Document:

EX-10.1

Exhibit 10.1

FORM OF EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT dated as of May 1, 2006, by and between PIEDMONT NATURAL GAS
COMPANY, INC., a North Carolina corporation (the “Corporation”), and,      , (the
“Officer”).

W I T N E S S E T H:

WHEREAS, the Board of Directors of the Corporation has determined that the continued retention
of the services of the Officer on a long-term basis as described herein is in the best interest of
the Corporation in that (a) it promotes the stability of senior management of the Corporation;
(b) it enables the Corporation to obtain and retain the services of a well-qualified executive
officer with extensive contacts in the natural gas industry; and (c) it secures the continued
services of the Officer notwithstanding any change in control of the Corporation; and

WHEREAS, the services of the Officer, his experience and knowledge of the Corporation’s
industry, and his reputation and contacts in the Corporation’s industry are valuable to the
Corporation; and

WHEREAS, the Corporation considers the establishment and maintenance of a sound and vital
management to be part of its overall corporate strategy and to be essential to protecting and
enhancing the best interests of the Corporation and its stockholders; and

WHEREAS, the parties desire to enter into this Agreement in order to clearly set forth the
terms and conditions of the Officer’s employment relationship with the Corporation; and

WHEREAS, contemporaneous with this Agreement, the parties have entered into a Severance
Agreement (the “Severance Agreement”), which sets forth certain rights and obligations of the
Officer and certain rights and obligations of the Corporation in the event of a “Potential Change
of Control” (as defined in the Severance Agreement) or following a “Change in Control” (as defined
in the Severance Agreement). Use of the phrases “Potential Change of Control” and “Change in
Control” herein shall have the meanings ascribed to those phrases in the Severance Agreement.

NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the
parties hereby agree as follows:

1. Employment. The Corporation hereby employs the Officer and the Officer hereby
accepts such employment, upon the terms and conditions stated herein, as Senior Vice President –
     . The Officer shall render such administrative and management services to the
Corporation as are customarily performed by persons situated in a similar executive capacity. The
Officer shall promote the business of the Corporation and perform such other duties as shall from
time to time be reasonably prescribed by the Directors or the Chief Executive Officer of the
Corporation. It is understood that the Officer’s continued election as an officer of the
Corporation is dependent upon action by the Board of Directors of the Corporation from time to time
and that, subject to the provisions of Section 7 of this Agreement, the Officer’s title and/or
duties may change from time to time; provided that following a Change in Control and during the
term of the Severance Agreement any action affecting a change in title and/or duties shall be
subject to the Severance Agreement.

2. Base Salary. The Corporation shall pay the Officer during the term of this
Agreement as compensation for all services rendered by him to the Corporation a base salary in such
amounts and at such intervals as shall be commensurate with his duties and responsibilities
hereunder. Initially such base salary shall be at the rate of $    per year. The Officer’s
base salary may be increased from time to time to reflect the duties required of the Officer. In
reviewing the Officer’s base salary, the Board of Directors of the Corporation shall consider the
overall performance of the Corporation, the overall performance of the Officer and the service of
the Officer rendered to the Corporation and its subsidiaries and changes in the cost of living.
The Board of Directors may also provide for performance or merit increases. Participation by
Officer in any incentive, deferred compensation, stock option, stock purchase, bonus, pension, life
insurance or other employee benefit plans which may be offered by the Corporation from time to time
and participation in any fringe benefits provided by the Corporation shall not cause a reduction of
the base salary payable to the Officer. The Officer will be entitled to such customary fringe
benefits, vacation and sick leave as are consistent with the normal practices and established
policies of the Corporation.

3. Participation in Incentive, Retirement and Employee Benefit Plans; Fringe Benefits.
The Officer shall be entitled to participate in any plan relating to incentive compensation, stock
options, stock purchase, pension, thrift, profit sharing, group life insurance, medical coverage,
disability coverage, education, or other retirement or employee benefits that the Corporation has
adopted, or may from time to time adopt, for the benefit of its executive employees and for
employees generally, subject to the eligibility rules of such plans.

The Officer shall also be entitled to participate in any other fringe benefits which are now
or may be or become applicable to the Corporation’s executive employees, including the payment of
reasonable expenses for attending annual and periodic meetings of trade associations, and any other
benefits which are commensurate with the duties and responsibilities to be performed by the Officer
under this Agreement. Additionally, the Officer shall be entitled to such vacation and sick leave
as shall be established under uniform employee policies promulgated by the Board of Directors. The
Corporation shall reimburse the Officer for all out-of-pocket reasonable and necessary business
expenses which the Officer may incur in connection with his service on behalf of the Corporation.

4. Term. The initial term of employment under this Agreement shall be for a one-year
period commencing May 1, 2006; provided that this Agreement shall automatically be extended
to a full one-year period on each successive day during the term of this Agreement. The effect
hereof shall be that the Agreement shall at all times remain subject to a term of one year, unless
(i) written notice has been given that the Agreement shall not be extended as provided in this
Section 4, or (ii) the Agreement is terminated pursuant to Section 7. If written notice from the
Corporation or the Officer is delivered to the other party advising the other party that this
Agreement is not to be further extended, then upon such notice, the Agreement shall terminate on
the anniversary of the date of notice. Provided, further, no extension shall cause this
Agreement to extend beyond the date on which the Officer reaches 65 years of age. Upon any
extension, the base salary of the extended agreement shall be the base salary in effect on the
effective date of such extension.

