Exhibit 10. 1
This EMPLOYMENT AGREEMENT (the "Agreement") is made as of December 10, 1999, between
POTOMAC ELECTRIC POWER COMPANY (the "Company") and John M. Derrick, Jr. (the
The Board of Directors of Potomac Electric Power Company (the "Board of Directors") recognizes
that outstanding management of the Company is essential to advancing the best interests of the
Company, its shareholders and its subsidiaries. The Board of Directors believes that it is particularly
important to have stable, excellent management at the present time. The Board of Directors believes
that this objective may be achieved by giving key management employees assurances of financial
security for a period of time, so that they will not be distracted by personal risks and will continue to
devote their full time and best efforts to the performance of their duties.
The Human Resources Committee of the Board of Directors (the "Committee") has recommended,
and the Board of Directors has approved, entering into amended and restated employment agreements
with the Company's key management executives in order to achieve the foregoing objectives.
Accordingly, this Agreement amends, restates and supercedes the employment agreement previously
entered into between the Company and the Executive, dated August 1, 1995 (the "Prior Agreement").
Upon execution of this Agreement the Prior Agreement shall be of no further force or effect. The
Executive is a key management executive of the Company and is a valuable member of the Company's
management team. The Company acknowledges that the Executive's contributions to the past and
future growth and success of the Company have been and will continue to be substantial. The
Company and the Executive are enter