Aransas Resources S4 Registration of securities issued in business combination transactions | SEC 27 Apr 11

Exhibit 10.13

THE MERIDIAN RESOURCE &
EXPLORATION LLC
CHANGE IN CONTROL SEVERANCE PLAN
AND SUMMARY PLAN DESCRIPTION

(As Amended and Restated Effective as of May 14, 2010)

THE MERIDIAN RESOURCE & EXPLORATION LLC
CHANGE IN CONTROL SEVERANCE PLAN
AND SUMMARY PLAN DESCRIPTION

(As Amended and Restated Effective May 14, 2010)

WHEREAS, The Meridian Resource & Exploration LLC, a limited liability company that is organized and existing under the laws of the State of Delaware (“TMRX”), recognizes that one of its most valuable assets consists of its employees and consultants; and

WHEREAS, TMRX previously adopted The Meridian Resource & Exploration LLC Change in Control Severance Plan (the “Plan”), effective as of December 15, 2008, to provide severance benefits in the event that the employment or affiliation relationship of certain service providers is involuntarily terminated in conjunction with a Change in Control (as defined in the Plan); and

WHEREAS, TMRX desires to amend and restate the Plan to comply with ERISA and to clarify certain provisions therein; and intending thereby to provide a continuing program of benefits without a gap or lapse in coverage;

NOW, THEREFORE, the Plan is hereby amended and restated in its entirety, with no interruption or gap in coverage, effective as of May 14, 2010, unless otherwise specified herein:

TABLE OF CONTENTS


			Page
ARTICLE I ESTABLISHMENT AND OBJECTIVE				1
	1.1	Establishment		1
	1.2	Objective		1
ARTICLE II DEFINITIONS AND CONSTRUCTION				1
	2.1	Capitalized Terms		1
	2.2	Number and Gender		8
	2.3	Headings		8
	2.4	Construction and Interpretation		8
ARTICLE III ELIGIBILITY				8
ARTICLE IV BENEFITS				9
	4.1	Equity Based Compensation		9
	4.2	Benefits Following Termination of Employment or Affiliation Relationship		9
	4.3	Legal Fees		10
ARTICLE V TIME OF BENEFITS PAYMENTS				11
ARTICLE VI TERMINATION PROCEDURES AND COMPENSATION DURING DISPUTE				11
	6.1	Notice of Termination		11
	6.2	Termination Date		11
	6.3	Dispute Concerning Termination		11
ARTICLE VII WITHHOLDING				12
ARTICLE VIII DEATH OF PARTICIPANT				12
ARTICLE IX AMENDMENT AND TERMINATION				12
ARTICLE X ADOPTION OF PLAN BY AFFILIATES				12
ARTICLE XI MISCELLANEOUS				13
	11.1	Plan Not an Employment Contract		13
	11.2	Alienation Prohibited		13
	11.3	Severability		13
	11.4	Binding Effect		13
	11.5	Other Amounts Due		13
	11.6	Notices		14
	11.7	Governing Law		14
ARTICLE XII CLAIMS PROCEDURES				14
	12.1	Notice of Claim		14
	12.2	Claims Review Procedure		15
	12.3	Exhaustion of Administrative Remedies		15
ARTICLE XIII PLAN ADMINISTRATION				16
	13.1	Allocation of Authority		16


			Page
	13.2	Powers and Duties of the Plan Administrator		16
	13.3	Delegation by the Plan Administrator		17
APPENDIX A ERISA INFORMATION				A-1
APPENDIX B YOUR ERISA RIGHTS				B-1

iii

THE MERIDIAN RESOURCE & EXPLORATION LLC
CHANGE IN CONTROL SEVERANCE PLAN
AND SUMMARY PLAN DESCRIPTION

ARTICLE I
ESTABLISHMENT AND OBJECTIVE

1.1Establishment.The Meridian Resource & Exploration LLC, a Delaware limited liability company (“TMRX” or the “Company”), hereby amends and restates the “The Meridian Resource & Exploration LLC Change in Control Severance Plan” effective as of May 14, 2010 (the “Plan”).

1.2Objective.The Plan is designed to attract and retain certain designated Employees and Consultants of the Company and its Affiliates, and to reward such Employees and Consultants by providing replacement income and certain benefits following a Change in Control.

ARTICLE II
DEFINITIONS AND CONSTRUCTION

2.1Capitalized Terms.Whenever used in the Plan, the following capitalized terms in thisSection 2.1 shall have the meanings set forth below:

“Affiliate” means any entity which is a member of (i) the same controlled group of corporations within the meaning of section 414(b) of the Code with TMRC or TMRX, (ii) a trade or business (whether or not incorporated) which is under common control (within the meaning of section 414(c) of the Code) with TMRC or TMRX or (iii) an affiliated service group (within the meaning of section 414(m) of the Code) with TMRC or TMRX.

“Annual Incentive Plan” means The Meridian Resource & Exploration LLC Annual Incentive Compensation Plan, as it may be amended from time to time,

“Applicable Factor” means the applicable factor specified in the Participant’s Notice of Participation not in excess of 1.5, 1.0, and .6 for a Level One Participant, a Level Two Participant, and a Level Three Participant, respectively.

“Applicable Period” the number of months specified in the Participant’s Notice of Participation, but not in excess of 18, 12, and 6 for a Level One Participant, a Level Two Participant, and a Level Three Participant, respectively.

“Assets” means assets of any kind owned by TMRC or TMRX including, but not limited to, securities of TMRX’s parent or direct and indirect subsidiaries and Affiliates.

