Document:

RETIREMENT AGREEMENT

         This Retirement Agreement (this "Agreement") is entered into on this
31st day of May, 2001 between J. Gordon Hurst ("Executive") and Vectren
Corporation ("Vectren").

         WHEREAS, Executive and Vectren are parties to an Employment Agreement
dated as of March 31, 2000 (the "Employment Agreement");

         WHEREAS, Executive and Vectren desire that Executive retire from
employment with Vectren prior to the expiration of the Employment Agreement; and

         WHEREAS, Executive and Vectren have negotiated the following terms and
conditions for Executive's retirement.

         NOW THEREFORE, in consideration of the foregoing premises and the
agreement contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows.

         1. Retirement. Executive hereby tenders Executive's voluntarily
retirement from Vectren effective 11:59 p.m. Central Standard Time May 31, 2001
(the "Retirement Date"). Until that time, Executive will continue to be employed
by Vectren pursuant to the terms of the Employment Agreement. The Employment
Agreement will terminate as of the Retirement Date and Executive acknowledges
and agrees that as of the Retirement Date, Vectren shall have no further
obligations to Executive under the Employment Agreement.

         2. Deferral Compensation Payment. Vectren agrees to pay Executive a
post-retirement deferral compensation payment in the gross sum of $2,097,455.50,
less all applicable payroll withholdings, including all state, local, and
federal taxes (the "Retirement Payment"). The Retirement Payment shall be
reported by Vectren on the appropriate W-2 form and shall be made as follows:
(i) $116,745.52 in one lump sum; and (ii) $1,980,700.00 shall be deferred and
payable in accordance with the schedule attached hereto as Exhibit A. Such
deferred amount shall be credited to a bookkeeping account and credited with
interest in the manner described below. Vectren is under no obligation to fund
the bookkeeping account. The deferred amount shall be paid out of the general
assets of Vectren and Executive shall be an unsecured general creditor of
Vectren with respect to the deferred amounts. The unpaid deferred amount shall
earn interest at the rate of eight percent (8%) per annum. Accrued interest on
any unpaid deferred amount shall be paid along with each payment. If Executive
dies before payment of all of the deferred amounts, the remaining payments shall
be made in accordance with the terms of this Agreement to Executive's
beneficiary as designated to Vectren and if no beneficiary has been designated
to Executive's estate.

         No Retirement Payment shall be made until after the effective date of
this Agreement (as determined pursuant to Section 8). All payments shall be
mailed to Executive's address listed in Vectren's records within 30 days
following the payment due date.

<PAGE>  2

       Executive hereby elects not to have Federal income tax withheld from
Executive's distributions under this Agreement. Executive acknowledges and
agrees that Executive is liable for payment of Federal income tax on the taxable
portion of any distribution to Executive and Executive may be subject to tax
penalties under the estimated tax payment rules if Executive's payments of
estimated tax are not adequate. Executive's election not to have Federal income
tax withheld from Executive's distributions will remain in effect until
Executive revokes such election by providing notice of such revocation to
Vectren in accordance with this Agreement at least 60 days prior to the
effective date of such revocation.

         3. Welfare Benefits. During the Term (as defined in Section 12),
Executive shall continue to be eligible to participate in the health insurance
plan, the dental insurance plan, the vision insurance plan, the accidental death
and disability plan (in the amount of Executive's most recent base salary) and
the executive long term disability plan (collectively the "Welfare Benefit
Plans") of Vectren. Such participation by Executive during the Term shall be
governed by the terms and conditions of the respective Welfare Benefit Plan, as
such terms and conditions are amended, restated, canceled or replaced from time
to time. During the Term, Vectren and Executive shall continue to pay their
respective portions of the premium payments under such Welfare Benefit Plans in
accordance with the terms of the respective Welfare Benefit Plan, and Executive
shall be billed quarterly for Executive's portion of such premium. After the
Term until Executive is age 65, Executive's ability to continue to participate
in Vectren's health insurance plan shall be governed by the terms of such health
insurance plan as in effect at that time and thereafter. After age 65 and until
the death of Executive, during such time as Executive is covered by Medicare,
Vectren will reimburse Executive for Executive's cost of Medicare Part B and
Executive will be eligible to participate in Vectren's Medicare supplement plan.
After the Term, Executive's ability to continue to participate in Vectren's
executive long term disability plan shall be governed by the terms of such
executive long term disability plan as in effect at that time and thereafter. If
Executive elects to continue the executive long term disability plan, then (i)
Executive shall provide Vectren with written notice of such election on or
before the end of the Term, (ii) Executive shall become responsible for all
premium payments under the long term disability plan on and after the end of the
Term, and (iii) Executive shall be responsible for and pay all taxes associated
with the election to continue the long term disability plan by Executive.
Nothing in this Agreement shall in any way limit Vectren's ability to amend,
restate, cancel or replace any such Welfare Benefit Plan and the Medicare
supplement plan in Vectren's sole discretion.

<PAGE>  3

         4. Term Life Insurance. During the Term, Executive shall be eligible to
receive term life insurance in the amount of two times Executive's most recent
base salary. Executive acknowledges and agrees to provide Vectren and the
insurance provider with such information as is deemed necessary to issue a term
life insurance policy on Executive including, but not limited to, a physical
examination. During the Term, Vectren shall pay all premiums for such term life
insurance. Upon expiration or earlier termination of the Term, Executive shall
have the option to assume the term life insurance policy. If Executive elects to
assume the term life insurance policy then (i) Executive shall provide Vectren
with written notice of such assumption on or before the end of the Term, (ii)
Executive shall become responsible for all premium payments under the term life
insurance policy on and after the end of the Term, and (iii) Executive shall pay
any and all taxes associated with the assumption of such term life insurance
policy.

         5. Acknowledgment of Retirement Status. Executive shall be deemed
"retired" pursuant to the terms of the Vectren Corporation Executive Restricted
Stock Plan ("Restricted Stock Plan"). Vectren acknowledges that the Chief
Executive Officer (the "CEO") has consented to the early retirement of Executive
under the Restricted Stock Plan. Executive acknowledges and agrees that as a
result of Executive's retirement and the receipt of consent of such early
retirement from the CEO, Executive is entitled to 3,356 restricted shares from
the grant of restricted shares made to Executive as of October 1, 2000 under the
Restricted Stock Plan and the balance of the restricted shares granted as of
such date are forfeited. Executive further acknowledges and agrees that the
restricted shares to which Executive is entitled remain subject to the terms and
conditions of the Restricted Stock Plan including, but not limited to, the
restrictions and forfeiture provisions contained in the Restricted Stock Plan.
Notwithstanding anything contained herein to the contrary, Executive's rights
under the Vectren Corporation Nonqualified Deferred Compensation Plan (the
"Deferred Compensation Plan") and the Southern Indiana Gas & Electric Company
1994 Stock Option Plan (the "SIGECO Option Plan") shall be governed by the
provisions set forth in the Deferred Compensation Plan and the SIGECO Option
Plan and not this Agreement.

