**Exhibit 10.4**

 

**FORM OF SUPPLEMENTAL AGREEMENT TO**

**EMPLOYMENT AGREEMENT FOR SENIOR VICEPRESIDENTS**

 

**SUPPLEMENTAL AGREEMENT**

 

ThisSUPPLEMENTAL AGREEMENT No. 1 supplements and amends that certain EMPLOYMENTAGREEMENT, entered into the        day of            ,        by and between TEXAS EASTERNPRODUCTS PIPELINE COMPANY, LLC (“TEPPCO”), a Delaware limited liability companywith its principal executive offices in Houston, Texas, and                    (“Executive”).

 

# 1.             Section9 of the EMPLOYMENT AGREEMENT is hereby deleted in its entirety and a newSection 9 shall be substituted in place of the prior, deleted Section 9 and thenew, substituted Section 9 shall provide as follows:

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## (a)           (1)   Inthe event that within twelve (12) months following a change in control as setforth in Section 9(b), Executive’s employment shall be involuntarily terminatedor Executive shall (i) have asignificant reduction in responsibilities or reporting level, (ii) havea reduction in base or incentive compensation at target by five percent (5%) ormore or (iii) be required to relocate from the regular assigned work place bymore than fifty (50) additional miles from the Executive’s current worklocation, he shall be entitled to a lump sum severance payment equal to three(3) times his annual base salary plus three (3) times target bonus.  In order to qualify for a severance benefiton account of being required to relocate by more than fifty (50) additionalmiles from Executive’s residence, Executive must provide notice to TEPPCO pursuantto Section 10 within thirty (30) days after Executive receives notice pursuantto Section 10 that he is required to relocate. In addition, if Executive is enrolled in any of TEPPCO’s Medical orDental Plan coverages as an active employee, TEPPCO shall credit Executive witha lump sum in an amount that will provide an after-tax lump sum (assumingExecutive is in the highest marginal income tax bracket) equal to the currentmonthly COBRA continuation coverage cost of Executive’s coverage(s) at the timesuch amount is credited (including, where applicable, an HMO option, butexcluding any Cafeteria Plan – Medical Spending Account) for thirty-six (36)consecutive months from the termination of Executive’s employment withTEPPCO.  TEPPCO will promptly remit theincome taxes due on such amount directly to the appropriate taxingauthority.  Should Executive obtainsubsequent employment and become eligible for medical and/or dental coveragesavailable to employees of the new employer or otherwise cease to be coveredunder TEPPCO’s Medical and/or Dental Plans, Executive shall immediately notifyTEPPCO which shall immediately terminate Executive’s coverage(s) in its Medicaland/or Dental Plans, as appropriate. Executive shall have no further right to any amounts that otherwisewould have been applied to pay the monthly COBRA continuation coverage cost ofmedical and/or dental continuation coverage provided hereunder.  Should Executive be eligible for retireecoverages under the TEPPCO Medical and Dental Plans at the termination ofemployment, TEPPCO and Executive will take the same actions with respect to theretiree coverages under the TEPPCO Medical and Dental Plan as would have beentaken under the above provisions hereof had Executive been enrolled as an activeemployee except that the lump sum to be credited to Executive will bedetermined

 

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## withreference to the current monthly cost of Executive’s cost of retiree coverageat the time such lump sum amount is credited. All payments under this Section 9(a)(1) shallbe made not later than thirty (30) days after the termination of employment.

