Exhibit 10.4

ANADARKO PETROLEUM CORPORATION 1201 LAKE ROBBINS DRIVE, THE WOODLANDS, TEXAS
77380

P.O. BOX 1330 HOUSTON, TEXAS 77251-1330 U.S.A. PH. (832)636-1000

 

LOGO [g351439g89m52.jpg]

PERSONAL AND CONFIDENTIAL

[Date]

Dear                     :

Anadarko Petroleum Corporation’s (the “Company”, including affiliates where
applicable) Compensation and Benefits Committee of the Board of Directors (the
“Committee”) has made an award of Performance Units (“PUs”) to you under the
Anadarko Petroleum Corporation 2012 Omnibus Incentive Compensation Plan, as may
be amended from time to time (the “Plan”). This PU Award is subject to all terms
and conditions of the Plan, the summary of the Plan (the “Prospectus”) and the
provisions of this Award Agreement. Unless defined herein, capitalized terms
shall have the meaning assigned to them under the Plan. The Plan is available on
the Anadarko intranet website at the following address: [internal website
address].

You have been awarded                      PUs as your target (“Target”). The
value of these PUs, if any, will be dependent upon the Company’s relative Total
Stockholder Return (“TSR”) over the specified Performance Periods. Fifty percent
(50%) of your Target is subject to a two-year Performance Period that begins
[date] and ends [date] (the “[year] Performance Period”) and fifty percent
(50%) of your Target is subject to a three-year Performance Period that begins
[date] and ends [date] (the “[year] Performance Period”). The [year] and [year]
Performance Periods may each be individually referred to herein as a
“Performance Period.” At the end of each Performance Period, fifty percent
(50%) of your Target will vest. The maximum number of PUs that you can earn
during each Performance Period will be calculated as follows {             x 50%
x 200%}, with actual payout based on the Company’s relative TSR ranking as
described below.

Each PU represents the value of one share of the Company’s Common Stock. The
payout of PUs is contingent upon the Company’s TSR ranking relative to a
predetermined peer group during a Performance Period. The TSR measure provides
an external comparison of the Company’s performance against a peer group of
companies and will be calculated as follows:

Average Closing Stock Price for the last 30 trading days of the Performance
Period

Minus

Average Closing Stock Price for the 30 trading days preceding the beginning of
the

Performance Period

Plus

Dividends paid per share over the Performance Period

 

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Total Above Divided By

Average Closing Stock Price for the 30 trading days preceding the beginning of
the

Performance Period

The actual number of PUs you will earn for each Performance Period is based upon
the Company’s relative TSR ranking as follows:

 

Anadarko

Relative

Ranking

 

Percentile

Rank

 

Payout

as % of

Target

1st   100%   200% 2nd   91%   182% 3rd   82%   164% 4th   73%   146% 5th   64%  
128% 6th   55%   110% 7th   46%   92% 8th   36%   72% 9th   27%   54% 10th   18%
  0% 11th   9%   0% 12th   0%   0%

For example, if you were awarded 1,000 target PUs and the Company’s relative
ranking for the [year] Performance Period is 3rd, you will receive 820 PUs
(1,000 x 50% x 164%) at the end of the [year] Performance Period (subject to the
other terms and conditions of this Award Agreement). If the Company’s relative
ranking for the [year] Performance Period is 1st, you will receive 1,000 PUs
(1,000 x 50% x 200%) at the end of the [year] Performance Period (subject to the
other terms and conditions of this Award Agreement).

The peer group for the [year] Performance Period and the [year] Performance
Period include Apache Corporation, Chevron Corporation, ConocoPhillips, Devon
Energy Corporation, EOG Resources Inc., Hess Corporation, Marathon Oil
Corporation, Noble Energy Inc., Occidental Petroleum Corporation, Pioneer
Natural Resources Company and Plains Exploration & Production Company. If,
during either of the Performance Periods, any peer company undergoes a change in
corporate capitalization or a corporate transaction (including, but not limited
to, a going private transaction, bankruptcy, liquidation, merger, consolidation,
etc.), then the Committee shall undertake an evaluation to determine whether
such peer company will be replaced with a different peer company (any such
replacement company shall be identified pursuant to the rules established by the
Committee within the first 90 days of a Performance Period). The Committee has
designated Murphy Oil Corporation, Nexen, Inc., and Chesapeake Energy
Corporation as replacement companies, in the order just specified.

