Document:

exv10w27

Exhibit 10.27

AMENDED AND RESTATED SEVERANCE AGREEMENT

          This Amended and Restated Severance Agreement (this “Agreement”) is effective December
15, 2008 (the “Effective Date”) by and between Devon Energy Corporation (the
“Company”) and Danny Heatly (the “Employee”).

          WHEREAS, the Employee is employed by the Company and is party to a Severance Agreement by and
between the Company and the Employee dated as of September 14, 2004;

          WHEREAS, the parties desire to enter into this Agreement to amend, supersede, and fully
restate and replace the Severance Agreement.

          NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

1. Term of Agreement. This Agreement shall not have any specific duration and shall
continue in full force and effect unless and until (a) the Employee’s employment is terminated by
either party in accordance with Section 3, and (b) all obligations and liabilities of the parties
arising in connection with such termination or otherwise accruing under this Agreement have been
fully satisfied. Notwithstanding any contrary provision in this Agreement, nothing in this
Agreement constitutes a guarantee of continued employment but instead provides for certain rights
and benefits during the Employee’s employment with the Company and if such employment terminates.

2. Rights and Benefits. Beginning on a Change in Control and continuing at all times
thereafter, the Company shall not modify the requirements for eligibility for coverage or the
benefits under the Retiree Medical Benefit Plan to adversely affect the Employee’s right to
coverage or benefits for the Employee and the Employee’s dependents, if applicable.

3. Termination of Employment; Suspensions; Change in Control.

     (a) Termination Upon Death. The Employee’s employment with the Company shall terminate
immediately upon the Employee’s death.

     (b) Reassignment of Duties and Termination Due to the Employee Becoming Disabled.

          (i) Reassignment. Whether or not the Employee is Disabled, the Company may reassign
his or her duties during any time he or she has become physically or mentally incapable of
performing his or her essential job functions with or without reasonable accommodation or job
protection as required by law and no such reassignment shall be deemed Good Reason for the Employee
to terminate his or her employment under Section 3(d).

          (ii) Termination. If the Employee becomes Disabled, then the Company may give the
Employee written notice of its intent to terminate his or her employment, in which case such
employment shall terminate effective on the thirtieth (30th) day after receipt of such notice as
long as the Employee has not been medically released and returned to full-time duty before such
thirtieth (30th) day.

     (c) Termination by the Company; Cause. The Company may terminate the Employee’s
employment with the Company at any time whether with or without Cause.

     (d) Termination by the Employee; Good Reason. The Employee may terminate his or her
employment with the Company at any time whether with or without Good Reason. If the Employee
believes Good Reason exists for terminating his or her employment, then he or she shall give the

 

 

Company written notice of the acts or omissions constituting Good Reason within thirty (30)
days after learning of such acts or omissions constituting Good Reason (the “Good Reason
Notice”). No termination of employment for Good Reason shall be effective unless (i) within
thirty (30) days after receiving the Good Reason Notice, the Company fails to either cure such acts
or omissions or notify the Employee of the intended method of cure, and (ii) the Employee delivers
a Notice of Termination to the Company and subsequently resigns within thirty (30) days after the
Company’s deadline in Section 3(d)(i) expires. Notwithstanding the previous sentence and at the
Company’s request, the Employee shall provide services consistent with his or her then-current
authority, duties, and responsibilities for up to ninety (90) days after having provided the Good
Reason Notice to the Company.

     (e) Paid Suspensions. Notwithstanding any contrary provision in this Agreement, the
Company may suspend the Employee with pay for up to thirty (30) days pending an investigation
authorized by the Company or the Board, or pursued by, or at the request of, a governmental
authority to determine whether the Employee has engaged in acts or omissions constituting Cause.
Any such paid suspension shall not constitute Good Reason for the Employee to terminate his or her
employment under Section 3(d). The Employee shall cooperate with the Company in connection with
any such investigation. If the Employee’s employment is subsequently terminated for Cause in
connection with such investigation, then the Employee shall repay any amounts paid by the Company
to the Employee during such paid suspension.

     (f) Effect of a Change in Control on Timing of Termination Date. If the Company
terminates the Employee’s employment other than for Cause or the Employee becoming Disabled and a
Change in Control occurs following the Termination Date, then such Change in Control shall be
deemed to have occurred immediately prior to the Termination Date if either (i) the Termination
Date occurs following the execution of an agreement that provides for a transaction or transactions
that, if consummated, constitutes such Change in Control, or (ii) the Employee reasonably
demonstrates that such termination was either (A) requested by a third party who had indicated an
intention or taken steps reasonably calculated to effect the Change in Control or who effectuates
such Change in Control, or (B) was otherwise in connection with, or in anticipation of, such Change
in Control.

     (g) Notice of Termination. Any termination of the Employee’s employment by the Company
or by the Employee shall be effective only when communicated by a Notice of Termination given to
the other party in accordance with Section 15(d). In the event of a termination by the Employee
for Good Reason, a Notice of Termination shall be effective only if given within the time limit
established by Section 3(d).

     (h) Effect of Termination and Duties Upon Termination. If, on the Termination Date,
the Employee is a member of the board of directors (or any similar governing body) or an officer of
the Company or any Affiliate, or holds any other position with the Company or an Affiliate, then
the Employee shall resign and be deemed to have resigned from all such positions as of the
Termination Date. Between the date a Notice of Termination is delivered and the Termination Date,
the Employee shall continue to perform his or her regular job duties and such services for the
Company as are necessary and appropriate for a smooth transition to the Employee’s replacement, if
any. Notwithstanding the foregoing sentence, the Company may relieve the Employee from further
duties after receiving a Notice of Termination; provided, however, that prior to the
Termination Date, the Employee shall continue to be treated as a Company employee for other
purposes and the Employee’s rights to compensation or benefits shall not be reduced by reason of
the relief. Upon the Termination Date, the Employee shall return to the Company any keys, credit
cards, passes, confidential documents or material, or other property belonging to the Company, and
all writings, files, records, correspondence, notebooks, notes, and other documents and things
(including any copies thereof) containing any Confidential Information.

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4. Obligations of the Company Upon Termination.

     (a) Accrued Obligations. Upon any termination of the Employee’s employment for any
reason, the Company shall pay the Employee (i) his or her accrued Annual Base Salary and accrued,
unused vacation through the Termination Date in a lump sum in cash within thirty (30) days after
the Termination Date, and (ii) if the Employee is actively employed during the entire year upon
which such Annual Bonus is based before the Termination Date, the Annual Bonus at the same time as
such bonuses are paid to similarly situated employees of the Company but in no event later than two
and one-half (2 1/2) months after the end of the taxable year in which any substantial risk of
forfeiture with respect to such bonus lapses (the payments in (i) and (ii) shall be referred to as
the “Accrued Obligations”).

