good Reason;” and (ii) a termination of employment
by Executive under clause (g) above shall constitute a termination of employment
by Executive “without Good Reason”.
 
2.4  Notice of Termination. Notwithstanding the provisions in Section 2.1
relating to the Term of this Agreement, if Company or Executive desires to
terminate Executive’s employment hereunder at any time prior to expiration of
the term of employment as provided in paragraph 2.1, it or he shall do so by
giving written notice to the other party that it or he has elected to terminate
Executive’s employment hereunder and stating the effective date and reason for
such termination, provided that no such action shall alter or amend any other
provisions hereof or rights arising hereunder.
 
2.5  Liability for Damages. Notwithstanding anything herein to the contrary,
Company agrees not to pursue any claim against Executive resulting from
Executive’s termination of this Agreement prior to the expiration of the Term.
 
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ARTICLE 3:   COMPENSATION AND BENEFITS
 
3.1  Base Salary. During the Term, Executive shall receive an annual base salary
equal to $325,000, or such higher amounts as determined in the sole discretion
of Company. Executive’s annual base salary shall be paid in equal installments
in accordance with Company’s standard policy regarding payment of compensation
to executives.
 
3.2  Special Signing Bonus. On, or as soon as reasonably practical after, May
20, 2004, Company shall make a lump-sum cash payment to Executive in the amount
of $200,000.
 
3.3  Annual Bonus. In addition to the base salary, during each calendar year
during the Term commencing with calendar year 2004, Executive shall have the
opportunity to earn an annual cash bonus (“Bonus”) under and subject to the
terms and conditions of the TXU Annual Incentive Plan (“AIP”). For purposes of
this Agreement, Executive’s “Target Bonus” shall be 50% of Executive’s
annualized base salary. To the extent the limitation on awards provided for
under the AIP would limit the amount of the Bonus contemplated herein, any
amount over and above such AIP limit will be paid by Company contemporaneously
with the payment under the AIP.
 
3.4  Annual Long-Term Incentive Compensation Grants. Executive will be entitled
to receive annual performance-based awards under and subject to the terms of the
TXU Long-Term Incentive Compensation Plan (“LTICP”) each year during the Term of
this Agreement commencing in 2004. The annual LTICP award for 2004 shall have a
target value of 40,000 shares of TXU Corp. common stock, and the annual LTICP
award for each succeeding year during the Term of this Agreement shall have a
target value of not less than 20,000 shares of TXU Corp. common stock. The
initial LTICP award for 2004 shall be made as soon as reasonably practical
following the Effective Date and shall be on terms and conditions consistent
with other 2004 annual LTICP awards made to executive officers. The annual award
for each succeeding year will be made following, and in connection with, the
executive officer annual review by the Organization & Compensation Committee of
the Board of Directors of TXU Corp. (“O&C Committee”). Except as expressly
described herein, all such LTICP awards shall be subject to terms, conditions
and restrictions comparable to those contained in awards granted for the
corresponding year to executive officers under the LTICP, or such other terms,
conditions and restrictions as may be approved by the O&C Committee with the
concurrence of Executive.
 
As the following chart illustrates, and notwithstanding any provisions of the
LTICP to the contrary, performance for all Performance-Based Restricted Stock
Awards granted under this Section 3.4 shall be measured by TXU Corp.’s total
shareholder return (“TSR”) relative to the other companies that comprise the
Standard and Poors Electric Utilities Index (“SPELEC”) over the performance
period. Minimum, target and maximum performance levels are set in terms of TXU
Corp.’s TSR performance against the SPELEC quartiles.
 
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Perfor-
mance
Levels
Zero
Minimum
Target
125% of
Target
150% of
Target
Maximum
TSR
Ranges
40.99th
percentile
and below
41st to
50.99th
percentiles
51st to
60.99th
percentiles
61st to
70.99th
percentiles
71st to
80.99th
percentiles
81st
percentile
and above
Payouts
No payout
 
Interpolate
between
Minimum
and Target
(50% to
100% of
Target)
 
Interpolate
between
100% of
Target and
125% of
Target
 
Interpolate
between
125% of
 Target and
150% of
Target
 
Interpolate
between
150% of
Target and
Maximum
(150% and
200% of
Target
Maximum
payout
(200% of
Target)

 
Except as provided in Section 4.3, once such awards have been granted, they
shall be paid in full at the end of the relevant performance period based on
actual performance regardless of whether Executive’s employment has previously
terminated. In the event Executive’s employment with Company terminates prior to
any of the above-described awards being granted to Executive, such awards shall
be subject to the provisions of Article 4 herein.
 
