EXHIBIT 10.9
VASTAR RESOURCES, INC.
THIRD AMENDMENT TO
SPECIAL TERMINATION ALLOWANCE PLAN
Pursuant to the power of amendment reserved therein, Vastar Resources,
Inc. Special Termination Allowance Plan (the "Plan") is hereby amended as
follows:
1. Paragraph 3.1 is amended to delete the last sentence therein.
2. Paragraph 3.18 is amended in its entirety, effective as of the
Effective Time (as defined in Annex A to the Plan as amended hereby), to read as
follows:
"3.18 "Benefit Trigger Window" means the 24-month period
commencing on the date immediately following the Effective Time and means the
24-month period commencing on the date that a Subsequent Change of Control
occurs."
3. Paragraph 3 is amended to add new Paragraphs 3.29, 3.30, 3.31 and
3.32 which shall read as follows:
"3.29 "Effective Time" shall be ascribed the meaning set forth for
such term on Annex A attached hereto.
3.30 "Merger" shall be ascribed the meaning set forth for such
term on Annex A attached hereto.
3.31 "Parent Company" shall be ascribed the meaning set forth for
such term on Annex A attached hereto.
3.32 "Subsequent Change of Control" shall be ascribed the meaning
set forth for such term on Annex A attached hereto."
4. Paragraph 6.2 is amended to add "; or" at the end of subparagraph
(b)(ii) and to add a new subparagraph (b)(iii) which shall read as follows:
"(iii) with respect to Tier 1 and 2 Employees of the Company, a
demotion to a lesser job."
5. Paragraph 6.3 is amended in its entirety and shall read as
follows:
"6.3 A Terminated Employee shall be entitled to the following cash
payments, in lieu of any other benefit to which the Employee is entitled under
this Plan (except for the benefit described in Paragraph 6.5 hereof):
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(a) Basic Allowance: The Terminated Employee shall receive a basic
cash allowance equal to 1 1/2 weeks of Base Pay per year of service with a
minimum of 6 weeks of Base Pay and a maximum of 36 weeks of Base Pay.
(b) Supplemental Allowance:
(i) For Terminated Employees, other than Tier 1, 2 or 3
Employees of the Company, if the total of the Basic Allowance and the value of
the retirement allowance to which the Employee is entitled, if any, as described
in Paragraph 30.4 of the Vastar Resources, Inc. Retirement Plan (hereinafter
referred to as the "5+5 Benefit Component") is less than the greater of (A) the
Prior Benefit or (B) 1/2 of the Terminated Employee's Annual Compensation, the
Terminated Employee shall also be entitled to a supplemental payment under this
Plan so that the total of the Terminated Employee's Basic Allowance plus the
value of the 5+5 Benefit Component plus the supplemental payment equals the
greater of (A) the Prior Benefit or (B) 1/2 of the Terminated Employee's Annual
Compensation; and
(ii) For Terminated Employees who are Tier 1, 2 or 3 Employees
of the Company, if the Basic Allowance and the value of the 5+5 Benefit
Component is less than 3 times the Terminated Employee's Annual Compensation
(for Tier 1 Employees), 2 times the Terminated Employee's Annual Compensation
(for Tier 2 Employees), or 1 times the Terminated Employee's Annual Compensation
(or the Basic STAP if greater) (for Tier 3 Employees), respectively, the
Terminated Employee shall also be entitled to a supplemental payment under this
Plan so that the total of the Terminated Employee's Basic Allowance plus the
value of the 5+5 Benefit Component plus the supplemental payment equals 3 times
the Terminated Employee's Annual Compensation, 2 times the Terminated Employee's
Annual Compensation or 1 times the Terminated Employee's Annual Compensation (or
the Basic STAP if greater), as applicable.
(c) "Annual Compensation": For purposes of subparagraph (b) above,
"Annual Compensation" means the sum of a Terminated Employee's Base Pay plus
either (i) as to Terminated Employees who participate in Vastar Resources, Inc.
Annual Incentive Plan, the greatest of (x) the average of the awards, if any,
granted under such plan during the consecutive 3 years ending prior to the date
of the Change of Control, (y) the Terminated Employee's most recent award under
such plan, or (z) the Terminated Employee's Target Award under such plan for the
year in which his or her Termination of Employment occurs, or (ii) as to
Terminated Employees who do not participate in Vastar Resources, Inc. Annual
Incentive Plan, the Terminated Employee's target bonus under Vastar Resources,
Inc. Variable Pay Plan, if any, for the then current year.
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(d) "Prior Benefit": For purposes of subparagraph (b) above, "Prior
Benefit" means a cash allowance equal to 3 weeks of Base Pay per year of service
with a minimum of 12 weeks and a maximum of 72 weeks."
