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EXHIBIT 10.4
UNION PACIFIC RESOURCES GROUP INC.
DEFERRED COMPENSATION PLAN
FOR THE BOARD OF DIRECTORS
AMENDED AND RESTATED
EFFECTIVE JUNE 1, 1997
1. PURPOSE
The purpose of this Plan is to provide a means for deferring payment
of all or a portion of any cash compensation, excluding expenses,
payable to Directors for their service on the Board of Directors (the
"Board") of Union Pacific Resources Group Inc. (the "Company") in
accordance with the By-Laws of the Company. Such compensation
eligible to be deferred is referred to herein as "Compensation".
2. ELIGIBILITY
Any individual serving as a member of the Board as of the effective
date of this Plan or who subsequently becomes a member is eligible
under this Plan, provided that no member who is an employee of the
Company or any of its subsidiaries shall be eligible under this Plan.
3. PRIOR PLAN
Any person who terminated service as a Director prior to the effective
date of this Plan and who participated in and is entitled to benefits
under the Union Pacific Resources Group Inc. Stock Unit Grant and
Deferred Compensation Plan for the Board of Directors, effective
September 28, 1995 (the "Prior Plan") shall continue to have such
rights and be subject to such restrictions as would pertain to him or
her under the Prior Plan. Any person who is a Director on the
effective date of this Plan and who participated in and is entitled to
benefits under the Prior Plan shall now have such rights and be
subject to such restrictions as would pertain to him or her under this
Plan; provided, however, that under no circumstances shall any
benefits or rights under the Prior Plan be diminished or impaired by
this Plan.
4. ELECTION
Election to defer Compensation is to be made on or before December 31
of any year for Compensation for services as a member of the Board for
the following and later calendar years.
Election to defer is a continuing election until changed by the
Director on or before December 31 of any year for the then following
and later calendar years. However, once an election is made (and
effective), subsequent elections will have no effect on the amounts,
timing and manner of payment covered by the previous election.
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Any newly elected Director who was not a Director on the preceding
December 31 may elect, before his or her term begins, to defer
Compensation for services as a member of the Board for the balance of
the calendar year in which such election is made.
Any Director who has not previously made a deferral election because
such Director was not eligible to participate in this Plan, may elect,
prior to the calendar quarter for which Compensation will initially be
paid, to defer Compensation for services as a member of the Board for
the balance of the calendar year in which such election is made.
Forms shall be made available to Directors each year for the purpose
of making or changing their election.
5. AMOUNT
All or any portion, in multiples of 10%, of a Director's Compensation
may be deferred.
6. DEFERRED ACCOUNTS
Each Director shall have a Stock Unit Account and a Fixed Income
Account (together, the "Accounts"). Amounts deferred pursuant to
paragraph 4 may be credited to either Account, at the election of the
Director made at the time of the deferral election, in multiples of
10% of such Director's Compensation.
(a) STOCK UNIT ACCOUNT
(i) Amounts deferred and credited to the Stock Unit
Account shall be converted into whole Stock Units on
the basis of the Fair Market Value of the Company's
Common Stock on the first business day of the month
following the quarter in which the Compensation was
earned, and cash shall be credited to the Stock Unit
Account in lieu of any fractional Stock Unit. "Fair
Market Value" on a date means the average of the high
and low trading prices per share on that date, as
reported in The Wall Street Journal listing of
consolidation trading for New York Stock Exchange
issues.
(ii) On the payment date for each cash dividend or other
cash distribution with respect to the Company's
Common Stock, each Director's Stock Unit Account
shall be credited with an amount equal to the amount
of the per share dividend or distribution, multiplied
by the number of Stock Units in such Account, and, if
such Director is then serving as a member of the
Board, shall be converted into whole Stock Units on
the basis of the Fair Market Value of the Company's
Common Stock on the payment date for such dividend or
distribution, and cash shall be credited to the Stock
Unit Account in lieu of any fractional Stock Units.
If a Director is no longer serving as a member of
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the Board on the payment date for such dividend or
distribution, the amount representing such dividend
or distribution shall be paid out of the Stock Unit
Account to such Director as soon as practicable after
the payment date for such dividend or distribution.
Except as provided in the preceding sentence, any
cash credited to a Director's Stock Unit Account
shall be added to other cash credited to such Account
and converted into a whole Stock Unit on the date
sufficient cash exists to purchase a whole Stock
Unit, based on the Fair Market Value of the Company's
Common Stock on such date.
