exv10w1



 




	 	 	 
	 	Plains Resources Inc.

700 Milam, Suite 3100

Pennzoil North Tower

Houston, Texas 77002	
Exhibit 10.1



September 8, 2003



Stephen A. Thorington

6623 Westchester

Houston, TX 77005


               Re: Terms of Employment with the Company



Dear Steve:



I am pleased to offer you the position of Executive Vice President and Chief
Financial Officer of Plains Resources Inc. (the “Company”). This offer letter
shall outline the terms of your employment with the Company.


Subject to earlier termination by either you or the Company, you will be
employed by the Company for a term of five years which shall begin effective as
of December 18, 2002 (the “Effective Date”). The term of your employment will
automatically be extended one year and again for successive one-year periods on
each anniversary thereof, if you and the Company have agreed to new
compensation terms at least ninety days prior to the end of the initial
five-year period and any additional one-year extensions (the initial five-year
term and any additional years are hereinafter referred to as the “Term”). Your
annual salary shall be $100,000, and you shall be eligible for an annual target
bonus of 100% of your annual salary, subject to attainment of goals set forth
by the Company’s Board of Directors (the “Board”).


Since the majority of your professional time will be devoted to your duties at
Plains Exploration & Production Company (“PXP”), you will not be entitled to
any benefits from the Company other than participation in bonus, equity
incentive and similar plans.


You agree to use reasonable best efforts to perform faithfully and sufficiently
your responsibilities and duties hereunder. The Company understands and
acknowledges that you shall be an employee of PXP, and therefore, you will not
be able to devote all of your attention and time during normal business hours
to the Company. Accordingly, the Company agrees that the performance of your
duties on behalf of PXP shall not be a breach of this Agreement.


If the Company terminates your employment during the Term for any reason other
than cause, or if a “change in control” as defined in the Company’s 2001 Stock
Incentive Plan occurs, or if your employment terminates due to your death
during the Term, you will receive a severance payment equal to two times the
sum of your base salary and last earned annual bonus (provided, however, that
if such termination shall take place prior to December 31, 2003, the bonus
amount used for the severance calculation shall be the target bonus), and any
options or grants of restricted


 






 


September 8, 2003

Page 2 of 3


Company common stock shall immediately vest. In addition, you will be
entitled to health benefits for up to two years, subject to mitigation should
you become entitled to health benefits under another plan.


During the Term and for any period thereafter, you shall not, without the
written consent of the Board or a person authorized by the Board, disclose to
any person, other than an employee of the Company or a person to whom
disclosure is reasonably necessary or appropriate in connection with the
performance of your duties as an executive of the Company, any confidential
information obtained by you while in the employ of the Company with respect to
the Company’s business, including but not limited to technology, know-how,
processes, maps, geological and geophysical data, other proprietary information
and any information whatsoever of a confidential nature, the disclosure of
which you know or should know will be damaging to the Company; provided,
however, that confidential information shall not include any information known
generally to the public (other than as a result of unauthorized disclosure by
you) or any information which you may be required to disclose by any applicable
law, order, or judicial or administrative proceeding.


During the Term, you shall not in North America directly or indirectly engage
in or become interested financially in as a principal, employee, partner,
shareholder, agent, manager, owner, advisor, lender or guarantor of any person
engaged in any business substantially identical to the Business (defined
below); provided, however, that you may invest in stock, bonds or other
securities in any such business (without participating in such business) if:
(i)(A) such stock, bonds or other securities are listed on any United States
securities exchange or are publicly traded in an over the counter market and
(B) your investment does not exceed, in the case of any capital stock of any
one issuer, 5% of the issued and outstanding capital stock, or in the case of
bonds or other securities, 5% of the aggregate principal amount thereof issued
and outstanding, or (ii) such investment is completely passive and no control
or influence over the management or policies of such business is exercised.
The term “Business” shall mean (1) marketing, gathering, transporting,
terminalling, and storage of oil and investments in companies conducting such
activities and (2) acquiring, exploiting, developing, exploring for and
producing oil in Florida.


Further, during the Term and for a period of one year thereafter, you shall not
solicit or hire, directly or indirectly, in any manner whatsoever (except in
response to a general solicitation), in the capacity of employee, consultant or
in any other capacity whatsoever, one or more of the employees, directors or
officers or other persons (hereinafter collectively referred to as “Employees”)
who at the time of solicitation or hire, or in the 90-day period prior thereto,
are working full-time or part-time for the Company or any of its subsidiaries
and you shall not endeavor, directly or indirectly, in any manner whatsoever,
to encourage any Employee to leave his or her job with the Company or any of
its subsidiaries and you shall not endeavor, directly or indirectly, and in any
manner whatsoever, to incite or induce any client of the Company or any of its
subsidiaries to terminate, in whole or in part, its business relations with the
Company or any of its subsidiaries.


[The next page is the signature page.]



 






 





September 8, 2003

Page 3 of 3


If you agree with the terms as set forth herein, please sign both copies of
this letter and return one copy to me at the above address.


Sincerely,



/s/ John T. Raymond




John T. Raymond

President and Chief Executive Officer

Agreed to and accepted this 8th day of September 2003.



/s/ Stephen A. Thorington




Stephen A. Thorington