Unassociated Document


    AMENDMENT
      NO. 2

    TO

    BURLINGTON
      RESOURCES INC.

    COMPENSATION
      PLAN FOR NON-EMPLOYEE DIRECTORS

     

     

    The
      Burlington Resources Inc. Compensation Plan for Non-Employee Directors (the
      “Plan”) is hereby amended as follows:

     

    1.    Section
      1.4 of the Plan is amended, effective as of the “Effective Time” as defined in
      that certain Agreement and Plan of Merger dated as of December 12, 2005 by
      and among Burlington Resources Inc., ConocoPhillips and Cello Acquisition Corp.
      (the “Effective Time”), to read as follows:

     

    “1.4
       Common
      Stock
      means
      the common stock, par value $.01 per share, of the Company (except as otherwise
      provided in Section 4.11).”

     

    2.    The
      second sentence of Section 4.1 of the Plan is amended, effective as of January
      1, 2005, to read as follows:

     

    “Subject
      to Section 4.10, the election shall be irrevocable and shall be made on a form
      prescribed by the Compensation Committee, which shall govern the amount
      deferred, the form of its payment pursuant to Section 4.6 following the
      Participant’s Termination, and, except as provided in Section 4.3 and 4.4, the
      investment of the Participant’s Memorandum Account for such deferral period
      pending its payment.”

     

    3.    Section
      4.3 of the Plan is amended, effective as of the Effective Time, to read as
      follows:

     

    “4.3
       Investment
      of Accounts.
      Except
      as provided below, each Account shall accrue interest on the deferred
      Compensation credited to such Account from the date such Compensation is
      credited to the Account through the date of its distribution (the “Interest
      Account”). Such interest shall be credited to the Interest Account as of such
      valuation dates as shall be determined by the Compensation Committee. The
      Compensation Committee shall determine, in its sole discretion, the rate of
      interest to be credited periodically to the Interest Accounts; provided,
      however, that in no event may the interest rate be less than the Moody’s
      Long-Term Corporate Bond Yield Average (as it may be adjusted from time to
      time); and, provided, further, that the Plan may not be amended to reduce or
      eliminate this minimum rate of interest. 

     

    In
      lieu
      of investing in the Interest Account, a Participant may elect that all or a
      specified percentage of his or her Compensation deferred that Plan Year be
      invested in Phantom Stock (the “Company Stock Account”), in the S&P Account
      or in any combination of the Interest Account, Company Stock Account and/or
      S&P Account. If the Participant so elects, the Compensation Committee shall
      establish a separate notional subaccount(s) for such Participant under his
      or
      her Account, which shall be credited (i) with respect to the Company Stock
      Account, with whole and fractional shares of Phantom Stock


    
      
         

         

      

      
         

        
          

        

      

      
         

      

    


    periodically
      as of the dates of the credits to the Company Stock Account, and with phantom
      (notional) dividends with respect to the Phantom Stock, which shall be credited
      as being reinvested in additional shares of Phantom Stock and (ii) with
      respect to the S&P Account, with whole and fractional units in the S&P
      Account periodically as of the credits to the S&P Account and with any
      notional distributions on such units, which shall be credited as being
      reinvested in additional units. All credits and debits to the Company Stock
      Account shall be made based on the Fair Market Value per share of the Common
      Stock on the applicable date. The Compensation Committee shall determine, in
      its
      sole discretion, the valuation dates for valuing each Participant’s
      Account(s).”

     

    4.    Section
      4.4 is amended, effective as of the Effective Time, to read as
      follows:

     

    “4.4
       Change
      in Investment Elections.
      Each
      Participant who has an Account under the Plan may elect that all or a specified
      percentage of his or her Account balance as of any date be reinvested in the
      Interest Account, Company Stock Account and/or S&P Account in such
      proportions as elected by the Participant. This election shall be in such form
      as the Compensation Committee shall establish and shall comply with all
      requirements of Section 16(b), to the extent applicable.”