“Base Compensation” means a Participant’s base salary or wages from the Company (as defined in section 3401(a) of the Code for purposes of federal income tax withholding) or net earnings from self-employment from the Company (as defined in section 1402(a) of the Code) from the Company, modified by including any portion thereof that such Participant could have received in cash in lieu of any elective deferrals made by the Participant pursuant to a

nonqualified deferred compensation arrangement or pursuant to a qualified cash or deferred arrangement described in section 401(k) of the Code and any elective contributions under a cafeteria plan described in section 125 of the Code, and modified further by excluding any bonus, incentive compensation (including but not limited to equity-based compensation), commissions, expense reimbursements or other expense allowances, fringe benefits (cash and noncash), moving expenses, deferred compensation (other than elective deferrals by the Participant under a qualified cash or deferred arrangement described in section 401(k) of the Code or a nonqualified deferred compensation arrangement that are expressly included in “Base Compensation” under the foregoing provisions of this definition), welfare benefits as defined in ERISA, overtime pay, special performance compensation amounts and severance compensation.

“Beneficial Owner” or “Beneficial Ownership” shall have the meaning ascribed to those terms in Rule 13d-3 of the General Rules and Regulations under the Exchange Act.

“Board” means the Board of Managers of TMRX or the Sole Manager of TMRX, as applicable, or any other equivalent governing body of TMRX.

“Cause” means (i) the willful and continued failure by the Participant to substantially perform the Participant’s duties with the Company (other than any such failure resulting from the Participant’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Participant by the Board (or by a delegate appointed by the Board), which demand specifically identifies the manner in which the Board believes that the Participant has not substantially performed the Participant’s duties, or (ii) the willful engaging by the Participant in conduct which is demonstrably and materially injurious to the Company or any of its Affiliates, monetarily or otherwise. For purposes ofSections (i) and(ii) of this definition, (A) no act, or failure to act, on the Participant’s part shall be deemed “willful” if done, or omitted to be done, by the Participant in good faith and with reasonable belief that the act, or failure to act, was in the best interest of the Company and (B) in the event of a dispute concerning the application of this provision, no claim by the Company that Cause exists shall be given effect unless the Company establishes to the satisfaction of the Board that Cause exists.

“Change in Control” means the occurrence of any of the following events:

(a) the consummation of a Merger of TMRC or an Affiliate of TMRC with another Entity, unless the individuals and Entities who were the Beneficial Owners of the Voting Securities of TMRC outstanding immediately prior to such Merger own, directly or indirectly, more than 70 percent of the combined voting power of the Voting Securities of any of TMRC, the surviving Entity or the parent of the surviving Entity outstanding immediately after such Merger;

(b) any Person, other than a Specified Owner, becomes a Beneficial Owner, directly or indirectly, of securities of TMRC representing 30 percent or more of the combined voting power of TMRC’s then outstanding Voting Securities; (c) a sale, transfer, lease or other disposition of all or substantially all of TMRC or TMRX’s Assets is consummated (an “Asset Sale”), unless:

(1) the individuals and Entities who were the Beneficial Owners of the Voting Securities of TMRC or TMRX immediately prior to such Asset Sale own, directly or indirectly, more than 70 percent of the combined voting power of the Voting Securities of the Entity that acquires such Assets in such Asset Sale or its parent immediately after such Asset Sale in substantially the same proportions as their ownership of TMRC or TMRX’s Voting Securities immediately prior to such Asset Sale; or

(2) the individuals who comprise the Board immediately prior to such Asset Sale constitute a majority of the board of directors or other governing body of either the Entity that acquired such Assets in such Asset Sale or its parent (or a majority plus one member where such board or other governing body is comprised of an odd number of directors); or

(c) the individuals who are Incumbent Directors cease for any reason to constitute a majority of the members of the Board of TMRC; or

(d) The stockholders of TMRC or TMRX approve a plan of complete liquidation or dissolution of TMRC or TMRX.

“Code” means the Internal Revenue Code of 1986, as amended, or any successor act.

“Committee” means one or more individuals as may be appointed by the Board to serve as the Committee until such time as removed or replaced by the Board in its discretion; provided, however, any Employee shall be automatically removed as a Committee member upon his termination of Employment.

“Company” means TMRX (or a successor in interest to TMRX or its successor) or an Affiliate that adopts the Plan pursuant to the provisions ofArticle X.

“Consultant” means an individual who (a) performs significant and valuable services for the Company or its Affiliates, as determined by the Board, but is not an Employee, and (b) has been designated by the Board as a Consultant hereunder for purposes of participation in this Plan.

“Disability” means the Participant’s incapacity due to physical or mental illness that has caused the Participant to be absent from full-time performance of his duties with the Company for a period of six (6) consecutive months.

“Effective Date” means December 15, 2008, the date as of which the Plan was originally adopted.

“Eligible Individual” means an Employee who is not the Chief Executive Officer or President and Chief Operating Officer of TMRC or TMRX, or a member of the Board of TMRC. “Eligible Individual” also means a Consultant, as so designated by the Board, who is not a member of the Board of TMRC.

“Employee” means any individual who is employed by an Employer and classified as an employee on its payroll records.

“Employer” means TMRX or any of its Affiliates.

“Employment” means the Employee is in employment service with an Employer and classified as an employee on the Employer’s payroll records. A leave of absence that has been approved by the Employer, or is required by applicable law, shall not be deemed a termination of Employment for the purposes of the Plan. The term “Employment”, as used herein with respect to a Consultant, means that the Consultant is currently serving under a consulting arrangement with the Company as determined by the Board.