     (b) Good Reason; Other Than for Cause, Death, or Becoming Disabled. If (x) the Company
terminates the Employee’s employment other than for Cause, the Employee’s death, or the Employee
becoming Disabled, or (y) the Employee terminates his or her employment for Good Reason, then the
Company shall, in addition to the payment of the Accrued Obligations, have the following
obligations to the Employee:

          (i) the Company shall pay the Employee within thirty (30) days after the Termination Date

               (A) a lump sum in cash equal to two (2) times the sum of:

                    (1) the greater of (x) the Employee’s then-current Annual Base Salary, or (y) the Employee’s
Annual Base Salary at any time during the two (2) years before the Termination Date; and

                    (2) the highest Annual Bonus received by the Employee within three (3) years before the
Termination Date (or, if termination occurs during the CIC Period, the greater of (x) the highest
Annual Bonus received by the Employee within three (3) years before the Termination Date, and (y)
the highest Annual Bonus received by the Employee within three (3) years before the Change in
Control); provided, however, if the Employee’s employment began in the same calendar year
as the termination of such employment, then the Annual Bonus amount used for calculating the lump
sum payment due shall be determined by the Compensation Committee in its discretion; and

               (B) any applicable Prorated Annual Bonus; and

          (ii) the Company shall pay, or reimburse the Employee, for a reasonable amount of outplacement
services from a mutually agreeable service provider for twelve (12) months following the
Termination Date. The amount of such outplacement services shall be commensurate with the
Employee’s title and position with the Company and other employees similarly situated in other
companies within the Company’s peer industry group. Any reimbursement of such expenses shall be
made by December 31 of the Employee’s taxable year following the year the expenses were incurred;
and

          (iii) if the Termination Date occurs during the CIC Period, then

               (A) the Employee shall be deemed, for purposes of the Retiree Medical Benefit Plan, (i) to
have earned two (2) years of service in addition to the Employee’s actual service at the
Termination Date, and (ii) to be two (2) years older than his or her actual age on the Termination
Date; provided, however, that the additional deemed service and age shall not be construed
to reduce the Employee’s right to benefits under the Retiree Medical Benefit Plan that may
otherwise be reduced by reason of such additional service or age. This subparagraph (A) shall not
limit the ability of the Company

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or an Affiliate to modify the Retiree Medical Benefit Plan for all participants who are
similarly situated as the Employee, subject to the restrictions imposed by the plan;

               (B) the Company shall provide the Employee (and his or her dependents, if applicable) for the
period allowed under Section 4980B of the Code, with the same level of health and dental insurance
benefits upon substantially similar terms and conditions (including contributions required by the
Employee for such benefits) as existed immediately before the Termination Date (or, if more
favorable to the Employee, as such benefits and terms and conditions existed immediately before the
Change in Control, if applicable); provided, however, if the Employee is not eligible to
continue participating in the Company plans providing such benefits (including the Retiree Medical
Benefit Plan), then the Company shall otherwise provide such benefits on the same after-tax basis
as if continued participation had been permitted. The Company’s obligations under this
subparagraph (B) shall apply against its coverage obligations under COBRA. Notwithstanding the
foregoing, if the Employee becomes eligible to receive health and dental insurance benefits through
subsequent employment, then the Employee shall ensure that a coordination of benefits occurs so
that the medical and dental plan of the Employee’s new employer shall be responsible for such
medical and dental benefits that are available under the new employer’s plans before any medical
and dental benefits are provided pursuant to this subparagraph (B). This subparagraph (B) shall
not limit the ability of the Company or an Affiliate to modify the terms of the Retiree Medical
Benefit Plan for all participants who are similarly situated as the Employee, subject to the
restrictions imposed by the plan; and

               (C) the Company shall provide, for two (2) years following the Termination Date, the Employee
with the same level of life insurance benefits upon substantially similar terms and conditions
(including contributions required by the Employee for such benefits) as existed immediately before
the Termination Date (or, if more favorable to the Employee, as such benefits and terms and
conditions existed immediately before the Change in Control); provided, however, that, if
the Employee is not eligible to continue participating in the Company plans providing such life
insurance benefits, then the Company shall otherwise provide such benefits on the same after-tax
death benefit basis as if continued participation had been permitted; and

               (D) the Company shall pay the Employee, within thirty (30) days after the Termination Date, an
amount equal to six (6) times the monthly COBRA premium that applies to the Employee (and his or
her dependents if such dependents are then covered by the Company’s medical plans on the
Termination Date).

     (c) Death or Disabled. If the Employee’s employment terminates due to death or
because he or she is Disabled, then this Agreement shall terminate without further obligations to
the Employee or his or her legal representatives, as applicable, under this Agreement, other than
the obligation to pay, within thirty (30) days after the Termination Date, (i) the Accrued
Obligations, and (ii) any applicable Prorated Annual Bonus.

     (d) Cause; Other than for Good Reason. If the Employee’s employment is terminated for
Cause or the Employee terminates his or her employment without Good Reason, then this Agreement
shall terminate without further obligations to the Employee under this Agreement other than for
payment of the Accrued Obligations.

     (e) Application of Section 409A of the Code. Notwithstanding the above paragraphs of
this Section 4, if the Company determines that (i) the Employee is a “specified employee” within
the meaning of Section 409A of the Code (“Section 409A”) as of the date of his or her “separation
from service” as defined by Section 409A (“Separation from Service”), and (ii) any amount of any
payment to be made under this Section 4 is subject to Section 409A, then such amount shall not be
paid to the Employee until

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six (6) months after the date of his or her Separation from Service (or, if earlier, the date
of his or her death). In such case, the portion of the payment so delayed shall be paid in a
single lump sum in cash on the first (1st) day of the seventh (7th) month following the Employee’s
Separation from Service (or, if earlier, upon his or her death).

     (f) General Release. The Company’s obligation to make the payments described under
Section 4(b) shall be conditioned on the Employee signing and not revoking the general form of
release attached as Exhibit “B” or such other form acceptable to the Company within the
time periods provided in such release. The Company shall not be required to make any payment under
Section 4(b) until the period for the Employee to revoke the release has expired.

5. Non-Exclusivity of Rights. Except as specifically provided in Sections 4(b)(iii)(A) and
(B), nothing in this Agreement shall prevent or limit the Employee’s right to participate in any
plan, program, policy, or practice provided by the Company or any Affiliate and for which the
Employee may qualify, nor shall anything in this Agreement limit or otherwise affect such rights as
the Employee may have under any other contract or agreement with the Company or any Affiliate.
Amounts that are vested benefits or that the Employee is otherwise entitled to receive under any
plan, policy, practice, or program of, or any contract or agreement with, the Company or any
Affiliate at or after the Termination Date shall be payable in accordance with such plan, policy,
practice, program, contract, or agreement, except as explicitly modified by this Agreement;
provided, however, that the Employee shall not be eligible for severance benefits under any
other severance program, policy, practice, or plan of the Company or any Affiliate providing
benefits upon involuntary termination of employment.

6. Full Settlement. The Company’s payment and other obligations under this Agreement shall
not be affected by any set-off, counterclaim, recoupment, defense, or other claim, right, or action
against the Employee or others. The Employee shall have no obligation to seek employment or
otherwise mitigate his or her damages under this Agreement and amounts payable to the Employee
under this Agreement shall not be reduced whether or not the Employee obtains other employment,
except as provided in Section 4(b)(iii) of this Agreement.

7. Certain Additional Payments by the Company.

     (a) Gross-Up Payment. Notwithstanding any contrary provision of this Agreement and
except as provided below, if any payment, benefit, or distribution by the Company, any Affiliate,
or trusts established by the Company or any Affiliate for the benefit of its employees, to or for
the benefit of the Employee (whether pursuant to this Agreement or otherwise but determined without
regard to any additional payments required under this Section 7) (each, a “Payment”) is
determined to be subject to excise tax imposed by the Code, including Section 4999 of the Code, or
any interest or penalties are incurred by the Employee with respect to such an excise tax (such
excise tax and any such interest and penalties shall referred to as the “Excise Tax”), then
the Employee shall be entitled to receive an additional payment (a “Gross-Up Payment”) in
an amount such that, after payment by the Employee of all taxes (including any applicable interest
or penalties) and Excise Tax imposed upon or related to the Gross-Up Payment, the Employee retains
a Gross-Up Payment amount equal to the Excise Tax imposed upon the Payments.