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(2)           In the event thatafter twelve (12) months following a change in control as set forth in Section9(b), Executive’s employment shall be involuntarily terminated or Executiveshall (i) have a significant reduction in responsibilities or reporting level,(ii) have a reduction in base or incentive compensation at target by fivepercent (5%) or more or (iii) be required to relocate from the regular assignedwork place by more than fifty (50) additional miles from the Executive’scurrent work location, he shall be entitled to a lump sum severance paymentequal to two (2) times his base annual salary plus two (2) times targetbonus.  In order to qualify for aseverance benefit on account of being required to relocate by more than fifty(50) additional miles from Executive’s residence, Executive must provide noticeto TEPPCO pursuant to Section 10 within thirty (30) days after Executivereceives notice pursuant to Section 10 that he is required to relocate.  In addition, if Executive is enrolled in anyof TEPPCO’s Medical or Dental Plan coverages as an active employee, TEPPCOshall credit Executive with a lump sum in an amount that will provide anafter-tax lump sum (assuming Executive is in the highest marginal income taxbracket) equal to the current monthly COBRA continuation coverage cost ofExecutive’s coverage(s) at the time such amount is credited (including, whereapplicable, an HMO option, but excluding any Cafeteria Plan – Medical SpendingAccount) for twenty-four (24) consecutive months from the termination ofExecutive’s employment with TEPPCO. TEPPCO will promptly remit the income taxes due on such amount directlyto the appropriate taxing authority. Should Executive obtain subsequent employment and become eligible formedical and/or dental coverages available to employees of the new employer orotherwise cease to be covered under TEPPCO’s Medical and/or Dental Plans,Executive shall immediately notify TEPPCO which shall immediately terminateExecutive’s coverage(s) in its Medical and/or Dental Plans, asappropriate.  Executive shall have nofurther right to amounts that otherwise would have been applied to pay themonthly COBRA continuation coverage cost of medical and/or dental continuationcoverage provided hereunder.  ShouldExecutive be eligible for retiree coverages under the TEPPCO Medical and DentalPlans at the termination of employment, TEPPCO and Executive will take the sameactions with respect to the retiree coverages under the TEPPCO Medical andDental Plan as would have been taken under the above provisions hereof hadExecutive been enrolled as an active employee except that the lump sum to becredited to Executive will be determined with reference to the current monthlycost of Executive’s cost of retiree coverage at the time such lump sum amountis credited.  All payments under thisSection 9(a)(2) shall be made not later thanthirty (30) days after the date of the Change in Control.

 

## (b)           Forthe purposes of this Section 9, a “change in control” shall be deemed to haveoccurred if:

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### (i)            anyperson is or becomes the beneficial owner, directly or indirectly, ofsecurities of TEPPCO representing more than fifty percent (50%) of the combinedvoting power of TEPPCO’s then outstanding voting securities; or

 

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### (ii)           allor substantially all of the assets and business of TEPPCO or the Partnershipare sold, transferred or assigned to, or otherwise acquired by, any otherperson or persons; or

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### (iii)          the dissolution or liquidation of Partnership or TEPPCO; or

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### (iv)          adoption by the Board of Directors of TEPPCO of a resolutionto the effect that any person has acquired effective control of the businessand affairs of TEPPCO, or the Partnership.

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## (c)           Theterm “beneficial owner” shall have the meaning set forth in Section 13(d)of the Securities Exchange Act of 1934, as amended, and in the regulationspromulgated thereunder.  The term “person”shall mean an individual, corporation, partnership, trust, unincorporatedbusiness organization, association or other entity provided that the term “person”shall not include (i) Duke Energy Corporation (“Duke”), (ii) any affiliate ofDuke, including but not limited to Duke Energy Field Services, L.P., or (iii)any employee benefit plan maintained by Duke or any affiliate of Duke.  For the purpose of this Section 9, “control”or “controlled” when used with respect to any specified person or entity meansthe power to direct the management and policies of that person or entitywhether through the ownership of voting securities, membership interest or bycontract.

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# 2.             Except as hereby amended by this SUPPLEMENTAL AGREEMENT No.1, the EMPLOYMENT AGREEMENT is hereby ratified and affirmed in all respects.

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IN WITNESSWHEREOF, the parties hereto have executed this SUPPLEMENTAL AGREEMENT No. 1this        day of                     ,200     .

 
| **TEXAS EASTERN PRODUCTS PIPELINE COMPANY, LLC** |       |
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| By:                                              |       |   |   |
| Title:                                           |       |   |   |
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| **EXECUTIVE:**                                   |       |
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| Printed Name:                                    |       |   |   |
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