Document:

exv10w14

 

Exhibit 10.14

COMMERCIAL LEASE AGREEMENT

(Month-to-Month)

THIS LEASE (“Lease”) is entered into pursuant to the following terms and conditions, inclusive
of the basic information and definitions set forth in the Schedule.

SCHEDULE

Date of Lease: April 17, 2006

Landlord: First Life America Corporation, a Kansas life insurance company

Tenant: First American Capital Corporation, a Kansas corporation

Building: 1303 S.W. First American Place, Topeka, Kansas 66604

Premises: Certain portions of the Building, the location and amount of square footage to be
determined from time to time as agreed between Landlord and Tenant

Permitted Use: Commercial office use

Rent: Rent shall be $22/sq. ft annually

Term: Month-to-month

Commencement Date: May 1, 2006

Termination of Lease: Landlord or Tenant shall have the option to terminate this Lease effective
as of the date (the “Termination Date”) set forth in Landlord’s or Tenant’s Termination Notice
which Termination Date shall be no earlier than thirty (30) days after the date of giving such
notice. Either party’s option to terminate this Lease shall be exercised by written notice
(“Termination Notice”) given by Landlord to Tenant or Tenant to Landlord.

Tenant’s Address for Notice: 1303 S.W. First American Place, Topeka, Kansas 66604; fax
785-267-7079.

Landlord’s Address for Notice and Rent Payments: 1303 S.W. First American Place, Topeka, Kansas
66604.

 

 

 

1. PREMISES. Subject to the covenants and conditions of this Lease, Landlord leases
to Tenant, and Tenant leases from Landlord, the Premises, together with the right of ingress and
egress.

2. RENT PAYMENTS. Tenant shall pay to Landlord Rent in monthly installments, each due
and payable in advance without notice or demand at Landlord’s above stated address, or at any other
place Landlord designates in writing. The monthly Rent installment will be based on the number of
square feet rented each month. The first monthly Rent installment will be $2,566.67, which is
based on the lease of 1,400 square feet, located on the central and south section of the upper
level of the Building. The first monthly Rent installment will be paid on the Commencement Date
and all subsequent monthly Rent installments will be due on or before the first day of each
succeeding month during the Term.

3. POSSESSION AT BEGINNING OF TERM. Landlord shall use due diligence to give
possession to Tenant on the Commencement Date. Rent shall abate pro rata for the period of any
delay in giving Tenant possession, but the Term will not be extended as a result of such delay.
Tenant will make no other claim against Landlord for delay in obtaining possession.

4. PROPERTY INSURANCE. Landlord shall maintain property damage insurance on the
Building. Tenant shall comply with all insurance regulations so the lowest property damage
insurance and liability insurance rates may be obtained (including, but not limited to, Tenant
obtaining, supplying and maintaining, at Tenant’s sole cost and expense, fire extinguishers or such
other mechanisms or devices as may be required by Landlord’s insurance company or any and all
applicable insurance regulations); and nothing shall be done or kept in or on the Premises by
Tenant which will cause an increase in the premium for any such insurance on the Building or on any
contents located therein, over the rate usually obtained for the proper use of the Premises
permitted by this Lease or which will cause cancellation or make void any such insurance.

Tenant shall maintain, at all times during the Term, adequate insurance on its personal
property used, stored or kept in the Premises.

5. INDEMNITY AND LIABILITY INSURANCE. Tenant shall at all times indemnify, defend and
hold Landlord harmless from all loss, liability, costs, damages and expenses that may occur or be
claimed with respect to any person or persons, or property on or about the Premises or to the
Premises resulting from any act done or omission by or through Tenant, its agents, employees,
invitees or any person on the Premises by reason of Tenant’s use or occupancy or resulting from
Tenant’s non-use or possession of said property and any and all loss, cost, liability or expense
resulting therefrom. Tenant shall maintain, at all times during the Term, comprehensive general
liability insurance in a responsible insurance company, licensed to do business in the state in
which the Premises are located and satisfactory to Landlord, properly protecting and indemnifying
Landlord with single limit coverage of not less than $2,000,000 for injury to or death of persons
and for property damage. During the Term, Tenant shall furnish Landlord with a

 

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certificate or certificates of insurance covering such insurance so maintained by Tenant and
naming Landlord and Landlord’s mortgagees, if any, as additional insureds.

6. ASSIGNMENT AND SUBLETTING TO UNAFFILIATED THIRD PARTY. Tenant shall not assign,
transfer or encumber this Lease with respect to an unaffiliated third party and shall not sublease
the Premises or any part thereof to an unaffiliated third party or allow such unaffiliated third
party to be in possession thereof without the prior written consent of Landlord, in each and every
instance.

7. SIGNS AND ADVERTISEMENTS. Tenant shall not place upon nor permit to be placed upon
any part of the Premises, any signs, billboards or advertisements whatever, without the prior
consent of Landlord. Any such signs or advertisements shall be maintained by Tenant in good repair
and condition.

8. CONDITION OF PREMISES AT BEGINNING AND END OF TERM. Tenant acknowledges Tenant has
inspected the Premises and, except as may be provided otherwise in this Lease, Tenant accepts the
Premises in their present “AS IS, WHERE IS” condition.

At the end of the Term, except for damage caused by fire or other perils, Tenant, at Tenant’s
expense, will (a) surrender the Premises in as good or better condition as when the Premises were
delivered to Tenant; (b) have removed all of Tenant’s property from the Premises; (c) have promptly
repaired any damage to the Premises caused by the removal of Tenant’s property; (d) surrender all
equipment and systems used in connection with the Premises, or located therein, in good working
order; and (e) leave the Premises free of trash and debris and in “broom clean” condition.

9. LANDLORD’S RIGHT OF ENTRY. Landlord or Landlord’s agent may enter the Premises to
examine the same, to show the same and to do anything Landlord may be required to do hereunder or
which Landlord may deem necessary for the good of the Premises or the Building. Furthermore,
Landlord may display such signs on the Premises or Building as Landlord deems necessary or
beneficial to Landlord.

10. MAINTENANCE AND REPAIR. Responsibility for maintenance and repair shall be as
follows:

Landlord shall be obligated to maintain, the roof and structure, fixtures, floor coverings,
HVAC, plumbing, sprinkler, electrical and other mechanical equipment, appliances and systems
serving the Premises.

Tenant shall be obligated to maintain, the interior walls, inside surfaces of exterior walls,
glass, windows and doors, and all docks, dock doors and dock shelters, if any.

Tenant acknowledges and agrees that during the Term and at Tenant’s sole cost and expense,
Tenant will maintain and keep in good order, repair and condition and, when necessary, will replace
all parts of the Premises in accordance with this Paragraph. Tenant shall also, at Tenant’s sole
cost and expense, keep the interior of the Premises and the exterior area surrounding the Premises
free from trash and in a neat and orderly

 

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condition. Tenant further acknowledges that Landlord will be under no obligation, and will
not be liable for any failure, to make any repairs until and unless Tenant notifies Landlord in
writing they are necessary, in which event Landlord will have a reasonable time after notice to
make such repairs.

