Document:

exhibit 10(k)

Exhibit
10(k)

AMENDMENT

TO

EMPLOYMENT
AGREEMENT

 

This
Amendment to Employment Agreement is entered into effective as of the __ day of
February, 2003, by and between TXU Business Services Company, a Texas
corporation (the “Company”), and Kirk Oliver, an individual
(“Employee”).

 

WHEREAS,
the Company, as successor in interest to Texas Utilities Services Inc., and
Employee entered into that certain Employment Agreement dated as of September 1,
1998, (“Employment Agreement”); and

 

WHEREAS,
the parties now desire to amend the Employment Agreement to provide certain
severance and change in control benefits to Employee.

 

NOW,
THEREFORE, in consideration of the mutual agreements set forth herein and in the
Employment Agreement and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

 

	
      1.
	
      Definition
      of Cause.
      The definition of the term “Cause” contained in Section 4(c) of the
      Employment Agreement is hereby deleted in its entirety, and as amended,
      the definition of the term “Cause” contained in Section 4(c) shall be and
      read as follows:

“For
purposes of this Agreement, the term Cause shall mean any one or more of the
following: (a) the material breach by the Employee of this Agreement; (b)
Employee’s breach of his fiduciary duty to the Company and/or its shareholders
in his capacity as an officer of the Company; (c) any action or failure to act
on the part of Employee which results in material injury to the assets, business
prospects or reputation of the Company or any affiliate of the Company; (d) the
appropriation of a material business opportunity of the Company or any affiliate
of the Company, including attempting to secure or securing any personal profit
in connection with any transaction entered into on behalf of the Company; or (e)
Employee’s failure to substantially perform his duties and responsibilities
hereunder, including without limitation Employee’s breach of the Company’s Code
of Conduct or an express employment policy of the Company.”

	
      2.
	
      Severance
      and Change in Control Benefits.
      Section 10 of the Employment Agreement shall be replaced in full to
      reflect the provision of certain severance and change in control benefits,
      and, as amended, said Section 10 shall be and read in full as
      follows:

“10.1. Severance
Benefits. If
Employee is terminated by the Company without Cause (as defined below) during
the period between execution of the Amendment to Employment Agreement dated in
February 2003 and the third anniversary of the effective date of such amendment
(the “Term”), Employee shall be entitled to receive the compensation and
benefits described in (a), (b), and (c) hereinbelow:

“(a) A
one-time cash severance payment, which shall be payable as soon as reasonably
practical following such termination, but in any event within ten (10) business
days thereafter, in an aggregate amount equal to the sum of the following:

“(i) The
greater of: (a) the amount of base salary (as in effect on the date of the
termination) plus annual incentive awards (at the highest previous target level
and assuming performance satisfying a target payout) that Employee would have
received had he continued in the employment of the Company hereunder through the
expiration of the Term; or (b) twelve months’ base salary (as in effect on the
date of the termination) plus Employee’s target annual incentive award for the
year of the termination;

“(ii) An amount
equal to the sum of: (a) the value (as of the date of termination) of all
unvested and otherwise unpayable restricted stock (or alternative) awards
previously granted to Employee under the Long Term Incentive Compensation Plan
(“LTICP”) (as if performance criteria had been met to permit payment of 100% of
the award), and (b) the forfeited portion of Employee’s accounts under the TXU
Deferred and Incentive Compensation Plan (“DICP”) and the TXU Salary Deferral
Program (“SDP”) (valued in accordance with the relevant provisions of the DICP
and SDP, respectively); and

“(iii) An amount
equal to the difference between (a) the aggregate required monthly premium for
continuation coverage under the Consolidated Omnibus Budget Reconciliation Act
of 1985 (“COBRA”) under the TXU Medical (including prescription drugs), Dental
and Group Life Insurance Plans, and (b) the aggregate monthly employee
contribution rate in effect for Employee under such plans immediately prior to
such termination, multiplied by eighteen (18). 

“(b) In
addition to such severance payment, Employee shall be entitled to outplacement
services, at the Company’s expense through a third-party outplacement consultant
selected by the Company, for up to one hundred eighty (180) days after such
termination.

“(c) In the
event that the foregoing payments, or any portion thereof, constitute an “excess
parachute payment” under Section 4999 of the Code, or any successor provision,
the Company shall, in addition to providing the foregoing payments and benefits,
pay Employee a tax gross-up cash payment(s) in an amount agreed upon by Employee
to be sufficient to fully offset the excise tax which Employee is, or may be,
required to pay as a result thereof. Such tax gross-up payment shall be paid to
Employee concurrently with the cash payments provided for hereinabove; provided
that if the amount of such tax gross-up payment cannot be finally determined by
such date, the Company shall pay Employee concurrently with such other payments
an estimate, determined in good faith by the Company, of the minimum amount of
the required tax gross-up payment. Thereafter, the Company shall promptly (but
in any event within forty-five (45) days of Employee’s termination) determine in
good faith the total amount of the tax gross-up payment and seek to obtain
Employee’s approval thereof. The remaining portion of the tax gross-up payment
shall be paid to Employee promptly after Employee approves the total
amount.

