Form 10K





	     Exhibit
      10(i)

       
	     EMPLOYMENT
        AGREEMENT

         

	     THIS
      EMPLOYMENT AGREEMENT is made as of October 17, 2002 among DPL INC., an Ohio
      corporation (“DPL”), THE DAYTON POWER AND LIGHT COMPANY, an Ohio
      corporation (“DP&L”, and together with DPL, the “Companies”)
      and STEPHEN F. KOZIAR, JR. (“Mr. Koziar”) under the following circumstances:

       
	 	A.

        	DPL is
      a holding company headquartered in Dayton, Ohio, having as its principal
      subsidiary DP&L.

       
	 	B.

        	Mr. Koziar
      is presently employed by the Companies as Executive Vice President and Chief
      Operating Officer and has been elected by the Boards of Directors of the
      Companies to be the President and Chief Executive Officer of the Companies,
      effective upon the retirement of Allen M. Hill from such offices.

       
	 	C.

        	The Companies,
      subject to the terms and conditions set forth herein, desire to provide
      for the continued employment of Mr. Koziar as President and Chief Executive
      Officer of the Companies.

       
	     NOW,
      THEREFORE, the parties agree as follows:

       
	     Section
      1. Employment and Duties. Mr. Koziar shall serve as President and
      Chief Executive Officer of the Companies during the Term and Mr. Koziar
      hereby accepts such employment. In such capacity, Mr. Koziar shall report
      directly to the Boards of Directors of the Companies, shall have the duties
      customarily performed by a president and chief executive officer of a similarly
      situated company, and, in addition, shall specifically be responsible for
      working with the Companies and the DPL Board of Directors to formulate and
      implement a key executive succession plan, including with respect to the
      position of President and Chief Executive Officer of the Companies. Mr.
      Koziar shall also perform such other and further duties as may be assigned
      to him from time to time by DPL’s Board of Directors. During the Term,
      Mr. Koziar shall devote his entire business time and attention to the performance
      of his duties hereunder and shall use his best efforts to perform his duties
      hereunder faithfully and efficiently.

       
	     Section
      2. Term. The term of this Agreement (the “Term”) shall
      commence on January 1, 2003 and shall continue until December 31, 2005 or
      until terminated in accordance with Section 7, whichever shall first occur.

       
	     Section
      3. Compensation. As compensation for his services hereunder, Mr.
      Koziar shall receive the following:

       
	 	 	(a)   Base
      Salary. Mr. Koziar shall receive a base salary at the annual rate of
      $600,000 or such greater amount as the Board of Directors of DPL may determine

       







 

  
     from time to time
      in its sole discretion (the “Base Salary”), to be paid in installments
      in accordance with the Companies’ customary payroll practices.
    

     (b) Participation
      in MICP. For each calendar year during the Term, Mr. Koziar shall
      continue to have the opportunity to receive an annual bonus under DP&L’s
      Management Incentive Compensation Plan (“MICP).  

     (c) Stock Options.
      Options under DPL’s Stock Option Plan, in addition to those previously
      granted to Mr. Koziar, may be granted to Mr. Koziar in DPL’s sole discretion.
    

     (d) Other Incentive
      Programs. During the Term, Mr. Koziar shall have the opportunity
      to participate in other incentive programs in which executive level employees
      of the Companies generally participate.  

     (e) Fringe Benefits.
      During the Term, Mr. Koziar shall be entitled to receive such fringe benefits
      (including, medical, life and disability insurance benefits and retirement
      benefits) as are generally made available to other executive level employees
      of the Companies in accordance with the plans, practices, programs and policies
      of the Companies in effect from time to time, including, without limitation,
      continued participation in DP&L’s Key Employees Deferred Compensation
      Plan. 

  



      Section
  4. Vacations. During the Term, Mr. Koziar shall be entitled to paid
  vacation time of five (5) weeks annually.  

      Section
  5. Expenses. The Companies shall reimburse Mr. Koziar for all reasonable
  out-of-pocket expenses properly incurred by his in connection with the performance
  of his duties hereunder in accordance with the policies established from time
  to time by the Companies, including, without limitation, expenses associated
  with any off premises office and travel to and from such office.  

      Section
  6. Withholdings. The Companies may withhold from any amounts payable
  to Mr. Koziar hereunder such federal, state or local taxes or other amounts
  as the Companies shall be required to withhold pursuant to applicable law. 


      Section
  7. Termination. (a) This Agreement and Mr. Koziar’s employment
  with the Companies may be terminated at any time, with or without cause, by
  either the Companies or Mr. Koziar upon one hundred eighty (180) days’
  prior written notice; provided this Agreement and Mr. Koziar’s employment
  with the Companies may be terminated by the Companies for Cause without prior
  notice.  