11. DAMAGE BY CASUALTY. In case, during the Term or previous thereto, the Premises
hereby let, or the Building, shall be destroyed or shall be so damaged by fire or other casualty as
to become untenantable, then in such event, the Term shall cease and this Lease shall become null
and void from the date of such damage or destruction and Tenant shall immediately surrender said
Premises and all interest therein to Landlord, and Tenant shall pay Rent within said Term only to
the time of such surrender. In such event, Tenant shall remove all rubbish, debris, merchandise,
furniture, equipment and other of its personal property, within five days after the request of
Landlord. If the Premises shall be but slightly injured by fire or other casualty, so as not to
render the same untenantable and unfit for occupancy, then Landlord shall repair the same with all
reasonable promptitude, and in that case the Rent shall abate during the completion of such repairs
in proportion to the area deemed untenantable and unfit for occupancy. Except as provided herein,
no compensation or claim shall be made by or allowed to Tenant by reason of any inconvenience or
annoyance arising from the necessity of repairing any portion of the Building or the Premises,
however the necessity may occur.

12. EMINENT DOMAIN. If the Building, the Premises or any substantial part thereof
shall be taken under the power of eminent domain or be acquired for any public or quasi-public use
or purpose or if any condemnation proceeding shall be instituted in which it is sought to take or
damage any part of the Premises or the Building or the land under it at Landlord’s option, the Term
shall cease and terminate upon the date when the possession of said Premises or the part thereof so
taken shall be required for such use or purpose and without apportionment of the award, and Tenant
shall have no claim against Landlord for the value of any unexpired Term. In all such events, Rent
at the then current rate shall be apportioned as of the date of the termination. No money or other
consideration shall be payable by Landlord to Tenant for the right of cancellation and Tenant shall
have no right to any condemnation award or in any judgment for damages caused by the taking.

13. PERSONAL PROPERTY. Landlord shall not be liable for any loss or damage to any
merchandise, inventory, goods, fixtures, improvements, equipment or personal property of Tenant in
or about the Premises, regardless of the cause of such loss or damage.

14. ALTERATIONS. Tenant shall not make alterations or additions in or to the Premises
without the prior consent of Landlord.

15. UTILITIES AND SERVICES. Landlord shall furnish and pay for all electricity, gas,
water/sewer, storm water fees, trash, security, sprinkler/pump/monitoring, and all other services
or utilities used in or assessed against the Premises to be occupied by Tenant.

 

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16. FIXTURES. Except for Tenant’s property and business fixtures, all buildings,
repairs, alterations, additions, improvements, installations and other non-business fixtures
installed or erected on the Premises, whether by or at the expense of Landlord or Tenant, will
belong to Landlord and will remain on and be surrendered with the Premises at the expiration or
termination of this Lease. However, at Landlord’s option, Tenant shall, at Tenant’s sole cost and
expense, remove Tenant’s alterations or improvements prior to the expiration of this Lease and
return the Premises to their original condition.

17. REAL ESTATE TAXES AND SPECIAL ASSESSMENTS. Landlord shall pay the real estate
taxes and installments of general and special assessments, payable with respect to the Premises.

18. OPERATIONS. Tenant agrees to conduct its business in a manner that will not be
objectionable to other tenants in the Building, including noise, vibration, odor, trash or fumes.
In the event Landlord receives complaints from other tenants and determines, in its sole reasonable
judgment, that Tenant is conducting its operations in a manner so as to be objectionable to other
tenants, Tenant agrees, upon notice from Landlord thereof, to promptly modify the conduct of its
operations to eliminate such objectionable operations.

19. WAIVER OF SUBROGATION. As part of the consideration for this Lease, each of the
parties hereby releases the other party hereto from all liability for damage due to any act or
neglect of the other party (except as hereinafter provided) occasioned to property owned by said
parties which is or might be incident to or the result of a fire or any other casualty against loss
for which either of the parties is now carrying or hereafter may carry insurance; provided,
however, that the releases herein contained shall not apply to any loss or damage occasioned by
intentional acts of either of the parties hereto, and the parties hereto further covenant that any
insurance they obtain on their respective properties shall contain an appropriate provision whereby
the insurance company, or companies, consent to the mutual release of liability contained in this
paragraph.

20. DEFAULT AND REMEDIES. In the event: (a) Tenant fails to comply with any term,
provision, condition or covenant of this Lease; (b) Tenant deserts or vacates the Premises; (c) any
petition is filed by or against Tenant under any section or chapter of the Federal Bankruptcy Act,
as amended, or under any similar law or statute of the United States or any state thereof; (d)
Tenant becomes insolvent or makes a transfer in fraud of creditors; (e) Tenant makes an assignment
for benefit of creditors; or (f) a receiver is appointed for Tenant or any of the assets of Tenant,
then in any of such events, Tenant shall be in default and Landlord shall have the right, without
the need for demand or notice, in addition to and not in limitation of any other remedy permitted
by law, to enter upon the Premises either with or without process of law, and to expel, remove and
put out Tenant or any other persons who might be thereon, together with all personal property found
therein; and Landlord may terminate this Lease. Should Landlord at any time terminate this Lease
by reason of any default, in addition to any other remedy it may have, Landlord shall have the
right and remedy to seek redress in the courts at any time to

 

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correct or remedy any default of Tenant by injunction or otherwise, and Landlord shall have
the absolute right by court action or otherwise to collect any and all amounts of unpaid Rent or
unpaid Additional Rent or any other sums due from Tenant to Landlord under this Lease which were or
are unpaid at the date of termination. In case it should be necessary for Landlord to bring any
action under this Lease, to consult or place this Lease or any amount payable by Tenant hereunder
with an attorney concerning or for the enforcement of any of Landlord’s rights hereunder, then
Tenant agrees in each and any such case to pay to Landlord, Landlord’s reasonable attorney’s fees.
If Tenant shall fail to pay when due any amount payable to Landlord under this Lease, Tenant shall
pay to Landlord a “late charge” of $.05 for each dollar so overdue to defray part of the cost of
collection. In addition, all delinquent payments shall accrue interest at a rate equal to the
lesser of 1.5% per month or the maximum amount permitted by law, from the due date of such payment
and shall constitute additional Rent payable by Tenant under this Lease and shall be paid by Tenant
to Landlord upon demand.

21. WAIVER. The rights and remedies of Landlord under this Lease, as well as those
provided or accorded by law, shall be cumulative, and none shall be exclusive of any other rights
or remedies hereunder or allowed by law. A waiver by Landlord of any breach or breaches, default
or defaults of Tenant hereunder shall not be deemed or construed to be a continuing waiver of such
breach or default nor as a waiver of or permission, expressed or implied, for any subsequent breach
or default, and it is agreed that the acceptance by Landlord of any installment of Rent subsequent
to the date the same should have been paid hereunder, shall in no manner alter or affect the
covenant and obligation of Tenant to pay subsequent installments of Rent promptly upon the due date
thereof. No receipt of money by Landlord after the termination of this Lease shall in any way
reinstate, continue or extend the Term above demised.

22. HAZARDOUS SUBSTANCES. Tenant shall not use or allow the Premises to be used for
the Release, storage, use, treatment, disposal or other handling of any Hazardous Substance,
without the prior consent of Landlord. The term “Release” shall have the same meaning as is
ascribed to it in the Comprehensive Environmental Response Compensation and Liability Act, 42
U.S.C. §9601 et seq., as amended (“CERCLA”). The term “Hazardous Substance” means (i) any
substance defined as a “hazardous substance” under CERCLA, (ii) petroleum, petroleum products,
natural gas, natural gas liquids, liquefied natural gas, and synthetic gas, and (iii) any other
substance or material deemed to be hazardous, dangerous, toxic, or a pollutant under any federal,
state or local law, code, ordinance or regulation.