     

    5.    Section
      4.6 of the Plan is amended, effective as of the Effective Time, to read as
      follows:

     

    “4.6
       Payment
      of Accounts.
      Upon a
      Participant’s Termination, the Company shall pay to such Participant (or to his
      or her Beneficiary in case of the Participant’s death) in cash the balance
      credited to his or her affected Account(s) as follows:

     

    
      	 	
              (a)

            	
              a
                lump sum payment; or

               

            


    

    
      	 	
              (b)

            	
              in
                60 consecutive substantially equal monthly installments; or

               

            


    

    
      	 	
              (c)

            	
              in
                120 consecutive substantially equal monthly installments;

               

            


    

    whichever
      form of payment has been elected by the Participant. If distributions are to
      be
      made in substantially equal installments, the amount of each installment payment
      shall be determined by dividing (i) the amount credited to the portion of the
      Participant’s Account to be paid in that form determined as of the valuation
      date before the applicable installment payment by (ii) the number of
      installment payments (including the applicable installment) remaining to be
      paid. On and after the Participant’s Termination and until the full distribution
      of his or her Account(s), the Participant may invest all or a specified portion
      of his or her Account(s) as of any date in the Interest Account, Company Stock
      Account and/or S&P Account in such proportions as elected by the
      Participant. Payment of Accounts shall commence or be made in the January
      following the year in which the Participant’s Termination occurs. In the case of
      distribution to a Participant in installments, payment will be made on a pro
      rata basis from each of the Participant’s Accounts.”

     

    6.    Section
      4.7 of the Plan is amended, effective as of January 1, 2005, by adding the
      following sentence at the beginning of said Section:


    
      
         

         

      

      
        -2-

        
          

        

      

      
         

      

    


    “This
      Section 4.7 shall not apply to the portion of a Participant’s account
      attributable to deferrals of Compensation after December 31, 2004.”

     

    7.    Section
      4
      of the Plan is amended, effective as of January 1, 2005, by adding the following
      new Sections 4.8, 4.9 and 4.10:

     

    “4.8
       Acceleration
      of Payments for Post-2004 Deferrals.

     

    Anything
      in this Plan to the contrary notwithstanding, with respect to the portion of
      a
      Participant’s Account attributable to deferrals of Compensation after December
      31, 2004, this Section 4.8 shall apply in lieu of Section 4.7.

     

    Notwithstanding
      anything in the Plan to the contrary, the Compensation Committee, in its sole
      discretion, may accelerate the payment of all or part of the unpaid balance
      of a
      Participant’s Account(s) at the request of the Participant upon its
      determination that the Participant has incurred an unforeseeable emergency.
      For
      this purpose, the term “unforeseeable emergency” means a severe financial
      hardship to the Participant resulting from an illness or accident of the
      Participant, the Participant’s spouse, or a dependent (as defined in Section
      152(a) of the Code) of the Participant, loss of the Participant’s property due
      to casualty, or other similar extraordinary and unforeseeable circumstances
      arising as a result of events beyond the control of the Participant. A
      distribution may be made on account of an unforeseeable emergency only if the
      amounts distributed with respect to an emergency do not exceed the amounts
      necessary to satisfy such emergency plus amounts necessary to pay taxes
      reasonably anticipated as a result of the distribution, after taking into
      account the extent to which such hardship is or may be relieved through
      reimbursement or compensation by insurance or otherwise or by liquidation of
      the
      Participant’s assets (to the extent the liquidation of such assets would not
      itself cause severe financial hardship).

     

    4.9    Post
      -
      2004 Deferrals.
      Anything in this Plan to the contrary notwithstanding, deferrals of Compensation
      may continue to be made pursuant to the terms of this Plan after December 31,
      2004; provided,
      however,
      that
      any such deferrals shall be subject to such rules as the Compensation Committee
      may prescribe so that such deferrals meet the requirements of Section 409A
      of
      the Internal Revenue Code of 1986, as amended, and the regulations, guidelines
      and transitional rules thereunder.