     (b) Determinations and Tax Notice. Subject to Section 7(c), all determinations
required under this Section 7, including whether and when a Gross-Up Payment is required and its
amount, shall be made by a nationally recognized certified public accounting firm designated and
paid by the Company (the “Accounting Firm”), which shall provide its analysis and detailed
supporting calculations to both the Company and the Employee within fifteen (15) business days
after the Employee delivers to the Company any written notice of any claim by the Internal Revenue
Service that may require the

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Company’s Gross-Up Payment (the “Tax Notice”). The Company shall pay any Gross-Up
Payment due under this Section 7 to the Employee within five (5) days after receiving the
Accounting Firm’s determination but in no event later than December 31 of the year next following
the taxable year in which the Employee received the Payment. If the Accounting Firm determines
that no Excise Tax is payable by the Employee, then it shall furnish the Employee with an opinion
supporting the determination not to report an Excise Tax on the Employee’s federal income tax
return. Any determination by the Accounting Firm shall be binding upon the parties. Due to the
uncertainty of the application of Section 4999 of the Code when the initial determination is made
by the Accounting Firm, it is possible that Gross-Up Payments that will not have been made by the
Company should have been made (“Underpayment”), consistent with the calculations required
under this Section 7. If the Company exhausts its remedies pursuant to Section 7(c) and the
Employee thereafter is required to pay any Excise Tax, then the Accounting Firm shall determine the
amount of the Underpayment that has occurred, and any such Underpayment shall be promptly paid by
the Company to or for the benefit of the Employee but in no event later than the December 31 of the
year next following the taxable year in which the Employee received the Payment.

     (c) Contests. The Tax Notice shall be given as soon as practicable but no later than
ten (10) business days after the Employee receives written notice of such claim describing the
nature of such claim and indicating the due date for such claim. The Employee shall not pay such
claim until thirty (30) days after delivering the Tax Notice to the Company (or such shorter period
imposed by the Internal Revenue Service). If the Company notifies the Employee in writing before
the expiration of such period that it desires to contest such claim, then the Employee shall:

          (i) provide any information reasonably requested by the Company relating to such claim;

          (ii) contest such claim as the Company shall reasonably request in writing, including, without
limitation, accepting legal representation reasonably selected by the Company;

          (iii) cooperate with the Company in good faith to effectively contest such claim; and

          (iv) permit the Company to participate in any proceedings relating to such claim.

The Company (x) shall pay all costs and expenses (including additional interest and penalties)
related to such contest and shall indemnify and hold the Employee harmless, on an after-tax basis,
for any Excise Tax or income tax (including interest and penalties) imposed as a result of such
representation and payment of costs and expenses, (y) shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo any and all
administrative appeals, proceedings, hearings, and conferences with the taxing authority in respect
of such claim, and (z) may, at its sole option, either direct the Employee to pay the tax claimed
and sue for a refund or contest the claim in any permissible manner, in which case, the Employee
shall administratively and judicially prosecute such contest to a determination as the Company
shall determine; provided, however, that the Company’s control of the contest shall be
limited to issues with respect to which a Gross-Up Payment would be payable under this Agreement
and the Employee shall be entitled to settle or contest, as the case may be, any other issue raised
by the Internal Revenue Service or any other taxing authority. If the Company directs the Employee
to pay such claim and sue for a refund, then the Company shall, to the extent permitted by law,
advance the amount of such payment to the Employee, on an interest-free basis, and shall indemnify
and hold the Employee harmless, on an after-tax basis, from any Excise Tax or income tax (including
interest or penalties) imposed with respect to such advance or with respect to any imputed income
with respect to such advance. The Company shall make any payment in reimbursement of costs and
expenses, Excise Tax, income tax, or other amounts due the Employee under this Section 7(c) no
later than December 31 of the year following the year in which (x) the taxes that are the subject
of the audit are remitted to the

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taxing authority, or (y) there is a final and non-appealable settlement or other resolution of the
litigation.

     (d) Refunds. If, after receiving an advance from the Company pursuant to Section
7(c), the Employee becomes entitled to receive any refund with respect to such claim, the Employee
shall promptly pay the Company the amount of such refund (together with any interest paid or
credited after applicable taxes). If, after receiving an advance from the Company pursuant to
Section 7(c), a determination is made that the Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify the Employee in writing of its intent to
contest such denial of refund before the expiration of thirty (30) days after such determination,
such advance shall be forgiven and shall not be required to be repaid and the amount of such
advance shall offset the amount of the Gross-Up Payment required to be paid.

8. Confidential Information and Non-Solicitation.

     (a) Confidential Information. Given his or her position and employment with the
Company, the Employee acknowledges that he or she will be using, acquiring, and adding to
Confidential Information of a special and unique nature and value to the Company and its strategic
plan and financial operations. The Employee further acknowledges that all Confidential Information
belongs exclusively to the Company, is material and proprietary, and is critical to the Company’s
success. Accordingly, the Employee shall use Confidential Information only to the Company’s benefit
and shall not at any time during or after his or her employment with the Company directly or
indirectly disclose any Confidential Information to any person or use any Confidential Information
for the Employee’s own benefit, for the benefit of others, or to the Company’s detriment.

     (b) Legally Required Disclosure. If any court or agency requests the Employee to
disclose Confidential Information, then the Employee shall promptly notify the Company and take
reasonable steps to prevent such disclosure until the Company receives such notice and has an
opportunity to respond to such court or agency. If the Employee obtains information that may be
subject to the attorney-client privilege of the Company or any Affiliate, then the Employee shall
take reasonable steps to maintain the confidentiality of such information and to preserve such
privilege.

     (c) Exceptions. Confidential Information shall not include knowledge that was
acquired during the course of the Employee’s employment under this Agreement that is generally
known to persons of the Employee’s experience in other companies in the same industry.

     (d) Legal Proceedings. This Section 8 shall not unreasonably restrict the Employee’s
ability to disclose Confidential Information in any legal proceeding involving any claim for breach
or enforcement of this Agreement. If the parties dispute whether information may be disclosed in
accordance with this Section 8(d), then the matter shall be considered an Employment Matter and
decided in accordance with Section 10.

     (e) Other Obligations. This Agreement supplements, rather than supplants, the
Employee’s obligations under any Company policy relating to confidential information and any
agreement of the Employee relating to confidentiality, inventions, copyrightable material, business
and/or technical information, trade secrets, solicitation of employees, interference with business
relationships, competition, and other similar matters that protect the business and operations of
the Company or its Affiliates.

     (f) Non-Solicitation. During his or her employment with the Company and for twenty
four (24) months following the Termination Date, regardless of the reason for such termination, the
Employee shall not directly or indirectly hire, employ, solicit for employment, attempt to solicit
for employment, or

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communicate with about changing employment, any person who was an employee of the Company or
its Affiliate within six (6) months of such hiring, employing, soliciting, or communicating (the
“Non-Solicitation Obligation”); provided, however, that the Non-Solicitation
Obligation shall be modified as follows:

          (i) if the Termination Date occurs during the CIC Period, then the Non-Solicitation Obligation
shall expire on the Termination Date; and

          (ii) if the Employee terminates his or her employment with the Company without Good Reason,
then the Non-Solicitation Obligation shall expire twelve (12) months following the Termination
Date.