Tenant shall: (a) give prior notice to Landlord of any activity or operation to be conducted
by Tenant at the Premises which involves the Release, use, handling, generation, treatment,
storage, or disposal of any Hazardous Substance (“Tenant’s Hazardous Substance Activity”), (b)
comply with all federal, state, and local laws, codes, ordinances, regulations, permits and
licensing conditions governing the Release, discharge, emission, or disposal of any Hazardous
Substance and prescribing methods for or other limitations on storing, handling, or otherwise
managing Hazardous Substances, (c) at its own expense, promptly contain and remediate any Release
of Hazardous Substances arising from or related to Tenant’s Hazardous Substance Activity in the

 

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Premises, the Building or the environment and remediate and pay for any resultant damage to
property, persons, and/or the environment, (d) give prompt notice to Landlord, and all appropriate
regulatory authorities, of any Release of any Hazardous Substance in the Premises, the Building or
the environment arising from or related to Tenant’s Hazardous Substance Activity, which Release is
not made pursuant to and in conformance with the terms of any permit or license duly issued by
appropriate governmental authorities, and any such notice to include a description of measures
taken or proposed to be taken by Tenant to contain and remediate the Release and any resultant
damage to property, persons, or the environment, (e) at Landlord’s request, from time to time,
execute affidavits, representations and the like concerning Tenant’s best knowledge and belief
regarding the presence of Hazardous Substances in the Premises, (f) upon expiration or termination
of this Lease, surrender the Premises to Landlord free from the presence and contamination of any
Hazardous Substance, (g) be solely responsible for and defend, indemnify and hold Landlord, its
agents and employees, harmless from and against all claims, costs and liabilities, including
attorney’s fees and costs, arising out of or in connection with the removal, clean-up and
restoration work and materials necessary to return the Premises, and any other property of whatever
nature located on the Premises, to their condition existing prior to the appearance of any
Hazardous Substance on the Premises. Tenant’s obligations under this paragraph will survive the
termination of this Lease.

23. NOTICES. Any notice hereunder shall be sufficient if sent by hand delivery,
overnight delivery or certified or registered mail, postage prepaid, return receipt requested,
addressed to Tenant and to Landlord as set forth in the Schedule of this Lease. Notice shall be
deemed to have been given upon receipt or refusal of receipt by the intended recipient.

24. SUBORDINATION. This Lease shall be subject and subordinate in law and equity to
any existing or future mortgage or deeds of trust placed by Landlord upon the Premises or the
property of which the Premises form a part. Tenant shall attorn to any successor to Landlord upon
request and execute any documents reasonably required or appropriate to effectuate such an
attornment, or the subordination aforesaid, upon written notice thereof, and Tenant does hereby
make, constitute and irrevocably appoint Landlord as Tenant’s attorney-in-fact and in Tenant’s name
to execute all such documents in accordance therewith.

25. SUCCESSORS. The provisions, covenants and conditions of this Lease shall bind and
inure to the benefit of the legal representatives, heirs, successors and assigns of each of the
parties hereto, except that no assignment or subletting by Tenant without the written consent of
Landlord shall vest any rights in the assignee or subtenant of Tenant.

26. QUIET POSSESSION. Landlord agrees, so long as Tenant fully complies with all of
the terms, covenants and conditions herein contained on Tenant’s part to be kept and performed,
that Tenant shall and may peaceably and quietly have, hold and enjoy the Premises for the Term
aforesaid, it being expressly understood and agreed that the aforesaid covenant of quiet enjoyment
shall be binding upon Landlord, its heirs,

 

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successors or assigns, but only during such party’s ownership of the Premises. Landlord and
Tenant further covenant and represent that each has full right, title, power and authority to make,
execute and deliver this Lease.

27. BANKRUPTCY. Neither this Lease nor any interest therein nor any estate hereby
created shall pass to any trustee or receiver in bankruptcy or to any other receiver or assignee
for the benefit of creditors by operation of law or otherwise during the Term or any renewal
thereof.

28. ENTIRE AGREEMENT. This Lease contains the entire agreement between the parties,
and no modification of this Lease shall be binding upon the parties unless evidenced by an
agreement in writing signed by Landlord and Tenant after the date hereof.

29. LANDLORD’S LIABILITY. If Landlord shall fail to perform any covenant, term or
condition of this Lease upon Landlord’s part to be performed, Tenant’s sole remedy shall be
Tenant’s right to terminate this Lease. It is understood that in no event shall Tenant have any
right to (i) any money damages, including, but not limited to, actual or consequential damages or
(ii) specific performance. In the event of the sale or other transfer of Landlord’s right, title
and interest in the Premises or the Building, Landlord shall be released from all liability and
obligations hereunder.

30. ESTOPPEL CERTIFICATES. Tenant shall at any time upon not less than ten (10) days’
prior written notice from Landlord execute, acknowledge and deliver to Landlord, or to any lender
of or purchaser from Landlord, a statement in writing certifying that this Lease is unmodified and
in full force and effect (or if modified stating the nature of such modification) and the date to
which the Rent and other charges are paid in advance, if any, and acknowledging that there are not,
to Tenant’s knowledge, any uncured defaults on the part of Landlord or specifying such defaults if
any are claimed. Any such statement may be conclusively relied upon by any prospective purchaser
or encumbrancer of the Premises or of the business of Landlord.

31. HOLDOVER. If Tenant retains possession of the Premises or any part thereof after
the termination of the Term, by lapse of time or otherwise, Tenant shall as a charge for the use of
the Premises, pay Landlord Rent for the first month of such holdover period at double the rate of
Rent payable for the month immediately preceding said holdover and at triple the rate of Rent
payable for the month immediately preceding said holdover for each month thereafter, computed on a
monthly basis for the time Tenant thus remains in possession. Tenant shall also pay Landlord’s
actual and consequential damages. Any retention of the Premises after the termination of this
Lease or any extension thereof shall be considered as a month-to-month holdover. The provisions of
this paragraph do not waive Landlord’s right of re-entry or any other rights hereunder.

THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK

 

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IN WITNESS WHEREOF, said parties hereunto subscribed their names. Executed in multiple originals.

	 	 	 	 	 
	 	 	Landlord:
	 	 	First Life America Corporation,
	 	 	a Kansas life insurance company
	 
	 	 	 	 
	 

	 	By:
	 	JOHN F. VAN ENGELEN
	 

	 	 	 	 
	 

	 	 	 	John F. Van Engelen, President
	 
	 	 	 	 
	 	 	Tenant:
	 	 	First American Capital Corporation,
	 	 	a Kansas corporation
	 
	 	 	 	 
	 

	 	By:
	 	HARLAND E. PRIDDLE
	 

	 	 	 	 
	 

	 	 	 	Harland E. Priddle, Chairman of the
	 

	 	 	 	Board of Directors

 

9KMI Exhibit 10.25

Exhibit 10.25

EMPLOYMENT AGREEMENT

THIS AGREEMENT made as of the 28th day of November, 2005

BETWEEN:

TERASEN GAS INC., a body corporate incorporated under the laws of British Columbia

(“Employer”)

AND:

RANDALL JESPERSEN

(“Employee”)

WHEREAS:

A.