5. Loyalty; Noncompetition

(a) The Officer shall devote his best efforts to the performance of his duties and
responsibilities under this Agreement.

(b) During the term of this Agreement, or any renewals hereof, the Officer agrees he will not,
own, manage, operate, join, control or participate in the management, operation or control of, or
be employed by or connected in any manner with any business which competes with the Corporation or
any of its subsidiary corporations without the prior written consent of the Corporation.
Notwithstanding the foregoing, the Officer shall be free, without such consent, to purchase or hold
as an investment or otherwise, up to five percent of the outstanding stock or other securities of
any corporation which has its securities publicly traded on any recognized securities exchange or
in any established over-the-counter market.

The Officer shall hold in confidence all knowledge or information of a confidential nature
with respect to the business of the Corporation or any subsidiary of the Corporation received by
him during the term of this Agreement and will not disclose or make use of such information without
the prior written consent of the Corporation.

The Officer acknowledges that it would not be possible to ascertain the amount of monetary
damages in the event of a breach by the Officer under the provisions of this Section 5 and agrees
that, in the event of a breach of this Section, injunctive relief enforcing the terms of this
Section is an appropriate remedy.

6. Standards. The Officer shall perform his duties and responsibilities under this
Agreement in accordance with such reasonable standards expected of employees with comparable
positions in comparable organizations and as may be established from time to time by the Board of
Directors. The Corporation will provide the Officer with the working facilities and staff
customary for similar executives and necessary for him to perform his duties.

7. Termination and Termination Pay.

(a) Change of Control. Following a Change in Control and during the term of the
Severance Agreement, this Agreement shall become null and void except with respect to any rights or
obligations accruing prior to the Change in Control and the rights and obligations of the Officer
and the Company, including any termination of the Officer, shall be subject to the provisions of
the Severance Agreement.

(b) By Death. The Officer’s employment under this Agreement shall be terminated upon
the death of the Officer during the term of this Agreement, in which event the Officer’s estate
shall be entitled to receive all compensation due the Officer through the last day of the calendar
month in which his death shall have occurred.

(c) By Total Disability. Except for that period of time following a Change in Control
and during the term of the Severance Agreement, the Officer’s employment under this Agreement shall
be terminated upon the total permanent disability of the Officer during the term of this Agreement,
in which event the Officer shall receive all compensation, including bonuses, through the date of
determination of such disability and for a period of 90 days thereafter. For purposes of this
Section, the Officer shall be deemed to have suffered permanent disability upon the determination
of such status by the United States Social Security Administration or a certification to such
effect by the Officer’s regular physician.

(d) By Officer. Except as provided in Section 4 of the Severance Agreement, the
Officer’s employment under this Agreement may be terminated at any time by the Officer upon 60
days’ written notice to the Board of Directors. Upon such termination, the Officer shall be
entitled to receive all compensation, including bonuses, through the effective date of such
termination.

(e) By Corporation. Except for that period of time following a Change of Control and
during the term of the Severance Agreement, the Board of Directors may terminate the Officer’s
employment at any time, but any such termination by the Board of Directors, other than termination
for cause, shall not prejudice the Officer’s right to continue to receive payment of all
compensation and the continuance of benefits for a period of 12 months from the effective date of
termination or until such time as the Officer reaches 65 years of age (whichever is less) as
provided below. The Officer shall have no right to receive compensation or other benefits (other
than vested benefits) for any period after “termination for cause.” Termination for cause shall
mean termination because of the Officer’s personal dishonesty, incompetence, willful material
misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform
stated duties, willful material violation of a law, rule or regulation (other than traffic or
traffic-related violations or similar offenses) or final cease-and-desist order, or material breach
of any provisions of this Agreement.

(f) Costs and Expenses. In the event any dispute shall arise between the Officer and
the Corporation as to the terms or interpretation of this Agreement, including this Section 7,
whether instituted by formal legal proceedings or otherwise, including any action taken by Officer
to enforce the terms of this Section 7 or in defending against any action taken by the Corporation,
the Corporation shall reimburse the Officer for all costs and expenses, proceedings or actions in
the event the Officer prevails in any such action.

8. Successors and Assigns.

(a) This Employment Agreement shall inure to the benefit of and be binding upon any corporate
or other successor of the Corporation that shall acquire, directly or indirectly, by conversion,
merger, consolidation, purchase or otherwise, all or substantially all of the assets of the
Corporation.

(b) Since the Corporation is contracting for the unique and personal skills of the Officer,
the Officer shall be precluded from assigning or delegating his rights or duties hereunder without
first obtaining the written consent of the Corporation.

9. Modification; Waiver; Amendments. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to in writing, signed
by the Officer and on behalf of the Corporation by such officer as may be specifically designated
by the Board of Directors. No waiver by either party hereto at any time of any breach by the other
party hereto of, or compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No amendments or additions to this Agreement shall be
binding unless in writing and signed by both parties, except as herein otherwise provided. Any
modification, waiver or amendment shall be made consistent with the terms and conditions of the
Severance Agreement.

10. Applicable Law. This Agreement shall be governed in all respects whether as to
validity, construction, capacity, performance or otherwise, by the laws of North Carolina.

11. Severability. The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity or enforceability of
the other provisions hereof.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first
hereinabove written.

CORPORATION:

ATTEST

Piedmont Natural Gas Company, Inc.