Company shall, if Executive so requests, satisfy any income tax withholding
obligations in respect of the payment of any amounts under the LTICP by
withholding amounts otherwise issuable to Executive under such award.
 
3.5  Additional Retirement Compensation. Executive shall be entitled to
additional retirement compensation on the following basis.
 
(a) Executive shall, commencing upon his retirement or other commencement of
retirement benefits under the TXU Retirement Plan or any successor plan
(“Retirement Plan”), be entitled to receive additional retirement compensation
(the "Additional Retirement Compensation") equal to the aggregate benefits which
would have been payable to Executive under the Retirement Plan and the TXU
Second Supplemental Retirement Plan or any successor plan (the "Supplemental
Retirement Plan") as if, during each of the first 10 years of employment with
Company, Executive was credited with 2 years of Accredited Service (as defined
in the Retirement Plan). Thus, upon the tenth anniversary of the Effective Date,
Executive will have accrued twenty (20) years of Accredited Service for purposes
of calculating the Additional Retirement Compensation. The Additional Retirement
Compensation shall be reduced by all amounts payable to Executive under the
Retirement Plan and the Supplemental Retirement Plan (or any successor plan or
plans) pursuant to the provisions of those plans as a result of his employment
with Company.
 
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(b) The additional deemed years of Accredited Service provided for in paragraph
(a) shall be included for purposes of determining Executive's satisfaction of
the vesting requirements under the Retirement Plan, as well as Executive's
eligibility for earlier-than-normal retirement under the terms of the Retirement
Plan. If and to the extent that the inclusion of the additional deemed years of
Accredited Service for vesting and earlier-than-normal retirement purposes shall
result in retirement benefits being payable to Executive when not otherwise
permitted under the Retirement Plan, the full amount of such retirement benefits
shall be paid as the Additional Retirement Compensation.
 
(c) The Additional Retirement Compensation shall be payable at the time(s) and
in the form elected by Executive with respect to the benefits which are or may
become payable under the Retirement Plan. The amount of each such periodic
installment shall be determined by Employer using actuarial assumptions
(including any actuarial reduction for earlier-than-normal retirement)
substantially similar to those used in connection with the determination of
benefits payable or which may become payable to Executive under the Retirement
Plan.
 
(d) The Additional Retirement Compensation shall be provided on an unfunded
basis and is not intended to meet the qualification requirements of Section 401
of the Internal Revenue Code of 1986, as amended (the "Code").
 
3.6  Vacation and Sick Leave. During each year of his employment, Executive
shall be entitled to vacation and sick leave benefits equal to the maximum
available to any Company executive, determined without regard to the period of
service that might otherwise be necessary to entitle Executive to such vacation
or sick leave under standard Company policy.
 
3.7  Other Employee Benefits. Executive shall be entitled to participate in all
of Company’s employee benefit plans, programs, arrangements and fringe benefit
policies made available to similarly situated senior executives of the Company
to the extent he is qualified to do so by virtue of his employment with Company,
subject to the terms, conditions and limitations of such plans, arrangements and
policies, as they may be amended from time to time.
 
3.8  Other Perquisites. During his employment hereunder, Executive shall be
afforded the following benefits as incidences of his employment:
 
(a)  Business and Entertainment Expenses - Subject to Company’s standard
policies and procedures with respect to expense reimbursement as applied to its
executive employees generally, Company shall reimburse Executive for, or pay on
behalf of Executive, reasonable and appropriate expenses incurred by Executive
for business related purposes, including dues and fees to industry and
professional organizations, bar related expenses, costs of entertainment and
business development, and costs reasonably incurred as a result of Executive’s
spouse accompanying Executive on business travel. Company shall also pay on
behalf of Executive the expenses of one club selected by Executive.
 
(b)  Parking - Company shall provide at no expense to Executive a reserved
parking place convenient to Executive’s headquarters office.
 
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(c) Automobile Allowance - Company shall provide Executive with an automobile
allowance under Company’s standard policy.

