Exhibit 10.1
OCEAN ENERGY, INC.
OUTSIDE DIRECTORS DEFERRED FEE PLAN
(As Amended and Restated Effective July 1, 2001)
1. History and Purposes of the Plan
The Ocean Energy, Inc. Outside Directors Deferred Fee Plan ("Plan") was originally adopted on May 16,
1983 by Ocean Energy, Inc., a Delaware corporation (the "Company"), formerly known as Ocean Energy, Inc, a Texas
corporation, Seagull Energy Corporation and Seagull Pipeline Corporation, and is intended to provide a method for
attracting and retaining qualified outside directors for the Company and to encourage them to devote their best
efforts to the business of the Company, thereby advancing the interests of the Company and its shareholders.
Effective as of March 30, 1999, the Company merged the Ocean Energy, Inc. Outside Directors Fee Plan with and
into the Plan and amended and restated the Plan in order to reflect the plan merger and the merger of Ocean
Energy, Inc., a Delaware corporation with and into Seagull Energy Corporation. Effective as of July 1, 2001 (the
"Effective Date"), the Company has again restated the Plan for the purpose of incorporating previously-adopted
amendments into the text of the Plan and for the purpose of further amending the Plan in certain respects.
2. Administration of the Plan
Except as otherwise specifically provided herein, the Plan shall be administered by the Organization &
Compensation Committee (the "Committee") of the Board of Directors of the Company (the "Board"). The Committee
is authorized to interpret the Plan and may from time to time adopt such rules and regulations, consistent with
the provisions of the Plan, as it may deem advisable to carry out the Plan. All decisions made by the Committee
shall be final. All expenses incurred in connection with the administration of the Plan shall be borne by the
Company. In certain cases arising under the Plan, action or approval must be taken by either the full Board or
by a committee of "Non-Employee Directors" as described in Rule 16b-3 promulgated by the Securities Exchange
Commission (such board or committee being referred to herein as the "Rule 16b-3 Committee").
3. Participation in the Plan
(a) Participation. Each outside director who was a participant in the Plan ("Participant") on the
Effective Date shall remain a Participant in this restatement of the Plan as of the Effective Date. Each other
director shall become a Participant on the later of (1) the Effective Date or (2) the date he becomes an outside
director. For purposes of this Paragraph, an "outside director" is an individual who is a validly elected or
appointed director of the Company and who does not perform any services for the Company in a common-law employee
capacity.
(b) Deferral of Director's Fees. A Participant may elect to defer director's fees (whether annual,
periodic or special) to be earned by such Participant for services rendered under the Plan by filing with the
Committee an election to defer receipt of all or a designated portion of such fees.
(c) Time and Manner of Making Elections. Any deferral election that may be made by a Participant under
the Plan shall be made with respect to the period commencing on January 1 (or, if later, the date the Participant
is first elected or appointed to the Board) and ending on December 31 of each year ("Service Period") during
which services are rendered by such Participant and must be made prior to the first day of such Service Period;
provided, however, that the deferral election with respect to a Participant's initial Service Period may be made
no later than thirty days after the date the Participant is first elected or appointed to the Board and shall be
prospective only. All deferral elections shall be made in the manner and form prescribed by the Committee.
Deferral elections made prior to the Effective Date with respect to the Service Period that includes the
Effective Date shall remain in effect for the remainder of such Service Period.
(d) Nature of Elections. A Participant's election to defer receipt of all or a designated portion of
his fees for a Service Period shall continue in force and effect for future Service Periods unless modified or
revoked by such Participant. Any such modification or revocation shall be effective only as of the first day of
a Service Period and must be made prior to the first day of such Service Period. A modification or revocation of
an existing deferral election shall be made in the manner and form prescribed by the Committee. Any deferral
election (whether in the nature of an initial election, an unrevised continuing election or a revised continuing
election) with respect to a Service Period shall be irrevocable as of the first day of such Service Period or, if
later, the day following the last day upon which an election may be made with respect to a Service Period.