-2-

“Notwithstanding
any other provision of this Agreement seemingly to the contrary, Employee shall
not be entitled to any of the payments or benefits provided for under this
Section 10.1 if Employee’s termination is for Cause, or if the circumstances of
Employee’s termination entitle him to the payments and benefits provided for in
Section 10.2 below.

“10.2 Change
In Control.
 If,
during the Term: (i) Employee voluntarily terminates his employment with the
Company (or its successor) within six (6) months following a Change in Control
(as defined below), or (ii) Employee’s employment is terminated by the Company
(or its successor) without Cause, or Employee terminates his employment for Good
Reason (as defined below), in either case within twenty-four (24) months
following a Change in Control, Employee shall be entitled to receive the
compensation and benefits described in (a), (b), (c) and (d)
hereinbelow:

“(a) A
one-time cash payment, which shall be payable as soon as reasonably practical
following such termination, but in any event within ten (10) business days
thereafter, in an aggregate amount equal to the sum of the
following:

“(i) An amount
equal to three (3) times the aggregate of Employee’s annualized base salary as
in effect immediately prior to the Change in Control plus Employee’s target
annual incentive award for the year in which the Change in Control occurs;

“(ii) An amount
equal to the sum of: (a) the value (as of the date of termination) of all
unvested and otherwise unpayable restricted stock (or alternative) awards
previously granted to Employee under the LTICP (as if performance criteria had
been met to permit payment of 100% of the award), and (b) the forfeited portion
of Employee’s accounts under the DICP and SDP (valued in accordance with the
relevant provisions of the DICP and SDP, respectively);

“(iii) An amount
equal to the sum of: (a) the matching contributions which would have been made
under the DICP had Employee continued to defer salary thereunder at the rate in
effect as of the effective date of the Change in Control, for an additional
three years following the termination of employment; and (b) the matching
contributions which would have been made under the SDP had Employee continued to
defer salary thereunder at the rate in effect as of the effective date of the
Change in Control, for an additional three years following the termination of
employment; and

“(iv) An amount
equal to the difference between (a) the monthly COBRA premium for coverage under
the Company’s medical (including prescription drugs), dental and group life
insurance plans, and (b) the monthly employee contribution under such plans in
effect for Employee immediately prior to the termination, multiplied by eighteen
(18).

“(b) In
addition to such payment, Employee shall be entitled to the following
benefits:

-3-

“(i) The
Company shall fully secure the benefit provided for under the Split-Dollar Life
Insurance Program by making irrevocable contributions to the trust established
thereunder (“Trust”) as contemplated in Section 11 of the Split-Dollar Life
Insurance Program. Additionally, Employee’s participation in the Split-Dollar
Life Insurance Program shall continue notwithstanding the termination of
employment as if the Participation Agreement between the Company and Employee
entered into under the Split-Dollar Life Insurance Program continued in
accordance with its terms as in effect prior to Employee’s termination and as if
Employee’s termination had not occurred. In the event the Company terminates the
Split-Dollar Life Insurance Program, the Company shall nonetheless provide
Employee with the benefits contemplated under the Split-Dollar Life Insurance
Program, as in effect on the effective date of this Agreement, and shall fully
secure such benefits through irrevocable contributions to the Trust;

“(ii) Employee
shall, at the Company’s cost, be entitled to financial planning services
equivalent to services available under the Company’s executive financial
planning program for three years from the date of the termination;
and

“(iii) The
Company shall pay on behalf of Employee, or shall reimburse Employee for, the
physician fees for one physical examination of Employee per year for three years
from the date of the termination.