         6.       General Release and Waiver.

(a) Executive hereby agrees that in order to receive the considerations set
forth in this Agreement, and for other good and valuable consideration including
the Retirement Payment, the receipt and adequacy of which is hereby
acknowledged, Executive was required to sign this Agreement and that Executive,
for Executive and Executive's heirs, representatives, successors and assigns,
hereby WAIVES, RELEASES and FOREVER DISCHARGES Vectren, Vectren's current and
former affiliates and their predecessors and successors and their respective
officers, directors, shareholders, employees, and agents, both individually and
in their official capacities, from any claim, demand, action, cause of action,
or right, known or unknown, which arose at any time from the beginning of time
to the date Executive executes this Agreement relating to, arising out of, or in
any way connected with Executive's employment, the cessation of that employment,
or the compensation or benefits payable in connection with that employment or

<PAGE>  4

the cessation of that employment including, but not limited to, any claim,
demand, action, cause of action or right based on but not limited to: (i) the
Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. * 621, et
seq. and the Older Workers' Benefit Protection Act; (ii) Title VII of the Civil
Rights Act of 1964, as amended, 42 U.S.C. * 2000(e), et seq.; (iii) the
Americans With Disabilities Act of 1990, as amended, 42 U.S.C. * 12101, et seq.;
(iv) the Family & Medical Leave Act of 1993, 29 U.S.C. * 2601, et seq.; (v) the
Indiana Civil Rights Law, IND. CODE 22-9-1, et seq.; (vi) the Fair Labor
Standards Act, 29 U.S.C. * 201, et seq.; (vii) any existing or potential
entitlement or benefit under any Vectren program or plan; (viii) any agreement,
contract, or representation, whether oral or written, express or implied; and
(ix) any other federal, state, or local law, whether emanating or arising from
statute, constitution, executive order, regulation, common law, or other source
including, but not limited to, any action sounding in tort or contract, any
action relating to age, sex, disability, racial or other discrimination or any
action for wrongful discharge.

                  (b) Executive does not hereby waive or release (i) any right
         or claim that may arise after the date of this Agreement or (ii) any
         non-forfeitable rights or benefits the Executive has accrued under any
         tax qualified retirement plan.

                  (c) Executive is specifically agreeing that Executive is
         WAIVING, RELEASING and FOREVER DISCHARGING any claim, demand, action,
         cause of action or right arising out of or relating to the termination
         of Executive's employment, recognizing that the decision to terminate
         employment is being made now, even though actual termination of
         employment is taking effect later, and that the termination will take
         place as provided in this Agreement without any further action on the
         part of either Executive or Vectren.

         7.       Confidentiality and Non-Competition.

                  (a) Confidentiality. Executive agrees to hold in a fiduciary
         capacity for the benefit of Vectren all secret or confidential
         information, knowledge or data relating to Vectren or any of its
         affiliated companies, and their respective businesses, which shall have
         been obtained by Executive during Executive's employment by Vectren or
         any of its affiliated companies and which shall not be or become public
         knowledge (other than by acts by Executive or representatives of
         Executive in violation of this Agreement). After the Retirement Date,
         Executive shall not, without the prior written consent of Vectren or as
         may otherwise be required by law or legal process (provided Vectren has
         been given notice of and opportunity to challenge or limit the scope of
         disclosure purportedly so required), communicate or divulge any such
         information, knowledge or data to anyone other than Vectren and those
         designated by it. In addition, Executive shall not solicit employees of
         Vectren for the period beginning on the Retirement Date and ending on
         the date one (1) year after the Term (as hereinafter defined).

<PAGE>  5

                  (b) Non-Compete. From the Retirement Date until the end of the
         second year following the end of the Term, Executive will not directly
         or indirectly, own, manage, operate, control or participate in the
         ownership, management, operation or control of, or be connected as an
         officer, employee, partner, director or otherwise with, or have any
         financial interest in, any business which competes, or that is planning
         to compete, with the utility business of Vectren or any of its
         affiliates or any other business in which Vectren or any of its
         affiliates are engaged immediately prior to the Retirement Date or
         during the Term in: (i) Indiana; (ii) Ohio, (iii) Michigan, (iv)
         Illinois; (v) Kentucky; and (vi) the United States. The parties
         expressly agree that the terms of this limited non-competition
         provision under this section are reasonable, enforceable, and necessary
         to protect Vectren's interests, and are valid and enforceable. In the
         unlikely event, however, that a court of competent jurisdiction were to
         determine that any portion of this limited non-competition provision is
         unenforceable, then the parties agree that the remainder of the limited
         non-competition provision shall remain valid and enforceable to the
         maximum extent possible.

                  (c) Damages; Specific Enforcement/Injunctive Relief. Executive
         agrees that it would be difficult to measure damages to Vectren from
         any breach of the covenants contained in subsections (a) and (b) above,
         but that such damages from any breach would be great, incalculable and
         irremediable, and that damages would be an inadequate remedy.
         Accordingly, Executive agrees that upon a breach of any of the
         covenants contained in subsections (a) and (b) above (i) Vectren may
         have specific performance of the terms of this Agreement in any court
         permitted by this Agreement and (ii) Executive shall immediately return
         any payment paid pursuant to this Agreement including, but not limited
         to, the Retirement Payment and waive any future payment pursuant to
         this Agreement including, but not limited to, the Retirement Payment.
         The parties agree, however, that specific performance, the return and
         waiver of payments and the other remedies described herein shall not be
         the exclusive remedies, and Vectren may enforce any other remedy or
         remedies available to it either in law or in equity including, but not
         limited to, temporary, preliminary, and/or permanent injunctive relief.

         8. Return of Property. Immediately upon the request of Vectren,
Executive agrees to return to the custody of Vectren all Vectren property and
proprietary information, as well as all copies thereof, that are in Executive's

<PAGE>  6

possession, custody or control. This includes all tangible personal property
(such as keys, credit cards, computers, hand held devices, cell phones, etc.)
and all writings, contracts, records, files, tape recordings, correspondence,
communications, summaries, data, notes, memoranda, diskettes, or any other
source containing information which relates to or references Vectren and which
was provided by Vectren or obtained as a result of Executive's employment with
Vectren.

         9. Covenant Not to Sue. Executive agrees that Executive will not
commence any legal action or lawsuit, or otherwise assert any legal claim, in
violation of the waiver and release contained in this Agreement or on any claim
released in this Agreement, except to the extent such right to bring a legal
action may not be waived by law. Executive agrees that if Executive violates
this covenant not to sue or this Agreement (a) that Executive's lawsuit is null
and void, and must be summarily withdrawn and/or dismissed; (b) that Executive
shall pay all costs, expenses, and damages incurred by Vectren in defending
against and as a result of Executive's lawsuit, including reasonable attorneys'
fees; (c) that Executive shall pay all costs and expenses incurred by Vectren in
seeking enforcement of this Agreement; and (d) that Executive shall immediately
return any payment paid pursuant to this Agreement including, but not limited
to, the Retirement Payment and waive any future payment pursuant to this
Agreement including, but not limited to, the Retirement Payment.

         10. Knowledge and Understanding. Executive acknowledges that before
Executive signed this Agreement: (a) Executive was advised to consult with an
attorney prior to executing this Agreement, (b) Executive had a period of
twenty-one (21) days within which to consider this Agreement; and (c) Executive
is fully aware of Executive's rights, and has carefully read and fully
understands all provisions of this Agreement. Executive further acknowledges
that this Agreement has been signed freely, knowingly, and voluntarily and that
Executive has not been threatened or coerced into signing this Agreement.
Executive further acknowledges that to the extent Executive has signed this
Agreement less than twenty-one (21) days after it was furnished to Executive,
Executive does so for Executive's own personal reasons and with an understanding
that Executive could have taken the full twenty-one (21) days to consider this
Agreement.

         11. Revocation and Effective Date. For a period of seven (7) days
following Executive's execution of this Agreement, Executive may revoke this
Agreement by submitting a written revocation to Vectren. Executive may revoke
this Agreement during the revocation period for any reason or no reason at all.
This Agreement shall not become effective or enforceable, and the payments and
benefits stated above shall not become payable or due, until this Agreement has
been signed by both parties and the revocation period has expired without this

<PAGE>  7

Agreement being revoked by either party. If this Agreement is not timely revoked
by either party, it shall become effective and enforceable on the eighth (8th)
day after it is executed by both parties.

         12.      Consulting Agreement.

                  (a) Commencement of Consulting Services. As of the Retirement
         Date, Vectren hereby appoints and engages Executive after the
         Retirement Date as an independent contractor and not as an employee,
         and Executive hereby accepts appointment and engagement as a consultant
         to Vectren, upon the terms and conditions contained in this Section.

                  (b) Term. Executive shall provide the services described in
         this Section beginning on the Retirement Date and ending three years
         after the Retirement Date, unless, prior to such date, Executive or
         Vectren terminates, with or without cause, Executive's services (the
         "Term").