The Employee has been an Employee of the Employer since March 25, 1996; and

B.

Kinder Morgan, Inc. is acquiring all of shares of Terasen Inc. and consequently is acquiring all of Terasen Inc.’s wholly owned subsidiaries pursuant to a plan of arrangement between Kinder Morgan, Inc., 0731297 B.C. Ltd. and Terasen Inc. (the “Plan of Arrangement”) and the Employee has agreed to enter into a new employment relationship following the Plan of Arrangement on new terms and conditions as set forth in this Agreement.

NOW THEREFORE in consideration of the premises and mutual covenants and agreements set out in this Agreement and other good and valuable consideration given by each party hereto to the other, the receipt and sufficiency of which is hereby acknowledged by each of the parties, the parties hereby agree as follows:

PART 1 - DEFINITIONS

1.1

In this Agreement, the following terms shall have the following definitions:

(a)

“Annual Salary” means the annual base salary to be paid to the Employee as stated in Section 4.1 of this Agreement or as may subsequently be established by the Board as the annual base salary payable to the Employee by the Employer;

(b)

“Board” means the Board of Directors of the Employer;

(c)

"Change in Control" means the occurrence of one or more of the following events:

i)

any "person," as such term is defined in the Income Tax Act (Canada) (other than Kinder Morgan, any trustee or other fiduciary holding securities under an employee benefit plan of Kinder Morgan or any corporation owned, directly or indirectly, by the shareholders of Kinder

 

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Morgan in substantially the same proportions as their ownership of stock of Kinder Morgan), is or becomes the owner, directly or indirectly, of securities of Kinder Morgan representing fifty percent (50%) or more of the combined voting power of Kinder Morgan’s then outstanding securities;

ii)

during any period of two consecutive years (not including any period prior to the date of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with Kinder Morgan to effect a transaction described in paragraph (i), (iii) or (iv) of this Section 1.1(c) whose election by the board of directors of Kinder Morgan or nomination for election by Kinder Morgan's shareholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason other than normal retirement, death or disability to constitute at least a majority thereof;

iii)

the shareholders of Kinder Morgan approve a merger or consolidation of Kinder Morgan with any other person, other than (i) a merger or consolidation which would result in the voting securities of Kinder Morgan outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities for the surviving entity) more than fifty percent (50%) of the combined voting power of the voting securities of Kinder Morgan or surviving entity outstanding immediately after such merger or consolidation, or (ii) a merger in which Kinder Morgan is the surviving entity but no "person" (as defined above) acquires more than fifty percent (50%) of the combined voting power of Kinder Morgan's then outstanding securities; or

iv)

the shareholders of Kinder Morgan approve a plan of complete liquidation of Kinder Morgan or an agreement for the sale or disposition by Kinder Morgan of all or substantially all of Kinder Morgan's assets (or any transaction having a similar effect),

but does not include the Plan of Arrangement or any financial transaction that may occur between Kinder Morgan, Terasen Inc., any company within the Terasen Group or, as applicable, any company related to any of Kinder Morgan, Terasen Inc. or the Terasen Group.

(d)

“Employee” means Randall Jespersen;

(e)

“Employer” means Terasen Gas Inc.;

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(f)

“Good Reason” means one or more of the following events, occurring without the Employee’s written consent:

i)

a material diminution or adverse change to the Employee’s position, nature of responsibilities, or authority within the Terasen Group that is not contemplated by this Agreement (for the purpose of this Agreement, a material diminution in responsibilities shall include the sale or disposition by the Terasen Group of assets or shares comprising 40% or more of the Terasen Group’s consolidated assets or shares or assets that generate 40% or more of the Terasen Group’s consolidated revenues; but shall not include the Plan of Arrangement or any change in the Employee’s position, nature of responsibilities or authority within the Terasen Group that is incidental to the Plan of Arrangement;

ii)

a decrease in the Employee’s Annual Salary as provided in this Agreement (or as such amounts may be increased from time to time) excluding any amounts accrued by or paid to the Employee relating to incentive compensation amounts as described in Sections 4.2 and 4.3 herein and any decrease that may occur in the value of the Employee’s benefits under the Employer’s benefit plans resulting from a restructuring of any or all benefit plans at the discretion of the Employer in accordance with Section 4.4;

iii)

any other failure by the Employer to perform any material obligation under, or breach by the Employer of any material provision of this Agreement; 

iv)

a relocation of the Employee’s current primary work location to a location greater than fifty (50) miles from its current location; or

v)

any failure to secure the agreement of any successor corporation or other entity to the Employer to fully assume the Employer’s obligations under this Agreement;

but does not include any financial transaction that may occur between Kinder Morgan, Terasen Inc., any company within the Terasen Group or, as applicable, any company related to any of Kinder Morgan, Terasen Inc. or the Terasen Group.

(g)

 “Kinder Morgan” means Kinder Morgan, Inc.;

(h)

“Restricted Stock Unit Plan” means Kinder Morgan, Inc. Restricted Stock Unit Plan; and

(i)

 “Terasen Group” means Terasen Gas Inc., Terasen Gas (Vancouver Island) Inc., Terasen Gas (Squamish) Inc. and Terasen Gas (Whistler) Inc.

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PART 2- EMPLOYMENT

2.1

Position

The Employer hereby employs the Employee as its President, reporting to the Office of the Chairman of Kinder Morgan, with such powers and duties in the conduct of such office as are normally associated with such a position together with such other duties, responsibilities, and tasks as the Employer may reasonably request of the Employee from time to time.  As part of his duties hereunder, the Employee agrees to serve as President of each of Terasen Gas (Vancouver Island) Inc., Terasen Gas (Squamish) Inc. and Terasen Gas (Whistler) Inc. (or such other comparable position in the future as determined by the Employer), and to perform the duties associated with the position and those additional duties that may from time to time be reasonably requested by the Employer, including any duties on behalf of such affiliates or subsidiaries of the Employer designated as requiring the services of the Employee.

2.2

Service

The Employee shall well and faithfully serve the Employer and use the Employee’s best efforts to promote the interests of the Employer.  The Employee shall, while this Agreement is in effect devote the whole of the Employee’s working time and attention to the business of the Employer and shall not, without the prior written consent of the Employer, engage in any other business, profession or occupation, or become an officer, employee, contractor for service, agent, or representative of any other company, partnership, firm, person, organization, or enterprise, where such engagement or position would conflict with or unduly interfere with the full and satisfactory performance of the Employee’s duties and obligations to the Employer.

2.3

Confidentiality

The Employee’s obligations under this Section 2.3 will not apply in the event disclosure is required by law or in the event such information becomes part of the public domain other than through the breach of this Agreement by the Employee.

The Employee acknowledges that, as the President of each of the companies in the Terasen Group and in any other position the Employee has held or may hold the Employee may have acquired or will acquire information about certain matters and things which are confidential to the Employer, and which information is the exclusive property of the Employer, including:

(a)

product design and manufacturing information;

(b)

names and addresses of present customers of the Employer, as well as prospective customers;

(c)

pricing and sales policies, techniques and concepts; 

(d)

trade secrets; and

- 5 -

(e)

other confidential information concerning the business operations or financing of the Employer.