     (g) Remedies. The Employee acknowledges and agrees that the Company will have no
adequate remedy at law and could be irreparably harmed if the Employee breaches or threatens to
breach his or her obligations under this Section 8. The Company shall be entitled to equitable
and/or injunctive relief to prevent any such breach or threatened breach and to specific
performance in addition to any other available legal or equitable remedies. The Employee shall
not, in any equity proceeding relating to the enforcement of this Section 8, raise the defense that
the Company has an adequate remedy at law.

     (h) Survival. The Employee’s obligations under this Section 8 shall survive any
termination of the Employee’s employment or of this Agreement.

9. Assignment; Successors.

     (a) Assignment. The Company’s rights and obligations under this Agreement may not be
assigned to any entity other than an Affiliate without the Employee’s consent. The Employee’s
duties, responsibilities, authorities, compensation, and benefits are personal to the Employee and
may not be assigned to any person or entity without written consent from the Company other than by
will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be
enforceable by the Employee’s legal representatives.

     (b) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

     (c) Assumption. The Company shall require any successor or assignee (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the
business and/or assets of the Company to assume expressly and agree to perform this Agreement in
the same manner and to the same extent that the Company would be required to perform if no such
succession had taken place.

10. Dispute Resolution and Guarantees of Payment.

     (a) Mandatory Arbitration. Subject to Section 10(b), any Employment Matter shall be
finally settled by arbitration in Oklahoma City, Oklahoma administered by the AAA under its
Employment Arbitration Rules then in effect; provided, however, that the AAA’s Employment
Arbitration Rules shall be modified as follows: (i) each arbitrator shall agree to treat as
confidential evidence and other information presented, and (ii) there shall be no authority to
award punitive damages or liquidated or indirect damages unless such damages could be awarded by a
court of competent jurisdiction. The decision of the arbitrator(s) shall be enforceable in any
court of competent jurisdiction.

     (b) Injunctions and Enforcement of Arbitration Awards. Either party may bring an
action or special proceeding in a state or federal court of competent jurisdiction in Oklahoma
City, Oklahoma to

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enforce any arbitration award under Section 10(a). The Company also may bring such an action
or proceeding, in addition to its rights under Section 10(a) and whether or not an arbitration
proceeding has been or is ever initiated, to temporarily, preliminarily, or permanently enforce
Sections 8 or 11. The Employee agrees that (i) violating Sections 8 or 11 would damage the Company
in ways that cannot be measured or repaired, (ii) the Company shall be entitled to an injunction,
restraining order, or other equitable relief restraining any actual or threatened violation of
Sections 8 or 11, (iii) the Company shall not be required to post a bond or prove actual damages
when seeking such an injunction, restraining order, or other equitable relief, and (iv) remedies at
law for such violations would be inadequate.

     (c) Waiver of Jury Trial. To the extent permitted by law, the parties waive any and
all rights to a jury trial with respect to any Employment Matter.

     (d) Attorney Fees.

          (i) If (A) a claim for arbitration or a lawsuit in connection with an Employment Matter (an
“Employment Matter Claim”) is filed by either of the parties, and (B) the Employee is
ultimately successful in respect of one or more material claims or defenses brought, raised or
pursued in connection with such Employment Matter Claim, then the Company shall reimburse the
Employee for all legal fees and expenses reasonably incurred in connection with such Employment
Matter Claim, provided that such legal fees are reasonable and are calculated on an hourly rather
than a contingency fee basis, as well as all costs and expenses reasonably incurred in connection
with pursuing or defending any such Employment Matter Claim. Except as provided in Section
10(d)(ii) below, the Company shall make such reimbursement to the Employee as soon as practicable
following final resolution of the Employment Matter Claim, but no later than December 31 of the
year immediately following the year of such resolution, provided that the Company receives
appropriate documentation of such attorneys’ fees, costs, and expenses, which shall be provided by
the Employee no later than the later of (x) December 31 of the year in which resolution occurs, or
(y) sixty (60) days following the resolution of the Employment Matter Claim.

          (ii) If an Employment Matter Claim is filed by either of the parties during the CIC Period, or
(B) an Employment Matter Claim has been filed prior to a Change in Control but has not been
resolved as of the effective date of a Change in Control, then the Employee may submit his or her
request for reimbursement of attorneys’ fees, costs and expenses on a monthly basis during the
pendency of such Employment Matter Claim. Within sixty (60) days following the Company’s receipt of
each such monthly request and appropriate documentation supporting such request for reimbursement
of attorneys’ fees, costs and expenses, the Company shall reimburse the Employee (or pay directly
to the Employee’s attorney) the Employee’s attorneys’ fees, costs and expenses that the Company is
obligated, pursuant to Section 10(d)(i) above, to reimburse with respect to such Employment Matter
Claim. In the event the Employee ultimately fails to be successful with respect to at least one of
the Employee’s material claims or defenses brought, raised or pursued in connection with such
contest or dispute, the Employee shall repay the Company the amount of any such reimbursement
received in connection with such dispute in accordance with this Section 10(d) (without interest)
as soon as practicable following the final resolution of such matter.

     (e) Secondary Liability for Payment. If any Affiliate is not otherwise obligated to
provide benefits to the Employee by this Agreement, then the Company shall take, and cause each
such Affiliate (the “Guarantors”) to take, such actions as are necessary to cause the
Guarantors to jointly and severally guarantee the payment of benefits otherwise due to the Employee
under this Agreement if the Company fails to pay such benefit within thirty (30) days of the due
date for such payment; provided, however, that no entity organized under the laws of any
jurisdiction outside the United States shall have an obligation to enter into such guarantee. Each
of the Guarantors shall be subrogated to the Employee’s rights under this

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Agreement to the extent of any payments by each such Guarantor to or on account of the
Employee under this Section 10(e).

11. Non-Disparagement. The Employee shall not make any negative or disparaging comments
regarding the Company or its Representatives or its or their respective performance, operations, or
business practices, or otherwise take any action that could reasonably be expected to adversely
affect the Company or such Representatives or their personal or professional reputations. The
Employee may truthfully respond to inquiries by government agencies or to inquiries by any person
through a subpoena or other valid judicial process without violating this Section 11, provided that
the Employee delivers written notice of such required disclosure to the Company promptly before
making such disclosure, unless such notice to the Company is prohibited by applicable law, court
order, subpoena, process, or governmental decree.

12. Indemnification and Insurance.

     (a) Indemnity. The Company shall, to the maximum extent permitted by law, defend,
indemnify, and hold harmless the Employee and the Employee’s heirs, estate, executors, and
administrators against any costs, losses, claims, suits, proceedings, damages, or liabilities to
which they may become subject to arising from, based on, or relating to the Employee’s employment
by the Company (and any predecessor of the Company), or the Employee’s service as an officer or
member of the board of directors (or any similar governing body) of the Company (or any predecessor
of the Company) or any Affiliate, including without limitation reimbursement for any legal or other
expenses reasonably incurred by the Employee in connection with investigation and defending against
any such costs, losses, claims, suits, proceedings, damages, or liabilities.

     (b) Insurance. The Company shall maintain directors and officers liability insurance
in commercially reasonable amounts (as reasonably determined by the Board), and the Employee shall
be covered under such insurance to the same extent as other similarly situated employees of the
Company; provided, however, that the Company shall not be required to maintain such
insurance coverage if the Board determines that it is unavailable at reasonable cost, provided that
the Employee is given written notice of any such determination promptly after it is made.

