WITH THE PERFORMANCE OF THE EXECUTIVE'S RESPONSIBILITIES TO THE
COMPANY.
4
(B)
COMPENSATION.
(I)
BASE SALARY.
DURING THE EMPLOYMENT
PERIOD, THE EXECUTIVE SHALL RECEIVE AN ANNUAL BASE SALARY ("ANNUAL BASE
SALARY"), WHICH SHALL BE PAID ON A MONTHLY BASIS, AT LEAST EQUAL TO TWELVE TIMES
THE HIGHEST MONTHLY BASE SALARY PAID OR PAYABLE TO THE EXECUTIVE BY THE COMPANY
AND ITS AFFILIATED COMPANIES IN RESPECT OF THE TWELVE-MONTH PERIOD IMMEDIATELY
PRECEDING THE MONTH IN WHICH THE APPLICABLE DATE OCCURS.
DURING THE EMPLOYMENT
PERIOD, THE ANNUAL BASE SALARY SHALL BE REVIEWED AT LEAST ANNUALLY AND MAY BE
INCREASED AT ANY TIME AND FROM TIME TO TIME AS SHALL BE SUBSTANTIALLY CONSISTENT
WITH INCREASES IN BASE SALARY GENERALLY AWARDED IN THE ORDINARY COURSE OF
BUSINESS TO OTHER EXECUTIVES OF THE COMPANY AND ITS AFFILIATED COMPANIES.
FOLLOWING A CHANGE OF CONTROL, ANNUAL BASE SALARY SHALL BE INCREASED NOT LESS
FREQUENTLY THAN ANNUALLY IN AN AMOUNT NOT LESS THAN THE PERCENTAGE INCREASE, IF
ANY, IN THE UNITED STATES DEPARTMENT OF LABOR'S U.S. CONSUMER PRICE INDEX - ALL
ITEMS (ALL URBAN CONSUMERS) FROM THE LAST DAY OF THE LAST FULL MONTH PRECEDING
THE CHANGE OF CONTROL TO THE LAST MONTH PRECEDING THE DATE OF INCREASE.
ANY
INCREASE IN ANNUAL BASE SALARY SHALL NOT SERVE TO LIMIT OR REDUCE ANY OTHER
OBLIGATION TO THE EXECUTIVE UNDER THIS AGREEMENT.
AS USED IN THIS AGREEMENT,
THE TERM "AFFILIATED COMPANIES" SHALL INCLUDE ANY COMPANY CONTROLLED BY,
CONTROLLING OR UNDER COMMON CONTROL WITH THE COMPANY.
(II)
ANNUAL BONUS.
IN ADDITION TO ANNUAL BASE
SALARY, THE EXECUTIVE MAY BE AWARDED AT THE DISCRETION OF THE COMPANY FOR ANY
FISCAL YEAR ENDING DURING THE EMPLOYMENT PERIOD, A BONUS.
(III)
INCENTIVE, SAVINGS AND RETIREMENT PLANS.
DURING THE EMPLOYMENT PERIOD, THE EXECUTIVE SHALL BE ENTITLED TO PARTICIPATE IN
ALL INCENTIVE, SAVINGS AND RETIREMENT PLANS, PRACTICES, POLICIES AND PROGRAMS
APPLICABLE GENERALLY TO OTHER EXECUTIVES OF THE COMPANY AND ITS AFFILIATED
COMPANIES.
SUCH PLANS, PRACTICES, POLICIES AND PROGRAMS SHALL PROVIDE THE
EXECUTIVE WITH INCENTIVE OPPORTUNITIES (MEASURED WITH RESPECT TO BOTH REGULAR
AND SPECIAL INCENTIVE OPPORTUNITIES, TO THE EXTENT, IF ANY, THAT SUCH
DISTINCTION IS APPLICABLE), SAVINGS OPPORTUNITIES AND RETIREMENT BENEFIT
OPPORTUNITIES, IN EACH CASE, EQUAL TO THE MOST FAVORABLE OF THOSE PROVIDED BY
THE COMPANY AND ITS AFFILIATED COMPANIES FOR THE EXECUTIVE UNDER SUCH PLANS,
PRACTICES, POLICIES AND PROGRAMS AS IN EFFECT AT ANY TIME DURING THE 90-DAY
PERIOD IMMEDIATELY PRECEDING THE APPLICABLE DATE.
(IV)
EXCESS RETIREMENT BENEFIT PAYMENTS.
IN
ADDITION TO THE BENEFITS AVAILABLE PURSUANT TO SECTION
4(B)(III):
(A)
UPON THE TERMINATION OF THE EXECUTIVE'S
SERVICES WITH THE COMPANY FOR ANY REASON OTHER THAN DEATH, THE COMPANY SHALL PAY
TO THE EXECUTIVE A MONTHLY BENEFIT FOR LIFE (OR THE LUMP-SUM EQUIVALENT THEREOF
WITH THE CONSENT OF THE EXECUTIVE'S SPOUSE), IN AN AMOUNT EQUAL TO THE MONTHLY
ANNUITY PAYMENT THAT
5
THE EXECUTIVE WOULD BE ENTITLED TO RECEIVE UNDER THE RETIREMENT PLAN FOR POGO
PRODUCING COMPANY (OR ANY SUCCESSOR THERETO) (THE "RETIREMENT PLAN") IF THE
LIMITATIONS ON RETIREMENT BENEFITS UNDER SECTIONS 415 AND 401(A)(17)