“Entity” means any corporation, partnership, association, joint-stock company, limited liability company, trust, unincorporated organization or other business entity.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor act.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any successor act.

“Expiration Date” shall have the meaning specified in the definition of the “Term of the Plan”.

“Good Reason” for termination by the Participant of his Employment means the occurrence (without the Participant’s express written consent) after any Change in Control, of any one of the following acts by the Company, or failures by the Company to act, as determined by the Committee as of the termination date, unless, in the case of any act or failure to act described in paragraph (a) below, such act or failure to act is corrected prior to the effective date of the Participant’s termination for Good Reason:

(a) the assignment to the Participant of any duties or responsibilities which are substantially diminished as compared to the Participant’s duties and responsibilities immediately prior to a Change in Control or a material change in the Participant’s reporting responsibilities, titles or offices as an Employee or Consultant, as applicable, and as in effect immediately prior to the Change in Control;

(b) a reduction by the Company in the sum of the amount of the Participant’s annual Base Compensation and the amount of the Participant’s target bonus opportunity under the Annual Incentive Plan as in effect immediately prior to a Change in Control;

(c) only with respect to an Employee who is a Participant, the relocation of the Participant’s principal place of Employment location for the Company outside of a 30-mile radius from the Participant’s principal place of Employment immediately prior to the Change in Control or the Company requiring the Participant to be based anywhere other than such principal place of Employment (or permitted relocation thereof) except for required travel on the Company’s business to an extent substantially consistent with the Participant’s business travel obligations immediately prior to a Change in Control;

(d) only with respect to an Employee who is a Participant, a material reduction in the employee benefits plans provided to the Participant immediately prior to the Change in Control; or

(e) any purported termination of the Participant’s Employment which is not effected pursuant to a notice of termination satisfying the requirements ofSection 6.1 hereof.

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

For purposes of any determination regarding the existence of Good Reason, any claim by the Participant that Good Reason exists shall be presumed to be correct unless the Company establishes to the satisfaction of the Committee that Good Reason does not exist. The Committee’s determination regarding the existence of Good Reason shall be conclusive and binding upon all parties unless the Committee’s determination is arbitrary and capricious.

“Highest Base Compensation” means the Participant’s annualized Base Compensation in effect immediately prior to (1) a Change in Control, (2) the first event or circumstance constituting Good Reason, or (3) the Participant’s Termination of Employment, whichever is the greatest amount.

“Incumbent Director” means —

(a) a member of the Board of TMRC on the Effective Date; or

(b) an individual:

(1) who becomes a member of the Board of TMRC after the Effective Date;

(2) whose appointment or election by the Board of TMRC or nomination for election by TMRC’s stockholders is approved or recommended by a vote of at least two-thirds (2/3) of the then serving Incumbent Directors (as defined herein); and

(3) whose initial assumption of service on the Board of TMRC is not in connection with an actual or threatened election contest.

“Level One Participant” means an Eligible Individual who is classified by the Committee as a Level One Participant.

“Level Two Participant” means an Eligible Individual who is classified by the Committee as a Level Two Participant.

“Level Three Participant” means an Eligible Individual who is classified by the Committee as a Level Three Participant.

“Merger” means a merger, consolidation or similar transaction.

“Notice of Participation” has the meaning specified inArticle III.

“Participant” means an individual who is eligible to participate in the Plan under the provisions ofArticle III.

“Person” shall have the meaning ascribed to the term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof, except that the term shall not include TMRC, TMRX, the Company or any of their Affiliates, (b) a trustee or other fiduciary holding TMRC or TMRX securities under an employee benefit plan of the Company or any of its Affiliates, (c) an underwriter temporarily holding securities pursuant to an offering of those securities or (d) a corporation owned, directly or indirectly, by the stockholders of TMRC or TMRX in substantially the same proportions as their ownership of stock of the Company.

“Plan” means The Meridian Resource & Exploration LLC Change in Control Severance Plan, as it may be amended from time to time.

“Plan Administrator” means the administrator of the Plan for purposes of ERISA Section 3(16)(A). The Plan Administrator is TMRX (or any successor in interest to TMRX).

“Plan Year” means the year beginning May 1 and ending April 30. The first Plan Year of the Plan was a short Plan Year from December 15, 2008 to April 30, 2009.

“Renewal Date” shall have the meaning specified in the definition of the “Term of the Plan.”

“Section 409A” means section 409A of the Code and the Department of Treasury rules and regulations issued thereunder.

“Separation From Service” has the meaning ascribed to that term in Section 409A.

“Specified Employee” means a person who is, as of the date of the person’s Separation From Service, a “specified employee” within the meaning of Section 409A.

“Specified Owner” means any of the following:

(a) TMRC or an Affiliate of TMRC;

(b) an employee benefit plan (or related trust) sponsored or maintained by TMRC or TMRX or any Affiliate of TMRC or TMRX;

(c) a Person that becomes a Beneficial Owner of TMRC’s or TMRX’s outstanding Voting Securities representing 50 percent or more of the combined voting

power of TMRC’s or TMRX’s then outstanding Voting Securities as a result of the acquisition of securities directly from TMRC and/or its Affiliates and/or Joseph Reeves and/or Michael Mayell;

(d) Joseph Reeves or Michael Mayell; or

(e) a Person that becomes a Beneficial Owner of TMRC’s or TMRX’s outstanding Voting Securities representing 50 percent or more of the combined voting power of TMRC’s or TMRX’s then outstanding Voting Securities as a result of a Merger if the individuals and Entities who were the Beneficial Owners of the Voting Securities of TMRC or TMRX outstanding immediately prior to such Merger own, directly or indirectly, more than 70 percent of the combined voting power of the Voting Securities of any of TMRC or TMRX, the surviving Entity or the parent of the surviving Entity outstanding immediately after such Merger in substantially the same proportions as their ownership of the Voting Securities of TMRC or TMRX outstanding immediately prior to such Merger.

