Exhibit 10.22

 

[Premcor logo appears here]

 

1700 East Putnam Avenue, Suite 500

Old Greenwich, CT 06870

 

December 15, 2003

 

Mr. Thomas D. O’Malley

Horse Island, Mead Point

Greenwich, CT 06830

 

Dear Tom:

 

On January 30, 2002, you executed an Employment Agreement (“Agreement”) with the
Company that provided that you would receive an annual grant of stock options
under terms defined in the Agreement.

 

Management and the Company’s Board of Directors have determined that it is
desirable to modify the terms for the year 2004 only of the grant of stock
options. Under these new terms, during the month of January of the year 2004,
you will receive a grant of options to purchase 150,000 shares of Company common
stock at an exercise price per share equal to Fair Market Value (as defined in
the Plan) on the date of grant (the “Annual Options”). Subject to your continued
employment with the Company, such Annual Options will vest in equal installments
on each of the first five anniversaries of the date of grant, and will become
fully vested upon the occurrence of a Change in Control of the Company. Other
terms and conditions of the Annual Options shall be as set forth your Agreement,
in the Plan, and an option agreement between you and the Company. If the Company
should, prior to any Annual Option grant, be involved in any merger,
reorganization, stock split or spinoff or other similar event, the number of
shares subject to the Annual Options yet to be granted, as provided above, shall
be adjusted on a pro rata basis.

 

Your acceptance of this letter shall serve as your consent to the change in
terms with respect to your Annual Options. This letter shall also serve as a
waiver by you of the change in terms of your Annual Options as a purported
breach of your employment agreement.

 

Please execute one copy of this letter and return it to James R. Voss, Senior
Vice President and Chief Administrative Officer.

 

Sincerely, /s/    Richard C. Lappin        

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Richard C. Lappin

Chairman, Compensation Committee

 

Agreed and Accepted:             /s/    Thomas D. O’Malley       Date:     

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Thomas D. O’Malley