     (c) Gross-Up. If the value of any benefits or payment provided under Section 12(a) is
subject to income taxes, then the Company shall make a Gross-up Payment (as described in Section
7(a)) to the Employee, by December 31 of the year next following the Employee’s taxable year in
which the income taxes were incurred, such that, after payment of all taxes imposed on or related
to such Gross-up Payment, the Employee retains an amount equal to 75% of the federal, state, and
local income taxes imposed upon such benefits or payment.

     13. Employee to Provide Assistance with Claims. During his or her employment with the
Company and following the termination of such employment, regardless of the reason for such
termination, the Employee shall assist the Company in defending any claims that may be made against
the Company, and shall assist the Company in prosecuting any claims that may be made by the
Company, to the extent that such claims may relate to the Employee’s services for the Company. The
Employee shall promptly inform the Company if he or she learns of any lawsuits involving such
claims that may be filed against the Company. The Company shall reimburse the Employee for all
reasonable out-of-pocket expenses associated with such assistance, including travel expenses,
incurred and accounted for in accordance with its standard policies and procedures for expense
reimbursements and deductibles under Section 162(m) of the Code. For periods after the Termination
Date, the Company shall provide reasonable compensation to the Employee for such assistance at a
rate to be determined by the Company in its discretion. The Employee shall promptly inform the
Company if asked to assist in any investigation of the Company that

10

 

may relate to the Employee’s services for the Company, regardless of whether a lawsuit has then
been filed against the Company with respect to such investigation. For purposes of this Section
13, the term “Company” shall include the Company and its Affiliates.

14. Entire Agreement. Except as provided in Section 8(e), this Agreement constitutes the
entire agreement among the parties with respect to its subject matters and supersedes any and all
prior or contemporaneous oral and written agreements and understandings with respect to such
subject matters, including without limit all prior agreements relating to employment, severance, or
change in control; provided, however, that this Agreement shall not adversely affect the
Employee’s rights under the terms of any option on stock of the Company or any other award based on
the stock of the Company.

15. Miscellaneous.

     (a) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Oklahoma, without reference to its conflict-of-laws principles.

     (b) Captions. The captions of this Agreement are not part of this Agreement and shall
have no force or effect.

     (c) Amendment. This Agreement may not be amended or modified except by a written
agreement executed by the parties or their respective successors and legal representatives.

     (d) Notices. All notices and other communications under this Agreement shall be in
writing and sent to the other party by either hand delivery, pre-paid overnight carrier, or
registered or certified U.S. mail (return receipt requested) postage prepaid, addressed as follows:

If to the Employee:

Danny Heatly

C/O Devon Energy Corporation

20 North Broadway

Oklahoma City, Oklahoma 73102

If to the Company:

Devon Energy Corporation

C/O Executive Vice President — Human Resources

20 North Broadway

Oklahoma City, Oklahoma 73102

With a copy to:

Devon Energy Corporation

C/O Executive Vice President & General Counsel

20 North Broadway

Oklahoma City, Oklahoma 73102

or to such other address as either party shall have furnished to the other in writing. Such notice
shall be deemed given (i) in the case of hand delivery, the day of delivery; (ii) in the case of
overnight delivery, the next business day or the day designated for delivery; and (iii) in the case
of certified or registered U.S.

11

 

mail, five (5) days after deposit in the U.S. mail; provided, however, that in no event
shall any such notices be deemed to be given later than the date they are actually received.

     (e) Severability. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision of this Agreement,
and this Agreement shall be construed as if such invalid or unenforceable provisions were omitted
(but only to the extent such provision cannot be appropriately reformed or modified). If any such
provision may be made enforceable by limitation, then such provision shall be deemed to be so
limited and shall be enforceable to the maximum extent permitted by applicable law.

     (f) Withholdings. The Company may withhold from any amounts payable under this
Agreement all amounts authorized by the Employee or required to be withheld under any applicable
federal, state, local, or foreign law or regulation.

     (g) Waiver. The waiver by either party of a breach of any term or provision of this
Agreement shall not operate or be construed as a waiver of a subsequent breach of the same term or
provision by either party or of the breach of any other term or provision of this Agreement.

     (h) Representations and Warranties. The Employee represents and warrants that (i) he
or she is not, and shall not become, a party to any agreement, contract, arrangement, or
understanding, whether of employment or otherwise, that would in any way restrict or prohibit him
or her from undertaking or performing the duties required by his or her employment with the Company
or that would in any way restrict or prohibit his or her ability to be employed by the Company;
(ii) his or her employment by the Company does not and shall not violate the terms of any policy
of, or any agreement with, any prior employer regarding confidentiality or competition; and (iii)
his or her position with the Company shall not require him or her to improperly use any trade
secrets or confidential information of any prior employer or any other person or entity for whom he
or she has performed services.

[SIGNATURES APPEAR ON FOLLOWING PAGE]

12

 

     IN WITNESS WHEREOF, the Company and the Employee have executed this Amended and Restated
Severance Agreement as of the Effective Date.

	 	 	 
	 

	 	      /s/ Danny Heatly
	 

	 	 
	 

	 	Danny Heatly
	 
	 	 
	 

	 	Devon Energy Corporation
	 
	 	 
	 

	 	      /s/ Frank W. Rudolph
	 

	 	 
	 

	 	By: Frank W. Rudolph

Its: Executive Vice President — Human Resources

13

 

Exhibit A

Definitions

Definitions. The following terms, when used throughout this Agreement, shall have the
following meanings:

	1.	 	“AAA” means the American Arbitration Association.
	 
	2.	 	“Accounting Firm” has the meaning ascribed to such term in Section 7(b).
	 
	3.	 	“Act” means the Securities Exchange of Act of 1934, as amended from time to time.
	 
	4.	 	“Accrued Obligations” has the meaning ascribed to such term in Section 4(a).
	 
	5.	 	“Affiliate” means, with respect to the Company, any person that directly, or
indirectly through one or more intermediaries, controls, is controlled by, or is under common
control with, the Company; provided, however, that a natural person shall not be
considered an Affiliate.
	 
	6.	 	“Agreement” has the meaning set forth in the preamble.
	 
	7.	 	“Annual Base Salary” means the annual base salary of the Employee as in effect from
time to time.
	 
	8.	 	“Annual Bonus” means, with respect to any given year, the annual bonus payable to the
Employee with respect to that year, as determined by the Compensation Committee in its
discretion.
	 
	9.	 	“Board” means, at any given time, the Company’s Board of Directors at that time.
	 
	10.	 	“Cause” means any of the following:

	 	(a)	 	the willful failure by the Employee to substantially perform the Employee’s
duties for the Company or an Affiliate (other than due to physical or mental incapacity)
within thirty (30) days after receiving a written demand for substantial performance
from the Supervisor, the CEO, or the Board;
	 
	 	(b)	 	the willful engaging by the Employee in illegal or dishonest conduct or gross
misconduct that is materially and demonstrably injurious to the Company or an Affiliate;
or
	 
	 	(c)	 	the conviction of the Employee of a felony or any crime of moral turpitude, a
guilty or nolo contendere plea by the Employee with respect to a felony or any crime of
moral turpitude, or the deferred adjudication or unadjudicated probation of the Employee
with respect to a felony or any crime of moral turpitude;

provided, however, that (x) an act or omission by the Employee shall be considered
“willful” only if it was not in good faith and was without reasonable belief that it was in
the Company’s best interests, and (y) any act or omission by the Employee based upon
authority granted by resolution duly adopted by the Board, the instructions of the
Supervisor, or the advice of counsel for the Company shall be conclusively presumed to be in
good faith and in the Company’s best interests.

	11.	 	“CEO” means, at any given time, the Chief Executive Officer of the Company at that
time.