“Term of the Plan” means the period commencing on the Effective Date and ending on:

(a) the last day of the two-year period beginning on the Effective Date if no Change in Control shall have occurred during that one-year period (such last day being the “Expiration Date”); or

(b) if a Change in Control shall have occurred during (i) the one-year period beginning on the Effective Date or (ii) any period for which the Term of the Plan shall have been automatically extended pursuant to the second sentence of this definition, the last day of the two-year period beginning on the date on which the Change in Control occurred.

After the expiration of the time period described insubsection (a) of this definition and in the absence of a Change in Control (as described insubsection (b) of this definition), the Term of the Plan shall be automatically extended for successive two-year periods beginning on the day immediately following the Expiration Date (the beginning date of each successive two-year period being a “Renewal Date”), unless, not later than nine months prior to the Expiration Date or applicable Renewal Date, the Company shall give notice to Participants that the Term of the Plan will not be extended.

“Termination Date” means the date as of which a Participant incurs a Separation From Service, as determined in accordance with the provisions ofSection 6.1.

“Termination of Employment or Affiliation Relationship” means the termination of a Participant’s Employment relationship with the Company (i) by the Company without Cause after a Change in Control occurs, or (ii) by the Participant for Good Reason after a Change in Control occurs.

For purposes of this definition, a Participant’s Employment relationship shall be deemed to have been terminated after a Change in Control, if (a) a Change in Control occurs and (b) (i) the Participant’s Employment relationship is terminated by the Company without Cause

prior to a Change in Control and such termination was at the request or direction of a Person who has entered into an agreement with the Company, the consummation of which would constitute a Change in Control; (ii) the Participant terminates his Employment relationship for Good Reason prior to a Change in Control and the circumstance or event which constitutes Good Reason occurs at the request or direction of a Person who has entered into an agreement with the Company, the consummation of which would constitute a Change in Control; or (iii) the Participant’s Employment relationship is terminated by the Company without Cause or by the Participant for Good Reason and such termination, or the circumstance or event which constitutes Good Reason, is otherwise in connection with or in anticipation of a Change in Control. For purposes of any determination regarding the applicability of the immediately preceding sentence, any position taken by the Participant shall be presumed to be correct unless the Company establishes to the satisfaction of the Committee that such position is not correct.

“Termination of Employment or Affiliation Relationship” does not include (i) a termination of Employment due to the Participant’s death or Disability, or (ii) a termination of Employment by the Participant without Good Reason.

“TMRC” means The Meridian Resource Corporation, a Texas corporation, and any successor by merger or otherwise.

“TMRX” means The Meridian Resource & Exploration LLC, a Delaware limited liability company, and any successor by merger or otherwise.

“Voting Securities” means the outstanding securities entitled to vote generally in the election of directors or other governing body.

2.2Number and Gender.As used in the Plan, unless the context otherwise expressly requires to the contrary, references to the singular include the plural, and vice versa; references to the masculine include the feminine and neuter; references to “including” mean “including (without limitation)”; and references to Sections, Articles and clauses mean the sections and clauses of the Plan,

2.3Headings.The headings of Sections and Articles herein are included solely for convenience, and if there is any conflict between such headings and the text of the Plan, the text shall control.

2.4Construction and Interpretation. TMRX and the Committee shall have full power, authority, and discretion to control and manage the operation and administration of the Plan, and to construe, interpret, and apply all of its provisions.

ARTICLE III
ELIGIBILITY

The individuals who shall be eligible to participate in the Plan shall be those Eligible Individuals who are selected by the Committee. The Committee shall notify each Eligible Individual who has been selected for participation of his eligibility to participate in the Plan by furnishing him a written notification of participation. Unless such notification (the “Notice of Participation”) is delivered to an Eligible Individual by the Committee, the Eligible Individual

shall not be a Participant. Unless a Participant signs and returns to the Committee a copy of the Notice of Participation on or prior to the deadline specified in the Notice of Participation, he or she shall not be eligible to receive payments or benefits under the Plan. The Notice of Participation shall specify whether the Eligible Individual is classified by the Committee as a Level One Participant, a Level Two Participant or a Level Three Participant. The Notice of Participation shall also specify the Eligible Individual’s Applicable Factor and the Eligible Individual’s Applicable Period.

Notwithstanding any other provision of the Plan, the Committee may discontinue a Participant’s eligibility to participate in the Plan by providing him written advance notice (the “Notice”), no later than 9 months prior to the Expiration Date or a Renewal Date (as defined in the definition of “Term of the Plan” inSection 2.1), that he shall no longer participate in the Plan; provided, however, that should a Change in Control occur during such 9-month advance notification period, the Notice shall be void and of no effect, and the Participant shall be eligible to participate in the Plan as if the Notice were never given.

A Participant shall remain a Participant until (a) he is removed as a Participant under the terms of the Plan, or (b) he is paid the entire amount of the benefit under the Plan to which he is entitled. A Participant is no longer a Participant if he incurs (i) a termination of Employment due to his death or Disability, or (ii) a termination of Employment without Good Reason.