     

Secretary

By:

Thomas E. Skains

President & CEO

OFFICER:

By:      Name of

Officer

Address:      

     

Employment Agreement reviewed and approved by the Board of Directors this      Day of     , 200_.

	 	 	 
	By:

	 	

	
 
	 	 
	
 
	 	John W. Harris

Chairman of Compensation CommitteeEX-10.2

Exhibit 10.2

FORM OF SEVERANCE AGREEMENT

THIS AGREEMENT, dated May 1, 2006, is made by and between PIEDMONT NATURAL GAS COMPANY, INC.,
a North Carolina corporation (the “Company”), and      (the “Executive”).

WHEREAS, the Company considers it essential to the best interests of its shareholders to
foster the continued employment of key management personnel; and

WHEREAS, the Board of the Company recognizes that, as is the case with many publicly held
corporations, the possibility of a Change in Control exists and that such possibility, and the
uncertainty and questions which it may raise among management, may result in the departure or
distraction of management personnel to the detriment of the Company and its shareholders; and

WHEREAS, the Board has determined that appropriate steps should be taken to reinforce and
encourage the continued attention and dedication of members of the Company’s management, including
the Executive, to their assigned duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a Change in Control; and

WHEREAS, contemporaneous with this Agreement, the Company and the Executive have entered into
an Employment Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained,
the Company and the Executive hereby agree as follows:

1. Defined Terms. The definitions of capitalized terms used in this Agreement are
provided in the last Section hereof.

2. Term of Agreement. The Term of this Agreement shall commence on the date hereof
and shall continue in effect through December 31, 2006; provided, however, that commencing on
January 1, 2007 and each January 1 thereafter, the Term shall automatically be extended for one
additional year unless, not later than fifteen (15) months prior to the applicable January 1, the
Company or the Executive shall have given notice not to extend the Term; and further provided,
however, that if a Change in Control shall have occurred during the Term, the Term shall expire at
the end of the thirty-sixth (36th) calendar month after the calendar month in which such Change in
Control occurred. For example, if a Change in Control were to occur on July 1, 2006, the Term of
this Agreement would expire on June 30, 2009, and if a Change in Control were to occur on July 1,
2009, the Term of this Agreement would expire on June 30, 2012 (regardless of whether on or before
September 30, 2006 either party had given notice to the other party not to extend the Term as
provided above).

3. Company’s Covenants Summarized. In order to induce the Executive to remain
in the employ of the Company and in consideration of the Executive’s covenants set forth in Section
4 hereof, the Company agrees, under the conditions described herein, to pay the Executive the
Severance Payments and the other payments and benefits described herein. Except as provided in
Section 9.1 hereof, no Severance Payments shall be payable under this Agreement unless there shall
have been (or, under the terms of the second sentence of Section 6.1 hereof, there shall be deemed
to have been) a termination of the Executive’s employment with the Company following a Change in
Control and during the Term. This Agreement shall not be construed as creating an express or
implied contract of employment and, except as otherwise agreed in writing between the Executive and
the Company, the Executive shall not have any right to be retained in the employ of the Company.

4. The Executive’s Covenants. The Executive agrees that, subject to the terms and
conditions of this Agreement, in the event of a Potential Change in Control during the Term, the
Executive will remain in the employ of the Company until the earliest of (i) a date which is twelve
(12) months from the date of such Potential Change of Control, (ii) the date of a Change in
Control, (iii) the date of termination by the Executive of the Executive’s employment for Good
Reason or by reason of death, Disability or Retirement, or (iv) the termination by the Company of
the Executive’s employment for any reason. Should the Executive fail to comply with the provisions
of this paragraph 4, the Company’s sole remedy shall be to deny the payment of any Severance
Payments to the Executive.

5. Compensation Other Than Severance Payments.

5.1 Following a Change in Control and during the Term, during any period that the Executive
fails to perform the Executive’s full-time duties with the Company as a result of incapacity due to
physical or mental illness, the Company shall pay the Executive’s full salary to the Executive at
the rate in effect at the commencement of any such period, together with all compensation and
benefits payable to the Executive under the terms of any compensation, benefit or incentive plan,
program or arrangement maintained by the Company during such period, until the Executive’s
employment is terminated by the Company for Disability.

5.2 If the Executive’s employment shall be terminated for any reason following a Change in
Control and during the Term, the Company shall pay the Executive’s full salary to the Executive
through the Date of Termination at the rate in effect immediately prior to the Date of Termination
or, if higher, the rate in effect immediately prior to the first occurrence of an event or
circumstance constituting Good Reason, together with all compensation and benefits payable to the
Executive through the Date of Termination under the terms of the Company’s executive compensation,
benefit and incentive plans, programs or arrangements as in effect immediately prior to the Date of
Termination or, if more favorable to the Executive, as in effect immediately prior to the first
occurrence of an event or circumstance constituting Good Reason.

5.3 If the Executive’s employment shall be terminated for any reason following a Change in
Control and during the Term, the Company shall pay to the Executive the Executive’s normal
post-termination compensation and benefits as such payments become due, including in a lump sum in
cash that portion of the Executive’s vacation pay vested and accrued but not paid. Such
post-termination compensation and benefits shall be determined under, and paid in accordance with,
the Company’s long-term incentive stock plan, pension, supplemental retirement, insurance and other
executive compensation, benefit or incentive plans, programs and arrangements as in effect
immediately prior to the Date of Termination or, if more favorable to the Executive, as in effect
immediately prior to the occurrence of the first event or circumstance constituting Good Reason.

