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EXHIBIT 10.22
PETROTECH LONG TERM INCENTIVE PLAN
1. PURPOSE
The objective of the Petrotech Long Term Incentive Plan (hereinafter referred
to as "Petrotech Plan") is to attract and retain highly qualified managerial
and professional oil and gas employees.
2. PLAN PARTICIPANTS
The Petrotech Plan shall be limited to non-officer employees designated by the
Chief Executive Officer of Meridian who, because of their position and
responsibility, directly affect the success of Meridian Oil Inc.'s (hereinafter
referred to as "Meridian") exploration and production activities. Those
employees are hereinafter referred to as "Plan Participants".
3. ADMINISTRATION
The Petrotech Plan shall be administered by the Chief Executive Officer of
Meridian or such other person as the Chief Executive Officer shall designate
from time to time (hereinafter referred to as the "Administrator"). The
Administrator shall have the exclusive right and authority to manage and
administer as well as to amend, interpret or rescind any of the terms and
conditions of the Petrotech Plan. All actions taken by the Administrator shall
be binding upon all Plan Participants.
4. PLAN AWARDS
In July of each year the plan is in effect, an amount equal to twenty percent
of the annualized July 1 regular base pay of all Plan Participants shall be
deemed to be applied to a fund (hereafter referred to as the "Award Fund").
The Award Fund shall then be converted to "Stock Units" by dividing the Award
Fund by the Conversion Price. The Conversion Price is the average of the
closing prices of Burlington Resources Inc. common stock for the last twenty
trading days in June of each year. The Stock Units distributed to certain Plan
Participants shall be referred to as an "Award".
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Awards made to the Plan Participants shall be at the sole discretion of the
Administrator. Awards, if any, shall be made and communicated to Plan
Participants on or before August 15 of each year.
5. DISTRIBUTION AND CASH VALUE OF STOCK UNITS
By August 15 of the year following the year of each Award, twenty percent of
the Stock Units associated with that Award will be distributed to the Plan
Participant. The remaining eighty (80%) percent of the Stock Units associated
with that Award will be distributed annually over the subsequent four year
period.
The value of the Stock Units is immediately payable in cash to the Plan
Participant at the time of their distribution. The value is determined by
multiplying the number of Stock Units distributed, by the Conversion Price in
effect at the time of that distribution. Appropriate state and federal income
taxes, F.I.C.A. and other similar deductions will be withheld from any payment
made under this Petrotech Plan.
Except as otherwise provided in this Petrotech Plan, a Plan Participant must be
a full time employee, on short-term disability or on an approved Unpaid Leave
of Absence at the time the cash value of the Stock Units becomes payable to
receive payments based upon any Award.
6. DEATH/DISABILITY/RETIREMENT/SEVERANCE
If a Plan Participant dies, retires, is permanently disabled, or severed (as
defined below) on or subsequent to the date that an Award is made, a Special
Distribution, as defined below, will occur. The resulting payment shall be a
final payment and complete settlement for all Awards then outstanding and for
any benefits under the Petrotech Plan.
Permanent Disability--A Plan Participant shall be deemed permanently disabled
when the Administrator shall find upon the basis of medical evidence
satisfactory to the Administrator that the Plan Participant is totally
disabled, whether due to physical or mental condition, so as to be prevented
from engaging in any further employment by Meridian, and such disability will
be permanent and continuous during the remainder of the Plan Participant's
life.
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Retirement--A Plan Participant shall be deemed retired when the Plan
Participant leaves the employment of Meridian and is eligible to receive a
retirement benefit under the Burlington Resources Inc. Pension Plan.
Severance--A Plan Participant's employment shall be deemed severed if the Plan
Participant is included in a reduction in the work force or his/her position is
job abolished as defined by Company policy. Voluntary termination or
termination for poor performance or for cause or for any other reason other
than job abolishment or reduction in force will not be a severance under the
Petrotech Plan and will not result in a Special Distribution.
7. SPECIAL DISTRIBUTION
A Special Distribution is made in the event of a Plan Participant's death,
Disability, Retirement or Severance only. If such an event occurs on or
subsequent to the date that an Award is made, the Stock Units that would have
been distributed to the Plan Participant as part of the next year's usual
distribution shall be immediately distributed to the Plan Participant or
his/her beneficiary. The cash value of such Stock Units shall be determined by
multiplying the number of Stock Units by the last determined Conversion Price.
Payment of the cash value of the Stock Units shall be made within forty-five
(45) days of the event and shall be the full and final payment and complete
settlement for all Awards then outstanding and for any benefits under the
Petrotech Plan.
8. BENEFICIARY
Any person or persons may be named as the beneficiary of a Special Distribution
in the event of the Plan Participant's death. If a beneficiary is not named or
if the named beneficiary is not living at the time of the Plan Participant's
death, payment from the Special Distribution will be made to the first survivor
according to the following priority: spouse, children, parents, siblings, or
the executor for the benefit of the Plan Participant's estate.
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9. BENEFIT PLANS
Awards and any payments to Plan Participants under this Petrotech Plan shall
not be considered as part of a Plan Participant's salary for the calculation of
regular pay, compensation, allowance, pension or any other benefits unless
otherwise required by law or specific contractual obligation of Meridian.
10. UNFUNDED PLAN
Nothing in this Petrotech Plan shall be construed as requiring Meridian to
segregate any moneys from its general funds, or to create any trusts, or make
any special deposits or investments in connection with any amounts credited to
a Plan Participant. All funds deemed to be in the Award Fund and Stock Units
are acknowledged to be subject to Meridian's general creditors prior to any
actual payment of such funds to any Plan Participant.
11. ASSIGNMENT
The benefits of a Plan Participant or a designated beneficiary of a Plan
Participant under this Petrotech Plan may not be assigned. Any attempt to
transfer, assign, pledge, hypothecate, encumber or otherwise dispose of any
rights, privileges or benefits or the sale or levy or any attachment or similar
process upon the rights, privileges or benefits conferred hereby, shall be
invalid. Any attempt to do so shall result in voiding of any Awards and
payments thereunder.
12. NO CONTRACT OF EMPLOYMENT
This Petrotech Plan shall not constitute a contract or any right of
employment. Participation in this Petrotech Plan shall not affect Meridian's
right to discharge a Plan Participant and thereby terminate a Plan
Participant's participation in the Petrotech Plan and payout of Awards (except
as specifically provided in Paragraph 6).
13. NO RIGHT OF INSPECTION
Neither this Petrotech Plan nor any action taken thereunder by the
Administrator shall be construed as giving any Plan Participant or beneficiary
or any other person the right
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to an accounting, to examine the books, or to review or question the affairs,
management, or business decisions of Meridian relating to this Petrotech Plan.
14. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Administrator may, from time to time, amend any provision of the Petrotech
Plan, or suspend or terminate the Petrotech Plan, in whole or in part, and if
any term or condition of the Petrotech Plan is suspended or terminated, the
Administrator may reinstate any or all the prior terms and conditions of the
Petrotech Plan. The Administrator may take such actions from time to time and
no Plan Participant has any vested or contract right under this Petrotech Plan.
In the event the Petrotech Plan is suspended or terminated by the
Administrator, the cash value of the Stock Units derived from previous Awards
may continue to be paid in the manner described in the above referenced
paragraphs entitled "Distribution of Stock Units" and "Special Distribution".
15. EFFECTIVE DATE
The Petrotech Plan is effective as of July 1, 1988, revised August 1,1993 and
July 1, 1994.