- 1 -

 

	12.	 	“Change in Control” means the occurrence of any one of the following events:

	 	(a)	 	The Incumbent Directors cease for any reason to constitute at least a majority of
the Board;
	 
	 	(b)	 	any person is or becomes a “beneficial owner” (as defined in Rule 13d-3
under the Act), directly or indirectly, of Company securities representing 30% or more
of either (x) the Company’s outstanding shares of common stock or (y) the combined
voting power of the Company’s then outstanding securities eligible to vote in the
election of directors (each, “Company Securities”); provided, however,
that the event described in this paragraph (b) shall not be deemed to be a Change in
Control by virtue of any of the following acquisitions or transactions: (A) by the
Company or any subsidiary, (B) by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any subsidiary, (C) by an underwriter temporarily
holding securities pursuant to an offering of such securities, or (D) pursuant to a
Non-Qualifying Transaction;
	 
	 	(c)	 	the consummation of a merger, consolidation, statutory share exchange, or similar
form of corporate transaction involving the Company or any of its subsidiaries that
requires the approval of the Company’s stockholders, whether for such transaction or the
issuance of securities in the transaction (a “Reorganization”), or the sale or
other disposition of all or substantially all of the Company’s assets to an entity that
is not an Affiliate (a “Sale”), unless:

	 	(i)	 	the holders of the Company’s shares of common stock either receive in
such Reorganization or Sale, or hold immediately following the consummation of the
Reorganization or Sale, more than 50% of each of the outstanding common stock and
the total voting power of securities eligible to vote in the election of directors
of (x) the corporation resulting from such Reorganization or the corporation that
has acquired all or substantially all of the assets of the Company in connection
with a Sale (in either case, the “Surviving Corporation”), or (y) if
applicable, the ultimate parent corporation that directly or indirectly has
beneficial ownership of 100% of the voting securities eligible to elect directors
of the Surviving Corporation (the “Parent Corporation”),
	 
	 	(ii)	 	no person (other than any employee benefit plan (or related trust)
sponsored or maintained by the Surviving Corporation or the Parent Corporation) is
or becomes, as a result of the Reorganization or Sale, the beneficial owner,
directly or indirectly, of 30% or more of the outstanding shares of common stock
or the total voting power of the outstanding voting securities eligible to vote in
the election of directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation), and
	 
	 	(iii)	 	at least a majority of the members of the board of directors of the
Parent Corporation (or, if there is no Parent Corporation, the Surviving
Corporation) following the consummation of the Reorganization or Sale were
Incumbent Directors at the time of the Board’s approval of the execution of the
initial agreement providing for such Reorganization or Sale;

(any Reorganization or Sale that satisfies all of the criteria specified in (i), (ii)
and (iii) above shall be deemed to be a “Non-Qualifying Transaction”); or

- 2 -

 

	 	(d)	 	the Company’s stockholders approve a plan of complete liquidation or dissolution
of the Company.

Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely
because any person acquires beneficial ownership of more than 30% of Company Securities due
to the Company’s acquisition of Company Securities that reduces the number of Company
Securities outstanding; provided, however, if, following such acquisition by the
Company, such person becomes the beneficial owner of additional Company Securities that
increases the percentage of outstanding Company Securities beneficially owned by such person,
a Change in Control shall then occur. In addition, if a Change in Control occurs pursuant to
paragraph 12(b) above, then no additional Change in Control shall be deemed to occur pursuant
to paragraph 12(b) by reason of subsequent changes in holdings by such person (except if the
holdings by such person are reduced below 30% and thereafter increase to 30% or above).

	13.	 	“CIC Period” means the two-year period following a Change in Control.
	 
	14.	 	“COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended
from time to time.
	 
	15.	 	“Code” means Internal Revenue Code of 1986, as amended from time to time.
	 
	16.	 	“Company” means the Devon Energy Corporation, as set forth in the preamble to this
Agreement, and any successor to or assignee of its business and/or assets that assumes and
agrees to perform this Agreement by operation of law or otherwise.
	 
	17.	 	“Compensation Committee” means, at any given time, the Compensation Committee of the
Board at that time.
	 
	18.	 	“Confidential Information” means non-public information (including, without
limitation, information regarding litigation and pending litigation) concerning the Company
and its Affiliates that was acquired by or disclosed to the Employee during his or her
employment with the Company and following the Termination Date.
	 
	19.	 	“Disabled” means, with respect to the Employee, that (a) he or she has received
disability payments under the Company’s long-term disability plan for a period of three (3)
months or more, or (b) based upon the written report (prepared after a complete physical
examination of the Employee) of a mutually agreeable qualified physician designated by the
Company and the Employee or his or her representative, the Compensation Committee determines,
in accordance with Section 409A of the Code, that the Employee has become physically or
mentally incapable of performing his or her essential job functions with or without reasonable
accommodation or job protection as required by law for a continuous period expected to last
for a continuous period of not less than twelve (12) months.
	 
	20.	 	“Effective Date” has the meaning set forth in the preamble to this Agreement.
	 
	21.	 	“Employment Matter” means any dispute, controversy, or claim between the parties
arising out of, relating to, or concerning this Agreement, the Employee’s employment with the
Company, or the termination of that employment.
	 
	22.	 	“Employment Matter Claim” has the meaning ascribed to such term in Section 10(d)(i).

- 3 -

 

	23.	 	“Excise Tax” has the meaning ascribed to such term in Section 7(a).
	 
	24.	 	“Employee” has the meaning set forth in the preamble to this Agreement.
	 
	25.	 	“Good Reason” means any of the following events, unless the Employee has consented in
writing to such events:

	 	(a)	 	the assignment of any duties materially inconsistent with the Employee’s position
(including status, offices, and titles), authority, duties, or responsibilities under
this Agreement, other than an isolated, insubstantial, or inadvertent action not taken
in bad faith and which the Company remedies promptly after receipt of notice from the
Employee; provided, however, that Good Reason shall not exist under this
Agreement solely because of a change in the Employee’s reporting relationship;
	 
	 	(b)	 	any reduction in Annual Base Salary or material failure to provide incentive
compensation opportunities or benefits to the Employee that are comparable to the
incentive compensation opportunities and benefits provided to similarly situated Company
employees;
	 
	 	(c)	 	any material failure by the Company to comply with any provision of this
Agreement, other than an isolated, insubstantial, or inadvertent failure not occurring
in bad faith and which and which the Company remedies promptly after receipt of notice
from the Employee;
	 
	 	(d)	 	any failure by the Company to comply with and satisfy Section 9(c); or
	 
	 	(e)	 	any relocation of the Employee’s principal office to a location more than fifty
(50) miles from the Employee’s principal office prior to such relocation.

	26.	 	“Good Reason Notice” has the meaning ascribed to such term in Section 3(d).
	 
	27.	 	“Gross-Up Payment” has the meaning ascribed to such term in Section 7(a).
	 
	28.	 	“Guarantors” has the meaning ascribed to such term in Section 10(e).
	 
	29.	 	“Incumbent Directors” means the members of the Board on the Effective Date;
provided, however, that (x) any person becoming a director and whose election or
nomination for election was approved by a vote of at least a majority of the Incumbent
Directors then on the Board (either by a specific vote or by approval of the proxy statement
of the Company in which such person is named as a nominee for director, without written
objection to such nomination) shall be deemed an Incumbent Director, and (y) no individual
initially elected or nominated as a director of the Company as a result of an actual or
threatened election contest (as described in Rule 14a-11 under the Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of any person (as such term is
used in Sections 13(d)(3) and 14(d)(2) of the Act) other than the Board, including by reason
of any agreement intended to avoid or settle any such election contest or solicitation of
proxies or consents, shall be deemed an Incumbent Director.
	 