6. Severance Payments.

6.1 Subject to Section 6.2 hereof, if the Executive’s employment is terminated following a
Change in Control and during the Term, other than (A) by the Company for Cause, (B) by reason of
the Executive’s death or Disability, or (C) by the Executive without Good Reason (including
Retirement by the Executive), then the Company shall pay the Executive the amounts, and provide the
Executive the benefits, described in this Section 6.1 (“Severance Payments”), in addition to any
payments and benefits to which the Executive is entitled under Section 5 hereof. For purposes of
this Agreement, the Executive’s employment shall be deemed to have been terminated following a
Change in Control by the Company without Cause or by the Executive with Good Reason, if (i) the
Executive’s employment is terminated by the Company without Cause prior to a Change in Control
(whether or not a Change in Control ever occurs) and such termination was at the request or
direction of a Person who has entered into an agreement with the Company the consummation of which
would constitute a Change in Control, (ii) the Executive terminates his employment for Good Reason
prior to a Change in Control (whether or not a Change in Control ever occurs) and the circumstance
or event which constitutes Good Reason occurs at the request or direction of such Person, or
(iii) the Executive’s employment is terminated by the Company without Cause or by the Executive for
Good Reason and such termination or the circumstance or event which constitutes Good Reason is
otherwise in connection with or in anticipation of a Change in Control (whether or not a Change in
Control ever occurs). For purposes of any determination regarding the applicability of the
immediately preceding sentence, any position taken by the Executive shall be presumed to be correct
unless the Company establishes by clear and convincing evidence that such position is not correct.

(A) In lieu of any further salary payments to the Executive for periods subsequent to the Date
of Termination and in lieu of any severance benefit otherwise payable to the Executive, the Company
shall pay to the Executive a lump sum severance payment, in cash, equal to 3.00 times the sum of
(i) the Executive’s annual base salary as in effect immediately prior to the Date of Termination
or, if higher, in effect immediately prior to the first occurrence of an event or circumstance
constituting Good Reason and (ii) an amount equal to the average of the Executive’s annual W-2
Compensation for the three years ending on the last day of the month prior to the Date of
Termination.

(B) For the 36-month period immediately following the Date of Termination, the Company shall
arrange to provide the Executive and his dependents life, disability, accident and health insurance
benefits substantially similar to those provided to the Executive and his dependents immediately
prior to the Date of Termination or, if more favorable to the Executive, those provided to the
Executive and his dependents immediately prior to the first occurrence of an event or circumstance
constituting Good Reason, at no greater cost to the Executive than the cost to the Executive
immediately prior to such date or occurrence; provided, however, that, unless the Executive
consents to a different method (after taking into account the effect of such method on the
calculation of “parachute payments” pursuant to Section 6.2 hereof), such health insurance benefits
shall be provided through a third-party insurer. Benefits otherwise receivable by the Executive
pursuant to this Section 6.1(B) shall be reduced to the extent benefits of the same type are
received by or made available to the Executive during the 36-month period following the Executive’s
termination of employment (and any such benefits received by or made available to the Executive
shall be reported to the Company by the Executive); provided, however, that the Company shall
reimburse the Executive for the excess, if any, of the cost of such benefits to the Executive over
such cost immediately prior to the Date of Termination or, if more favorable to the Executive, the
first occurrence of an event or circumstance constituting Good Reason. If the Severance Payments
shall be decreased pursuant to Section 6.2 hereof, and the Section 6.1(B) benefits which remain
payable after the application of Section 6.2 hereof are thereafter reduced pursuant to the
immediately preceding sentence, the Company shall, no later than five (5) business days following
such reduction, pay to the Executive the least of (a) the amount of the decrease made in the
Severance Payments pursuant to Section 6.2 hereof, (b) the amount of the subsequent reduction in
these Section 6.1(B) benefits, or (c) the maximum amount which can be paid to the Executive without
being, or causing any other payment to be, nondeductible by reason of section 280G of the Code.

6.2 (A) Notwithstanding any other provisions of this Agreement, in the event that any payment
or benefit received or to be received by the Executive in connection with a Change in Control or
the termination of the Executive’s employment (whether pursuant to the terms of this Agreement or
any other plan, arrangement or agreement with the Company, any Person whose actions result in a
Change in Control or any Person affiliated with the Company or such Person) (all such payments and
benefits, including the Severance Payments, being hereinafter called “Total Payments”) would not be
deductible (in whole or part), by the Company, an affiliate or Person making such payment or
providing such benefit as a result of section 280G of the Code, then, to the extent necessary to
make such portion of the Total Payments deductible (and after taking into account any reduction in
the Total Payments provided by reason of section 280G of the Code in such other plan, arrangement
or agreement), the cash Severance Payments shall first be reduced (if necessary, to zero), and all
other Severance Payments shall thereafter be reduced (if necessary, to zero); provided, however,
that the Executive may elect to have the noncash Severance Payments reduced (or eliminated) prior
to any reduction of the cash Severance Payments.