“(c) In
addition to such severance payments and benefits, Employee shall be entitled to
additional retirement compensation (“Additional Severance Retirement
Compensation”) in an amount equal to the difference between: (i) the benefit
Employee is entitled to receive under the TXU Retirement Plan (“Retirement
Plan”) and the TXU Second Supplemental Retirement Plan (“Supplemental Retirement
Plan”), and (ii) the amount of the retirement benefit Employee would have been
entitled to receive under the Retirement Plan and the Supplemental Retirement
Plan had Employee continued in the employment of the Company, and continued
participating in the Retirement Plan, through the Term. The calculation of the
Additional Severance Retirement Compensation shall assume: (x) an annual
increase in base salary (effective as of the normal effective date for executive
salary adjustments under the Company’s standard practice in effect as of the
termination) equal to Employee’s greatest base salary increase during the Term,
and (y) an annual bonus payment (payable at the normal time under the AIP, or
successor plan) equal to the highest annual bonus payment previously paid to
Employee. The Additional Severance Retirement Compensation shall be payable in
the form elected by Employee with respect to benefits under the Retirement Plan.
The amount of the Additional Severance Retirement Compensation shall be
determined by the actuary for the Retirement Plan using the assumptions set
forth above and other reasonable and consistent actuarial assumptions
substantially similar to those used in connection with the determination of
benefits payable under the Retirement Plan. The Additional Severance Retirement
Compensation is not intended to meet the qualification requirements of Section
401 of the Internal Revenue Code of 1986, as amended (“Code”); however the
Additional Severance Retirement Compensation shall be funded and payable under
the rabbi trust established under the Supplemental Retirement Plan.

“(d) In the
event that the foregoing payments, or any portion thereof, constitute an “excess
parachute payment” under Section 4999 of the Code, or any successor provision,
the Company shall, in addition to providing the foregoing payments and benefits,
pay Employee a tax gross-up cash payment(s) in an amount agreed upon by Employee
to be sufficient to fully offset the excise tax which Employee is, or may be,
required to pay as a result thereof. Such tax gross-up payment shall be paid to
Employee concurrently with the cash payments provided for hereinabove; provided
that if the amount of such tax gross-up payment cannot be finally determined by
such date, the Company shall pay Employee concurrently with such other payments
an estimate, determined in good faith by the Company, of the minimum amount of
the required tax gross-up payment. Thereafter, the Company shall promptly (but
in any event within forty-five (45) days of Employee’s termination) determine in
good faith the total amount of the tax gross-up payment and seek to obtain
Employee’s approval thereof. The remaining portion of the tax gross-up payment
shall be paid to Employee promptly after Employee approves the total
amount.

“(e) For
purposes of this Agreement, “Change in Control” shall mean a change in control
of TXU Corp. 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 TXU Corp.
representing 20% or more of the combined voting power of TXU Corp.’s then
outstanding securities having the right to vote at elections of directors of TXU
Corp. (“Voting Securities”); (ii) individuals who constitute the board of
directors of TXU Corp. 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 TXU Corp.’s
shareholders, was approved by at least three-quarters of TXU Corp.’s directors
comprising the Incumbent Board (either by a specific vote or by approval of the
proxy statement of TXU Corp. 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
TXU Corp. , 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 TXU Corp. are liquidated or transferred to an
unrelated party; or (v) TXU Corp. is a party to a merger, consolidation,
reorganization or similar transaction pursuant to which TXU Corp. is not the
surviving ultimate parent entity. For purposes of this definition, the term
“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 TXU Corp., a subsidiary of TXU Corp. or any employee
benefit plan(s) sponsored or maintained by TXU Corp. or any subsidiary thereof,
and the term “Independent Shareholder” shall mean any shareholder of TXU Corp.
except any employee(s) or director(s) of TXU Corp. or any employee benefit
plan(s) sponsored or maintained by TXU Corp. or any subsidiary
thereof.

-4-

“(f) For
purposes of this Agreement, “Good Reason” shall mean any one or more of the
following occurrences: (i) Employee’s base salary as in effect immediately prior
to the Change in Control, or as it may be increased subsequent to the Change in
Control, is reduced; (ii) Employee’s status or responsibilities with the Company
immediately prior to the Change in Control are materially reduced, or Employee
is assigned duties which are inconsistent with such status or responsibilities,
or Employee’s business location is materially changed; (iii) the Company (or its
successor) fails to continue in effect any pension, health care or executive
compensation plan or arrangement in which Employee was participating immediately
prior to the Change in Control, or Employer or the Company (or their successors)
takes some action which materially reduces Employee’s benefits under any such
plan or program, without (in either such case) providing Employee with
substantially similar benefits; or (iv) any successor to the Company in
connection with the Change in Control does not, prior to the Change in Control,
expressly assume this Agreement.

“10.3. Severance/Change
in Control Benefits Contingent Upon Full Release.
Employee acknowledges and agrees that the benefits and payments provided for in
Section 10.1 or 10.2, as applicable, constitute the exclusive remedy of Employee
upon termination of employment under the circumstances described in Section 10.1
or 10.2, as the case may be. Notwithstanding any other provision of this
Agreement, as a condition to receiving such benefits and payments, Employee
shall be required to execute a release of claims in favor of the Company in a
form reasonably acceptable to the Company.

“10.4 Confidentiality
and Nondisclosure.