Notwithstanding the foregoing, in the event that the Rule 16b-3 Committee, in its sole discretion, determines
that a Participant has an unforseeable emergency pursuant to Paragraph 6, the Rule 16b-3 Committee may revoke the
Participant's deferral election then in effect, if any, in connection with such determination. A Participant
whose deferral election is so revoked may make a new deferral election in the manner and form prescribed by the
Committee prior to the first day of any subsequent Service Period.
4. Crediting of Deferred Fees to Plan Accounts
(a) Establishment of Plan Accounts. The Committee shall establish a memorandum bookkeeping account
(the "Plan Account") for each Participant in the Plan. The Committee shall credit to each Participant's Plan
Account the Participant's deferred fees as soon as practicable after such fees are earned by the Participant.
Further, the Committee shall credit to each Participant's Plan Account such additional amounts at such times as
may be determined by the Committee in its sole discretion; provided, however, that the Committee shall credit to
the Plan Account of each Participant who is a member of the Board during the period beginning on the Effective
Date and ending on December 31, 2001 (the "Benefit Period") an additional amount of $17,500 (the "2001 Additional
Amount") as soon as practicable after the Benefit Period.
(b) Deemed Investment of Funds.
(1) The amounts credited to each Participant's Plan Account shall be deemed to be
invested in the Fidelity Money Market Trust: Retirement Money Market Portfolio until such
Participant designates, in accordance with the procedures established from time to time by the
Committee, the manner in which amounts credited to his Plan Account shall be deemed to be
invested from among the investment funds made available from time to time by the Committee for
the deemed investment of Plan Accounts (the "Investment Funds"), which may include an
Investment Fund (an "OEI Stock Fund") investing in the common stock of the Company, par value
$.10 per share ("Company Stock"). A Participant may designate one of such Investment Funds for
the deemed investment of all the amounts credited to his Plan Account or he may split the
deemed investment of the amounts credited to his Plan Account among such Investment Funds in
such increments as the Committee may prescribe. The deemed investment of amounts credited to a
Participant's Plan Account shall be based on the value of the applicable Investment Funds at
the time such amounts are credited or subsequently converted pursuant to an initial deemed
investment designation or pursuant to Paragraph (b)(2) below. Deemed investment elections in
effect immediately prior to the Effective Date shall remain in effect following the Effective
Date unless and until changed or converted pursuant to Paragraph (b)(2) below.
(2) A Participant may (i) change his deemed investment designation for future amounts
to be credited to his Plan Account or (ii) convert his deemed investment designation with
respect to the amounts already credited to his Plan Account; provided, however, that (I) a
Participant may change his deemed investment designation of an OEI Stock Fund only for future
amounts to be credited to his Plan Account and (II) in the event of a change described in
clause (I), any amounts already credited to the Participant's Plan Account that were deemed
invested in an OEI Stock Fund shall remain so invested until paid to such Participant pursuant
to Paragraph 5. Any such change or conversion shall be made in accordance with the procedures
established by the Committee, and the frequency of such changes may be limited by the
Committee; provided, however, that a change described in clause (I) of the preceding sentence
must be made prior to the beginning of a calendar quarter and shall become effective only as of
the first day of such calendar quarter.
Notwithstanding the foregoing, if the Committee credits an additional amount to a Participant's Plan Account
pursuant to Paragraph (a) above, the Committee may designate one or more Investment Funds for the deemed
investment of such additional amount; provided however, that the 2001 Additional Amount credited to a
Participant's Plan Account pursuant to Paragraph (a) above shall be deemed to be invested in an OEI Stock Fund
until paid to the Participant pursuant to Paragraph 5.