(B) For purposes of this limitation, (i) no portion of the Total Payments the receipt or
enjoyment of which the Executive shall have waived at such time and in such manner as not to
constitute a “payment” within the meaning of section 280G(b) of the Code shall be taken into
account, (ii) no portion of the Total Payments shall be taken into account which, in the opinion of
tax counsel (“Tax Counsel”) reasonably acceptable to the Executive and selected by the accounting
firm which was, immediately prior to the Change in Control, the Company’s independent auditor (the
“Auditor”), does not constitute a “parachute payment” within the meaning of section 280G(b)(2) of
the Code, including by reason of section 280G(b)(4)(A) of the Code, (iii) the Severance Payments
shall be reduced only to the extent necessary so that the Total Payments (other than those referred
to in clauses (i) or (ii)) in their entirety constitute reasonable compensation for services
actually rendered within the meaning of section 280G(b)(4)(B) of the Code or are otherwise not
subject to disallowance as deductions by reason of section 280G of the Code, in the opinion of Tax
Counsel, and (iv) the value of any noncash benefit or any deferred payment or benefit included in
the Total Payments shall be determined by the Auditor in accordance with the principles of sections
280G(d)(3) and (4) of the Code.

(C) If it is established pursuant to a final determination of a court or an Internal Revenue
Service proceeding that, notwithstanding the good faith of the Executive and the Company in
applying the terms of this Section 6.2, the Total Payments paid to or for the Executive’s benefit
are in an amount that would result in any portion of such Total Payments being subject to the
Excise Tax under section 4999 of the Code, then, if such repayment would result in (i) no portion
of the remaining Total Payments being subject to the Excise Tax and (ii) a dollar-for-dollar
reduction in the Executive’s taxable income and wages for purposes of federal, state and local
income and employment taxes, the Executive shall have an obligation to pay the Company upon demand
an amount equal to the sum of (i) the excess of the Total Payments paid to or for the Executive’s
benefit over the Total Payments that could have been paid to or for the Executive’s benefit without
any portion of such Total Payments being subject to the Excise Tax; and (ii) interest on the amount
set forth in clause (i) of this sentence at the rate provided in section 1274(b)(2)(B) of the Code
from the date of the Executive’s receipt of such excess until the date of such payment.

6.3 The payments provided in subsection (A) of Section 6.1 hereof shall be made not later than
the fifth day following the Date of Termination; provided, however, that if the amounts of such
payments, and the limitation on such payments set forth in Section 6.2 hereof, cannot be finally
determined on or before such day, the Company shall pay to the Executive on such day an estimate,
as determined in good faith by the Company of the minimum amount of such payments to which the
Executive is clearly entitled and shall pay the remainder of such payments (together with interest
on the unpaid remainder (or on all such payments to the extent the Company fails to make such
payments when due) at 120% of the rate provided in section 1274(b)(2)(B) of the Code) as soon as
the amount thereof can be determined but in no event later than the thirtieth (30th) day after the
Date of Termination. In the event that the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall constitute a loan by the Company to the
Executive, payable on the fifth (5th) business day after demand by the Company (together with
interest at 120% of the rate provided in section 1274(b)(2)(B) of the Code). At the time that
payments are made under this Agreement, the Company shall provide the Executive with a written
statement setting forth the manner in which such payments were calculated and the basis for such
calculations including, without limitation, any opinions or other advice the Company has received
from Tax Counsel, the Auditor or other advisors or consultants (and any such opinions or advice
which are in writing shall be attached to the statement).

7. Termination Procedures and Compensation During Dispute.

7.1 Notice of Termination. After a Change in Control and during the Term, any
purported termination of the Executive’s employment (other than by reason of death) shall be
communicated by written Notice of Termination from one party hereto to the other party hereto in
accordance with Section 10 hereof. For purposes of this Agreement, a “Notice of Termination” shall
mean a notice which shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive’s employment under the provision so indicated. Further, a Notice of
Termination for Cause is required to include a copy of a resolution duly adopted by the affirmative
vote of not less than three-quarters (3/4) of the entire membership of the Board at a meeting of
the Board that was called and held for the purpose of considering such termination (after
reasonable notice to the Executive and an opportunity for the Executive, together with the
Executive’s counsel, to be heard before the Board) finding that, in the good faith opinion of the
Board, the Executive was guilty of conduct set forth in clause (i) or (ii) of the definition of
Cause herein, and specifying the particulars thereof in detail.

7.2 Date of Termination. “Date of Termination” with respect to any purported
termination of the Executive’s employment after a Change in Control and during the Term, shall mean
(i) if the Executive’s employment is terminated for Disability, thirty (30) days after Notice of
Termination is given (provided that the Executive shall not have returned to the full-time
performance of the Executive’s duties during such thirty (30) day period), and (ii) if the
Executive’s employment is terminated for any other reason, the date specified in the Notice of
Termination (which, in the case of a termination by the Company, shall not be less than thirty (30)
days (except in the case of a termination for Cause) and, in the case of a termination by the
Executive, shall not be less than fifteen (15) days nor more than sixty (60) days, respectively,
from the date such Notice of Termination is given).

7.3 Dispute Concerning Termination. If within fifteen (15) days after any Notice of
Termination is given, or, if later, prior to the Date of Termination (as determined without regard
to this Section 7.3), the party receiving such Notice of Termination notifies the other party that
a dispute exists concerning the termination, the Date of Termination shall be extended until the
earlier of (i) the date on which the Term ends or (ii) the date on which the dispute is finally
resolved, either by mutual written agreement of the parties or by a final judgment, order or decree
of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to
which the time for appeal therefrom has expired and no appeal has been perfected); provided,
however, that the Date of Termination shall be extended by a notice of dispute given by the
Executive only if such notice is given in good faith and the Executive pursues the resolution of
such dispute with reasonable diligence.