(iii) In the event of a subdivision or combination of
shares of Company Stock, the number of Stock Units
credited to the Stock Unit Accounts on the effective
date of such subdivision or combination shall be
proportionately subdivided or combined as the case
may be. No adjustment shall be made in Stock Units
in connection with the issuance by the Company of any
rights or options to acquire additional shares of
Company Common Stock or securities convertible into
Company Common Stock. In the event of any stock
dividend or reclassification of Company Common Stock,
any merger or consolidation to which the Company is a
party, or any spinoff of shares or distribution of
property other than cash with respect to the Company
Common Stock, the Committee shall cause appropriate
adjustments, if any, to be made in the Stock Units to
reflect such stock dividend, reclassification, merger
or consolidation, spinoff or distribution of
property.
(b) FIXED INCOME ACCOUNT. Amounts credited to the Fixed Income
Account shall earn interest compounded quarterly, from the
date the Compensation would otherwise have been paid until it
is actually paid in full. The rate of interest shall be set
at an annual rate equal to the average for the previous four
years of the interest rates for the months of December in each
such years on Moody's A Public Utility Bond Yields and Moody's
A Corporate Bond Yields.
7. DISTRIBUTION
All distribution from Accounts shall be made in cash. For purposes of
distributions from the Stock Unit Account, each Stock Unit shall be
converted into an amount of cash equal to the Fair Market Value of one
share of the Company's Common Stock on the first business day of the
month in which such distribution is made. The Director must elect, at
the same time and on the same form provided to elect a deferral of
Compensation, the timing and manner of payment of such Compensation.
- TIMING OF PAYMENT: Distributions from the Accounts shall begin
following termination from the Board for any reason, provided
that in the case of distributions from the Fixed Income
Account, the Director may elect that distributions begin
following retirement from the Director's principal occupation.
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- MANNER OF PAYMENT: The Director may elect to receive payment
from the Accounts in a lump sum or in a number of annual
installments of an aggregate amount of cash equal to the value
of the accounts maintained for the Director in the Accounts at
the Valuation Date next preceding the installment payment
divided by the remaining number of such annual installments.
The installments may be paid over a period of either 5 or 10
years.
The lump sum or first installment is to be paid in January of the year
following the year of termination or retirement, as elected by the
Director, and any remaining installments in January of each succeeding
year until the total balance is paid.
Distributions from the Stock Unit Account in installments shall be
based on equal numbers of Stock Units in each installment.
In the event of the death of a Director then serving as a member of
the Board or a terminated or retired Director entitled to a
distribution under this Plan, the balance of theAccounts shall be
payable to the estate or designated beneficiary in full during the
January of the year following the year of such Director's, terminated
Director's or retired Director's death.
The Director may designate his or her beneficiary at the same time he
or she elects deferral of Compensation. However, the latest
designated beneficiary will be the beneficiary or beneficiaries for
the total of all distributions from the Accounts. The designated
beneficiary may be changed at any time on a form provided by the
Secretary of the Company, provided that no designation will be
effective unless it is filed with the Secretary of the Company prior
to the Director's death.
8. UNFUNDED PLAN
The liability of the Company to any Director, terminated Director,
retired Director or his or her estate or designated beneficiary under
the Plan shall be that of a debtor only pursuant to such contractual
obligations as are created by the Plan, and no such obligation of the
Company shall be deemed to be secured by any assets, pledges, or other
encumbrances on any property of the Company.
9. INALIENABILITY OF DEFERRED COMPENSATION
Except to the extent of the rights of a designated beneficiary, no
distribution pursuant to, or interest in, the Plan may be transferred,
assigned, pledged or otherwise alienated and no such distribution or
interest shall be subject to legal process or attachment for the
payment of any claims against any individual entitled to receive the
same.
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10. CONTROLLING STATE LAW
All questions pertaining to the construction, regulation, validity and
effect of the Plan shall be determined in accordance with the laws of
the State of Texas.
11. AMENDMENT
The Board of Directors of the Company in its sole discretion may
amend, suspend or terminate the Plan at any time. However, any such
amendment, suspension or termination of the Plan may not adversely
affect any Director's or his or her beneficiary's rights with respect
to Compensation previously deferred.
12. ADMINISTRATION
Administration of the Plan will be coordinated by the Finance
Department of the Company. Administration will include, but not be
limited to, crediting of deferred compensation, dividends and accrued
interest to individual Director accounts and ultimate disbursement of
deferred amounts.
13. EFFECTIVE DATE
This Plan shall become effective June 1, 1997, applicable only to
compensation for services rendered on or after that date.
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