ARTICLE 4:   EFFECT OF TERMINATION ON COMPENSATION
 
4.1  By Expiration of Term. If Executive’s employment hereunder shall terminate
upon expiration of the Term, then all compensation and all benefits to Executive
hereunder shall terminate contemporaneously with termination of his employment,
except that:
 
(a)  Company shall pay to Executive all Accrued Obligations (as defined below in
Section 4.8) in a lump sum in cash within thirty (30) days after the date of
termination of Executive’s employment (the “Date of Termination”). For the
avoidance of doubt, salary, annual bonus, vacation and sick leave, other
employee benefits (except for COBRA Coverage (as defined below)) and other
perquisites shall cease to accrue as of the Date of Termination.
 
(b)  Company shall pay Executive a pro rata annual Bonus for the year of
termination based on actual performance at the time when bonuses are paid to
senior executives generally.
 
(c)  All outstanding awards which had been made to Executive pursuant to Section
3.4 (for purposes of this Article 4, “LTICP Awards”) shall not be forfeited and
shall be paid at the times and in the amounts provided for in, and subject to
the terms and conditions of, such awards.
 
(d)  Company shall provide Executive and his eligible dependents with continuous
health care coverage under and subject to the provisions of the Consolidated
Omnibus Budget Reconciliation Act of 1985 (“COBRA Coverage”) at the prevailing
active employee rate for up to eighteen (18) months from such termination.
 
(e)  Company’s obligations under Sections 4.6 and 5.1 shall continue.
 
(f)  Company shall pay any amounts owed but unpaid to Executive under any plan,
policy or program of Company as of the date of termination at the time provided
by, and in accordance with the terms of, such plan, policy or program, including
any annual Bonus earned in the prior calendar year or a portion thereof as
described in Section 3.3.
 
4.2  By Company Without Cause or By Executive for Good Reason Prior to
Expiration of Term. If Executive’s employment hereunder shall be terminated by
Company without Cause, or by Executive for Good Reason, prior to the expiration
of the Term then, upon such termination, the payments and benefits described
below will be provided to Executive, or in the event of Executive’s death, to
his spouse (or his estate if he is not married or his spouse does not survive
him):
 
(a)  Company shall pay to the Executive all Accrued Obligations in a lump sum in
cash within thirty (30) days after the Date of Termination. For the avoidance of
doubt, salary, annual bonus, vacation and sick leave, other employee benefits
(except for COBRA Coverage and retiree medical) and other perquisites shall
cease to accrue as of the Date of Termination.
 
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(b)  Company shall immediately pay Executive a lump sum payment equal to the
then current annualized base salary provided for under Section 3.1 and the
Target Bonuses due as described in Section 3.3, through the remainder of the
Term, provided that the lump sum shall not be less than the sum of Executive’s
annualized base salary and Target Bonus.
 
(c)  All outstanding LTICP Awards shall be paid at the times and in the amounts
provided for in, and subject to the terms and conditions of, such awards.
Additionally, all ungranted LTICP Awards that would have been made to Executive
pursuant to Section 3.4 on or prior to the expiration date of the Term shall be
immediately granted. The performance period for each such previously ungranted
LTICP Award shall be the performance period that would have applied had the
award been made at the time provided for in Section 3.4. Each such previously
ungranted LTICP Award shall be delivered or paid following the applicable
performance period in accordance with the terms of the award.
 
(d)  Company shall pay Executive an amount equal to: (i) the forfeited portion
of Executive’s accounts under the TXU Deferred and Incentive Compensation Plan
(“DICP”) and the TXU Salary Deferral Program (“SDP”) (valued as of the date of
such termination in accordance with the valuation methodology used under such
plans); and (ii) the matching contributions which would have been made on behalf
of Executive under the DICP had Executive continued to defer salary under the
DICP at the rate in effect as of the date of such termination for an additional
twelve (12) months.
 
(e)  Executive shall be entitled to receive the Additional Retirement
Compensation provided for in Section 3.5 as if Executive had continued in the
employment of Company through the expiration of the Term.
 
(f)  Company shall provide Executive and his eligible dependents with COBRA
Coverage at the prevailing active employee rate for up to eighteen (18) months
from such termination.  
 
(g)  Company’s obligations under Sections 4.6 and 5.1 shall continue.
 
(h)  Company shall pay any amounts owed but unpaid to Executive under any plan,
policy or program of Company as of the date of termination at the time provided
by, and in accordance with the terms of, such plan, policy or program, including
any unpaid annual Bonus earned in the prior calendar year or portion thereof as
described in Section 3.3.
 