The Employee acknowledges that the information referred to in this Section 2.3 could be used to the detriment of the Employer.  Accordingly, the Employee undertakes not to disclose same to any third party, either during the term of the Employee’s employment, except as may be necessary in the proper discharge of the Employee’s employment under this Agreement, or after the termination of the Employee’s employment, howsoever caused, except with the written permission of the Board.

2.4

Change in Employment

The Employee’s duties, title, salary and/or benefits may be modified by the Employer from time to time.  Where the Employer modifies the Employee’s duties, salary and/or benefits, the Employee agrees that any such minor modification to any or all of the above, shall be deemed not to constitute a termination of this Agreement or the employment of the Employee hereunder or constitute Good Reason which terminates this Agreement in accordance with Section 5.6 and that all other aspects of this Agreement shall remain in full force and effect.

PART 3 - TERM OF EMPLOYMENT

3.1

Term of Employment

This Agreement shall commence upon the Plan of Arrangement becoming effective (the “Effective Date”) and be for an indefinite term (such term not to extend past the date of retirement of the Employee under and pursuant to the retirement plans of the Employer), subject to the right of either party to terminate this Agreement as provided herein.

PART 4 - COMPENSATION AND BENEFITS

4.1

Annual Salary

The Employer shall pay to the Employee, as remuneration for the Employee’s services, an annual base salary of CDN $250,000 per year as of the Effective Date, less statutory and other applicable deductions required payable in accordance with the normal payroll procedures of the Employer or on such other basis as mutually agreed by the Employer and the Employee.

The Annual Salary paid to the Employee shall, for the purpose of establishing appropriate increases, be reviewed annually by the Board or a committee thereof as part of the annual review of executive officers’ remuneration.  The decision on whether to grant an increase to the Employee’s base salary and the amount of any such increase shall be in the sole discretion of the Board or committee thereof.

- 6 -

4.2

Short Term Incentive Plan

As of the Effective Date, the Employee shall be eligible to participate in such executive incentive plans as may be implemented by the Employer following the Plan of Arrangement.  The terms and conditions of all such incentive plans are subject to modification from time to time by the Board or committee thereof, in its sole discretion.  It is anticipated that, for the 2006 calendar year, provided the Employee meets the Employee’s financial and operating targets as may be set by the Board in its sole discretion, that the Employee will receive a bonus that is similar to other bonuses that may be provided to similarly situated executives in the approximate amount of CDN $300,000, in the sole discretion of the Board acting in the best interests of the Employer.

Notwithstanding any other provision of this Agreement, the Employer will pay the Employee a minimum of CDN $250,000 for the period from January 1, 2005 to December 31, 2005 (“2005 Incentive Payment”) and the Employee will not be entitled to any other short term incentive compensation during this period respecting any other short term incentive plan that may be implemented by the Employer.  Payment of the 2005 Incentive Payment shall be paid to the Employee by the Employer in accordance with the normal procedures established by the Employer for the payment of short term incentive compensation to its employees.

4.3

Long Term Incentive Plan

In consideration of the Employee entering into this Agreement and in full satisfaction of any entitlement the Employee had, has, or may have to any incentive compensation pursuant to any terms of employment with the Employer or any affiliate or subsidiary of the Employer that predate the execution of this Agreement and, without limiting the generality of the forgoing, any entitlement the Employee may have under Terasen Inc.’s prior Medium Term Incentive Plan, the Employer shall grant the Employee, for the 2006 calendar year, 6,000 restricted stock units pursuant to the Restricted Stock Unit Plan which will vest as follows:

(a)

2,000 restricted stock units on January 18, 2007;

(b)

2,000 restricted stock units on January 18, 2008; and

(c)

2,000 restricted stock units on January 18, 2009,

contingent upon the Restricted Stock Unit Plan being approved by a majority of the shareholders of Kinder Morgan and subject to the terms and conditions of the Restricted Stock Unit Plan.

For each calendar year thereafter, the Employee shall be eligible to participate in such Restricted Stock Unit Plan and such other long term incentive plans as may be implemented by the Employer from time to time.  The terms and conditions of all such long term incentive plans are subject to modification from time to time by the Board or committee thereof, in its sole discretion.

- 7 -

4.4

Group Insurance Benefits and Retirement Plans

As of the Effective Date, all of the Employee’s group insurance benefit and retirement plans in force at the time of the Plan of Arrangement shall remain in place and the Employee shall be entitled to participate in all such plans (the “Pre-Acquisition Plans”).

Effective January 1, 2007, the Employer will be changing certain group insurance benefit and retirement plans and the Employee will be eligible to participate in all such new employee benefit and retirement plans that may be made available to employees of the Employer having responsibilities similar in nature or level to those of the Employee (the “Post-Acquisition Plans”), provided that such participation will be subject to all terms and conditions of such new plans (including, without limitation, all waiting periods, eligibility requirements, contributions, exclusions or other similar conditions and limitations)

For the purpose of calculating pension entitlement at the time of retirement, the Employer, subject to all applicable laws, will credit the Employee with 2 years of service per year of service up until June 30, 2009.  If the Employee retires between age 54 and 55, the Employee’s pension entitlement will not be subject to any penalty related to early retirement that may apply pursuant to the relevant retirement plan in effect at the time of retirement.  If the Employee retires before age 54, the terms of the relevant retirement plan in effect at the time of retirement shall apply but, notwithstanding any contrary language that may appear in the relevant retirement plan, the Employee will be eligible to participate in the Employer’s retiree medical plan in place at the date of retirement.

To the extent that the Employee’s pension entitlement at the time of retirement, based on a valuation of the Employee’s pension entitlement under the Post-Acquisition Plans (accounting for amounts carried over from the Pre-Acquisition Plans), is less than what the Employee’s pension entitlement would have been had the Pre-Acquisition Plans remained in effect up until the date of his retirement, the Employer agrees to pay the Employee the difference through the supplemental employer retirement plan in place at the time of retirement.

The termination of the Pre-Acquisition Plans and the introduction and administration of the Post-Acquisition Plans is within the Employer’s sole discretion, and the Employee agrees that the introduction, deletion or amendment of any of the benefits at any time shall not constitute a breach of this Agreement.

4.5

Vacation

The Employee shall be entitled to vacation and shall be entitled to additional days off, all to be taken in accordance with the Employer’s policies and procedures, and as amended from time to time by the Employer, in its sole discretion and the Employee agrees that such amendments shall not constitute a breach of this Agreement.

- 8 -

4.6

Expenses

During the Employee’s employment, the Employer shall reimburse the Employee for all travelling and other expenses actually, properly and necessarily incurred by the Employee in connection with the performance of the Employee’s duties hereunder in accordance with the policies set from time to time by the Employer, in its sole discretion.  The Employee shall furnish such receipts, vouchers or other evidence as are required by the Employer to substantiate such expenses.

PART 5- TERMINATION OF AGREEMENT AND EMPLOYMENT

5.1

Termination by Employee

The Employee may terminate this Agreement and the Employee’s employment with the Employer by giving as much notice as possible and in any event not less than eight (8) weeks’ written notice of termination to the Employer, or other such time as may be mutually agreed to by the Employer and the Employee.