(c) Allocation of Net Income or Net Loss Equivalents. The balance of each Participant's Plan Account
shall be adjusted at such times and in such manner as the Committee deems appropriate to reflect the value of the
Investment Funds, including any net income (or net loss) thereto resulting from interest, dividends or other
distributions. A Participant's Plan Account shall continue to be so adjusted as long as there is any balance
credited to such account.
(d) Matching Deferrals. Effective as of January 1, 2002, if a Participant designates an OEI Stock Fund
for the deemed investment of all or a portion of the deferred fees to be credited to his Plan Account, at the
same time as such deferred fees are credited to his Plan Account and deemed invested in an OEI Stock Fund (the
"Deemed OEI Stock Fund Investment"), an additional amount equal to the OEI Deemed Stock Fund Investment shall be
credited to the Participant's Plan Account and deemed invested in an OEI Stock Fund.
5. Payment of Deferred Fees
(a) Payment Election Generally. A Participant shall elect, subject to the provisions of Paragraphs
(b), (c) and (d) below, the time (which may not be prior to the latest of (i) the date on which he ceases to be a
member of the Board or (ii) the date on which he ceases to be a member of the Senior Advisory Council to the
Board and the mode (which may either be a lump sum payment or monthly, quarterly, or annual installment payments
over a specified term certain) for payment of amounts credited to his Plan Account during a Service Period (and
the income credited thereto). A Participant may revise his election regarding the time and mode of payment of
amounts credited to his Plan Account only if, and at such time as, such revised election is approved by a Rule
16b-3 Committee; provided, however, that such revised election shall not be effective until the later of (A) the
January 1 following the date such revised election is approved or (B) the date that is six months after the date
such revised election is approved. In the absence of direction by a Participant regarding the time or mode of
payment of amounts credited to his Plan Account during a Service Period (and the income credited thereto), such
amounts shall be distributed in a lump sum payment as soon as practicable after the later of (i) the date on
which he ceases to be a member of the Board or (ii) the date on which he ceases to be a member of the Senior
Advisory Council to the Board.
(b) Payment Upon Death. In the event of a Participant's death, the balance of such Participant's Plan
Account, computed as of the date of his death, shall be paid in one lump sum to his designated beneficiary within
the first four months following the date of such Participant's death. A Participant, by written instrument filed
with the Committee in such manner and form as it may prescribe, may designate one or more beneficiaries to
receive payment of the amounts credited to his Plan Account in the event of his death. Any such beneficiary
designation may be changed from time to time prior to the death of the Participant. In the absence of a
beneficiary designation on file with the Committee at the time of a Participant's death, the executor or
administrator of the Participant's estate shall be deemed to be his designated beneficiary.
(c) Payment Upon Plan Termination. In the event the Plan is terminated by the Company, the Committee,
in its sole discretion, may elect to pay the balance of each Participant's Plan Account to such Participant in
one lump sum as soon as practicable after the date of such Plan termination.
(d) Payment Upon Change of Control. With respect to any Participant (1) who ceases to be a director of
the Company (or any successor) as a result of or in connection with a change of control that is not approved,
recommended and supported by at least two-thirds of the directors that were also directors prior to the
occurrence of any such change of control in actions taken prior to, and with respect to, such change of control
or (2) who ceased to be a member of the Board or of the Senior Advisory Council to the Board prior to such change
of control but who is entitled to receive (or is receiving) payments under the Plan at the time of such change of
control, the balance of such Participant's Plan Account, computed as of the date of such change of control or,
for Participants described in clause (1), the date such Participant ceases to be a director of the Company (or
any successor), if later, shall be paid to such Participant in one lump sum as soon as practicable, but no later
than thirty days following such date. For purposes of the Plan, "change of control" shall be deemed to have
occurred if (i) any person (other than Participant or the Company) including a "group" as determined in
accordance with Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the beneficial owner of shares
of the Company having 40% or more of the total number of votes that may be cast for the election of directors; or
(ii) as a result of, or in connection with, any cash tender or exchange offer, merger or other business
combination, sale of assets or contested election, or any combination of the foregoing transactions (a
"Transaction"), the persons who were directors before the Transaction shall cease to constitute a majority of the
Board or any successor thereto. The determinations of whether a change of control has occurred, whether such
change of control was not approved, recommended or supported by the Directors in actions taken prior to, and with
respect to, such change of control and whether any Participant ceased to be a director of the Company as a result
of or in connection with such change of control shall be made by the Committee as existing at least six months
prior to the occurrence of such change of control and its determination shall be final.