                  (c) Activities of Executive. During the Term, Executive shall
         undertake for and on behalf of, and to the extent requested by, Vectren
         subject to the limitations set forth herein, to advise Vectren by
         telephone, electronically, in writing or in person: (i) with respect to
         the business of Vectren as it exists on the Retirement Date including,
         but not limited to, environmental issues and testimony in proceedings
         regarding same or (ii) with respect to other matters relating to the
         business of Vectren and within the knowledge of Executive for which
         consultation shall reasonably be requested by Vectren from time to
         time. In performing the consulting work for Vectren, Executive shall
         (i) have no formal schedule of duties or assignments, (ii) be required
         to perform services for Vectren a minimum of 20 hours per month, (iii)
         be subject to control and supervision of Vectren, and (iv) be required
         to comply with any detailed orders and instructions given by Vectren
         from time to time.

                  (d) Time and Place for the Performance of Executive's Duties.
         In performing consulting work for Vectren, Executive shall (i) work at
         such times as either Executive may elect or as Vectren may reasonably
         request, and (ii) shall perform consulting work at such locations as
         Vectren may reasonably require.

                  (e) Non-Performance Payment. If Executive fails to perform the
         services required under this Agreement for the full three year period,
         then Executive shall immediately pay to Vectren, or at Vectren's option
         permit Vectren to offset from any amount payable to Executive, $50,000

<PAGE> 8

         for each year and portion thereof that Executive did not perform the
         services required; provided, however, such payments or offset shall not
         be effected unless Vectren provides Executive with written notice of
         Executive's failure to perform the services required and Executive
         fails to cure such failure to the satisfaction of Vectren within five
         calendar days after receipt of such notice.

                  (f) Applicability of Provisions and Extension of Time Periods.
         Executive acknowledges and agrees that the confidentiality and
         non-competition provisions contained in Section 4 of this Agreement
         shall be applicable during the Term (provided the provision of
         consulting services provided pursuant to this Section shall be
         permitted) and shall be applicable after the Term for the period
         provided in Section 4 as if the Retirement Date was the end of the
         Term.

                  (g) Tax Treatment. The parties agree that payments hereunder
         (i) constitute ordinary income to Executive, (ii) are deductible by
         Vectren, (iii) do not constitute wages for purposes of Federal Income
         Contributions Act ("FICA") but constitute earnings from self-employment
         for purposes of FICA and are therefore the responsibility of Executive.
         The parties agree to file tax returns and pay taxes consistent with
         this subsection, to resist (and cooperate with each other in resisting)
         any assertion to the contrary by any governmental agency and to
         indemnify each other from and against any loss or expense by reason of
         a breach of the foregoing.

         13.      Miscellaneous.

                  (a) This Agreement shall apply to Executive, as well as to
         Executive's heirs, executors, and administrators. This Agreement also
         shall apply to, and inure to the benefit of, Vectren, the predecessors,
         successors, and assigns of Vectren and each of their respective past,
         present, or future employees, agents, representatives, trustees,
         officers, or directors.

                  (b) The parties agree that the provisions of this Agreement
         are both reasonable and enforceable. However, if any provision of this
         Agreement were determined to be unenforceable or invalid, the parties
         agree that such provision shall be enforced to the maximum extent
         permitted by law and that the remaining provisions shall remain in full
         force and effect.

<PAGE>  9

                  (c) This Agreement shall not be considered to create an escrow
         account, trust fund or other funding arrangement of any kind or a
         fiduciary relationship between Executive and Vectren.

                  (d) Executive shall not have any right to anticipate, pledge,
         alienate or assign any rights under this Agreement and any effort to do
         so shall be null and void. The amounts payable under this Agreement
         shall be exempt from the claims of creditors or other claimants and
         from all orders, decrees, levies and executions and any other legal
         process to the fullest extent that may be permitted by law.

                  (e) The parties acknowledge and agree that this Agreement
         shall be governed, interpreted, and enforced under the laws of the
         State of Indiana, without regard to conflicts of law principles.

                  (f) This Agreement and the other documents and agreements
         executed in connection with this Agreement sets forth the complete
         agreement between the parties relating to the subject matter herein.
         Executive acknowledges and agrees that, in executing this Agreement,
         Executive does not rely and has not relied upon any representations or
         statements not set forth herein made by Vectren with regard to the
         subject matter, basis, or effect of this Agreement or otherwise.

                  (g) Any prior agreement between Executive and Vectren and/or
         Vectren's predecessors or their past and present affiliates relating to
         Executive's employment, including, but not limited to, the Employment
         Agreement (the "Prior Agreements") are terminated as of the Retirement
         Date without any remaining obligations of either party thereunder and
         are as of the Retirement Date superseded by this Agreement. All
         payments made under this Agreement are in full satisfaction of all
         amounts due Executive under the Prior Agreements.

                  (h) This  Agreement  may not be  amended  or  modified  other
         than by a  written  agreement executed by the parties hereto.

                  (i) All notices and other communications hereunder shall be in
         writing and shall he given by hand delivery to the other party or by
         registered or certified mail, return receipt requested, postage
         prepaid, addressed as follows:

<PAGE>  10

         If to Executive:             If to Vectren:
         ---------------              -------------

         J. Gordon Hurst              Vectren Corporation
         5000 Royal Oak Drive         20 N.W. Fourth Street
         Evansville, IN  47720        Evansville, Indiana  47708
                                      Attn: Ronald E. Christian, General Counsel

         or to such other address as either party shall have furnished to the
         other in writing in accordance herewith. Notice and communications
         shall be effective when actually received by the addressee.

                  (j)   This Agreement may be executed in  counterparts  and
         when executed shall constitute one agreement.

                     [signature page immediately following]

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

                                     "Vectren"

                                      Vectren Corporation

                                      By:  /s/Richard G. Lynch
                                      Printed: Richard G. Lynch
                                      Title: Sr. Vice President

                                      "Executive"

                                      /s/ J. Gordon Hurst
                                      Printed: J. Gordon Hurst

<PAGE>  1

EXHIBIT A

Gordon Hurst -- Deferred Payments

           Interest Rate  Interest Earned Principle Payment       Total Payment
      6/1/01           0               0                  0                   0

      1/2/02      4.712%     $ 91,927.05       $ 975,388.78      $ 1,067,315.83
      4/1/03      9.951%     $ 97,057.86       $ 487,694.39      $   584,752.25
      4/1/04      8.022%     $ 39,122.44       $ 487,694.39      $   526,816.83

                                              ---------------------------------
                                               $ 1,950,777.56    $ 2,178,884.92
                                              =================================VECTREN CORPORATION
                              EMPLOYMENT AGREEMENT

         This AGREEMENT by and between Vectren Corporation, an Indiana
corporation (the "Company"), and William S. Doty (the "Executive"), dated as of
the 30th day of April, 2001.

         1. Employment Period. The Company hereby agrees to employ the
Executive, and the Executive hereby agrees to remain in the employ of the
Company subject to the terms and conditions of this Agreement, for the period
commencing on April 30, 2001 (the "Commencement Date") and ending on the third
annual anniversary of the Commencement Date (the "Employment Period"); provided,
however, that the Employment Period shall automatically be extended without
action by either party for one (1) month periods, without further action of the
parties, as of the first month anniversary of the Commencement Date and each
succeeding monthly anniversary unless the Company or the Executive shall have
served written notice to the other party prior to May 31, 2001 or prior to any
subsequent monthly anniversary, as the case may be, of its or his intention that
the Agreement shall terminate at the end of the thirty-six (36) month period
that begins with the monthly anniversary of the Commencement Date immediately
following the date of such written notice; provided, further, that the
Employment Period shall automatically terminate upon the Executive's attainment
of age sixty-five (65). A notice delivered by the Company or the Executive that
it or he does not intend to extend the term of this Agreement shall hereinafter
be referred to as a "Nonrenewal Notice." For purposes of this Agreement,
employment and compensation paid by any direct or indirect subsidiary of the
Company will be deemed to be employment and compensation paid by the Company.