4.3  By Executive Without Good Reason or By Company for Cause. If Executive’s
employment hereunder shall be terminated by Company for Cause or by Executive
without Good Reason, then all compensation and benefits to Executive hereunder
shall terminate contemporaneously with the termination of such employment,
except that:
 
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(a)  Company shall pay to Executive all Accrued Obligations in a lump sum in
cash within thirty (30) days after the Date of Termination. For the avoidance of
doubt, salary, annual bonus, vacation and sick leave, other employee benefits
(except for COBRA Coverage) and other perquisites shall cease to accrue as of
the Date of Termination.
 
(b)  Company shall provide Executive and his eligible dependents with COBRA
Coverage at the prevailing COBRA rate for up to eighteen (18) months from such
termination.
 
(c)  Company’s obligations under Sections 4.6 and 5.1 shall continue.
 
(d)  Company shall pay any amounts owed but unpaid to Executive under any plan,
policy or program of Company as of the date of termination at the time provided
by, and in accordance with the terms of, such plan, policy or program, including
any annual Bonus earned in the prior calendar year or portion thereof as
described in Section 3.3.
 
(e)  Any unvested or ungranted LTICP awards described in Section 3.4 shall be
forfeited.
 
4.4  Upon Executive’s Death or Disability. In the event of Executive’s death or
Disability during the Term, this Agreement shall terminate, and Executive, or
Executive’s spouse in the event of his death (or his estate in the event he is
not married or his spouse does not survive him) will be entitled to receive the
following:
 
(a)  Company shall pay to the Executive all Accrued Obligations in a lump sum in
cash within thirty (30) days after the Date of Termination. For the avoidance of
doubt, salary, annual bonus, vacation and sick leave, other employee benefits
(except for COBRA Coverage) and other perquisites shall cease to accrue as of
the Date of Termination.
 
(b)  Company shall immediately pay Executive (or Executive’s surviving spouse or
estate, as the case may be) a lump sum payment equal to the sum of Executive’s
then current annualized base salary provided for under Section 3.1 plus the
Target Bonus defined in Section 3.3.
 
(c)  Company shall pay Executive a pro rata annual Bonus for the year of
termination based on actual performance at the time when bonuses are paid to
senior executives generally.
 
(d)  All outstanding LTICP Awards shall be paid at the times and in the amounts
provided for in, and subject to the terms and conditions of, such awards.
Additionally, all ungranted LTICP Awards that would have been made to Executive
pursuant to Section 3.4 during the one (1) year period following the date of
Executive’s death or Disability shall be immediately granted. The performance
period for each such previously ungranted LTICP Award shall be the performance
period that would have applied had the award been made at the time provided for
in Section 3.4. Each such previously ungranted LTICP Award shall be delivered or
paid following the applicable performance period in accordance with the terms of
the award. Any LTICP Awards provided for in Section 3.4 which remain ungranted
after application of this subsection 4.4(d) shall be forfeited.
 
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(e)  Company shall provide Executive and his eligible dependents with COBRA
Coverage at the prevailing active employee rate for up to thirty-six (36) months
from such termination.
 
(f)  Company’s obligations under Sections 4.6 and 5.1 shall continue.
 
(g)  Company shall pay any amounts owed but unpaid to Executive under any plan,
policy or program of Company as of the date of termination at the time provided
by, and in accordance with the terms of, such plan, policy or program, including
any annual Bonus earned in the prior calendar year or portion thereof as
described in Section 3.3.
 
4.5  Termination Following Change in Control. If Executive’s employment is
terminated by Company (or its successor) without Cause or Executive terminates
his employment with Company (or its successor) with Good Reason in either case
within twenty-four (24) months after a Change in Control (as defined in Section
4.8 below), Executive will be entitled to the following benefits:
 
(a)  Company (or its successor) shall pay to the Executive all Accrued
Obligations in a lump sum in cash within thirty (30) days after the Date of
Termination. For the avoidance of doubt, salary, annual bonus, vacation and sick
leave, other employee benefits (except for COBRA Coverage and retiree medical)
and other perquisites shall cease to accrue as of the Date of Termination.
 
(b)  Company (or its successor) shall immediately pay Executive a lump sum
payment equal to the then current annualized base salary provided for under
Section 3.1 and the Target Bonuses due as described in Section 3.3, through the
remainder of the Term, provided that the lump sum shall not be less than three
(3) times the sum of Executive’s annualized base salary and Target Bonus.
 