ARTICLE IV
BENEFITS

4.1Equity Based Compensation.Upon the occurrence of a Change in Control, all options to acquire TMRC stock, all shares of restricted TMRC stock, all other equity or phantom equity incentives and any awards the value of which is determined by reference to or based upon the value of TMRC stock, held by the Participant under any plan of the Company shall become immediately vested, exercisable and nonforfeitable and all conditions thereof (including, but not limited to, any required holding periods) shall be deemed to have been satisfied. However, in the case of such an award that is subject to Section 409A, the payment of the award shall not be made earlier than the earlier to occur of (1) the date on which occurs a Change in Control that constitutes a change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets of the corporation, within the meaning of Section 409A or (2) the payment date specified in the applicable award agreement or the applicable terms and conditions relating to the award.

4.2Benefits Following Termination of Employment or Affiliation Relationship.If a Participant incurs a Termination of Employment or Affiliation Relationship during the Term of the Plan, the Company shall provide the Participant the benefits described below.

(a)Severance Payment. The Company will pay the Participant a cash severance benefit in an amount equal to the Applicable Factor multiplied by the Participant’s Highest Base Compensation. A Participant’s severance payment under this paragraph (a) will be paid in accordance with the provisions ofArticle V.

(b)Accident and Health Insurance Benefits. The Company shall arrange to provide the Participant and his dependents continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for accident and health insurance benefits substantially similar to those provided to the Participant and his dependents by the Company immediately prior to the Termination Date or, if more favorable to the Participant, those provided to the Participant and his dependents by the Company immediately prior to the first occurrence of an event or circumstance constituting Good Reason, at no cost to the Participant, for the Applicable Period following the Participant’s Termination Date (or such shorter period of time as is required under COBRA),

Except for any reimbursements under the applicable group health plan that are subject to a limitation on reimbursements during a specified period, the amount of expenses eligible for reimbursement under thisSection 4.2(b), or in-kind benefits provided, during the Participant’s taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year of the Participant. Any reimbursement of an expense described in thisSection 4.2(b) shall be made on or before the last day of the Participant’s taxable year following the Participants’ taxable year in which the expense was incurred. The Participant’s right to reimbursement or in-kind benefits pursuant to thisSection 4.2(b) shall not be subject to liquidation or exchange for another benefit.

(c)Life Insurance. A Participant shall be entitled to a single sum cash payment in an amount equivalent to the product of (i) the total monthly basic life insurance premium (both the portion paid by the Company and the portion paid by the Participant) applicable to the Participant’s basic life insurance coverage on his Termination Date and (ii) the Applicable Period. The single sum cash payment will be made in accordance with the provisions ofArticle V. If a conversion option is applicable under the Company’s group life insurance program, a Participant may, at his option, convert his basic life insurance coverage to an individual policy after his Termination Date by completing the forms required by the Company.

4.3Legal Fees.The Company shall pay all reasonable legal fees and expenses incurred by the Participant (i) in disputing in good faith any issue relating to the Participant’s termination of employment or affiliation, or (ii) in seeking in good faith to obtain or enforce any benefit or right provided under the Plan. Such payments shall be made within ten (10) business days after the delivery of the Participant’s written request for the payment accompanied by such evidence of fees and expenses incurred as the Company may reasonably require. In any event the Company shall pay the Participant such legal fees and expenses by the last day of the Participant’s taxable year following the taxable year in which the Participant incurred such legal fees and expenses. The legal fees or expenses that are subject to reimbursement pursuant to thisSection 4.3 shall not be limited as a result of when the fees or expenses are incurred. The amount of legal fees or expenses that is eligible for reimbursement pursuant to thisSection 4.3 during a given taxable year of the Participant shall not affect the amount of expenses eligible for reimbursement in any other taxable year of the Participant. The right to reimbursement pursuant to thisSection 4.3 is not subject to liquidation or exchange for another benefit.

ARTICLE V
TIME OF BENEFITS PAYMENTS

The Company shall pay the Participant any cash benefits described inparagraphs (a),(b), and(c) ofSection 4.2 in a single sum cash payment within thirty (30) days after the Participant’s Separation From Service if the Participant is not a Specified Employee or on the date that is six months following the Participant’s Separation From Service if the Participant is a Specified Employee.

ARTICLE VI
TERMINATION PROCEDURES AND COMPENSATION DURING DISPUTE

6.1Notice of Termination.After a Change in Control and during the Term of the Plan, any purported termination of the Participant’s Employment relationship by the Company shall be communicated by the Company by a written Notice of Termination to the Participant in accordance withSection 11.7 hereof. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in the Plan relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Participant’s Employment under the provision so indicated. Further, a Notice of Termination for Cause is required to include a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership of the Board at a meeting of the Board which was called and held for the purpose of considering such termination (after reasonable notice to the Participant and an opportunity for the Participant, together with the Participant’s counsel, to be heard before the Board) finding that, in the good faith opinion of the Board, the Participant was guilty of conduct set forth inclause (i) or(ii) of the definition of Cause herein, and specifying the particulars thereof in detail. No purported termination of the Participant’s Employment by the Company after a Change in Control and during the Term of the Plan shall be effective unless the Company complies with the procedures set forth in thisSection 6.1.