         2.       Terms of Employment.
                  -------------------

                  (a)      Position and Duties.
                           -------------------

                           (i) During the Employment Period, the Executive shall
                  serve in the position and at the location set forth on Exhibit
                  A hereto, or such other executive position(s) appropriate to
                  the Executive's training, qualifications or experience, as the
                  Compensation Committee of the Company may from time to time
                  determine which position(s) are reasonably comparable to the
                  Executive's initial position.

                           (ii) During the Employment Period, and excluding any
                  periods of vacation and sick leave to which the Executive is
<PAGE>

                  entitled, the Executive agrees to devote full attention and
                  time during normal business hours to the business and affairs
                  of the Company and to use the Executive's reasonable best
                  efforts to perform such responsibilities in a professional
                  manner. It shall not be a violation of this Agreement for the
                  Executive to (A) serve on corporate, civic or charitable
                  boards or committees, (B) deliver lectures, fulfill speaking
                  engagements or teach at educational institutions and (C)
                  manage personal investments, so long as such activities do not
                  significantly interfere with the performance of the
                  Executive's responsibilities as an employee of the Company in
                  accordance with this Agreement. It is expressly understood and
                  agreed that to the extent that any such activities have been
                  conducted by the Executive prior to the Commencement Date, the
                  continued conduct of such activities (or the conduct of
                  activities similar in nature and scope thereto) subsequent to
                  the Commencement Date shall not thereafter be deemed to
                  interfere with the performance of the Executive's
                  responsibilities to the Company.

                  (b)      Compensation.
                           ------------

                           (i) Base Salary. During the Employment Period, the
                  Executive shall receive an annual base salary ("Annual Base
                  Salary") in an amount no less than the Executive's annual base
                  salary in effect on the Commencement Date, payable in cash. If
                  the Annual Base Salary is increased after the Commencement
                  Date, the increased Base Salary amount shall become the
                  minimum level of Annual Salary for the Executive. The Annual
                  Base Salary shall be paid no less frequently than in equal
                  monthly installments.

                           (ii) Annual Bonus. During the Employment Period, the
                  Executive shall have an annual bonus opportunity no less than
                  the applicable target award percentage in effect for the
                  Executive's employment level which is in effect immediately
                  prior to the Commencement Date or, if greater, in effect at
                  any time after the Commencement Date.

                           (iii) Long-Term Incentives. During the Employment
                  Period the Executive shall be eligible to participate in all
                  long-term incentive plans and in all Company stock incentive
                  plans (the "Stock Incentive Plan"), practices, policies and
                  programs to the extent applicable generally to other peer
                  executives of the Company and its affiliated companies. The
                  Executive's awards under the Stock Incentive Plan shall be no
<PAGE>

                  less than the applicable awards in effect for the Executive's
                  employment level which is in effect at the Commencement Date
                  or, if later, at the date of his initial participation in the
                  Stock Incentive Plan; provided, however, that if the awards
                  under the Stock Incentive Plan subsequently increases, the
                  increased award level shall become the minimum award.

                           (iv) Savings and Retirement Plans. During the
                  Employment Period, the Executive shall be eligible to
                  participate in all savings and retirement plans, practices,
                  policies and programs to the extent applicable generally to
                  other peer executives of the Company and its affiliated
                  entities. Notwithstanding anything contained in this Agreement
                  to the contrary and while Executive shall become a participant
                  in a nonqualified supplemental retirement plan ("Vectren
                  SERP"), the Vectren Transaction (as defined in Section 3(f) of
                  this Agreement) shall not be deemed to be an Acquisition of
                  Control for purposes of determining the Executive benefits, if
                  any, under the Vectren SERP.

                           (v) Welfare and Other Benefit Plans. During the
                  Employment Period, the Executive and/or the Executive's
                  family, as the case may be, shall be eligible for
                  participation in and shall receive all benefits and executive
                  perquisites under welfare, fringe, change of control
                  protection, incentive, vacation and other similar benefit
                  plans, practices, policies and programs provided by the
                  Company and its affiliated entities (including, without
                  limitation, medical, prescription, dental, disability,
                  employee life, group life, accidental death and travel
                  accident insurance plans and programs) to the extent
                  applicable generally to other peer executives of the Company
                  and its affiliated entities.

                           (vi) Expenses. During the Employment Period, the
                  Executive shall be entitled to receive prompt reimbursement
                  for all reasonable business expenses incurred by the
                  Executive, in accordance with the policies of the Company.

                           (vii) Indemnity. The Executive shall be indemnified
                  by the Company against claims arising in connection with the
                  Executive's status as an employee, officer, director or agent
                  of the Company in accordance with the Company's indemnity
                  policies for its senior executives, subject to applicable law.

         3.       Termination of Employment.
                  -------------------------

                  (a) Death or Disability. The Executive's employment shall
         terminate automatically upon the Executive's death during the
         Employment Period. If the Company determines in good faith that the
<PAGE>

         Disability (as defined below) of the Executive has occurred during the
         Employment Period, it may give to the Executive written notice in
         accordance with Section 9(b) of this Agreement of its intention to
         terminate the Executive's employment. In such event, the Executive's
         employment with the Company shall terminate effective on the thirtieth
         day after receipt of such notice by the Executive (the "Disability
         Commencement Date"), provided that, within the thirty day period after
         such receipt, the Executive shall not have returned to full-time
         performance of the Executive's duties. For purposes of this Agreement,
         "Disability" shall have the meaning set forth in the Company's
         long-term disability plan.

                  (b) Cause. The Company may terminate the Executive's
         employment during the Employment Period for Cause. For purposes of
         this Agreement, "Cause" shall mean:

                           (i)      intentional gross misconduct by the
                  Executive damaging in a material way to the Company, or

                           (ii) a material breach of this Agreement, after the
                  Company has given the Executive notice thereof and a
                  reasonable opportunity to cure.

                  (c) Good Reason. The Executive's employment may be terminated
         by the Executive for Good Reason. For purposes of this Agreement and
         before the conclusion of the Window Period (as defined in Section 3(f)
         below) of the Company, "Good Reason" shall mean a material breach by
         the Company of this Agreement after the Executive has given the Company
         notice of the breach and a reasonable opportunity to cure. After the
         Window Period, "Good Reason" shall mean, without the Executive's
         written consent, (i) a demotion in the Executive's status, position or
         responsibilities which, in his reasonable judgment, does not represent
         a promotion from his status, position or responsibilities as in effect
         immediately prior to the Change in Control (as defined in Section 3(f)
         below); (ii) the assignment to the Executive of any duties or
         responsibilities which, in his reasonable judgment, are inconsistent
         with such status, position or responsibilities immediately prior to the
         Change in Control; or any removal of the Executive from or failure to
         reappoint or reelect him to any of such positions that the Executive
         had immediately prior to the Change in Control, except in connection
         with the termination of his employment for total and permanent
         disability, death or Cause or by him other than for Good Reason; (iii)
         a reduction by the Company in the Executive's base salary as in effect
         on the date hereof or as the same may be increased from time to time
         during the term of this Agreement or the Company's failure to increase
         (within twelve (12) months of the Executive's last increase in base
<PAGE>