	30.	 	“Non-Solicitation Obligation” has the meaning ascribed to such term in Section 8(f).
	 
	31.	 	“Notice of Termination” means a written notice that (i) indicates the specific
termination provision of Section 3 that is being relied upon, (ii) to the extent applicable,
reasonably describes the facts and circumstances claimed to provide a basis for termination
under the provision so indicated, and (iii) specifies the Termination Date; provided,
however, that the failure to describe in the Notice of

- 4 -

 

	 	 	Termination any fact or circumstance constituting Good Reason or Cause shall not waive any
right of either party under this Agreement or preclude either party from asserting such fact
or circumstance in enforcing rights under this Agreement.
	32.	 	“Payment” has the meaning ascribed to such term in Section 7(a).
	 
	33.	 	A “person” shall have the meaning ascribed by Section 3(a)(9) of the Act and shall
also mean a natural person, company, government (and any political subdivision, agency, or
instrumentality of a government), corporation, partnership, limited liability company, trust,
unincorporated organization, or other entity. When two or more persons act as a partnership,
limited partnership, syndicate, or other group for the purposes of acquiring, holding, or
disposing Company Securities, such partnership, limited partnership, syndicate, or other group
shall be deemed a “person” for purposes of this Agreement.
	 
	34.	 	“Prorated Annual Bonus” means a prorated amount of an Annual Bonus payable under
Sections 4(b)(i)(B) or 4(c). If the Employee’s employment began in a calendar year before the
calendar year in which the Termination Date occurs, the Prorated Annual Bonus shall be
calculated based on the prior year’s Annual Bonus (if any) times the number of days worked in
the year in which the Termination Date occurs divided by three hundred sixty five (365). If
the Employee’s employment began in the calendar year in which the Termination Date occurs,
then the Prorated Annual Bonus shall be determined by the Compensation Committee in its
discretion.
	 
	35.	 	“Representatives” means, with respect to the Company, its Affiliates and any of their
respective past or present officers, directors, stockholders, partners, members, managers,
agents, and employees.
	 
	36.	 	“Retiree Medical Benefit Plan” means any retiree medical benefit plan applicable to
the Employee or that would be applicable to the Employee if his or her employment then
terminated and he or she satisfied the applicable age and service requirements.
	 
	37.	 	“Section 409A” has the meaning ascribed to such term in Section 4(e).
	 
	38.	 	“Separation from Service” has the meaning ascribed to such term in Section 4(e).
	 
	39.	 	“Short-Term Disability Payments” means disability payments under the Company’s
short-term disability policy or plan that are less than 100% of the then-current Annual Base
Salary.
	 
	40.	 	“Supervisor” means, with respect to the Employee, the person to whom the Employee
reports, as determined by the CEO or the CEO’s designee from time to time.
	 
	41.	 	“Tax Notice” has the meaning ascribed to such term in Section 7(b).
	 
	42.	 	“Termination Date” means the Employee’s last day of employment by the Company or an
Affiliate (including any successor to the Company or such Affiliate as determined in
accordance with Section 9).
	 
	43.	 	“Underpayment” has the meaning ascribed to such term in Section 7(b).

- 5 -

 

EXHIBIT B

GENERAL RELEASE

NOTICE

Devon Energy Corporation (the “Company”) is an equal opportunity employer. Various laws
prohibit employment discrimination based on sex, race, color, national origin, religion, age,
disability, eligibility for covered employee benefits, veteran status, and other legally protected
characteristics. You may also have rights under other federal, state, and/or municipal statutes,
orders, or regulations pertaining to labor, employment, and/or employee benefits. These laws are
enforced through the United States Department of Labor (DOL), the Equal Employment Opportunity
Commission (EEOC), and various other federal, state, and municipal labor departments, fair
employment boards, human rights commissions, similar agencies, and courts.

This General Release is being provided to you in connection with the Amended and Restated Severance
Agreement previously entered between you and the Company (the “Severance Agreement”). You
have at least twenty-one (21) days from the date you receive this General Release, if you want it,
to consider whether you wish to sign this General Release and receive the payments and benefits
(the “Severance Benefits”) available under the Severance Agreement for doing so. You have
at least until the close of business twenty-one (21) days from the date you receive this General
Release to make your decision. You may not, however, sign this General Release until, at the
earliest, your last effective date of employment.

BEFORE SIGNING THIS GENERAL RELEASE YOU SHOULD REVIEW IT CAREFULLY. YOU ALSO HAVE THE RIGHT TO
CONSULT WITH AN ATTORNEY OF YOUR CHOICE.

You may revoke this General Release within seven (7) days after you sign it and it shall not become
effective or enforceable until that revocation period has expired. If you do not timely sign and
return this General Release, or if you exercise your right to revoke the General Release after
signing it, then you will not be eligible to receive the Severance Benefits. Any revocation must
be in writing and must be received by the Company within the seven-day period following your
execution of this General Release.

GENERAL RELEASE

In consideration of the Severance Benefits offered to me by the Company under the Severance
Agreement, I hereby (i) release and discharge the Company and its predecessors, successors,
affiliates, parent, subsidiaries, and partners and each of those entities’ current and former
employees, officers, directors, and agents (together, the “Released Parties”) from all
claims, liabilities, demands, and causes of action, known or unknown, fixed or contingent, that I
may have or claim to have against them, including without limit any claims that result from or
arise out of my past employment with the Company, the severance of that relationship and/or
otherwise, or any contract or agreement with or relating to the Released Parties, and (ii) waive
any and all rights I may have with respect to and promise not to file a lawsuit to assert any such
claims.

This General Release includes, but is not limited to, claims arising under the Age Discrimination
in Employment Act (“ADEA”) and any other federal, state, and/or municipal statutes, orders,
or regulations pertaining to labor, employment, and/or employee benefits. This General Release
also applies without limitation to any claims or rights I may have growing out of any legal or
equitable restrictions on the rights of the Released Parties not to continue an employment
relationship with their employees, including

6

 

any express or implied employment or other contracts, and to any claims I may have against the
Released Parties for fraudulent inducement or misrepresentation, defamation, wrongful termination,
or other torts or retaliation claims in connection with workers’ compensation, any legally
protected activity, or alleged whistleblower status, or on any other basis whatsoever.

It is specifically agreed, however, that this General Release does not have any effect on any
rights or claims under the ADEA I may have against the Company that arise after the date I execute
this General Release or on any vested rights I may have under any of the Company’s qualified
benefit plans or arrangements as of or after my last day of employment with the Company or on any
of the Company’s obligations under the Severance Agreement.

MISCELLANEOUS

By signing this General Release, I shall, and hereby do, resign from any corporate, board, and
other offices and positions I may hold with the Company and its affiliates as of the date my
employment with the Company terminated.

I agree that (i) none of the Released Parties shall have any obligation to employ or to hire or
rehire me, to consider me for hire, or to deal with me in any respect with regard to potential
future employment; (ii) I shall not ever apply for or otherwise seek employment with any of the
Released Parties at any time in the future; and (iii) my forbearance to seek future employment as
just stated shall be construed as being purely contractual and in no way involuntary,
discriminatory, or retaliatory.

I have carefully reviewed and fully understand all the provisions of the Severance Agreement and
General Release, including the foregoing Notice. I have not relied on any representation or
statement, oral or written, relating to the Severance Agreement or this General Release by the
Released Parties that are not set forth in those documents.