5.2

Termination by Death

This Agreement shall terminate automatically upon the death of the Employee.  In the event that this Agreement is terminated pursuant to this Section the following terms shall apply:

(a)

the Employer shall, within sixty (60) days of the date of termination, pay to the legal representatives of the Employee all amounts owed by the Employer to the Employee under this Agreement as of the date of termination of this Agreement (excluding any amounts arising from any long term incentive plan and relevant components thereof in place at the time of the Employee’s death); and

(b)

the Employer shall make such payments to the legal representatives of the Employee, when due, as the Employer may otherwise be obligated to make pursuant to any other benefit or other plan or program referred to in Section 4 of this Agreement, including without limitation any plan with respect to which the Employee was upon death, a beneficiary.

5.3

Termination by the Employer for Cause

Notwithstanding any other provisions of this Agreement, the Employer may terminate this Agreement and the Employee’s employment with the Employer at any time, without notice or pay in lieu of notice, for cause.  For the purposes of this Agreement, “cause” has the meaning commonly ascribed to the phrase “cause” or “just cause for termination” in the courts of the Province of British Columbia, and without limiting the foregoing, includes any of the following acts or omissions:

(a)

the wilful failure of the Employee to follow the instructions of the Employer; 

- 9 -

(b)

the wilful failure of the Employee to perform the reasonable duties assigned to him by the Employer;

(c)

the material breach or non-observance of any of the provisions of this Agreement by the Employee; or

(d)

any conduct of the Employee which tends to bring him or the Employer into disrepute and which is not corrected within a reasonable time after the Employer gives written notice to the Employee specifying the conduct.

5.4

Termination by the Employer Without Cause

The Employer may terminate this Agreement and the Employee’s employment at any time without cause immediately on written notice.  In the event that the Employer terminates this Agreement and the Employee’s employment without cause as provided by this Section 5.4, the Employer shall pay to the Employee all amounts owed by the Employer to the Employee under this Agreement as of the date of termination set out in the written notice of termination, and the Employee shall be entitled to be paid the following payments in lieu of any additional notice of termination:

(a)

an amount in lieu of any entitlement to annual incentive for the calendar year in which the Employee is terminated equivalent to the average amount of annual incentive paid to the Employee respecting the previous two calendar years pro-rated from the beginning of the calendar year in which the Employee is terminated to the date of written notice of termination;

(b)

an amount equivalent to twenty four (24) months Annual Salary and twenty four (24) months incentive under the terms of the short term incentive plan in place at the time of termination, which incentive will be based on the average incentive earned in the previous two calendar years;

(c)

an amount equivalent to the sum of all Registered Pension Plan, supplemental pension plan contributions and all other benefit contributions and premiums ordinarily paid by the Employer for insured benefits for the Employee, which would, but for the termination, have been paid by the Employer for the benefit of the Employee during the twenty four (24) months immediately following the date of termination of this Agreement.  At the Employee’s option, rather than payment of an amount equivalent to pension contributions, the Employer shall add an additional twenty four (24) months to the Employee’s age and an additional twenty four (24) months to the Employee’s service for the purpose of calculating the value of the Employee’s pension benefit upon termination; and

(d)

an amount in respect of outplacement counselling up to ten (10) percent of the Employee’s Annual Salary to be paid directly to an outplacement counselling agency as chosen by the Employer.

- 10 -

The parties acknowledge and agree that these amounts are payable as damages and not as a penalty.

Subject to any required regulatory or shareholder approval, any stock units held by the Employee at the date of termination shall be exercisable in accordance with the terms of the Restricted Stock Unit Plan in force as of the date of termination of this Agreement.

This Section 5.4 shall not apply and the Employee shall not be entitled to any payments as set out in this Section 5.4 where the Employee resigns, retires (whether or not the retirement is at the Employer’s direction in accordance with the Employer’s retirement policy that may be in place at the time of retirement) or is terminated pursuant to Section 5.2, 5.3 or 5.5 of this Agreement except where specific provisions are in place in the Restricted Stock Unit Plan.

5.5

Termination Due to Change in Control

In the event that this Agreement and the Employee’s employment are terminated by the Employer within three (3) months of a Change in Control or the Employee terminates his employment for Good Reason within three (3) months of a Change in Control, the Employee shall be entitled to payments in lieu of notice of termination equal to the payments set out and provided in Section 5.5 below, together with all legal and professional fees and expenses incurred by the Employee as a result of such termination (including all such fees and expenses, if any, incurred in contesting or disputing any such termination or in seeking to obtain or enforce any right or benefit):

(a)

an amount in lieu of any entitlement to annual incentive for the calendar year in which the Employee is terminated equivalent to the average amount of annual incentive paid to the Employee respecting the previous two calendar years pro-rated from the beginning of the calendar year in which the Employee is terminated to the date of written notice of termination;

(b)

an amount equivalent to twenty four (24) months Annual Salary and twenty four (24) months incentive under the terms of the short term incentive plan in place at the time of termination, which incentive will be based on the average incentive earned in the previous two calendar years;

(c)

an amount equivalent to the sum of all Registered Pension Plan, supplemental pension plan contributions and all other benefit contributions and premiums ordinarily paid by the Employer for insured benefits for the Employee, which would, but for the termination, have been paid by the Employer for the benefit of the Employee during the twenty four (24) months immediately following the date of termination of this Agreement.  At the Employee’s option, rather than payment of an amount equivalent to pension contributions, the Employer shall add an additional twenty four (24) months to the Employee’s age and an additional twenty four (24) months to the Employee’s service for the purpose of calculating the value of the Employee’s pension benefit upon termination; and

- 11 -

(d)

an amount in respect of outplacement counselling up to ten (10) percent of the Employee’s Annual Salary to be paid directly to an outplacement counselling agency as chosen by the Employer.

The parties acknowledge and agree that these amounts are payable as damages and not a penalty.

Subject to any required regulatory or shareholder approval, any stock units held by the Employee at the date of termination shall be exercisable in accordance with the terms of the Restricted Stock Unit Plan in force as of the date of termination of this Agreement.

This Section 5.5 shall apply instead of and not in addition to Section 5.4 of this Agreement, and this Section 5.5 shall not apply and the Employee shall not be entitled to any payments as set out in this Section 5.5 where the Employee resigns, retires (whether or not the retirement is at the Employer’s direction in accordance with the Employer’s retirement policy that may be in place at the time of retirement) or is terminated pursuant to Section 5.2 or 5.3 of this Agreement, except where specific provisions are in place in the Restricted Stock Unit Plan.

5.6

Termination by Employee for Good Reason

In the event the Employee terminates this Agreement and resigns as an employee for Good Reason, where no Change in Control has occurred, the Employee shall be entitled to payments equal to the payments set out and provided in Section 5.4.

For greater certainty, the Plan of Arrangement does not constitute Good Reason entitling the Employee to terminate this Agreement and receive the payments set out and provided in Section 5.4 or Section 5.5.

5.7

No Other Compensation on Termination

The Employee agrees that the Employee shall not be entitled, by reason of his employment with the Employer or by reason of any termination of this Agreement, howsoever arising, to any remuneration, compensation or other benefits other than those expressly provided for in this Section 5.