7.4 Compensation During Dispute. If a purported termination occurs following a Change
in Control and during the Term and the Date of Termination is extended in accordance with Section
7.3 hereof, the Company shall continue to pay the Executive the full compensation in effect when
the notice giving rise to the dispute was given (including, but not limited to, salary) and
continue the Executive as a participant in all compensation, benefit and insurance plans in which
the Executive was participating when the notice giving rise to the dispute was given, until the
Date of Termination, as determined in accordance with Section 7.3 hereof. Amounts paid under this
Section 7.4 are in addition to all other amounts due under this Agreement (other than those due
under Section 5.2 hereof) and shall not be offset against or reduce any other amounts due under
this Agreement.

8. No Mitigation. The Company agrees that, if the Executive’s employment with the
Company terminates during the Term, the Executive is not required to seek other employment or to
attempt in any way to reduce any amounts payable to the Executive by the Company pursuant to
Section 6 hereof or Section 7.4 hereof. Further, the amount of any payment or benefit provided for
in this Agreement (other than Section 6.1(B) hereof) shall not be reduced by any compensation
earned by the Executive as the result of employment by another employer, by retirement benefits, by
offset against any amount claimed to be owed by the Executive to the Company, or otherwise.

9. Successors; Binding Agreement.

9.1 In addition to any obligations imposed by law upon any successor to the Company, the
Company will require any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place. Failure of the
Company to obtain such assumption and agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle the Executive to compensation from the
Company in the same amount and on the same terms as the Executive would be entitled to hereunder if
the Executive were to terminate the Executive’s employment for Good Reason after a Change in
Control, except that, for purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Date of Termination.

9.2 This Agreement shall inure to the benefit of and be enforceable by the Executive’s
personal or legal representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. If the Executive shall die while any amount would still be payable to the
Executive hereunder (other than amounts which, by their terms, terminate upon the death of the
Executive) if the Executive had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to the executors, personal
representatives or administrators of the Executive’s estate.

10. Notices. For the purpose of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have been duly given when
delivered or mailed by United States registered mail, return receipt requested, postage prepaid,
addressed, if to the Executive, to the address inserted below the Executive’s signature on the
final page hereof and, if to the Company, to the address set forth below, or to such other address
as either party may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon actual receipt:

To the Company:

Piedmont Natural Gas Company, Inc.

P.O. Box 33068

Charlotte, North Carolina 28233

Attention: Vice President and General Counsel

11. Miscellaneous. No provision of this Agreement may be modified, waived or
discharged unless such waiver, modification or discharge is agreed to in writing and signed by the
Executive and such officer as may be specifically designated by the Board. No waiver by either
party hereto at any time of any breach by the other party hereto of, or of any lack of compliance
with, any condition or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. This Agreement supersedes any other agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof which have been made by
either party; provided, however, that this Agreement shall supersede any agreement setting forth
the terms and conditions of the Executive’s employment with the Company only in the event that the
Executive’s employment with the Company is terminated on or following a Change in Control (i) by
the Company other than for Cause or (ii) by the Executive for Good Reason. The validity,
interpretation, construction and performance of this Agreement shall be governed by the laws of the
State of North Carolina. All references to sections of the Exchange Act or the Code shall be deemed
also to refer to any successor provisions to such sections. Any payments provided for hereunder
shall be paid net of any applicable withholding required under federal, state or local law and any
additional withholding to which the Executive has agreed. The obligations of the Company and the
Executive under this Agreement which by their nature may require either partial or total
performance after the expiration of the Term (including, without limitation, those under Sections 6
and 7 hereof) shall survive such expiration.

12. Validity. The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of any other provision of this Agreement, which
shall remain in full force and effect.

13. Counterparts. This Agreement may be executed in several counterparts, each of
which shall be deemed to be an original but all of which together will constitute one and the same
instrument.

14. Settlement of Disputes; Arbitration.

14.1 All claims by the Executive for benefits under this Agreement shall be directed to and
determined by the Board and shall be in writing. Any denial by the Board of a claim for benefits
under this Agreement shall be delivered to the Executive in writing and shall set forth the
specific reasons for the denial and the specific provisions of this Agreement relied upon. The
Board shall afford a reasonable opportunity to the Executive for a review of the decision denying a
claim and shall further allow the Executive to appeal to the Board a decision of the Board within
sixty (60) days after notification by the Board that the Executive’s claim has been denied.

14.2 Any further dispute or controversy arising under or in connection with this Agreement
shall be settled exclusively by arbitration in Charlotte, North Carolina in accordance with the
rules of the American Arbitration Association then in effect; provided, however, that the
evidentiary standards set forth in this Agreement shall apply. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction. Notwithstanding any provision of this
Agreement to the contrary, the Executive shall be entitled to seek specific performance of the
Executive’s right to be paid until the Date of Termination during the pendency of any dispute or
controversy arising under or in connection with this Agreement.

15. Definitions. For purposes of this Agreement, the following terms shall have the
meanings indicated below:

(A) “Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of
the Exchange Act.

(B) “Auditor” shall have the meaning set forth in Section 6.2 hereof.

(C) “Base Amount” shall have the meaning set forth in section 280G(b)(3) of the Code.

(D) “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act.