6. Paragraph 6.4 is deleted in its entirety.
7. Paragraph 6.5 is amended to renumber the Paragraph as 6.4 and to
eliminate the parenthetical "(excluding an ARCO Acquisition)".
8. Paragraph 6.6 is amended to renumber the Paragraph as 6.5, to delete
subparagraph (b), to renumber subparagraph (c) as subparagraph (b) and to
replace subparagraph (a) with new subparagraph (a) which shall read as follows:
"(a) If any employee is liable for the payment of any excise tax (the
"Basic Excise Tax") because of Section 4999 of the Code, or any successor or
similar provision relating to a Change of Control, with respect to any payments
or benefits received or to be received from the Company or its affiliates, or
any successor to the Company or its affiliates, upon a termination of employment
during a Benefit Trigger Window, whether provided under this Plan or otherwise,
the Company or any successor to the obligations of the Company will pay the
employee an amount (the "Special Reimbursement") which, after payment by such
employee (or on the employee's behalf) of any federal, state and local taxes
applicable thereto, including, without limitation, any further excise tax under
such Section 4999 of the Code, on, with respect to or resulting from the Special
Reimbursement, equals the net amount of the Basic Excise Tax. The Special
Reimbursement will be paid upon receipt by the employee of any payment or
benefit that will result in the Basic Excise Tax."
9. The references in the Plan, if any, to Paragraph 6.5 and 6.6 shall
be changed to 6.4 and 6.5, respectively.
10. Paragraph 8.4 is amended in its entirety and shall now read as follows:
"8.4. Authorized Officers
Both the Chief Financial Officer and the Vice President, Human
Resources of the Company whose duties with respect to this Plan are provided
herein, will be those persons who have been employed in such positions by the
Company since April 1, 1999. Any action required to be taken under this Plan by
the Chief Financial Officer and the Vice President, Human Resources of the
Company may be taken by either individual if the other position is vacant. If
the positions of Chief Financial Officer and Vice President, Human Resources of
the Company are both vacant, actions required to be taken under the Plan by such
officers may only be taken by one of the officers of the Company set forth below
(in the order stated) who was in such position on April 1, 1999:
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(a) Controller
(b) General Counsel
(c) Senior Vice President of Production
(d) Senior Vice President of Exploration
(e) Vice President of Business Development.
If none of such persons is in such position, the Special Plan Administrator
shall take actions required to be taken under the Plan."
11. Paragraph 9.3 is amended to delete the second sentence therein.
12. Paragraph 9.4 is deleted in its entirety.
13. Annex A is amended, with respect to the definition of "Change of
Control" and the definition of "Outside Director", to replace the terms
"Atlantic Richfield Company" and "ARCO" with the term "Parent Company". This
amendment shall be construed consistently with the intent that the Merger, if it
occurs, is a Change of Control.
14. Annex A, with respect to the definition of "Change of Control," is
amended, effective as of the Effective Time, to add "; or" at the end of
Paragraph (6) and to add new Paragraph (7) which shall read as follows:
"(7) A Subsequent Change of Control."
15. Annex A is amended to add the following definitions:
""Effective Time" means, with respect to the Merger, such time as the
Certificate of Merger is duly filed with the Secretary of State of the State of
Delaware or at such later time as is specified in the Certificate of Merger in
accordance with the Delaware General Corporation Law.
"Merger" shall mean the merger between Atlantic Richfield Company and
Prairie Holdings, Inc., a subsidiary of BP Amoco p.l.c.
"Parent Company" shall mean, until the Effective Time, Atlantic
Richfield Company and, after Effective Time of the Merger, BP Amoco p.l.c. or
any of its subsidiaries or affiliates and any of their respective successors.
"Subsequent Change of Control" shall mean each Change of Control which
occurs after the consummation of a transaction constituting a Change of
Control.""
16. The Plan is amended to replace (except in Paragraph 8.4 as amended
herein) the term "General Counsel" with the term "Vice President, Human
Resources."
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17. All current references in the Plan to other sections and subsections
of the Plan shall be deemed to refer to the applicable section or subsection as
renumbered herein. All amendments shall be effective as of July 21, 1999 unless
otherwise noted.
Executed as of the 12th day of August, 1999.
ATTEST: VASTAR RESOURCES, INC.
By: /s/ Jonathan D. Edelfelt By: /s/ Jeffrey M. Bender
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Jonathan D. Edelfelt Jeffrey M. Bender
Associate Secretary Vice President, Human Resources
APPROVED as to form this 12th day
of August, 1999
WACHOVIA BANK, N.A.,
By: /s/ Peter D. Quinn
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Name: Peter D. Quinn
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Title: Senior Vice President
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