5.8

No Mitigation

The Employee shall not be required to mitigate any of the payments made to him pursuant to this Agreement, or otherwise, nor shall the amount of any payments made by the Employer to the Employee herein be reduced by any compensation earned by the Employee as the result of obtaining employment by another employer or by the receipt of any retirement benefits payable pursuant to this Agreement.

- 12 -

PART 6 - RESTRICTIONS ON COMPETITION

6.1

Restrictions on Employee’s Competitive Activities

In consideration of the mutual covenants and promises contained herein, including but not limited to the provisions governing notice of termination, the Employee agrees that during the term of this Agreement the Employee shall not, directly or indirectly, as an individual, as a member, employee, or agent of a firm, as a shareholder, director, officer, employee or agent of a corporation, as part of any other organization or group, participate in, assist, engage in, advise or consult for, lend money to, guarantee the debts or obligations of, permit the Employee’s name to be used by, or be in any way connected with any business competing with the Employer or any of its businesses.

The Employee agrees and acknowledges that after termination of this Agreement, however caused, the Employee owes a common law duty of fidelity or good faith to the Employer not to compete unfairly against the Employer which includes, but is not limited to, a duty not to make use of the Employer’s confidential information and material to compete with the Employer.  Further, the Employee agrees and acknowledges that he stands in a fiduciary relationship with the Employer and specifically under that relationship may not directly solicit the Employer’s clients, suppliers or take business advantage or opportunities belonging to the Employer for a period of eighteen (18) months after the termination of this Agreement.  All other aspects of the fiduciary relationship are not restricted.

6.2

Limits on Restrictions

The restrictions imposed by Section 6.1 shall not restrict the Employee from making a passive investment in any business in which the Employee does not participate actively in the business and in which the Employee’s direct or indirect investment does not exceed twenty percent of the capital of the business.

6.3

Solicitation of Business Restricted

In consideration of the mutual covenants and promises contained herein, including but not limited to the provisions governing notice of termination, and in addition to his common law duties set out in 6.1 above, the Employee agrees that during the term of this Agreement and for a period of eighteen (18) months after termination of this Agreement, however caused, the Employee shall not,

(a)

persuade or induce any customer of any of the Employer’s businesses to patronize any other business similar in nature to all or part of the Employer’s business or which competes in any way with the Employer’s businesses;

(b)

canvass, solicit or accept business from any customer of the Employer for the gain, profit or pecuniary advantage of the Employee independently of the employment hereunder or for the gain, profit or pecuniary advantage of any 

- 13 -

business similar in nature to all or part of the Employer’s business or which competes in any way with the Employer’s businesses; or 

(c)

request or advise any customer of any of the Employer’s businesses to withdraw, curtail or cancel such customer’s business with the Employer’s businesses.

6.4

Restrictions on Hiring Away

In consideration of the mutual covenants and promises contained herein, including but not limited to the provisions governing notice of termination, the Employee agrees that during the term of this Agreement and for a period of eighteen (18) months after termination of this Agreement, however caused, the Employee shall not directly hire or take away or cause or induce or persuade to be hired or taken away any employee of the Employer.

6.5

Remedies Protected

The Employee acknowledges that he has knowledge, skill and ability of a special and unique value gained in part as a result of the employment hereunder, and that the monetary value of the loss of such knowledge, skill and ability to the operations of the Employer cannot be estimated with certainty and cannot be adequately compensated by damages.  The Employee further acknowledges that, in the highly competitive business operations in which the Employer is engaged, personal contact is of primary importance in securing new customers and in retaining the patronage and goodwill of present customers and protecting the business of the Employer.  The Employee therefore agrees as follows:

(a)

that the Employer shall have the right, in addition to any other rights which the Employer may have, to enjoin the Employee by appropriate injunction proceedings from engaging in any act or omission in violation of Sections 6.1, 6.3 and 6.4 hereof;

(b)

that all restrictions imposed hereunder during and after this Agreement and the employment hereunder are reasonable and valid, and the Employee waives any defences to the strict enforcement thereof; and

(c)

that the claim or cause of action by the Employee against the Employer, whether based on this Agreement or otherwise, shall not constitute a defence to the enforcement by the Employer of the covenants or restrictions.

6.6

Substitution

With respect to Sections 6.1, 6.3 and 6.4 of this Agreement, in the event that a court of competent jurisdiction determines that the period of eighteen (18) months or the scope of the restrictions specified in such Sections is unreasonable and that such provision would for that reason be void or unenforceable, the parties hereby request the court to substitute such shorter period or narrower scope therefore as would provide the maximum protection to the Employer consistent with the enforceability of that provision.

- 14 -

PART 7 - SURVIVAL

Notwithstanding any other provision in this Agreement, the provisions of Sections 2.3, and 6 of this Agreement and all other provisions in this Agreement which are reasonably necessary to enforce the provisions of Sections 2.3 and 6 of this Agreement shall survive the termination of this Agreement and shall continue in full force and effect thereafter.

PART 8 - PROHIBITIONS AGAINST ASSIGNMENTS

The Employee shall not be at liberty to assign the Employee’s rights under this Agreement or to delegate to others any of the Employee’s functions and duties hereunder.

PART 9 - ENTIRE AGREEMENT AND RELEASE

This Agreement and the Release referred to herein contain the entire agreement between the parties and, except as specifically provided in this Agreement and in the specific agreements relating to any incentive plans that may be implemented from time to time after the Effective Date of this Agreement, supersede and cancel any and all prior expectations, understandings, communications, representations and agreements, whether written or oral, with respect to the employment of the Employee by the Employer or any company or entity related to the Employer and there are no agreements collateral hereto other than as are expressly set forth herein.  As a condition precedent to commencing employment with the Employer under the terms of this Agreement, the Employee agrees to execute a Release substantially in the form attached to this Agreement as Schedule “A”.

PART 10- SEVERABILITY

If any provision of this Agreement is unenforceable or invalid for any reason whatsoever, such unenforceability or invalidity shall not affect the enforceability or validity of the remaining provisions of this Agreement, and such unenforceable or invalid provisions shall be severed from the remainder of this Agreement.

PART 11 - GOVERNING LAW

This Agreement shall, in all respects, be subject to and be interpreted, construed and enforced in accordance with the laws in effect in the Province of British Columbia and the laws of Canada applicable therein.  Each of the parties hereto irrevocably accepts and attorns to the jurisdiction of the Supreme Court of British Columbia and all courts of appeal therefrom, except insofar as courts of other jurisdictions are requested to enforce the restrictive covenants contained herein.

- 15 -

PART 12 - NOTICES

Any notice or other communication required or permitted to be given under this Agreement shall be delivered by hand or courier or sent by prepaid registered mail to the parties hereto as follows:

(a)

to the Employer at:

the Office of the Chairman of Kinder Morgan whose address as of the date of this Agreement is as follows:

Kinder Morgan, Inc.

500 Dallas St., Suite 1000

Houston, TX

77002

(b)

to the Employee at:

c/o Terasen Gas Inc.

16705 Fraser Highway

Surrey, British Columbia

V3S 2X7

PART 13– SUCCESSION 

This Agreement and everything herein contained shall enure to the benefit of and be binding upon the parties hereto, and their respective legal representatives, executors, administrators, trustees, receivers, receiver managers, and successors.

PART 14 - AMENDMENT

This Agreement may not be altered or modified except by agreement in writing signed by the parties.