(c)  All outstanding LTICP Awards shall not forfeit and shall be paid at the
times and in the amounts, provided for in, and subject to the terms and
conditions of, such awards. Additionally, all ungranted LTICP Awards that would
have been made to Executive pursuant to Section 3.4 on or prior to the
expiration date of the initial 5-year Term shall be immediately granted. The
performance period for each such previously ungranted LTICP Award shall be the
performance period that would have applied had the award been made at the time
provided for in Section 3.4. Each such previously ungranted LTICP Award shall be
delivered or paid following the applicable performance period in accordance with
the terms of the award.
 
(d)   Company shall pay Executive an amount equal to: (i) the forfeited portion
of Executive’s accounts under the TXU Deferred and Incentive Compensation Plan
(“DICP”) and the TXU Salary Deferral Program (“SDP”) (valued as of the date of
such termination in accordance with the valuation methodology used under such
plans); and (ii) the matching contributions which would have been made on behalf
of Executive under the DICP had Executive continued to defer salary under the
DICP at the rate in effect as of the date of such termination for an additional
twenty-four (24) months.
 
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(e)  Executive shall be entitled to receive the Additional Retirement
Compensation provided for in Section 3.5 as if Executive had continued in the
employment of Company through the expiration of the Term.
 
(f)  Company (or its successor) shall provide Executive and his eligible
dependents with COBRA Coverage at the prevailing active employee rate for up to
eighteen (18) months from such termination.
 
(g)  Company’s (or its successor’s) obligations under Sections 4.6 and 5.1 shall
continue.
 
(h)  Company (or its successor) shall pay any amounts owed but unpaid to
Executive under any plan, policy or program of Company as of the date of
termination at the time provided by, and in accordance with the terms of, such
plan, policy or program, including any Annual Bonus earned in the prior calendar
year or portion thereof as described in Section 3.3.
 
4.6  Certain Additional Payments by Company. Notwithstanding anything to the
contrary in this Agreement, if any payment, distribution or provision of a
benefit by Company to or for the benefit of Executive, whether paid or payable,
distributed or distributable or provided or to be provided pursuant to the terms
of this Agreement or otherwise (a “Payment”), would be subject to an excise or
other special additional tax that would not have been imposed absent such
Payment (including, without limitation, any excise tax imposed by Section 4999
of the Internal Revenue Code of 1986, as amended), or any interest or penalties
with respect to such excise or other additional tax (such excise or other
additional tax, together with any such interest or penalties, are hereinafter
collectively referred to as the “Excise Tax”), Company shall pay to Executive an
additional payment (a “Gross-up Payment”) in an amount such that after payment
by Executive of all taxes (including any interest or penalties imposed with
respect to such taxes), including any income taxes and Excise Taxes imposed on
any Gross-up Payment, Executive retains an amount of the Gross-up Payment
(taking into account any similar gross-up payments to Executive under any stock
incentive or other benefit plan or program of Company) equal to the Excise Tax
imposed upon the Payments. Company and Executive shall make an initial
determination as to whether a Gross-up Payment is required and the amount of any
such Gross-up Payment. Executive shall notify Company in writing of any claim by
the Internal Revenue Service which, if successful, would require Company to make
a Gross-up Payment (or a Gross-up Payment in excess of that, if any, initially
determined by Company and Executive) within ten business days after the receipt
of such claim. Company shall notify Executive in writing at least ten business
days prior to the due date of any response required with respect to such claim
if it plans to contest the claim. If Company decides to contest such claim,
Executive shall cooperate fully with Company in such action; provided, however,
Company shall bear and pay directly or indirectly all costs and expenses
(including additional interest and penalties) incurred in connection with such
action and shall indemnify and hold Executive 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 Company’s action. If, as a result of Company’s
action with respect to a claim, Executive receives a refund of any amount paid
by Company with respect to such claim, Executive shall promptly pay such refund
to Company.If Company fails to timely notify Executive whether it will contest
such claim or Company determines not to contest such claim, then Company shall
immediately pay to Executive the portion of such claim, if any, which it has not
previously paid to Executive. Company’s obligation under this Section 4.6 shall
continue after the termination or expiration of the Term.
 
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4.7  Payment Obligations Absolute / Release of Claims. Except as set forth in
the following paragraph, Company’s obligation to pay Executive the amounts and
to make the arrangements provided in this Article 4 shall be absolute and
unconditional and shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
Company (including its subsidiaries and affiliates) may have against him or
anyone else. All amounts payable by Company shall be paid without notice or
demand. Executive shall not be obligated to seek other employment in mitigation
of the amounts payable or arrangements made under any provision of this Article
4, and the obtaining of any such other employment (or the engagement in any
endeavor as an independent contractor, sole proprietor, partner, or joint
venturer) shall in no event effect any reduction of Company’s obligations to
make (or cause to be made) the payments and arrangements required to be made
under this Article 4.
 