         salary) the Executive's base salary after a Change in Control in an
         amount which at least equals, on a percentage basis, the average
         percentage increase in base salary for all executive and senior
         Executives of the Company effected in the preceding twelve (12) months;
         (iv) the relocation of the principal executive offices of the Company
         or Company affiliate, whichever entity on behalf of which the Executive
         performs a principal function of that entity as part of his employment
         services, to a location more than fifty (50) miles outside the
         Evansville, Indiana metropolitan area or, if his services are not
         performed in Evansville, Indiana, the Company's requiring him to be
         based at any place other than the location at which he performed his
         duties immediately prior to the end of the Window Period, except for
         required travel on the Company's business to an extent substantially
         consistent with his business travel obligations at the time of a Change
         in Control; (v) the failure by the Company to continue in effect any
         incentive, bonus or other compensation plan in which the Executive
         participates immediately prior to the Change in Control, including but
         not limited to the Company's stock option and restricted stock plans,
         if any, unless an equitable arrangement (embodied in an ongoing
         substitute or alternative plan), with which he has consented, has been
         made with respect to such plan in connection with the Change in
         Control, or the failure by the Company to continue his participation
         therein, or any action by the Company which would directly or
         indirectly materially reduce his participation therein; (vi) the
         failure by the Company to continue to provide the Executive with
         benefits substantially similar to those enjoyed by him or to which he
         was entitled under any of the Company's pension, profit sharing, life
         insurance, medical, dental, health and accident, or disability plans in
         which he was participating at the time of a Change in Control, the
         taking of any action by the Company which would directly or indirectly
         materially reduce any of such benefits or deprive him of any material
         fringe benefit enjoyed by him or to which he was entitled at the time
         of the Change in Control, or the failure by the Company to provide him
         with the number of paid vacation and sick leave days to which he is
         entitled on the basis of years of service with the Company in
         accordance with the Company's normal vacation policy in effect on the
         date hereof; (vii) the failure of the Company to obtain a satisfactory
         agreement from any successor or assign of the Company to assume and
         agree to perform this Agreement; or (viii) any request by the Company
         that the Executive participate in an unlawful act or take any action
         constituting a breach of the Executive's professional standard of
         conduct.

                  (d) Notice of Termination. Any termination by the Company for
         Cause, or by the Executive for Good Reason, shall be communicated by
         Notice of Termination to the other party hereto given in accordance
         with Section 9(b) of this Agreement. For purposes of this Agreement, a
         "Notice of Termination" means a written notice which (i) indicates the
         specific termination provision in this Agreement relied upon, (ii) to
<PAGE>

         circumstances claimed to provide a basis for termination of the
         Executive's employment under the provision so indicated and (iii) if
         the Date of Termination (as defined below) is other than the date of
         receipt of such notice, specifies the termination date (which date
         shall be not more than thirty days after the giving of such notice).
         The failure by the Executive or the Company to set forth in the Notice
         of Termination any fact or circumstance which contributes to a showing
         of Good Reason or Cause shall not waive any right of the Executive or
         the Company, respectively, hereunder or preclude the Executive or the
         Company, respectively, from asserting such fact or circumstance in
         enforcing the Executive's or the Company's rights hereunder.

                  (e) Date of Termination. "Date of Termination" means (i) if
         the Executive's employment is terminated by the Company for Cause, or
         by the Executive for Good Reason, the date of receipt of the Notice of
         Termination or any later date specified therein, as the case may be,
         (ii) if the Executive's employment is terminated by the Company other
         than for Cause or Disability, the Date of Termination shall be the date
         on which the Company notifies the Executive of such termination and
         (iii) if the Executive's employment is terminated by reason of death or
         Disability, the Date of Termination shall be the date of death of the
         Executive or the Disability Commencement Date, as the case may be.

                  (f) Other Termination. The Executive's employment may be
         terminated by the Executive voluntarily, without Good Reason, during a
         thirty (30) day period immediately following the first annual
         anniversary of a Change in Control of the Company ("Window Period").
         For purposes of this Agreement, a "Change in Control" means:

                           (i) The acquisition by any individual, entity or
                  group (within the meaning of Section 13(d)(3) or 14(d)(2) of
                  the Securities Exchange Act of 1934, as amended (the "Exchange
                  Act")) (a "Person") of beneficial ownership (within the
                  meaning of Rule 13d-3 promulgated under the Exchange Act) of
                  twenty percent (20%) or more of either (A) the then
                  outstanding shares of common stock of the Company (the
                  "Outstanding Company Common Stock") or (B) the combined voting
                  power of the then outstanding voting securities of the Company
                  entitled to vote generally in the election of directors (the
                  "Outstanding Company Voting Securities"); provided, however,
                  that the following acquisitions shall not constitute an
                  acquisition of control: (A) any acquisition directly from the
                  Company (excluding an acquisition by virtue of the exercise of
                  a conversion privilege), (B) any acquisition by the Company,
                  (C) any acquisition by any employee benefit plan (or related
                  trust) sponsored or maintained by the Company or any
                  corporation controlled by the Company or (D) any acquisition
<PAGE>

                  by any corporation pursuant to a reorganization, merger or
                  consolidation, if, following such reorganization, merger or
                  consolidation, the conditions described in clauses (A), (B)
                  and (C) of subsection (iii) of this paragraph are satisfied;

                           (ii) Individuals who, as of April 30, 2001,
                  constitute the Board of Directors of the Company (the
                  "Incumbent Board") cease for any reason to constitute at least
                  a majority of the Board of Directors of the Company (the
                  "Board"); provided, however, that any individual becoming a
                  director subsequent to the date hereof whose election, or
                  nomination for election by the Company's shareholders, was
                  approved by a vote of at least a majority of the directors
                  then comprising the Incumbent Board shall be considered as
                  though such individual were a member of the Incumbent Board,
                  but excluding, for this purpose, any such individual whose
                  initial assumption of office occurs as a result of either an
                  actual or threatened election contest (as such terms are used
                  in Rule 14a-11 of Regulation 14A promulgated under the
                  Exchange Act) or other actual or threatened solicitation of
                  proxies or consents by or on behalf of a Person other than the
                  Board; or

                           (iii) Consummation of a reorganization, merger or
                  consolidation, in each case, unless, following such
                  reorganization, merger or consolidation, (A) more than sixty
                  percent (60%) of, respectively, the then outstanding shares of
                  common stock of the corporation resulting from such
                  reorganization, merger or consolidation and the combined
                  voting power of the then outstanding voting securities of such
                  corporation entitled to vote generally in the election of
                  directors is then beneficially owned, directly or indirectly,
                  by all or substantially all of the individuals and entities
                  who were the beneficial owners, respectively, of the
                  Outstanding Company Common Stock and Outstanding Company
                  Voting Securities immediately prior to such reorganization,
                  merger or consolidation in substantially the same proportions
                  as their ownership, immediately prior to such reorganization,
                  merger or consolidation, of the Outstanding Company Stock and
                  Outstanding Company Voting Securities, as the case may be, (B)
                  no Person (excluding the Company, any employee benefit plan or
                  related trust of the Company, one or more of its subsidiaries
                  or such corporation resulting from such reorganization, merger
                  or consolidation and any Person beneficially owning,
                  immediately prior to such reorganization, merger or
                  consolidation and any Person beneficially owning, immediately
                  prior to such reorganization, merger or consolidation,
                  directly or indirectly, twenty percent (20%) or more of the
                  Outstanding Company Common Stock or Outstanding Voting
                  Securities, as the case may be) beneficially owns, directly or
<PAGE>

                  indirectly, twenty percent (20%) or more of, respectively, the
                  then outstanding shares of common stock of the corporation
                  resulting from such reorganization, merger or consolidation or
                  the combined voting power of the then outstanding voting
                  securities of such corporation entitled to vote generally in
                  the election of directors and (C) at least a majority of the
                  members of the board of directors of the corporation resulting
                  from such reorganization, merger or consolidation were members
                  of the Incumbent Board at the time of the execution of the
                  initial agreement providing for such reorganization, merger or
                  consolidation;