           (b)
  In addition, this Agreement and Mr. Koziar’s employment with the Companies
  shall automatically terminate upon Mr. Koziar’s death or Disability; provided,
  however, that in the event of such termination due to Mr. Koziar’s death
  or Disability, the Companies shall pay to Mr. Koziar or his estate the Base
  Salary through December 31, 2005. 

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           (c)
  Upon the termination of this Agreement for any reason, this Agreement shall
  forthwith be of no further force and effect and there shall be no further liability
  on the part of either party, other than based upon (i) its obligations under
  this Agreement arising or accruing prior to such termination, (ii) the obligations
  of such party contained in any other agreement between the parties, including,
  without limitation, any agreement providing for the payment of benefits in the
  event of a change of control of the Companies, or (iii) the obligations in Section
  7(b) above or in Section 7(d) below, if applicable.  

           (d)
  In addition to the obligations under (c) above, if this Agreement is terminated
  prior to the expiration of the Term by (i) the Company without Cause (other
  than after a change of control, as a result of which, Mr. Koziar is entitled
  to payment of benefits under any other agreement with the Companies), or (ii)
  by Mr. Koziar, and at the time of such determination, any of the following executive
  positions are filled by more than one person: President or Chief Operating Officer
  of 1) DPL, 2) DP&L or 3) DPL Energy LLC, then;  

                (aa)
  the Companies shall continue to pay Mr. Koziar the Base Salary under Section
  3(a) through December 31, 2005;  

                (bb)
  DP&L shall pay to Mr. Koziar in accordance with the terms of the MICP the
  annual bonus that he would have received under the MICP for the year during
  which termination occurs had he been in the employ of the Companies under this
  Agreement as of the last day of such year;  

                
  (cc) any unvested options granted to Mr. Koziar under DPL’s Stock Option
  Plan shall be deemed to be fully vested as of the date of termination notwithstanding
  the provisions of any agreement between Mr. Koziar and DPL with respect to such
  options; and  

                (dd)
  through December 31, 2005, Mr. Koziar shall be on call to assist the Company
  in effecting a transition to a successor to his positions; provided, however,
  that during such period (1) Mr. Koziar shall not be required to perform such
  transition services for more than 80 hours per month with the scheduling of
  such services to be as mutually agreed between Mr. Koziar and the Companies;
  (2) the Companies at their expense shall provide Mr. Koziar with the use of
  corporate aircraft in order to enable Mr. Koziar to perform such services; (3)
  the Companies shall provide and/or reimburse Mr. Koziar for the cost of an executive
  office in the location of his designated residence to facilitate Mr. Koziar’s
  performance of such services; and (4) Mr. Koziar shall continue to be entitled
  to reimbursement under Section 5 hereof.  

      Section 8. Confidentiality.
  During the Term and indefinitely thereafter, Mr. Koziar (i) shall keep and
  hold all confidential, nonpublic and/or proprietary information (including,
  without limitation, any information which may constitute a “trade secret”
  within the meaning of Ohio law) of, or relating to, either of Companies or any
  of their subsidiaries or affiliates in strict confidence and (ii) shall not,
  directly or indirectly, use or disclose to any person or entity any of such
  information, except to the extent that any such use or disclosure is related
  to the performance of his duties hereunder. Upon termination of this Agreement,
  Mr. Koziar shall  

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 promptly return to the
  Companies all documents or other written or computer readable material containing
  or reflecting any of such confidential information in his possession or control.
   

      Section
  9. Indemnification. The Companies shall indemnify Mr. Koziar against
  any and all losses, liabilities, damages, expenses (including attorneys’
  fees), judgments, fines and amounts paid in settlement incurred by Mr. Koziar
  in connection with any claim, action, suit or proceeding (whether civil, criminal,
  administrative or investigative), including any action by or in the right of
  either of the Companies, by reason of any act or omission to act in connection
  with the performance of his duties hereunder to the full extent that the Companies
  are permitted to indemnify a director, officer, employee or agent against the
  foregoing under Ohio law, including, without limitation, Section 1701.13(E)
  of the Ohio Revised Code. The Companies shall at all times cause Mr. Koziar
  to be included, in his capacities hereunder, under all directors’ and officers’
  liability insurance coverage (or similar insurance coverage) maintained by either
  of the Companies from time to time.  

      Section
  10. Legal Expenses. The Companies shall reimburse Mr. Koziar in full
  for all legal fees and expenses reasonably incurred by him in connection with
  this Agreement (including, without limitation, any such fees and expenses incurred
  in contesting or disputing any termination of this Agreement or in seeking to
  obtain or enforce any right or benefit provided herein, regardless of the outcome,
  unless, in the case of a legal action brought by Mr. Koziar or in his name,
  a court finally determines that such action was not brought in good faith).
   