6.2Termination Date.“Termination Date,” with respect to any purported Separation From Service after a Change in Control and during the Term of the Plan, shall mean (i) if the Participant’s Employment relationship is terminated for Disability, thirty (30) days after Notice of Termination is given (provided that the Participant shall not have returned to the full-time performance of the Participant’s duties during such thirty (30) day period), and (ii) if the Participant’s Employment relationship is terminated for any other reason, the date specified in the Notice of Termination (which, in the case of a termination by the Company, shall not be less than thirty (30) days (except in the case of a termination for Cause) and, in the case of a termination by the Participant, shall not be less than fifteen (15) days nor more than sixty (60) days, respectively, from the date such Notice of Termination is given).

6.3Dispute Concerning Termination.If within fifteen (15) days after any Notice of Termination is given, or, if later, prior to the Termination Date (as determined without regard to thisSection 6.3), the party receiving such Notice of Termination notifies the other party that a dispute exists concerning the termination, the Termination Date shall be extended until the earlier of (i) the date on which the Term of the Plan ends or (ii) the date on which the dispute is finally resolved, either by mutual written agreement of the parties or by a final judgment, order

or decree of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected); provided, however, that the Termination Date shall be extended by a notice of dispute given by the Participant only if such notice is given in good faith and the Participant pursues the resolution of such dispute with reasonable diligence.

ARTICLE VII
WITHHOLDING

The Company may withhold from any benefits paid under the Plan all income, employment, and other taxes required to be withheld under applicable law.

ARTICLE VIII
DEATH OF PARTICIPANT

If a Participant dies after his Termination Date but before the Participant receives full payment of the benefits to which he is entitled under the Plan, any unpaid benefits will be paid to the Participant’s surviving spouse, or if the Participant does not have a surviving spouse, to the Participant’s estate.

ARTICLE IX
AMENDMENT AND TERMINATION

During the Term of the Plan, subject toArticle X, the Plan may not be terminated or amended in any manner that would negatively affect a Participant’s rights under the Plan. Further, no amendment or termination of the Plan after a Participant’s Termination Date shall affect the benefits payable to such Participant under the Plan. Subject to the foregoing restrictions, TMRX may amend or terminate the Plan, at any time in its discretion, by a written instrument that is authorized by the Committee,

ARTICLE X
ADOPTION OF PLAN BY AFFILIATES

(a) With the written approval of the Committee, any entity that is an Affiliate may adopt the Plan by appropriate action of its board of directors or noncorporate counterpart, as evidenced by a written instrument executed by an authorized officer of such entity or an executed adoption agreement (approved by the board of directors or noncorporate counterpart of the Affiliate), agreeing to be bound by all the terms, conditions and limitations of the Plan and providing all information required by the Committee.

(b) The provisions of the Plan shall apply separately and equally to each adopting Affiliate in the same manner as is expressly provided for the Company, except that the power to appoint the Committee and the power to amend or terminate the Plan shall be exercised by TMRX.

(c) For purposes of the Code and ERISA, the Plan as adopted by the Affiliates shall constitute a single plan rather than a separate plan of each Affiliate.

ARTICLE XI
MISCELLANEOUS

11.1Plan Not an Employment Contract.The adoption and maintenance of the Plan is not a contract between the Company and the Employees and Consultants that gives any Employee or Consultant the right to be retained in Employment. Likewise, it is not intended to interfere with the rights of the Company to terminate an Employee’s or Consultant’s Employment at any time, with or without notice and with or without cause, or to interfere with an Employee’s or Consultant’s right to terminate his Employment at any time.

11.2Alienation Prohibited.No benefits hereunder shall be subject to anticipation or assignment by a Participant, to attachment by, interference with, or control of any creditor of a Participant, or to being taken or reached by any legal or equitable process in satisfaction of any debt or liability of a Participant prior to its actual receipt by the Participant. Any attempted conveyance, transfer, assignment, mortgage, pledge, or encumbrance of the benefits hereunder prior to payment thereof shall be void.

11.3Severability.Each provision of the Plan may be served. If any provision is determined to be invalid or unenforceable, that determination shall not affect the validity or enforceability of any other provision.

11.4Binding Effect.The Plan shall be binding upon any successor of the Company. Further, the Board shall not authorize a Change in Control that is a merger or a sale transaction unless the purchaser or the Company’s successor agrees to take such actions as are necessary to cause all Participants to be paid or provided all benefits due under the terms of the Plan as in effect immediately prior to the Change in Control.

11.5Other Amounts Due.Except as expressly provided otherwise herein, the payments and benefits provided for in the Plan are in addition to and not in lieu of amounts and benefits that are earned by a Participant prior to his Termination Date. The Company shall pay a Participant any compensation earned through the Termination Date but not previously paid the Participant. Further the Participant shall be entitled to any other amounts or benefits due the Participant in accordance with any contract, plan, program or policy of the Company or any of its Affiliates, to the extent not offset against the benefits provided under the Plan as described below. Amounts that the Participant is entitled to receive under any plan, program, contract or policy of the Company or any of its Affiliates at or subsequent to the Participant’s Termination Date shall be payable or otherwise provided in accordance with such plan, program, contract or policy, except as may be expressly modified herein. Notwithstanding any provision herein to the contrary, and for the avoidance of any doubt, in the event that a Participant is eligible to receive payments and benefits under both (i) this Plan and (ii) any other severance or change-of-control plan, program, contract, or agreement (including, without limitation, any employment agreement by and between such Participant and the Company or its Affiliate) that is sponsored or maintained by the Company or any of its Affiliates (“Other Source”), then any monetary benefits provided under this Plan will be reduced and offset by the monetary benefits due and payable from the Other Source, with the result being that the Participant receives, in the aggregate, an amount that is not in excess of any monetary benefits due under this Plan but nothing in excess of such amount. Further, in the event that any non-monetary benefits are due