(E) “Board” shall mean the Board of Directors of the Company.

(F) “Cause” for termination by the Company of the Executive’s employment shall mean (i) the
willful and continued failure by the Executive to substantially perform the Executive’s duties with
the Company (other than any such failure resulting from the Executive’s incapacity due to physical
or mental illness or any such actual or anticipated failure after the issuance of a Notice of
Termination for Good Reason by the Executive pursuant to Section 7.1 hereof) which failure shall
continue unabated for thirty (30) days after a written demand for substantial performance is
delivered to the Executive by the Board, which demand specifically identifies the manner in which
the Board believes that the Executive has not substantially performed the Executive’s duties, or
(ii) the willful engaging by the Executive in conduct which is demonstrably and materially
injurious to the Company or its subsidiaries, monetarily or otherwise. For purposes of clauses (i)
and (ii) of this definition, (x) no act, or failure to act, on the Executive’s part shall be deemed
“willful” unless done, or omitted to be done, by the Executive not in good faith and without
reasonable belief that the Executive’s act, or failure to act, was in the best interest of the
Company and (y) in the event of a dispute concerning the application of this provision, no claim by
the Company that Cause exists shall be given effect unless the Company establishes by clear and
convincing evidence that Cause exists.

(G) A “Change in Control” shall be deemed to have occurred if the event set forth in any one
of the following paragraphs shall have occurred:

(I) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of
the Company (not including in the securities beneficially owned by such Person any securities
acquired directly from the Company or its affiliates) representing 20% or more of the combined
voting power of the Company’s then outstanding securities, excluding any Person who becomes such a
Beneficial Owner in connection with a transaction described in clause (i) of paragraph (III) below;
or

(II) the following individuals cease for any reason to constitute a majority of the number of
directors then serving: individuals who, on the date hereof, constitute the Board and any new
director (other than a director whose initial assumption of office is in connection with an actual
or threatened election contest, including but not limited to a consent solicitation, relating to
the election of directors of the Company) whose appointment or election by the Board or nomination
for election by the Company’s shareholders was approved or recommended by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors on the date hereof
or whose appointment, election or nomination for election was previously so approved or
recommended; or

(III) there is consummated a merger or consolidation of the Company or any direct or indirect
subsidiary of the Company with any other corporation, other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding immediately prior to such
merger or consolidation continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or any parent thereof), in combination
with the ownership of any trustee or other fiduciary holding securities under an employee benefit
plan of the Company or any subsidiary of the Company, at least 50% of the combined voting power of
the securities of the Company or such surviving entity or any parent thereof outstanding
immediately after such merger or consolidation, or (ii) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no Person is or
becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including
in the securities Beneficially owned by such Person any securities acquired directly from the
Company or its Affiliates other than in connection with the acquisition by the Company or its
Affiliates of a business) representing 20% or more of the combined voting power of the Company’s
then outstanding securities; or

(IV) the shareholders of the Company approve a plan of complete liquidation or dissolution of
the Company or there is consummated an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets, other than a sale or disposition by the Company of
all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting
power of the voting securities of which are owned by shareholders of the Company in substantially
the same proportions as their ownership of the Company immediately prior to such sale.

(H) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

(I) “Company” shall mean Piedmont Natural Gas Company, Inc. and, except in determining under
Section 15(G) hereof whether or not any Change in Control of the Company has occurred, shall
include any successor to its business and/or assets which assumes and agrees to perform this
Agreement by operation of law, or otherwise.

(J) “Date of Termination” shall have the meaning set forth in Section 7.2 hereof.

(K) “Disability” shall be deemed the reason for the termination by the Company of the
Executive’s employment, if, as a result of the Executive’s incapacity due to physical or mental
illness, the Executive shall have been absent from the full-time performance of the Executive’s
duties with the Company for a period of six (6) consecutive months, the Company shall have given
the Executive a Notice of Termination for Disability, and, within thirty (30) days after such
Notice of Termination is given, the Executive shall not have returned to the full-time performance
of the Executive’s duties.

(L) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to
time.

(M) “Executive” shall mean the individual named in the first paragraph of this Agreement.

(N) “Good Reason” for termination by the Executive of the Executive’s employment shall mean
the occurrence (without the Executive’s express written consent) after any Change in Control, or
prior to a Change in Control under the circumstances described in clauses (ii) and (iii) of the
second sentence of Section 6.1 hereof (treating all references in paragraphs (I) through (VII)
below to a “Change in Control” as references to a “Potential Change in Control”), of any one of the
following acts by the Company, or failures by the Company to act, unless, in the case of any act or
failure to act described in paragraph (I), (V), (VI) or (VII) below, such act or failure to act is
corrected prior to the Date of Termination specified in the Notice of Termination given in respect
thereof:

(I) the assignment to the Executive of any duties inconsistent with the Executive’s status as
a senior executive officer of the Company, a change in the Executive’s reporting responsibilities,
titles or offices, or a substantial adverse alteration in the nature or status of the Executive’s
responsibilities from those in effect immediately prior to the Change in Control other than any
such alteration primarily attributable to the fact that the Company may no longer be a public
company;

(II) a reduction by the Company in the Executive’s annual base salary as in effect on the
date hereof or as the same may be increased from time to time except for across-the-board salary
reductions (not to exceed 10%) similarly affecting all senior executives of the Company and all
senior executives of any Person in control of the Company including the Chief Executive Officer;