Executive acknowledges and agrees that the payments and benefits provided for in
this Article 4 constitute the exclusive remedy of Executive upon termination of
employment for any reason. Executive further agrees that as a condition to
receiving such payments and benefits, Executive shall execute a release of
claims arising out of Executive’s employment with, and termination of employment
from, Company in a form reasonably requested by Company.
 
4.8  Certain Defined Terms. For purposes of this Agreement, the following terms
shall have the following meanings:
 
(a)  “Change in Control” means a change in control of the Company of a nature
that would be required to be reported in response to Item 1(a) of the Securities
and Exchange Commission Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended
(“Exchange Act”), or would have been required to be so reported but for the fact
that such event had been “previously reported” as that term is defined in Rule
12b-2 of Regulation 12B under the Exchange Act; provided that, without in any
way limiting the foregoing, a Change in Control shall be deemed to have occurred
if any one or more of the following events occurs: (i) any Person is or becomes
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 20% or more of the
combined voting power of the Company then outstanding securities having the
right to vote at elections of directors of the Company (“Voting Securities”);
(ii) individuals who constitute the board of directors of the Company on the
Effective Date of this Agreement (the “Incumbent Board”) cease for any reason to
constitute at least a majority thereof, provided that any person becoming a
director subsequent to the Effective Date of this Agreement whose election, or
nomination for election by the Company shareholders, was approved by at least
three-quarters of the Company’s directors comprising the Incumbent Board (either
by a specific vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection to such
nomination) shall, for purposes of this clause (ii), be considered as though
such person were a member of the Incumbent Board; (iii) a recapitalization or
reclassification of the Voting Securities of the Company, which results in
either (a) a decrease by 33% or more in the aggregate percentage ownership of
Voting Securities held by Independent Shareholders (on a primary basis or on a
fully diluted basis after giving effect to the exercise of stock options and
warrants), or (b) an increase in the aggregate percentage ownership of Voting
Securities held by non-Independent Shareholders (on a primary basis or on a
fully diluted basis after giving effect to the exercise of stock options and
warrants) to greater than 50%; (iv) all or substantially all of the assets of
the Company are liquidated or transferred to an unrelated party; or (v) the
Company is a party to a merger, consolidation, reorganization or similar
transaction pursuant to which the Company is not the surviving ultimate parent
entity. For purposes of this definition, the terms “Person” shall mean and
include any individual, corporation, partnership, group association or other
“person,” as such term is used in Section 14(d) of the Exchange Act, other than
the Company, a subsidiary of the Company or any employee benefit plan(s)
sponsored or maintained by the Company or any subsidiary thereof, and the term
“Independent Shareholder” shall mean any shareholder of the Company except any
employee(s) or director(s) of the Company or any employee benefit plan(s)
sponsored or maintained by the Company or any subsidiary thereof
 
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(b)  The term “immediately” wherever used herein to refer to the timing of a
payment or other performance requirement of this Agreement, shall mean within
ten (10) business days after the date such payment or performance becomes due.
 
(c)  “Accrued Obligations” shall mean, as of the Date of Termination, the sum of
(i) Executive’s base salary through the Date of Termination to the extent not
previously paid, (ii) the signing bonus provided for in Section 3.2 to the
extent not previously paid, (iii) except as otherwise previously requested by
Executive, the amount of any bonus, incentive compensation, deferred
compensation and other cash compensation accrued by Executive as of the Date of
Termination to the extent not previously paid and (iv) any vacation pay, expense
reimbursements and other cash entitlements accrued by Executive as of the Date
of Termination to the extent not previously paid.
 