(e) Conversion of Plan Accounts for Purposes of Payment.
(1) If a Participant has elected to receive payment of his Plan Account in a lump sum
pursuant to Paragraph (a) above, the value of his Plan Account shall be determined as of the
last day of the month preceding the time that he has elected to receive such payment and an
amount equal to such value shall be paid to the Participant.
(2) If a Participant has elected to receive payment of his Plan Account in any mode
other than lump sum pursuant to Paragraph (a) above, the value of his Plan Account shall be
determined as of the last day of the month preceding the date of any such payment and each
subsequent interval thereafter, and an amount equal to the value of such Plan Account
multiplied by a fraction, the numerator of which is one and the denominator of which is the
remaining number of payments that the Participant elected, shall be paid as of each interval
such Participant elected.
(3) If Paragraphs (b), (c) or (d) above apply, the value of a Participant's Plan
Account shall be determined as of the date specified in the applicable Paragraph and an amount
equal to such value shall be paid to the Participant or his designated beneficiary.
(f) Form of Payment. Payments under the Plan shall be in the form of cash, except that if any portion
of a Participant's Plan Account is deemed invested in an OEI Stock Fund, any payment with respect to such portion
shall be in the form of shares of Company Stock. Without limiting the generality of the foregoing, nothing in
the Plan shall be construed as giving any Participant any rights as a holder of common stock or any other equity
security of the Company as a result of such Participant's participation in this Plan or his designation of an OEI
Stock Fund for the deemed investment of amounts credited to his Plan Account.
(g) Debiting of Plan Accounts. Once an amount has been paid to a Participant or his beneficiary, such
amount shall be debited from the Participant's Plan Account.
6. Distributions for Unforseeable Emergency
In the event the Rule 16b-3 Committee, in its sole discretion, determines that a Participant has an
unforseeable emergency, the Rule 16b-3 Committee may direct that such portion of the amounts credited to a
Participant's Plan Account as it determines is reasonably needed to satisfy such unforseeable emergency be paid
to the Participant in one lump sum payment as soon as practicable following the Rule 16b-3 Committee's
determination of the existence and extent of such unforseeable emergency. For purposes of this Paragraph 6, an
unforseeable emergency shall mean severe financial hardship to a Participant that arises from a sudden and
unexpected illness or accident of the Participant or of a dependent of a Participant, loss of the Participant's
property due to casualty, or similar extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of such Participant. Further, no payment may be made pursuant to this Paragraph 6 to the
extent such severe financial hardship may be relieved (i) through reimbursement or compensation by insurance or
otherwise, (ii) by liquidation of the Participant's assets, to the extent the liquidation of such assets would
not itself cause severe financial hardship, or (iii) by cessation of deferrals under the Plan. For purposes of
this Paragraph 6, the purchase of a house or education expenses for children, shall not be considered to be
unforseeable emergencies. The decision of the Rule 16b-3 Committee regarding the existence or nonexistence of an
unforseeable emergency of a Participant shall be final and binding. The Rule 16b-3 Committee shall have the
authority to require a Participant to provide such proof as it deems necessary to establish the existence and
nature of the Participant's unforseeable emergency. The foregoing notwithstanding, a Participant who is a member
of the Rule 16b-3 Committee shall not participate in the deliberations or decision of the Rule16b-3 Committee
regarding a hardship distribution to such Participant.