(III) the relocation of the principal executive offices to a location more than 35 miles from
the Company’s principal executive offices immediately prior to the Change in Control or the
Company’s requiring the Executive to be based anywhere other than the location of the Company’s
executive offices except for required travel on the Company’s business to an extent substantially
consistent with the Executive’s present business travel obligations;

(IV) the failure by the Company to pay to the Executive any portion of the Executive’s
current compensation or benefits except pursuant to an across-the-board compensation or benefit
deferral (not to exceed 10%) similarly affecting all senior executives of the Company and all
senior executives of any Person in control of the Company including the Chief Executive Officer, or
to pay to the Executive any portion of an installment of deferred compensation under any deferred
compensation program of the Company, within seven (7) days of the date such compensation is due;

(V) the failure by the Company to continue in effect any compensation plan in which the
Executive participates immediately prior to the Change in Control which is material to the
Executive’s total compensation, including but not limited to the Company’s long-term incentive
plans or any substitute plans adopted prior to the Change in Control, unless an equitable
arrangement (embodied in an ongoing substitute or alternative plan) has been made with respect to
such plan, or the failure by the Company to continue the Executive’s participation therein (or in
such substitute or alternative plan) on a basis not less favorable, both in terms of the amount or
timing of payment of benefits provided and the level of the Executive’s participation relative to
other participants, as existed immediately prior to the Change in Control;

(VI) the failure by the Company to continue to provide the Executive with benefits
substantially similar to those enjoyed by the Executive under any of the Company’s pension,
supplement retirement, savings, life insurance, supplemental life insurance, medical, health and
accident, or disability plans in which the Executive was participating immediately prior to the
Change in Control (except for across-the-board changes similarly affecting all senior executives of
the Company and all senior executives of any Person in control of the Company, including the Chief
Executive Officer, not to exceed 10%), the taking of any other action by the Company which would
directly or indirectly materially reduce any of such benefits or deprive the Executive of any
material fringe benefit enjoyed by the Executive at the time of the Change in Control, or the
failure by the Company to provide the Executive with the number of paid vacation days to which the
Executive is entitled either by prior written agreements or on the basis of years of service with
the Company in accordance with the Company’s normal vacation policy in effect at the time of the
Change in Control; or

(VII) any purported termination of the Executive’s employment which is not effected pursuant
to a Notice of Termination satisfying the requirements of Section 7.1 hereof; for purposes of this
Agreement, no such purported termination shall be effective.

The Executive’s right to terminate the Executive’s employment for Good Reason shall not be
affected by the Executive’s incapacity due to physical or mental illness. The Executive’s continued
employment shall not constitute consent to, or a waiver of rights with respect to, any act or
failure to act constituting Good Reason hereunder.

For purposes of any determination regarding the existence of Good Reason, any claim by the
Executive that Good Reason exists shall be presumed to be correct unless the Company establishes by
clear and convincing evidence that Good Reason does not exist.

(O) “Notice of Termination” shall have the meaning set forth in Section 7.1 hereof.

(P) “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified
and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the
Company or any of its subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its Affiliates, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, or (iv) a corporation owned,
directly or indirectly, by the shareholders of the Company in substantially the same proportions as
their ownership of stock of the Company.

(Q) “Potential Change in Control” shall be deemed to have occurred if the event set forth in
any one of the following paragraphs shall have occurred:

(I) the Company enters into an agreement, the consummation of which would result in the
occurrence of a Change in Control;

(II) the Company or any Person publicly announces an intention to take or to consider taking
actions which, if consummated, would constitute a Change in Control;

(III) any Person becomes the Beneficial owner, directly or indirectly, of securities of the
Company representing 15% or more of either the then outstanding shares of common stock of the
Company or the combined voting power of the Company’s then outstanding securities (not including in
the securities beneficially owned by such Person any securities acquired directly from the Company
or its affiliates); or

(IV) the Board adopts a resolution to the effect that, for purposes of this Agreement, a
Potential Change in Control has occurred.

( R ) “Retirement” shall be deemed the reason for the termination by the Executive of the
Executive’s employment if such employment is terminated voluntarily by the Executive in accordance
with the Company’s retirement policy, including early retirement, generally applicable to its
salaried employees.

(S) “Severance Payments” shall have the meaning set forth in Section 6.1 hereof.

(T) “Tax Counsel” shall have the meaning set forth in Section 6.2 hereof.

(U) “Term” shall mean the period of time described in Section 2 hereof (including any
extension, continuation or termination described therein).

(V) “Total Payments” shall mean those payments so described in Section 6.2 hereof.

(W) “W-2 Compensation” shall mean all amounts received for services actually rendered in the
course of employment with the Company to the extent that such amounts are includible in gross
income as wages for federal income tax purposes plus all amounts that are contributed by
the Company pursuant to a salary reduction agreement and which are not includible in the gross
income of the Executive under Code Sections 125 or 401(k) and minus all amounts includible
in the gross income of the Executive for annual base salary, expense reimbursements or allowances,
moving expenses, club initiation fees or special assessments, deferred compensation and welfare
benefits, or gross-ups for taxes.

PIEDMONT NATURAL GAS COMPANY

By:      

Thomas E. Skains

President & CEO

Name of Officer

     

Address:      

     

Employment Agreement reviewed and approved by the Board of Directors this      day of     , 200_.

By:  

John W. Harris

Chairman of Compensation Committee

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