4.9  Confidentiality and Nondisclosure. Executive understands and agrees that he
will be given Confidential Information (as defined below), and specialized
training relating to such Confidential Information, during his employment with
Company relating to the business of Company and/or its affiliates. Except as
authorized within the course and scope of his employment, Executive hereby
expressly agrees to maintain in strictest confidence and not to use in any way
(including without limitation in any future business relationship of Executive),
publish, disclose or authorize anyone else to use, publish or disclose in any
way, any Confidential Information relating in any manner to the business or
affairs of Company and/or its affiliates. Executive agrees further not to remove
or retain any figures, calculations, letters, documents, lists, papers, or
copies thereof, which embody Confidential Information of Company and/or its
affiliates, and to return, prior to Executive’s termination of employment, any
such information in Executive’s possession. If Executive discovers or comes into
possession of any such information after his termination, he shall promptly
return it to Company. For purposes of this Agreement, “Confidential Information”
includes, but is not limited to, information in the possession of, prepared by,
obtained by, compiled by, or that is used by Company or any of its affiliates or
customers and (a) is proprietary to, about, or created by Company or its
affiliates or customers; (b) gives Company or its affiliates or customers some
competitive business advantage, the opportunity of obtaining such advantage, or
disclosure of which might be detrimental to the interest of Company or its
affiliates or customers; and (c) is not typically disclosed by Company or its
affiliates or customers, or known by persons who are not employed by Company or
its affiliates or customers. Without in any way limiting the foregoing and by
way of example, Confidential Information shall include information not generally
available to the public pertaining to Company’s business operations such as
financial and operational information and data, operational plans and
strategies, business and marketing strategies and plans for various products and
services, global operational planning, and acquisition and divestiture planning.
 
4.10  Noncompetition and Non-Solicitation. Executive acknowledges and agrees
that: (1) in order to perform his obligations and job duties for Company,
Executive will gain training and access to Confidential Information regarding
Company and/or its affiliates or customers; (2) use of such Confidential
Information in competition with Company and/or its affiliates or customers would
be detrimental to the business interests of Company and/or its affiliates or
customers; and (3) Executive would not have been allowed to gain access to
Confidential Information, or to provide the obligations and job duties
contemplated under this Agreement without his promises and agreements contained
in the following paragraph. Executive also acknowledges and agrees that the
services he will be performing for Company, and the Confidential Information and
training he will be provided, relate to all operations of Company and will not
be limited to any specific geographic location within which Company, or any of
its affiliates, conducts business.
 
In the event this Agreement is terminated pursuant to the provisions of Sections
4.1, 4.2, 4.3 or 4.5 above, Executive agrees that for a period of one (1) year
after such termination, Executive shall not, directly or knowingly indirectly,
either as an employee, employer, independent contractor, consultant, agent,
principal, partner, stockholder, officer, director, or in any other individual
or representative capacity, either for his own benefit or the benefit of any
other person or entity: (a) engage or participate in a business which competes
in a material manner with Company or any of its affiliates in the geographic
locations in which Company (or such affiliates) conduct business; (b) solicit,
induce, encourage or in any way cause any of Company’s (or affiliate’s)
customers, or prospective customers, or any person, firm, corporation, company,
partnership, association or entity which was contacted or whose business was
solicited, serviced or maintained by Company (or its affiliates) during the term
of Executive’s employment with Company to reduce or terminate its business
relationship with Company (or such affiliate); or (c) solicit, recruit, induce,
encourage or in any way cause any employee of Company (or an affiliate) to
terminate his/her employment with Company (or such affiliate).
 
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ARTICLE 5:   MISCELLANEOUS
 
5.1  Interest and Indemnification; D&O Insurance.
 
(a)  If any payment to Executive provided for in this Agreement is not made by
Company when due, Company shall pay to Executive interest on the amount payable
from the date that such payment should have been made until such payment is
made, which interest shall be calculated at 3% plus the prime or base rate of
interest announced by JP Morgan Chase Bank, N.A. at its principal office in
Dallas, Texas (but not in excess of the highest lawful rate), and such interest
rate shall change when and as any such change in such prime or base rate shall
be announced by such bank. If Executive shall obtain any money judgment or
otherwise prevail with respect to any litigation brought by Executive or Company
to enforce or interpret any provision contained herein, Company, to the fullest
extent permitted by applicable law, hereby indemnifies Executive for his
reasonable attorneys’ fees and disbursements incurred by Executive in such
litigation and hereby agrees (i) to pay in full all such fees and disbursements
and (ii) to pay prejudgment interest on any money judgment obtained by Executive
from the earliest date that payment to him should have been made under this
Agreement until such judgment shall have been paid in full, which interest shall
be calculated at the rate set forth in the preceding sentence.
 