 

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After the end of each Performance Period, the value attributed to the PUs that
vest on such date shall be calculated by multiplying the number of PUs earned by
the Fair Market Value1 of the Company’s Common Stock on the day the Committee
certifies the performance results and approves the payouts. This value shall be
reduced by the applicable payroll taxes as a result of such vesting, and the
resulting amount shall then be paid to you in cash unless you had made a
deferral election.

Dividend Equivalents shall not be paid with respect to the PUs. The PUs do not
have voting rights and the PUs do not count toward any applicable stock
ownership guidelines.

You will be allowed to make an election to defer your entire PU award on a
separate form provided by Human Resources. All deferral elections and
distributions must be made in compliance with Code Section 409A.

If you voluntarily terminate your employment other than for Good Reason during
the Applicable Period following a Change of Control, or in the event you are
terminated for Cause, all unvested PUs will be immediately forfeited. Except in
the event of a Change of Control, if your employment is involuntarily terminated
without Cause prior to the end of a Performance Period, you will receive a
payout, paid after the end of the Performance Period, based on actual
performance and in accordance with your deferral election, if applicable. Upon
your (i) death, (ii) disability (as defined in the Company’s disability plan),
or (iii) termination of employment without Cause or for Good Reason during the
Applicable Period following a Change of Control all your unvested PUs will
become immediately vested and paid to you as soon as administratively
practicable in an amount equal to your Target multiplied by the Fair Market
Value of the Company’s Common Stock for the date of such determining event (with
respect to the termination of your employment following a Change of Control as
discussed in (iii) above, the date of such determining event shall be the first
trading day immediately preceding the date of the Change of Control). Upon your
retirement (as defined by the Anadarko Petroleum Corporation Retiree Health
Benefits Plan) prior to the end of a Performance Period, you will receive a
prorated payout, paid after the end of the Performance Period, based on actual
performance and the number of months you worked during the Performance Period.
Your PUs are subject to several restrictions, including that such PUs may not be
transferred, sold, assigned, pledged, exchanged, hypothecated or otherwise
transferred, or disposed of to the extent then subject to restrictions.

If the Company is required to prepare an accounting restatement due to the
material noncompliance of the Company, as a result of misconduct, with any
financial reporting requirement under the securities laws, and if you knowingly
engaged in the misconduct, were grossly negligent with respect to such
misconduct, or knowingly or grossly negligently failed to prevent the misconduct
(whether or not you are one of the individuals subject to automatic forfeiture
under Section 304 of the Sarbanes-Oxley Act of 2002), the Plan Administrator may
determine that you shall reimburse the Company the amount of any payment in
settlement of an Award earned or accrued during the twelve-month period
following the first public issuance or filing with the United States Securities
and Exchange Commission (whichever first occurred) of the financial document
embodying such financial reporting requirement.

 

 

1 As of any given date, the closing sales price at which Common Stock is sold on
such date as reported in the NYSE-Composite Transactions by The Wall Street
Journal or any other comparable service the Plan Administrator may determine is
reliable for such date, or if no Common Stock was traded on such date, on the
next preceding day on which Common Stock was so traded. If the Fair Market Value
of the Common Stock cannot be determined pursuant to the preceding provisions,
the “Fair Market Value” of the Common Stock shall be determined by the Plan
Administrator in such a manner as it deems appropriate, consistent with the
requirements of Section 409A.

 

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Notwithstanding anything in this Award Agreement or any other agreement between
you and the Company to the contrary, including, without limitation, any
provisions that prevent the Company from unilaterally amending this Award
Agreement, you agree by accepting this Award that the Dodd-Frank Wall Street
Reform and Consumer Protection Act (the “Act”) has the effect of requiring
certain officers of the Company to repay the Company, and for the Company to
recoup from such officers, erroneously awarded amounts of incentive-based
compensation. If the Act, any rules or regulations promulgated thereunder by the
Securities and Exchange Commission or any similar federal or state law requires
the Company to recoup any erroneously awarded incentive-based compensation
(including stock options and any other equity-based awards) that the Company has
paid or granted to you, you hereby agree, even if you have terminated your
employment with the Company, to promptly repay such erroneously awarded
incentive compensation to the Company upon its written request. This obligation
shall survive the termination of this Award Agreement.

Please establish a Beneficiary Designation for your Long-Term Incentive Equity
Awards online at [internal website address] or by contacting the Anadarko
Benefits Center at 1-866-472-xxxx, option 1 and then option 1 again. You may
update your designation anytime.

If you have any questions about this Award Agreement, please call me at
832-636-xxxx.

Sincerely,

 

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