                           (iv) Approval by the shareholders of the Company of
                  (A) a complete liquidation or dissolution of the Company or
                  (B) the sale or other disposition of all or substantially all
                  of the assets of the Company, other than to a corporation,
                  with respect to which following such sale or other disposition
                  (1) more than sixty percent (60%) of, respectively, the then
                  outstanding shares of common stock of such corporation and the
                  combined voting power of the then outstanding voting
                  securities of such corporation entitled to vote generally in
                  the election of directors is then beneficially owned, directly
                  or indirectly, by all or substantially all of the individuals
                  and entities who were the beneficial owners, respectively, of
                  the Outstanding Company Common Stock and Outstanding Company
                  Voting Securities immediately prior to such sale or other
                  disposition in substantially the same proportion as their
                  ownership, immediately prior to such sale or other
                  disposition, of the Outstanding Company Common Stock and
                  Outstanding Company Voting Securities, as the case may be, (2)
                  no Person (excluding the Company and any employee benefit plan
                  or related trust of the Company, one or more of its
                  subsidiaries or such corporation and any Person beneficially
                  owning, immediately prior to such sale or other disposition,
                  directly or indirectly, twenty percent (20%) or more of the
                  Outstanding Company Common Stock or Outstanding Company Voting
                  Securities, as the case may be) beneficially owns, directly or
                  indirectly, twenty percent (20%) or more of, respectively, the
                  then outstanding shares of common stock of such corporation
                  and the combined voting power of the then outstanding voting
                  securities of such corporation entitled to vote generally in
                  the election of directors and (3) at least a majority of the
                  members of the board of directors of such corporation were
                  members of the Incumbent Board at the time of the execution of
                  the initial agreement or action of the Board providing for
                  such sale or other disposition of assets of the Company; or

                           (v) The closing, as defined in the documents relating
                  to, or as evidenced by a certificate of any state or federal
<PAGE>

                  governmental authority in connection with, a transaction
                  approval of which by the shareholders of the Company would
                  constitute an "Change in Control" under subsection (iii) or
                  (iv) of this Section 3(f) of this Agreement.

         Except as provided in the last sentence of this Section and
         notwithstanding anything contained in this Agreement to the contrary,
         if the Executive's employment is terminated before a Change in Control
         as defined in this Section 3(f) and the Executive reasonably
         demonstrates that such termination (i) was at the request of a third
         party who has indicated an intention or taken steps reasonably
         calculated to effect a "Change in Control" and who effectuates a
         "Change in Control" or (ii) otherwise occurred in connection with, or
         in anticipation of, a "Change in Control" which actually occurs, then
         for all purposes of this Agreement, the date of a "Change in Control"
         with respect to the Executive shall mean the date immediately prior to
         the date of such termination of the Executive's employment.

         4.       Obligations of the Company upon Termination.
                  -------------------------------------------

                  (a) Good Reason; Other Than for Cause. If, during the
         Employment Period, the Company shall terminate the Executive's
         employment other than for Cause, death or Disability, or the Executive
         shall terminate employment for Good Reason or, if still available under
         Section 3(f), without reason during the Window Period.

                           (i) The Company shall pay to the Executive in a lump
                  sum in cash within fifteen calendar days after the Date of
                  Termination the aggregate of the amounts set forth in clauses
                  A, B and C below:

                                    A. the sum of (1) the Executive's Annual
                           Base Salary through the Date of Termination to the
                           extent not theretofore paid, (2) the product of (x)
                           the greater of the highest bonus paid to or the
                           target bonus in effect for the Executive with respect
                           to the three years ending prior to the year in which
                           the Date of Termination occurs (the "Minimum Bonus")
                           and (y) a fraction, the numerator of which is the
                           number of days in the current calendar year through
                           the Date of Termination, and the denominator of which
                           is 365 and (3) any compensation previously deferred
                           by the Executive (together with any accrued interest
                           or earnings thereon) and any other nonqualified
                           benefit plan balances to the extent not theretofore
                           paid (the sum of the amounts described in clauses
<PAGE>

                           (1), (2), and (3) shall be hereinafter referred to as
                           the "Accrued Obligations"); provided, however, that
                           for purposes of this Section 4, Base Salary shall
                           include any elective salary reductions in effect for
                           the Executive under any tax qualified or
                           non-qualified deferred compensation plan maintained
                           by the Company; and

                                    B.      the amount equal to the product of
                          (1) and (2) where:

                                            (1)  is

                                                     (i) if the Date of
                                            Termination occurs coincident with
                                            or after a Change in Control, the
                                            lesser of (a) three or (b) the
                                            number of years, rounded to the
                                            nearest twelfth (1/12th) of a year,
                                            between the Date of Termination and
                                            the Executive's attainment of age
                                            sixty-five (65) and

                                                     (ii) if the Date of
                                            Termination occurs prior to a Change
                                            in Control, the number of years
                                            remaining in the Executive's
                                            Employment Period at the Date of
                                            Termination, rounded to the nearest
                                            twelfth (1/12th) of a year,

                                    and where

                                            (2)  is the sum of (x) the
                                    Executive's Annual Base Salary and (y) the
                                    Minimum Bonus; and

                                    C. an amount equal to the excess of (a) the
                           actuarial equivalent of the benefit under the
                           Company's qualified defined benefit retirement plan
                           or such other qualified defined benefit pension plan
                           in which the Executive participates, if any (the
                           "Retirement Plan") (utilizing actuarial assumptions
                           no less favorable to the Executive than those in
                           effect under the Company's Retirement Plan
                           immediately prior to the Commencement Date), and any
                           excess or supplemental retirement plan in which the
                           Executive participates (together, the "SERP") which
                           the Executive would receive if the Executive's
                           employment continued for the period determined below:
<PAGE>

                                            (1) if the Date of Termination
                                    occurs coincident with or after a Change in
                                    Control, the lesser of (a) three or (b) the
                                    number of years, rounded to the nearest
                                    twelfth (1/12th) of a year, between the Date
                                    of Termination and the Executive's
                                    attainment of age sixty-five (65) and

                                            (2) if the Date of Termination
                                    occurs prior to a Change in Control, the
                                    number of years remaining in the Executive's
                                    Employment Period at the Date of
                                    Termination, rounded to the nearest twelfth
                                    (1/12th) of a year, and

                           assuming for this purpose that all accrued benefits
                           are fully vested, and, assuming that the Executive's
                           compensation during the duration of the Employment
                           Period is the sum of the Annual Base Salary and
                           Minimum Bonus over (b) the actuarial equivalent of
                           the Executive's actual benefit (paid or payable), if
                           any, under the Retirement Plan and the SERP as of the
                           Date of Termination; provided, however, that such
                           determination shall also take into account, to the
                           extent applicable, any early retirement subsidy,
                           based on the Executive's age, service or both, for
                           the additional service and age that the Executive
                           would have realized if he remained employed for the
                           period described above in this subparagraph;

                           (ii) any restricted stock, stock options and any
                  other stock awards under the Stock Incentive Plan or any other
                  Company sponsored plan or arrangement that were outstanding
                  immediately prior to the Commencement Date ("Prior Stock
                  Awards") shall become immediately vested and/or exercisable,
                  as the case may be;

                           (iii)    for the period determined below:

                                    (1) if the Date of Termination occurs
                           coincident with or after a Change in Control, the
                           lesser of (a) three or (b) the number of years,
                           rounded to the nearest twelfth (1/12th) of a year,
                           between the Date of Termination and the Executive's
                           attainment of age sixty-five (65) and

                                    (2) if the Date of Termination occurs prior
                           to a Change in Control, the number of years remaining
                           in the Executive's Employment Period at the Date of
                           Termination, rounded to the nearest twelfth (1/12th)
                           of a year, and

<PAGE>

                  or such longer period as may be provided by the terms of the
                  appropriate plan, program, practice or policy, the Company
                  shall continue benefits to the Executive and/or the
                  Executive's family at least equal to those which would have
                  been provided to them in accordance with the Welfare Plans,
                  programs, practices, executive perquisites and Policies
                  described in section 2(b)(v) of this Agreement if the
                  Executive's employment had not been terminated or, it more
                  favorable to the Executive, as in effect generally at any time
                  thereafter with respect to other peer executives of the
                  Company and its affiliated companies and their families;
                  provided, however, that if the Executive becomes reemployed
                  with another employer and is eligible to receive medical or
                  other welfare benefits under another employer provided plan,
                  the medical and other welfare benefits described herein shall
                  be secondary to those provided under such other plan during
                  such applicable period of eligibility. For purposes of
                  determining eligibility (but not the time of commencement of
                  benefits) of the Executive for retiree benefits pursuant to
                  such plans, practices, programs and policies, the Executive
                  shall be considered to have remained employed for the duration
                  of the Employment Period after the Date of Termination and to
                  have retired on the last day of such period; and

                           (iv) to the extent not theretofore paid or provided,
                  the Company shall timely pay or provide to the Executive any
                  other amounts or benefits required to be paid or provided or
                  which the Executive is entitled to receive under any plan,
                  program, policy or practice or contract or agreement of the
                  Company and its affiliated companies, excluding any severance
                  plan or policy except to the extent that such plan or policy
                  provides, in accordance with its terms, benefits with a value
                  in excess of the benefits payable to the Executive under this
                  Section 4, (such other amounts and benefits shall be
                  hereinafter referred to as the "Other Benefits").