(b)  Company agrees that if Executive is made a party or threatened to be made a
party to any action, suit or proceeding, whether civil, criminal, administrative
or investigative by reason of the fact that Executive is or was an employee of
Company, or any subsidiary of Company or is or was serving at the request of
Company, as a director, officer, member, employee or agent of another
corporation or a partnership, joint venture, trust or other enterprise
(“Proceeding”), Executive shall be indemnified and held harmless by Company to
the fullest extent permitted by applicable law.
 
(c)  Company shall provide Executive with directors’ and officers’ liability
insurance at least as favorable as the insurance coverage provided to other
senior executive officers and directors of Company respecting liabilities,
costs, charges and expenses of any type whatsoever incurred or sustained by
Executive (or Executive’s legal representative or other successors) in
connection with a Proceeding.
 
Company’s obligations under this Section 5.1(a), (b) and (c) shall continue
after the termination of this Agreement.
 
5.2  Notices. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or three days after the date
mailed by United States registered or certified mail, return receipt requested,
or by a nationally known overnight courier, in either case postage prepaid and
addressed as follows:
 
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If to Company to:                  TXU Corp.
 1601 Bryan Street
                                                                 Dallas, Texas
75201-3411
                                                                 Attention:
General Counsel
 
If to Executive to: The most recent address on file with Company
 
or to such other address as either party may furnish to the other in writing in
accordance herewith, except that notices of changes of address shall be
effective only upon receipt.
 
5.3  Applicable Law. This contract is entered into under, and shall be governed
for all purposes by, the laws of the State of Texas.
 
5.4  No Waiver. No failure by either party hereto at any time to give notice of
any breach by the other party of, or to require compliance with, any condition
or provision of this Agreement shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
 
5.5  Severability. If a court of competent jurisdiction determines that any
provision of this Agreement is invalid or unenforceable, then the invalidity or
unenforceability of that provision shall not affect the validity or
enforceability of any other provision of this Agreement, and all other
provisions shall remain in full force and effect.
 
5.6  Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be original, but all of which together will
constitute one and the same Agreement.
 
5.7  Withholding of Taxes and Other Employee Deductions. Company may withhold
from any benefits and payments made pursuant to this Agreement all federal,
state, city and other taxes as may be required pursuant to any law or
governmental regulation or ruling and all other normal employee deductions made
with respect to Company’s employees generally.
 
5.8  Headings. The paragraph headings have been inserted for purposes of
convenience and shall not be used for interpretive purposes.
 
5.9  Gender and Plurals. Wherever the context so requires, the masculine gender
includes the feminine or neuter, and the singular number includes the plural and
conversely.
 
5.10  Successors. This Agreement shall be binding upon and inure to the benefit
of Company and any successor of Company, including without limitation any
person, association, or entity which may hereafter acquire or succeed to all or
substantially all of the business or assets of Company by any means whether
direct or indirect, by purchase, merger, consolidation, or otherwise. Except as
provided in the preceding sentence, this Agreement, and the rights and
obligations of the parties hereunder, are personal and neither this Agreement,
nor any right, benefit or obligation of either party hereto, shall be subject to
voluntary or involuntary assignment, alienation or transfer, whether by
operation of law or otherwise, without the prior written consent of the other
party.
 
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5.11  Term. The term of this Agreement is co-extensive with the Term of
employment as set forth in paragraph 2.1. Termination shall not affect any right
or obligation of any party which is accrued or vested prior to or upon such
termination or by its terms continues following the termination of the Term,
including without limitation sections 4.6, 4.7, 4.9, 4.10 and 5.1 of this
Agreement.
 
5.12  Entire Agreement; Conflict. This Agreement sets forth the entire agreement
of the parties with respect to the subject matter hereto. Any modification of
this Agreement shall be effective only if it is in writing and signed by the
party to be charged. In the event of any conflict between the terms of this
Agreement and the terms of any policy, plan or program of Company, the terms of
this Agreement shall govern.
 
5.13  Deemed Resignations. Any termination of Executive’s employment shall
constitute an automatic resignation of Executive as an officer of Company and
each affiliate of Company, and an automatic resignation of Executive from the
Board of Directors and from the board of directors of any affiliate of Company,
and from the board of directors or similar governing body of any corporation,
limited liability company or other entity in which Company or any affiliate
holds an equity interest and with respect to which board or similar governing
body Executive serves as Company’s or such affiliate’s designee or other
representative.
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date set forth above.
 
TXU CORP.
 
By: /s/ John Wilder                                                    
Name: John Wilder
Title: Chief Executive Officer

EXECUTIVE:

/s/ David A. Campbell                                             
David Campbell

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