     

    4.10    Election
      of Form of Payment under Transition Rules.
      With
      respect to the portion of a Participant’s Account attributable to deferrals of
      Compensation after December 31, 2004, the Compensation Committee may allow
      Participants to make an election or to change their election as to the form
      of
      payment pursuant to Section 4.6 during an election period prescribed by the
      Compensation Committee to the extent permitted under transition rules prescribed
      by the U.S. Treasury Department under Section 409A of the Code.”

     


    
      
         

         

      

      
        -3-

        
          

        

      

      
         

      

    


    8.    Section
      4
      of the Plan is amended, effective as of the Effective Time, by adding the
      following new Section 4.11:

     

    “4.11
       Conversion
      of Company Stock Account.
      At the
“Effective Time” as defined in that certain Agreement and Plan of Merger dated
      as of December 12, 2005 by and among the Company, ConocoPhillips and Cello
      Acquisition Corp., the Phantom Stock held in the Company Stock Account shall
      be
      converted in accordance with said Agreement and Plan of Merger into phantom
      shares of common stock of ConocoPhillips, and thereafter the term “Common Stock”
for purposes of this Plan shall mean common stock of
      ConocoPhillips.

     

    9.    Section
      5.4 of the Plan is amended, effective as of January 1, 2005, to read as
      follows:

     

    “5.4
       Termination
      and Amendment.
      Subject
      to Section 5.7 and the limitation set forth in the third sentence of Section
      4.3, the Board may from time to time amend, suspend or terminate the Plan,
      in
      whole or in part, and if the Plan is suspended or terminated, the Board may
      reinstate any or all of its provisions. Subject to Section 5.7 and the
      limitation set forth in the third sentence of Section 4.3, the Management
      Committee may also amend the Plan; provided, however, that it may not suspend
      or
      terminate the Plan, or substantially increase the obligations of the Company
      under the Plan (provided, however, that the addition of new notional subaccounts
      for investments shall not be deemed an increase in the obligations of the
      Company), or expand the classification of employees who are eligible to
      participate in the Plan. No amendment, suspension or termination of the Plan
      may
      impair the right of a Participant or his or her Beneficiary to receive the
      benefit accrued hereunder prior to the effective date of such amendment,
      suspension or termination.”

     

    10.    Section
      5
      of the Plan is amended, effective as of January 1, 2005, by adding the following
      new Section 5.7:

     

    “5.7 Compliance
      with Code Section 409A.
      With
      respect to any deferrals under this Plan after December 31, 2004, it is intended
      that this Plan comply with Section 409A of the Internal Revenue Code of 1986,
      as
      amended (the “Code”) and any regulations, guidance and transitional rules issued
      thereunder, and the Plan shall be interpreted and operated consistently with
      that intent. If the Plan Administrator shall determine, following the issuance
      of final regulations, that any provisions of this Plan as applicable to the
      portion of this Plan attributable to deferrals after December 31, 2004, do
      not
      comply with the requirements of Section 409A of the Code, the Plan Administrator
      shall amend the Plan to the extent (and only to the extent) necessary (including
      retroactively) in order to preserve compliance with said Section 409A; provided,
      however, that any such amendment affecting amounts previously deferred under
      the
      Plan shall be made in a manner that preserves the economic value of such
      deferred amounts to the Participant.


    
      
         

         

      

      
        -4-

        
          

        

      

      
         

      

    


    It
      is
      intended that any amounts deferred under this Plan prior to January 1, 2005
      qualify under the grandfather provisions of Section 409A of the Code and the
      regulations and guidance thereunder so that such deferrals (as adjusted for
      earnings and losses thereon) are not subject to said Section 409A. No amendments
      shall be made to this Plan that would cause the loss of such grandfather
      protection.”

    
      
         

      

      
        -5-