from an Other Source, the Company will compare such non-monetary benefits to the non-monetary benefits provided under this Plan and, where the non-monetary benefits are of the same nature or class, the Participant will be provided with the better of the two non-monetary benefits; provided, however, under no circumstances shall the Participant receive duplicate or extra non-monetary benefits as determined by the Company, with the result being that the Participant receives, in the aggregate, all non-monetary benefits due under this Plan but nothing more. If the Participant is eligible to receive benefits from any Other Source, the form and timing of payments under such Other Source will be determined as set forth in such Other Source, and the form and timing of any remaining monetary and non-monetary benefits that are due and payable under this Plan will be as described herein and taking into account any required offset.

11.6Notices.For the purpose of the Plan, notices and all other communications provided for in the Plan shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed, if to the Participant, to the residential address listed on the Participant’s notification of participation and, if to the Company, to 1401 Enclave Parkway, Suite 300; Houston, Texas 77077; Attention: President, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon actual receipt.

11.7Governing Law.All provisions of the Plan shall be construed in accordance with the laws of the State of Texas, except to the extent preempted by federal law and except to the extent that the conflicts of laws provisions of the State of Texas would require the application of the relevant law of another jurisdiction, in which event the relevant law of the State of Texas will nonetheless apply, with venue for litigation being in Houston, Texas.

ARTICLE XII
CLAIMS PROCEDURES

12.1Notice of Claim.Normally, an Eligible Individual does not need to present a formal claim for benefits payable under the Plan. However, in the event that an Eligible Individual, Participant or other person (referred to as the “Claimant”) has a claim for any benefits that he believes were not provided in accordance with the terms and provisions of the Plan or otherwise, the Claimant must file a claim with the Committee within six (6) months from the date of the affected Eligible Individual’s Termination of Employment. Any Claimant who fails to file a claim within such 6-month period will completely and irrevocably forfeit and lose any and all rights that he may have, or ever had, to receive any benefits under the Plan at any time.

Any Claimant who applies for benefits or has an inquiry concerning the Plan or present or future rights to benefits under the Plan must submit his application or inquiry to the Committee, in writing, addressed as follows:

Mr. Harlan H. Chappelle
Alta Mesa Holdings, L.P.
15415 Katy Freeway
Houston, TX 77094-1816

Prior to authorizing and awarding any benefits hereunder, the Committee may require the Claimant to provide additional information, and to complete any required or requested releases, forms or other documents hereunder, including filing of all claims and requests for payment from any other source.

12.2Claims Review Procedure.If any claim for benefits filed by a Claimant is wholly or partially denied, the Committee will notify the Claimant of its determination in writing. Such notification will be written in a manner calculated to be understood by the average Claimant, and will contain (a) specific reasons for the denial, (b) specific reference to pertinent Plan provisions, (c) a description of any additional material or information necessary for the Claimant to perfect such claim and an explanation of why such material or information is necessary, and (d) information as to the steps to be taken if the Claimant wishes to submit a request for review. Such notification will be given within 60 days after the claim is received by the Committee (or within 120 days if special circumstances require an extension of time for processing the claim, and if written notice of such extension and circumstances is given to the Claimant within the initial 60-day period). However, if any such notification is not given within such period, the claim will be considered automatically denied as of the last day of such period and the Claimant may then request a review of the claim.

Within 60 days after the date on which a Claimant receives a written notice of a denied claim (or, if applicable, within 60 days after the date on which such denial is considered to have occurred) the Claimant (or his duly authorized representative) may (a) file a written request (including pertinent documents) with the Committee for a review of the denied claim, and (b) submit written issues and comments to the Committee. The Committee will review the claim and notify the Claimant of its decision in writing. Such notification will be written in a manner calculated to be understood by the Claimant and will contain specific reasons for the decision, as well as specific references to pertinent Plan provisions. The decision on review will be made within 60 days after the request for review is received by the Committee, or within 120 days if special circumstances require an extension of time for processing the request, such as a decision by the Committee to hold a hearing, provided that written notice of such extension and circumstances is given to the Claimant within the initial 60-day period. If the decision on review is not made within such period, the claim will be considered denied as of the last day of such period. All final determinations concerning claims made pursuant to these claims review procedures will not be subject to further review by anyone, but will be final, conclusive and binding on the Claimant and all other persons. To the extent the Committee has been granted discretionary authority under the Plan, the Committee’s prior exercise of such authority will not obligate it to exercise its authority in a like fashion thereafter.

12.3Exhaustion of Administrative Remedies.Completion of the claims procedures described inSections 12.1 and12.2 is a condition precedent to the commencement of any legal or equitable action in connection with a claim for benefits under the Plan by a Claimant or by any other person claiming rights individually or through a Claimant; provided, however, the

Committee may, in its discretion, waive compliance with such claims procedures as a condition precedent to filing of any such action. Any legal or equitable action in connection with, or arising out of, a claim for benefits under the Plan, including any claim denial, must be brought not later than one (1) year following a final Determination by the Plan Administrator on the claim pursuant toSection 12.2.