“(a) Employee
understands and agrees that he will be given Confidential Information (as
defined below) and Training (as defined below) during his employment with the
Company relating to the business of the Company and/or its Affiliates (as
defined below , in exchange for his agreement herein. Employee hereby expressly
agrees to maintain in strictest confidence and not to use in any way (including
without limitation in any future business relationship of Employee), 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
the Company and/or its Affiliates. Employee agrees further not to remove or
retain any figures, calculations, letters, documents, lists, papers, or copies
thereof, which embody Confidential Information of the Company and/or its
Affiliates, and to return, prior to Employee’s termination of employment, any
such information in Employee’s possession. If Employee discovers, or comes into
possession of, any such information after his termination he shall promptly
return it to the Company. Employee acknowledges that the provisions of this
paragraph are consistent with the Company’s Code of Conduct with which Employee,
as an employee of the Company, is bound.

“(b) 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 the Company or any of its Affiliates or customers and (1)
is proprietary to, about, or created by the Company or its Affiliates or
customers; (2) gives the 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 the Company or its Affiliates
or customers; and (3) is not typically disclosed by the Company or its
Affiliates or customers, or known by persons who are not employed by the 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 general public pertaining to the 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.

“(c) For
purposes of this Agreement, “Training” includes, but is not limited to,
specialized and valuable training regarding Confidential
Information.

“(d) For
purposes of this Agreement, “Affiliate” shall mean any person, or entity (or
sub-unit of an entity) that, directly or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with
the Company.

-5-

“10.5. Non-Compete
and Non-Solicitation.
Employee acknowledges and agrees that: (1) in order to perform his obligations
and job duties for the Company, Employee will gain Training and access to
Confidential Information regarding the Company and/or its Affiliates or
customers; (2) use of such Confidential Information in competition with the
Company and/or its Affiliates or customers would be detrimental to the business
interests of the Company and/or its Affiliates or customers; and (3) Employee
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. Employee
acknowledges and agrees further that the Company is a diverse energy company and
that, based on the nature and size of the Company and the scope of its
operations, the areas in which the Company competes are not limited. Employee
also acknowledges and agrees that the services he will be performing for the
Company, and the Confidential Information and Training he will be provided,
relate to the world-wide operations of the Company and its Affiliates, and will
not be limited to any specific geographic location within which the Company, or
any of its Affiliates, conducts business.

“Employee
agrees that, during his employment with the Company, and for a period of one (1)
year thereafter, Employee shall not, directly or 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: (i) engage or participate in a business which competes in a
material manner with the Company or any of its Affiliates in any geographic
location in which the Company conducts business; (ii) contact, solicit or
attempt to solicit the business or patronage of any of the 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 the Company (or its
Affiliates) during the term of Employee’s employment with the Company; or (iii)
solicit, recruit, induce, encourage or in any way cause any employee of the
Company (or an Affiliate) to terminate his/her employment with the Company (or
such Affiliate). Notwithstanding the foregoing, the restriction provided in (i)
above shall apply following the termination of this Agreement only if Employee
receives the payments and benefits provided for in Section 10.1 or 10.2
above.

“10.6. Injunctive
Relief. Because
of the unique nature of the business to be conducted by the Company and its
Affiliates and the Confidential Information relating thereto, Employee
acknowledges, understands and agrees that the Company and/or its Affiliates will
suffer immediate and irreparable harm if Employee fails to comply with any of
his obligations under Sections 10.4 and 10.5 of this Agreement, and that
monetary damages alone will be inadequate to compensate the Company or its
Affiliates for such breach. Accordingly, Employee agrees that the Company and/or
its Affiliates shall, in addition to any other remedies available to it at law
or in equity, be entitled to temporary, preliminary, and permanent injunctive
relief and specific performance to enforce the terms of Sections 10.4 and 10.5
without the necessity of proving inadequacy of legal remedies or irreparable
harm or posting bond.”

	
      3.
	
      Continued
      Effectiveness of Employment Agreement.
      Except as expressly amended hereby, the Employment Agreement shall remain
      in full force and effect.

	
      4.
	
      Governing
      Law.
      This Amendment shall be governed by and construed in accordance with the
      laws of the State of Texas.

Executed
effective as of the __ day of February, 2003.

 

TXU
BUSINESS SERVICES COMPANY   EMPLOYEE:

 

By:________________________   __________________________

Erle Nye,
Chairman of the Board    Kirk
Oliver

and Chief
Executive

 

-6-exhibit 10(l)

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.

 

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:

 

2

(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.

 

3

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.

 

4

	
      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.

 

5

(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.

 

6

(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.

 

7

(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:

 

8

(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.

 

9

(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.

 

10

(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.

 

11

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

 

12

(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). 

 

13

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:

 

14

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.

 

15

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

16

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