                  (b) Cause; Other than for Good Reason. If the Executive's
         employment shall be terminated for Cause or the Executive terminates
         employment without Good Reason or, if the Window Period has not been
         eliminated under Section 3(f), not during the Window Period, this
         Agreement shall terminate without further obligations to the Executive
         other than the obligation to pay to the Executive (x) Accrued
         Obligations less the amount determined under Section 4(a)(i)A(2)
         hereof, and (y) Other Benefits, in each case to the extent theretofore
         unpaid.

                  (c) Death. If the Executive's employment is terminated by
         reason of the Executive's death during the Employment Period, this
         Agreement shall terminate without further obligations to the
<PAGE>

         Executive's legal representatives under this Agreement, other than for
         payment of Accrued Obligations and the timely payment or provision of
         Other Benefits. Accrued Obligations shall be paid to the Executive's
         estate or beneficiary, as applicable, in a lump sum in cash within 30
         days of the Date of Termination.

                  (d) Disability. If the Executive's employment is terminated by
         reason of the Executive's Disability during the Employment Period, this
         Agreement shall terminate without further obligations to the Executive,
         other than for payment of Accrued Obligations and the timely payment or
         provision of Other Benefits. Accrued Obligations shall be paid to the
         Executive in a lump sum in cash within 30 days of the Date of
         Termination. With respect to the provision of Other Benefits, the term
         Other Benefits as utilized in this Section 4(d) shall include, and the
         Executive shall be entitled after the Disability Commencement Date to
         receive, disability and other benefits as in effect generally with
         respect to other peer executives of the Company and its affiliated
         companies and their families.

         5.       Confidential Information; Noncompetition.
                  ----------------------------------------

                  (a) The Executive shall hold in a fiduciary capacity for the
         benefit of the Company all secret or confidential information,
         knowledge or data relating to the Company or any of its affiliated
         companies, and their respective businesses, which shall have been
         obtained by the Executive during the Executive's employment by the
         Company or any of its affiliated companies and which shall not be or
         become public knowledge (other than by acts by the Executive or
         representatives of the Executive in violation of this Agreement). After
         termination of the Executive's employment with the Company, the
         Executive shall not, without the prior written consent of the Company
         or as may otherwise be required by law or legal process (provided the
         Company has been given notice of and opportunity to challenge or limit
         the scope of disclosure purportedly so required), communicate or
         divulge any such information, knowledge or data to anyone other than
         the Company and those designated by it. In addition, Executive shall
         not solicit employees of the Company for at least a one (1) year period
         beginning on the Date of Termination.

                  (b) In the event of a termination of the Executive by the
         Company for Cause or by the Executive before a Change in Control and
         without Good Reason, until the second anniversary of the Executive's
         Date of Termination, the Executive will not directly or indirectly,
         own, manage, operate, control or participate in the ownership,
         management, operation or control of, or be connected as an officer,
         employee, partner, director or otherwise with, or have any financial
         interest in, any business which competes, or that is planning to
<PAGE>

         compete, with the utility business of the Company or any of its
         affiliates or any other business in which the Company or any of its
         affiliates are engaged immediately prior to the Date of Termination in:

                           (i)      Indiana;

                           (ii)     Ohio, Michigan, Illinois or Kentucky; and

                           (iii)    the United States.

         The parties expressly agree that the terms of this limited
         non-competition provision under this section are reasonable,
         enforceable, and necessary to protect the Company's interests, and are
         valid and enforceable. In the unlikely event, however, that a court of
         competent jurisdiction were to determine that any portion of this
         limited non-competition provision is unenforceable, then the parties
         agree that the remainder of the limited non-competition provision shall
         remain valid and enforceable to the maximum extent possible.

                  (c) Specific Enforcement/Injunctive Relief. The Executive
         agrees that it would be difficult to measure damages to the Company
         from any breach of the covenants contained in Subsection (b) above, but
         that such damages from any breach would be great, incalculable and
         irremediable, and that damages would be an inadequate remedy.
         Accordingly, the Executive agrees that the Company may have specific
         performance of the terms of this Agreement in any court permitted by
         this Agreement. The parties agree however, that specific performance
         and the "add back" remedies described above shall not be the exclusive
         remedies, and the Company may enforce any other remedy or remedies
         available to it either in law or in equity including, but not limited
         to, temporary, preliminary, and/or permanent injunctive relief.

         6. Full Settlement. The Company's obligation to make the payments
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement and such amounts
shall not be reduced whether or not the Executive obtains other employment. The
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees and expenses which the Executive may reasonably incur as a result of
any contest (regardless of the outcome thereof) by the Company, the Executive or
others of the validity or enforceability of, or liability under, any provision
of this Agreement or any guarantee of performance thereof (including as a result
of any contest by the Executive about the amount of any payment pursuant to this
<PAGE>

Agreement), plus in each case interest on any delayed payment at the applicable
Federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code
of 1986, as amended (the "Code").

         7.       Successors.
                  ----------

                  (a) This Agreement is personal to the Executive and without
         the prior written consent of the Company shall not he assignable by the
         Executive otherwise than by will or the laws of descent and
         distribution. This Agreement shall inure to the benefit of and be
         enforceable by the Executive's legal representatives.

                  (b) This Agreement shall inure to the benefit of and be
         binding upon the Company and its successors and assigns.

                  (c) The Company will require any successor (whether direct or
         indirect, by purchase, merger, consolidation or otherwise) to all or
         substantially all of the business and/or assets of the Company to
         assume expressly and agree to perform this Agreement in the same manner
         and to the same extent that the Company would be required to perform it
         if no such succession had taken place. As used in this Agreement,
         "Company" shall mean the Company as hereinbefore defined and any
         successor to its business and/or assets as aforesaid which assumes and
         agrees to perform this Agreement by operation of law, or otherwise.

         8.       Certain Additional Payments by the Company.
                  ------------------------------------------

                  (a) Anything in this Agreement to the contrary or any
         termination of this Agreement notwithstanding and except as provided in
         subsection (e) of this Section 8, in the event it shall be determined
         that any payment or distribution or benefit made or provided by the
         Company or its affiliates to or for the benefit of the Executive
         whether pursuant to this Agreement or otherwise, and determined without
         regard to any additional payments required under this Section 8 (a
         "Payment") would be subject to the excise tax imposed by Section 4999
         of the Code or any interest or penalties are incurred by the Executive
         with respect to such excise tax (such excise tax, together with any
         such interest and penalties, are hereinafter collectively referred to
         as the "Excise Tax"), then the Executive shall be entitled to receive
         an additional payment (a "Gross- Up Payment") in an amount such that
         after payment by the Executive of all taxes (including any interest or
         penalties imposed with respect to such taxes), including, without
         limitation, any income taxes (and any interest and penalties imposed
         with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
         the Executive retains an amount of the Gross-Up Payment equal to the
         Excise Tax imposed upon the Payments.