ARTICLE XIII
PLAN ADMINISTRATION

13.1Allocation of Authority. TMRX will control and manage the operation and administration of the Plan, except to the extent such duties have been delegated to other persons or entities as provided in the Plan. Any decisions made by TMRX or the Plan Administrator (or any other person or entity delegated authority by TMRX or the Plan Administrator, as applicable) to determine benefits in accordance with the Plan will be final and conclusive on all Participants, and all other persons and entities, subject only to the claims appeal provisions of the Plan.

13.2Powers and Duties of the Plan Administrator. The Plan Administrator will have such duties and powers as may be necessary to discharge its duties hereunder, including, but not by way of limitation, the following:

(a) to have discretionary authority to (i) administer, enforce, construe, and construct the Plan, (ii) make decisions relating to all questions of eligibility to participate, and (iii) make a determination of benefits including, without limitation, reconciling any inconsistency, correcting any defect, supplying any omission, and making any findings of fact. All decisions, interpretations and other determinations described in thissubsection (a) will be final and conclusive on all persons and entities subject only to the claims appeal provisions of the Plan. Benefits under the Plan will be paid only if the Plan Administrator determines, in its discretion, that the Participant is entitled to them. There will be node novoreview of any such determination by any court. Any review of such determination will be solely limited to determining whether the determination was so arbitrary and capricious as to constitute an abuse of discretion under ERISA standards;

(b) to prepare and distribute, in such manner as the Plan Administrator determines to be appropriate, information regarding the Plan;

(d) to receive, review and keep on file (as it deems necessary) reports of benefit payments by the Employer and reports of disbursements for expenses;

(e) to exercise such authority and responsibility as it deems appropriate in order to comply with the terms of the Plan relating to the records of Participants; and

(f) to appoint persons or entities to assist in the administration of the Plan as it deems advisable; and the Plan Administrator may delegate thereto any power or duty imposed upon or granted to it under the Plan.

If, due to errors in drafting, any Plan provision does not accurately reflect its intended meaning, as determined by the Plan Administrator, in its sole and exclusive judgment, the provision will be considered ambiguous and will be interpreted in a fashion consistent with its intent, as determined by the Plan Administrator. The Plan may be amended retroactively to cure any such ambiguity, notwithstanding anything in the Plan to the contrary.

13.3Delegation by the Plan Administrator. The Plan Administrator may delegate to other persons or entities any of the administrative functions relating to the Plan, together with all powers necessary to enable its designee(s) to properly carry out such duties hereunder. The Plan Administrator may employ legal counsel, accountants and such other persons or entities as it deems advisable in its discretion. The Plan Administrator, as well as any person to whom any duty or power in connection with operation of the Plan has been delegated, may rely upon all valuations, reports, and opinions furnished by any accountant, consultant, third-party service provider, legal counsel, or other specialist. Moreover, the Plan Administrator, as well as any of its delegates, will be fully protected in respect to any action taken or omitted in reasonable reliance on such information.

APPENDIX A

ERISA INFORMATION

(1)		Name of Plan: The Meridian Resource & Exploration LLC Change in Control Severance Plan.

(2)		Plan Sponsor:

		The Meridian Resource & Exploration LLC Attn: President 1401 Enclave Parkway, Suite 300 Houston, Texas 77077

		Plan Administrator:

		The Meridian Resource & Exploration LLC Attn: President 1401 Enclave Parkway, Suite 300 Houston, Texas 77077

(3)		Employer Identification Number for Plan Sponsor: 76-0348919

(4)		Plan Number: 510

(5)		Type of Plan: The Plan is a self-funded “employee welfare benefit plan” subject to ERISA that provides severance pay benefits. No trust is maintained in connection with the Plan and the Plan is not considered to be “funded” for ERISA purposes.

(6)		Type of Administration: The Plan is administered by the Plan Administrator with benefits provided in accordance with the terms and conditions of the Plan.

(7)		Agent for Service of Legal Process:

		The Meridian Resource & Exploration LLC Attn: President 1401 Enclave Parkway, Suite 300 Houston, Texas 77077

(8)		Sources of Contributions: The adopting employers of the Plan provide all contributions to the Plan. No employee contributions are required.

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APPENDIX B

YOUR ERISA RIGHTS

As a Participant under the Plan, you are entitled to certain rights and protections under ERISA. These rights are described below. ERISA provides that all Plan Participants shall be entitled to:

(i) Examine, without charge, at the Plan Administrator’s office, all Plan documents, including insurance contracts and copies of documents filed by the Plan with the U.S. Department of Labor (such as detailed annual reports and Plan descriptions);

(ii) Obtain copies of Plan documents and other Plan information upon written request to the Plan Administrator. The Plan Sponsor, as Plan Administrator, may impose a reasonable charge for the copies.

(iii) Receive a summary of the Plan’s summary annual financial report, if applicable. The Plan Administrator is required to furnish each Participant with a copy of the summary annual report if it is required to prepare one.

In addition to creating rights for Plan Participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan Participants and beneficiaries. No one, including your employer, or any other person, may fire you or otherwise discriminate against you to prevent you from obtaining a benefit or exercising your rights under ERISA. If your claim for a benefit is denied in whole or in part, you must receive a written explanation of the reason for the denial. You have the right to have the Plan Administrator review and reconsider your claim.

Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request materials from the Plan Administrator and do not receive them within 30 days, you may file suit in a federal court. In such case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.

If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court. If it should happen that the Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor; or you may file suit in a federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.

If you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, you should contact the nearest area office of the U.S. Employee Benefits Security Administration, Department of Labor, as listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20210.

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Aransas Resources Inactive S-4Registration of securities issued in business combination transactions