PART 15- EXECUTION BY COUNTERPARTS

This Agreement may be executed in counterpart, including counterpart by facsimile, and such counterparts together shall constitute one and the same instrument and notwithstanding the date of execution shall be deemed to be executed on date as set out on the first page of this Agreement.

PART 16- AGREEMENT VOLUNTARY AND EQUITABLE

The Employer and the Employee acknowledge that they have carefully considered and understand the terms of employment contained in this Agreement including, without limitation, the Employer’s rights upon termination and the restrictions on the Employee after termination, and acknowledge that the terms of this Agreement are mutually fair and equitable, and that they have each executed this Agreement voluntarily and of their own free will.  The Employee acknowledges that, prior to entering into this Agreement, the Employee has been provided with 

 

- 16 -

copies of all policies and procedures which were in effect as of the Effective Date of this Agreement.

IN WITNESS WHEREOF the parties have hereto duly executed and delivered this Agreement.

				
	 
	 
	TERASEN GAS INC.

	 
	 
	 

	 
	 
	By:

	 

	 
	 
	 
	 

	 
	 
	Authorized Signatory

					
	SIGNED, SEALED AND DELIVERED by

	)

	 
	 
	 

	RANDALL JESPERSEN in the presence of:

	)

	 
	 
	 

	 
	)

	 
	 
	 

	 
	)

	 
	 
	 

	 /s/ Shelly Watson

	)

	 
	 
	 

	Signature

	)

	 
	 
	 

	 
	)

	 
	 /s/ Randall Jespersen

	 

	 Shelly Watson

	)

	 
	RANDALL JESPERSEN

	 

	(Print Name)

	)

	 
	 
	 

	 
	)

	 
	 
	 

	 	)

	 
	 
	 

	(Address)

	)

	 
	 
	 

	 
	)

	 
	 
	 

	 Executive Assistant

	)

	 
	 
	 

	(Occupation)

	)

	 
	 
	 

- 17 -

SCHEDULE “A”

RELEASE

KNOW ALL MEN BY THESE PRESENTS that RANDALL JESPERSEN of ____________, British Columbia (“RELEASOR”), in consideration of the payment of $10.00, the good and valuable consideration as set out in the written employment agreement attached to this Release as Schedule “A” (the “Employment Agreement”) and other good and valuable consideration to be paid and given to the RELEASOR by Terasen Gas Inc. (the “Employer”), the receipt and sufficiency of which is hereby acknowledged, hereby remises, releases and forever discharges the Employer and, as applicable, the Employer’s affiliates and subsidiaries and all of their respective officers, directors, shareholders, employees, agents, successors, administrators, executors, heirs and assigns (collectively, the “RELEASEE”) of and from any and all actions, causes of action, suits, debts, dues, accounts, costs, legal costs, contracts, claims and demands of every nature or kind, statutory or otherwise, including any claims made, pursuant to, as applicable, the Canada Labour Code, the Canadian Human Rights Act, the Employment Standards Act (British Columbia), the Human Rights Code (British Columbia), the Employment Standards Code (Alberta) or the Human Rights, Citizenship and Multiculturalism Act (Alberta), which the RELEASOR, and, as applicable, the RELEASOR’S officers, directors, partners, shareholders, employees, agents, successors, administrators, executors, heirs and assigns now or at any time hereafter can, shall or may have in any way arising or resulting from any cause, matter, or anything whatsoever, whether known or unknown, suspected or unsuspected existing as to the present time that the RELEASOR can, shall or may have against the RELEASEE, including, without restricting the generality of the foregoing but for greater certainty, any claims that are based on, relate to, or arise in connection with:

(a)

the employment of the RELEASOR by the Employer or, as applicable, the Employer’s affiliates or  subsidiaries;

(b)

the termination of that employment howsoever arising, including without limitation, any claims for notice, severance pay or pay in lieu of notice of termination whether as a result of a change in control of the Employer or otherwise, wrongful dismissal or vacation pay;

- 18 -

(c)

any entitlement the RELEASOR may have to bonuses, options, or shares pursuant to any of the incentive plans made available to the RELEASOR by the Employer including, without limitation, any Short-Term Incentive Plan, Medium Term Incentive Plan and Long-Term Incentive Plan in place at the time of execution of this Release and any claims arising out of the termination of the aforesaid plans;

(d)

any loss of office; and

(e)

the termination of any other of the RELEASOR’S allowances and benefits

(all of which are hereinafter referred to as the “Matters”).

THE RELEASOR FURTHER COVENANTS AND AGREES that this RELEASE shall bind, as applicable, the RELEASOR’S officers, directors, partners, shareholders, employees, agents, successors, administrators, executors, heirs and assigns, and the RELEASEE shall not by the payment of the consideration aforesaid or otherwise, be deemed to have admitted any liability to the RELEASOR in respect of any claim which the RELEASOR presently has or hereafter can, shall or may have and any such liability by the RELEASEE is in fact expressly denied.

THE RELEASOR ACKNOWLEDGES that any person or entity who satisfies the definition of “RELEASEE” set forth above has the direct right to enforce this RELEASE against the RELEASOR.  To the extent required by law to give full effect to these direct rights, the RELEASOR agrees and acknowledges that the Employer is acting as agent and/or as trustee of any other RELEASEE who is a RELEASEE by virtue of its relationship to the Employer.

IT IS FURTHER UNDERSTOOD AND AGREED that for the consideration expressed herein, the RELEASOR agrees not to make any claim or take any proceedings against any other person or corporation who might claim contribution or indemnity from the RELEASEE with respect to any of the Matters.

IT IS FURTHER UNDERSTOOD AND AGREED that the RELEASOR will not disclose, except in the necessary conduct of his business and to his legal and financial advisors 

- 19 -

(and then only to the extent absolutely necessary) or unless required to do so by law, the fact of, or the terms of this RELEASE.

IT IS FURTHER UNDERSTOOD AND AGREED that the RELEASOR HEREBY REPRESENTS AND DECLARES that the RELEASOR executes this RELEASE as the RELEASOR’S own free act (and has not been influenced to any extent whatsoever in executing this RELEASE by any representations or statements made by the RELEASEE, or by any person on behalf of the RELEASEE) and that the RELEASOR has read this RELEASE and has had an opportunity to take independent legal advice as to its terms and the RELEASOR acknowledges that the RELEASEE relies on this representation and declaration.

THIS RELEASE shall be governed by, and construed in accordance with, the laws of the Province of British Columbia and the laws of Canada applicable therein.

IN THE EVENT THAT any provision of this RELEASE becomes or is declared by a court of competent jurisdiction or arbitrator to be illegal, unenforceable or void, this RELEASE shall continue in full force and effect without said provision.

IT IS FURTHER UNDERSTOOD AND AGREED that terms of this RELEASE are contractual, and not merely a recital.

IN WITNESS WHEREOF, the RELEASOR has executed this RELEASE as of the ________ day of November, 2005.

			
	 
	 
	 

	SIGNED, SEALED AND DELIVERED BY 

	)

	 

	RANDALL JESPERSEN IN THE PRESENCE OF:

	)

)

	 

	 
	)

	 

	 
	)

	 

	Witness 

	)

	RANDALL JESPERSEN

	 
	)

	 

	 
	)

	 

	Address

	)

	 

	 
	)

	 

	 
	)

	 

	Occupation

	)

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