<PAGE>

                  (b) Subject to the provisions of Section 8(c), all
         determinations required to be made under this Section 8, including
         whether and when a Gross-Up Payment is required, the amount of such
         Gross-Up Payment and the assumptions to be utilized in arriving at such
         determination and whether subsection (e) is applicable, shall be made
         by the Company's independent auditor (the "Accounting Firm") which
         shall provide detailed supporting calculations both to the Company and
         the Executive within 15 business days of the receipt of notice from the
         Executive that there has been a Payment, or such earlier time as is
         requested by the Company. All fees and expenses of the Accounting Firm
         shall be borne solely by the Company. Any Gross-Up Payment, as
         determined pursuant to this Section 8, shall be paid by the Company to
         the Executive within five days of the receipt of the Accounting Firm's
         determination. Any determination by the Accounting Firm shall be
         binding upon the Company and the Executive. As a result of the
         uncertainty in the application of Section 4999 of the Code at the time
         of the initial determination by the Accounting Firm hereunder, it is
         possible that Gross-Up Payments which will not have been made by the
         Company should have been made ("Underpayment"), consistent with the
         calculations required to be made hereunder. In the event that the
         Company exhausts its remedies pursuant to Section 8(c) and the
         Executive thereafter is required to make a payment of any Excise Tax,
         the Accounting Firm shall determine the amount of the Underpayment that
         has occurred and any such Underpayment shall be promptly paid by the
         Company to or for the benefit of the Executive.

                  (c) The Executive shall notify the Company in writing of any
         claim by the Internal Revenue Service that, if successful, would
         require the payment by the company of the Gross-Up Payment. Such
         notification shall be given as soon as practicable but no later than
         ten business days after the Executive is informed in writing of such
         claim and shall apprise the Company of the nature of such claim and the
         date on which such claim is requested to be paid. The Executive shall
         not pay such claim prior to the expiration of the 30-day period
         following the date on which it gives such notice to the Company (or
         such shorter period ending on the date that any payment of taxes with
         respect to such claim is due). If the Company notifies the Executive in
         writing prior to the expiration of such period that it desires to
         contest such claim, the Executive shall:

                           (i)  give the Company any information reasonably
                  requested by the Company relating to such claim,

                           (ii) take such action in connection with contesting
                  such claim as the Company shall reasonably request in writing
                  from time to time, including, without limitation, accepting
                  legal representation with respect to such claim by an attorney
                  reasonably selected by the Company,
<PAGE>

                           (iii) cooperate with the Company in good faith in
                  order effectively to contest such claim, and

                           (iv) permit the Company to participate in any
                  proceedings relating to such claim;

         provided, however, that the Company shall bear and pay directly all
         costs and expenses (including additional interest and penalties)
         incurred in connection with such contest and shall indemnify and hold
         the 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 such representation and payment of costs and
         expenses. Without limitation on the foregoing provisions of this
         Section 8(c), the Company shall control all proceedings taken in
         connection with such contest and, at its sole option, may pursue or
         forego any and all administrative appeals, proceedings, hearings and
         conferences with the taxing authority in respect of such claim and may,
         at its sole option, either direct the Executive to pay the tax claimed
         and sue for a refund or contest the claim in any permissible manner,
         and the Executive agrees to prosecute such contest to a determination
         before any administrative tribunal, in a court of initial jurisdiction
         and in one or more appellate courts, as the Company shall determine;
         provided, however, that if the Company directs the Executive to pay
         such claim and sue for a refund, the Company shall advance the amount
         of such payment to the Executive, on an interest-free basis and shall
         indemnify and hold the Executive harmless, on an after-tax basis, from
         any Excise Tax or income tax (including interest or penalties with
         respect thereto) imposed with respect to such advance or with respect
         to any imputed income with respect to such advance; and further
         provided that any extension of the statute of limitations relating to
         payment of taxes for the taxable year of the Executive with respect to
         which such contested amount is claimed to be due is limited solely to
         such contested amount. Furthermore, the Company's control of the
         contest shall be limited to issues with respect to which a Gross-Up
         Payment would be payable hereunder and the Executive shall be entitled
         to settle or contest, as the case may be, any other issue raised by the
         Internal Revenue Service or any other taxing authority.

                  (d) If, after the receipt by the Executive of an amount
         advanced by the Company pursuant to Section 8(c), the Executive becomes
         entitled to receive any refund with respect to such claim, the
         Executive shall (subject to the Company's complying with the
         requirements of Section 8(c)) promptly pay to the Company the amount of
         such refund (together with any interest paid or credited thereon after
         taxes applicable thereto). If, after the receipt by the Executive of an
         amount advanced by the Company pursuant to Section 8(c), a
         determination is made that the Executive shall not be entitled to any
<PAGE>

         refund with respect to such claim and the Company does not notify the
         Executive in writing of its intent to contest such denial of refund
         prior to the expiration of 30 days after such determination, then such
         advance shall be forgiven and shall not be required to be repaid and
         the amount of such advance shall offset, to the extent thereof, the
         amount of Gross-Up Payment required to he paid.

                  (e) Notwithstanding anything contained in this Section 8 to
         the contrary, if the Executive's net after tax benefit for the payments
         made under this Agreement, including the Gross-Up Payment and after
         taking into account the applicable income and excise taxes (as
         determined in accordance with subsection (b) of this Section 8), would
         result in a net after tax benefit no greater than one hundred and five
         percent (105%) of the amount payable to the Executive assuming the
         Executive's payments under this Agreement were limited to the maximum
         amount that could be payable without application of the excise tax
         imposed by Section 4999 of the Code (the "Section 4999 Limit"), the
         Executive's payments shall be limited to the Section 4999 Limit.

         9.       Miscellaneous.
                  -------------

                  (a) This Agreement shall be governed by and construed in
         accordance with the laws of Indiana, without reference to principles of
         conflict of laws. The captions of this Agreement are not part of the
         provisions hereof and shall have no force, or effect. This Agreement
         may not be amended or modified otherwise than by a written agreement
         executed by the parties hereto or their respective successors and legal
         representatives.

                   (b) All notices and other communications hereunder shall be
         in writing and shall he given by hand delivery to the other party or by
         registered or certified mail, return receipt requested, postage
         prepaid, addressed as follows:

                           If to the Executive:
                           -------------------

                           William S. Doty
                           Vectren Corporation
                           20 N.W. Fourth Street
                           Evansville, Indiana  47708

                           If to the Company:
                           -----------------
                           Attention: Niel Ellerbrook, Chief Executive Officer
                           Vectren Corporation
                           20 N.W. Fourth Street
                           Evansville, Indiana  47708
<PAGE>

         or to such other address as either party shall have furnished to the
         other in writing in accordance herewith. Notice and communications
         shall be effective when actually received by the addressee,

                  (c) The invalidity or unenforceability of any provision of
         this Agreement shall not affect the validity or enforceability of any
         other provision of this Agreement.

                  (d) The Company may withhold from any amounts payable under
         this Agreement such Federal, state, local or foreign taxes as shall be
         required to be withheld pursuant to any applicable law or regulation.

                  (e) On and after the Commencement Date, this Agreement shall
         supersede any other agreement between the parties with respect to the
         subject matter hereof and any such agreement shall be deemed terminated
         without any remaining obligations of either party thereunder.

         10. Effective Date.  This Agreement is effective as of April 30, 2001.
Furthermore, this Agreement supersedes the employment agreement between
William S. Doty and Vectren Corporation dated March 31, 2000.  Executive hereby
acknowledges that he has received sufficient consideration for substitution of
this Agreement for the prior employment agreement.

         IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

/s/ William S. Doty
------------------------------------
William S. Doty, the Executive

Date: May 24, 2001

Vectren Corporation

By/s/  Robert L. Koch II
-----------------------------------
         Robert L. Koch II
         Chairman of Compensation Committee
         of Board of Directors

Date: June 26, 2001

<PAGE>

                                                                    EXHIBIT A

NAME                   POSITION                         LOCATION
--------               ------------                     ----------
William S. Doty        Senior Vice President            Evansville

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00036-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00036-of-00352.parquet"}]]