      Section
  11. Certain Definitions. For purposes of this Agreement, the following
  terms have the following meanings:  

      “Cause”
  means (i) the commission of a felony, (ii) embezzlement, (iii) the illegal
  use of drugs or (iv) the failure by Mr. Koziar to substantially perform his
  duties hereunder (other than any such failure resulting from his physical or
  mental illness or other physical or mental incapacity) as determined by the
  Board of Directors of DPL. Notwithstanding the foregoing, “Cause”
  shall not be deemed to exist unless and until there shall have been delivered
  to Mr. Koziar a copy of a resolution duly adopted by the written consent of
  not less than three-fourths of the number of directors of DPL then in office
  (after reasonable notice to Mr. Koziar and an opportunity for Mr. Koziar, together
  with his counsel, to be heard at a meeting of the Board of Directors of DPL
  called and held for that purpose), finding that in the good faith opinion of
  the Board of Directors, Mr. Koziar was guilty of conduct set forth in clauses
  (i), (ii), (iii) or (iv) of the preceding sentence and specifying the particulars
  thereof in detail.  

      “Disability”
  means the inability of Mr. Koziar to perform his duties hereunder for a period
  of six consecutive months because of physical or mental illness or other physical
  or mental disability or incapacity, followed by the Companies giving Mr. Koziar
  30 days’ written notice of its intention to terminate this Agreement by
  reason thereof and Mr. Koziar’s failure because of such physical or mental
  illness or other physical or mental disability or incapacity to resume the performance
  of his duties hereunder within such 30 day period and thereafter perform the
  same for a period of two consecutive months.  

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      Section
  12. Parties in Interest. This Agreement is for the sole benefit of the
  parties and shall not create any rights to any person not a party. This Agreement
  is personal and may not be assigned by any party without the prior written consent
  of the other party. Subject to the foregoing, this Agreement shall be binding
  upon, inure to the benefit of, and be enforceable by, the respective successors
  and assigns of the parties, but on assignment shall, of itself, relieve any
  party of its obligations hereunder. 

      Section
  13. Entire Agreement. This Agreement sets forth the entire
  agreement and understandings of the parties in respect to the subject matter
  hereof.  

      Section
  14. Interpretation. The section and other headings contained in this
  Agreement are for reference purposes only and shall not affect in any way the
  meaning or interpretation of this Agreement. Words used in this Agreement in
  the singular number shall include the plural, and vice versa, unless the context
  requires otherwise. Words of gender used in this Agreement may be read as masculine,
  feminine or neuter as the context may require. The terms “this Agreement”,
  “hereto” “herein”, “hereby”, “hereof”
  and similar expressions refer to this Agreement in its entirety and not to any
  particular provision or portion of this Agreement. When a reference is made
  to Sections, such reference shall be to a Section of this Agreement, unless
  otherwise indicated. Whenever the words “include”, “includes”
  or “including” are used herein, they shall be deemed to be followed
  by the words “without limitation”. 

      Section
  15. Law Governing. This Agreement shall be governed by, and construed
  and enforced in accordance with, the laws of the State of Ohio without regard
  to its conflicts of laws rules. 

      Section
  16. Counterparts. This Agreement may be executed simultaneously in two
  or more counterparts, each of which shall be deemed an original but all of which
  taken together shall constitute one and the same instrument.  

      Section
  17. Amendment. Any amendment to this Agreement or any waiver of rights
  or any consent hereunder shall not be operative unless it is in writing and
  signed by the party sought to be charged.  

      Section
  18. Severability. If any provision of this Agreement or the application
  thereof to any party or circumstance shall be held invalid or unenforceable
  to any extent, the remainder of this Agreement and the application of such provision
  to another party or circumstance shall not be affected thereby and such provision
  shall be enforced to the greatest extent permitted by applicable law. 


      Section
  19. Waiver. The failure or delay on the part of any party to insist
  upon strict performance of any of the terms or conditions of this Agreement
  will not constitute a waiver of any of its rights hereunder. No right or remedy
  herein conferred upon or reserved to any party is intended to be exclusive of
  any other right or remedy and all such rights and remedies shall be cumulative.
   

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      IN
  WITNESS WHEREOF, the parties have executed this Agreement as of the date first
  written above.  

	 	DPL INC.
      
	 	 	 
	 	By: 	 
	 	 	

	 	 Its:	 
	 	 	

	 	 	 
	 	THE DAYTON
      POWER AND
 LIGHT
      COMPANY 
	 	 
	 	By: 	 
	 	 	

	 	 Its:	 
	 	 	

	 	 	 
	 	 	 
	 	 	 
	 	

	 	Stephen
      F. Koziar, Jr.
	 	 	 


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