The Severance Agreement and this General Release, including the foregoing Notice, set forth the
entire agreement between me and the Company with respect to payments and benefits payable to me due
to the termination of my employment with the Company, and supersede all prior agreements and
understandings, written and oral, between the parties with respect to such subject matters. I
understand that my receipt and retention of the Severance Benefits are contingent not only on my
execution and non-revocation of this General Release, but also on my continued compliance with my
other obligations under the Severance Agreement. I acknowledge that the Company has given me at
least twenty-one (21) days to consider whether I wish to accept or reject the Severance Benefits I
am otherwise eligible to receive under the Severance Agreement in exchange for signing and not
revoking this General Release. I hereby represent and state that I fully understand the effects
and consequences of the Severance Agreement and General Release prior to signing those documents.

This General Release and the Company’s obligation to provide the Severance Benefits under the
Severance Agreement shall be interpreted and construed to comply with Section 409A of the Internal
Revenue Code (the “Code”). The parties agree to cooperate and work together in good faith
to take all actions reasonably necessary to effectuate the intent of this paragraph.
Notwithstanding the preceding sentence, I understand and acknowledge that I shall be solely
responsible for any risk that the tax treatment of all or part of the Severance Benefits may be
affected by Section 409A of the Code and impose significant adverse tax consequences on me,
including accelerated taxation, a 20% additional tax, and interest. Because of the potential tax
consequences, I understand that I have the right, and am encouraged by this paragraph, to consult
with a tax advisor of my choice before signing this General Release.

7

 

This General Release shall be governed by the laws of the State of Oklahoma, without regard to any
conflict-of-laws principles, and shall not be modified unless in a writing signed by both of the
parties.

Dated this
___ day of _________,
200     .

	 	 	 	 	 
	 

	 	 

[Name]
	 	 

8exv10w6

Exhibit 10.6

AMENDMENT NO. 1

TO

THE WILLIAMS PIPELINE GP LLC LONG-TERM INCENTIVE PLAN

This Amendment No. 1 (“Amendment”) to the Williams Pipeline GP LLC Long-Term Incentive Plan
(“Plan”) is hereby adopted effective the 3rd day of December 2008.

WHEREAS, in October 2004, Congress adopted Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”);

WHEREAS, final regulations to Section 409A of the Code become fully effective January 1, 2009
(Section 409A of the Code and such final regulations and other guidance thereunder being referred
to below in the aggregate as “Section 409A of the Code”); and

WHEREAS, the Board has determined that it is in the best interest of the Company to amend the Plan
to further reflect the Company’s intent that the Plan and Awards thereunder comply with Section
409A of the Code;

NOW, THEREFORE, the Plan is hereby amended as follows:

1. Section 2.1 is amended by deleting such section in its entirety and replacing it with
the following:

“Affiliate” means all Persons with whom the Company would be considered a
single employer under Section 414(b) of the Code, and all Persons with whom such
Person would be considered a single employer under Section 414(c) of the Code,
provided that the language “at least 50 percent” is used instead of “at least 80
percent” each place it appears in Treasury Regulation § 1.414(c)-2(b)(2)(i), and,
provided further that with respect to any Award wherein the Committee in good
faith determines that legitimate business criteria exist for the grant of one or
more Units or rights to acquire one or more Units, the phrase “ at least 20
percent” may be used instead of “at least 80 percent” each place it appears in
Treasury Regulation § 1.414(c)-2(b)(2)(i).

2. Section 2.5 is amended by deleting in its entirety the second paragraph of the definition of
“Change of Control” and replacing it with the following:

     Solely with respect to any Award that is subject to Section 409A of the Code
and to the extent that the definition of the term “change in control event” under
Section 409A applies to limited liability companies and partnerships, “Change of
Control” shall mean any event that qualifies as a “change in control event,” as
such term is defined in Section 409A of the Code, with respect to the Partnership,
the Company or any holder of more than 50 percent of the total fair market value
and total voting power of either the Partnership or the Company; provided that in
the event additional guidance is issued with respect to the meaning of the term

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“change in control event” with respect to limited liability companies and
partnerships, the term “Change of Control” as defined in this paragraph shall be
construed and applied in a manner that is consistent with such guidance.

3. Section 2.12 is amended by adding the following at the end of the second sentence of the
definition of “Fair Market Value”:

; provided that with respect to any Award that is subject to Section 409A of the Code, Fair
Market Value shall be determined by the Committee by reasonable application of a reasonable
valuation method applied in a manner consistent with Section 409A of the Code.

4. Section 6.2(b) shall be amended by adding the following at the end thereof:

Notwithstanding any other provision of the Plan to the contrary, any grant of UDRs
shall contain terms that (i) are designed to avoid application of Section 409A of
the Code to the Award or (ii) are designed to avoid adverse tax consequences under
Section 409A of the Code should that Code section apply.

5. Section 6.2(c) shall be amended by adding the following at the end thereof:

, provided that, with respect to any Award of Phantom Units, such waiver does not
cause adverse tax consequences to the respective Participant under Section 409A of
the Code.

6. Section 6.2(d)(1) is amended by deleting the first sentence in its entirety and
substituting the following sentence:

Unless a different payment time is specified in the Award Agreement, upon the
vesting of each Phantom Unit, but in no event later 30 days following such
vesting, subject to the provisions of Section 8.2, the Participant shall be
entitled to receive from the Company one Unit or, in the discretion of the
Committee, cash equal to the Fair Market Value of a Unit.

7. Section 6.4(h) is amended by deleting such section in its entirety and replacing it with the
following:

	 	(h)	 	Compliance with Section 409A of the Code. Nothwithstanding
any other provision of the Plan to the contrary, the Board intends that any
Award under the Plan shall be made on and contain terms that (i) are designed
to avoid application of Section 409A of the Code to the Award or (ii) satisfy
the requirements of Section 409A of the Code in order to avoid the imposition
of any taxes, including additional income taxes, thereunder. If the
Committee determines

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	 	 	 	that an Award, Award Agreement, payment, distribution, deferral election,
transaction or any other action or arrangement, including without
limitation any amendment, waiver, acceleration or adjustment of an Award
or terms of an Award, contemplated by the provisions of the Plan would, if
undertaken, result in adverse tax consequences under Section 409A of the
Code to the respective Participant, such Award, Award Agreement, payment,
distribution, deferral election, transaction or other action or
arrangement shall not be undertaken and the related provisions of the Plan
and/or Award Agreement will be deemed modified, or, if necessary,
rescinded in order to either (x) avoid application of Section 409A of the
Code or (y) satisfy the requirements of Section 409A of the Code in order
to avoid the imposition of any taxes, including additional income taxes,
thereunder, to the extent determined by the Committee without the consent
of or notice to the Participant.

8. Section 7.2 is amended by inserting the phrase “and Section 6.4(h)” after the phrase “Subject to
Section 7.1.”

9. Section 7.3 is amended by inserting the phrase “Subject to Section 6.4(h)” at the beginning of
such section.

10. Except as set forth in Paragraphs 1 through 9 above, the Plan and its terms and conditions
shall continue in effect.

11. Notwithstanding anything to the contrary in the Plan or in any Award Agreement, this Amendment
shall not be incorporated into nor amend or change in any respect the terms of any Award or Award
Agreement outstanding on the effective date hereof.

12. All capitalized terms in this Amendment shall have the meanings set forth in the Plan except to
the extent otherwise defined herein.

This Amendment is hereby approved and adopted effective as of the date first set forth above.

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