7. Prohibition Against Assignment or Encumbrance
No right, title, interest or benefit hereunder shall ever be liable for or charged with any of the torts
or obligations of a Participant or a person claiming under a Participant, or be subject to seizure by any
creditor of a Participant or any person claiming under a Participant. No Participant or any person claiming
under a Participant shall have the power to anticipate or dispose of any right, title, interest or benefit
hereunder in any manner until same shall have been actually distributed free and clear of the terms of the Plan.
The preceding notwithstanding, the Committee shall comply with the terms and provisions of an order that
satisfies the requirements for a "qualified domestic relations order" as defined in section 206(d) of ERISA,
including an order that requires distributions to an alternate payee prior to a Participant's "earliest
retirement age" as such term is defined in section 206(d)(3)(E)(ii) of ERISA.
8. Nature of the Plan
The Plan and any election agreements executed thereunder constitute an unfunded, unsecured liability of
the Company to make payments in accordance with the provisions hereof, and neither a Participant nor any person
claiming under the Participant shall have any security or other interest in any specific assets of the Company
by virtue of this Plan. Neither the establishment of the Plan, the crediting of amounts to Plan Accounts nor the
setting aside of any funds shall be deemed to create a trust. The Company at its election may fund the payment
of benefits under the Plan by setting aside and investing, in an account on the Company's books, such funds as
the Company may from time to time determine. Legal and equitable title to any funds so set aside shall remain in
the Company, and no Participant shall have any security or other interest in such funds. Any funds so set aside
shall remain subject to the claims of the creditors of the Company, present and future.
The preceding paragraph to the contrary notwithstanding, the Company may fund all or part of its
obligations hereunder by transferring assets to a trust if the provisions of the trust agreement creating such
trust require the use of such trust's assets to satisfy claims of the Company's general unsecured creditors in
the event of the Company's insolvency or bankruptcy and provide that no Participant shall at any time have a
prior claim to such assets and that such trust shall not cause the Plan to be other than "unfunded" for the
Internal Revenue Code of 1986, as amended. The assets of such trust shall not be deemed to be assets of this
Plan.
9. Amendment and Termination of Plan
The Company shall have the right to alter or amend the Plan or any part thereof from time to time,
except the Company shall not make any alteration or amendment that would impair the rights of a Participant with
respect to amounts theretofore credited to that Participant's Plan Account. The Company may terminate the Plan
at any time. If not sooner terminated under the provisions of this paragraph, the Plan shall terminate as of the
date on which all amounts theretofore credited to Plan Accounts have been paid.
10. Indemnification
The Company shall indemnify and hold harmless each member of the Committee and each employee who is a
delegate of the Committee against any and all expenses and liabilities arising out of his administrative
functions or fiduciary responsibilities, including any expenses and liabilities that are caused by or result from
an act or omission constituting the negligence of such individual in the performance of such functions or
responsibilities, but excluding expenses and liabilities that are caused by or result from such individual's own
gross negligence or willful misconduct. Expenses against which such individual shall be indemnified hereunder
shall include, without limitation, the amounts of any settlement or judgment, costs, counsel fees, and related
charges reasonably incurred in connection with a claim asserted or a proceeding brought or settlement thereof.
11. No Tax Guarantee
Neither the Plan nor any representation made in connection with it shall be construed to be an assurance
or guarantee of a deferral of income for income tax purposes of any amount to be paid pursuant to the Plan.
12. Number and Gender
Wherever appropriate herein, words used in the singular shall be considered to include the plural, and
words used in the plural shall be considered to include the singular. The masculine gender, where appearing in
the Plan, shall be deemed to include the feminine gender.
13. Laws Governing
The Plan and any documents executed in connection therewith shall be construed in accordance with and
governed by the laws of the State of Texas.
EXECUTED this _________ day of _______________, 2001.
OCEAN ENERGY, INC.
By: ______________________________
Name: ________________________
Title: ________________________
Devon Oei Operating Inactive
Filed: 2 Aug 01, 12:00am