Document:

Exhibit 10.1

 

Forest Oil Corporation

 

Annual Incentive Plan

 

2011

 

 

 

 

 

Forest Oil Corporation

2011 Annual Incentive Plan

 

Summary

 

Plan Objectives

 

The Annual Incentive Plan (the “Plan”) has been designed to meet the following objectives:

 

·                  Provide an annual incentive plan framework that is performance-driven and focused on objectives that are critical to the Company’s success.

 

·                  Offer competitive cash compensation opportunities to employees.

 

·                  Reward outstanding achievement.

 

Basic Plan Concept

 

The Plan provides annual incentive awards, which will be determined primarily on the basis of the Company’s consolidated results on selected financial and operating performance measures as well as business unit or department performance objectives.  Individual performance will also be considered in determining the actual participant award payout.  The Company shall have the flexibility to adjust individual awards to reflect individual or team performance.

 

Performance Measures and Weights

 

Each year the Company will establish the threshold, target and outstanding performance levels on each performance measure and its appropriate weighting, subject to the confirmation of the Compensation Committee of the Board of Directors (the “Committee”).  These performance measures and their weighting will be reviewed (and modified, if appropriate) in light of changing Company priorities and strategic objectives.

 

The Company has also established performance objectives for each business unit and department for 2011, the achievement of which will be determined by the President and Chief Executive Officer (the “CEO”) at year end, subject to the confirmation of the Committee.

 

The 2011 performance measures and their relative weightings are described below.

 

Plan Administration

 

The Plan will be administered by the Committee and the CEO (for all positions except his own).  Certain elements of the Plan administration will be delegated to the senior Human Resources executive of the Company.  The Executive Vice President and Chief Financial Officer will verify the performance calculation for the performance and operating measures in consultation with the Senior Vice President, Business Development & Engineering, who shall be responsible for the estimation of the Company’s oil and gas reserves.

 

 

Actual performance goals, standards, award determinations and modifications to the Plan design must be approved by the Committee.

 

	
Measure
    	
 
    	
Weighting
    	
 
    
	
Production
    	
 
    	
20
    	
%
    
	
Cash Cost
    	
 
    	
20
    	
%
    
	
Bankable Value PV10
    	
 
    	
20
    	
%
    
	
Business Unit/Department Performance Objectives
    	
 
    	
40
    	
%
    
	
Total Financial and Operating Objectives
    	
 
    	
100
    	
%
    

 

Once the total bonus pool has been established following the performance calculations, the CEO shall have the discretion to distribute bonus monies within business units and the corporate group or to move monies from one group to another, and to allocate incentive monies to individuals, based on his assessment (with advice of senior management) as to individual or group performance.

 

Targets

 

Targets for the Plan will be set consistent with the following:

 

·                  Threshold — Minimum level at which payout occurs.  The threshold percentage is 25% of the target award percentage.

 

·                  Target — Level at which the participant receives the target award percentage.

 

·                  Outstanding — Level at which the participant receives 200% of the target award percentage.

 

Completion percentages between Threshold, Target and Outstanding will be determined, with the exception of those for Business Unit and Department Performance Objectives, by interpolation.  Completion for results above Outstanding will be directly proportional to the change in completion between Target and Outstanding.

 

A Completion Percentage for each business unit and department with regard to its Business Unit/Department Performance Objectives will be assigned at year end by the CEO following a thorough review of its activities and accomplishments.  The assigned Completion Percentage on Business Unit/Department Performance Objectives for each business unit or department will be included in the calculation of the Overall Completion Percentage for that business unit or department in the same manner as is the Completion Percentage on other performance measures.

 

Targets shall be adjusted for material changes made during the year to the business plan or scope thereof, including the capital expenditure budget.

 

Maximum Completion

 

Although there will be no limit on completion of individual financial and operating measures, completion for the total Plan will be limited to 200% of target.

 

Performance Levels

 

Performance levels will be set for individual measures.  Results below the Threshold will equate to a zero completion percentage.

 

 

A minimum 25% completion threshold is required for the total plan for award payments to be made under the plan.

 

Completion Calculation

 

Completion percentages for each individual measure will be equal to the completion percentage of the measure times the weighting for that measure. The overall completion percentage for the Plan for financial and operating measures and business unit and department objectives will be the sum of the weighted completion percentages for each individual measure.

 

Property Sales

 

In computing results, non-budgeted property sales are not to be considered.  To avoid non-budgeted property sales from affecting results, they will be incorporated into performance measures as though they had been budgeted.

 

Participants

 

The CEO shall determine which employees are to be participants in the Plan.  If a participant’s employment with the Company terminates for any reason prior to payment, no bonus award will be paid.

 

The target award percentage for the CEO and other officers of the Company are established by the Committee. Any changes to target award percentages for Company officers are subject to the approval of the Committee. The CEO is authorized to establish and adjust at his discretion the target award percentages for non-officer Plan participants. All awards to officers under the Plan are subject to approval of the Committee.

 

Plan participants who change positions and/or have their individual target incentive levels changed during the Plan year will have their award prorated accordingly.  All awards paid will be rounded to the nearest $100.

 

Incentive compensation awards will be calculated based upon the participant’s base salary in effect at the end of the Plan year or earned salary during the Plan year if the participant was a new hire during the year.

 

Board of Directors’ Discretion

 

The granting of any and all incentive compensation awards is at the discretion of the Forest Oil Corporation Board of Directors.

 

 

Forest Oil Corporation

2011 Annual Incentive Plan

Operating Measure

Production

 

Objective

 

Measure net production on an annual basis.

 

Definition

 

Net production equals total net production (after royalty and other burdens) equal to that set forth in the 2011 Business Plan.

 

Should a business unit overspend budgeted Capex significantly, the Production target will either be proportionately adjusted or the target level will become the threshold for payout under this measure.

 

The calculation of net production volumes for the Canadian business unit shall be calculated as if Plan oil and gas prices were experienced, with no volume adjustments being made for higher or lower prices.

 

Targets

 

Measured against an approved annual plan with:

 

·                  Threshold equal to achievement of 95% of Business Plan objective (See Attachment 1A).

 

·                  Target equal to achievement of 100% of Business Plan objective (See Attachment 1A).

 

·                  Outstanding equal to achievement of 110% of Business Plan objective (See Attachment 1A).

 

 

Forest Oil Corporation

2011 Annual Incentive Plan

Financial Measure

Cash Cost

 

Objective

 

Measure cash cost on an annual basis.

 

Definition

 

Corporate:  The sum of direct operating expense and expensed workovers, transportation expense and total expensed G&A for the Company, but excluding ad valorem taxes, divided by total production for the Company measured in MCFE.

 

Business Unit:  The sum of direct operating expense and expensed workovers, transportation expense and allocated corporate G&A expense for the business unit, but excluding ad valorem taxes, divided by production for the business unit measured in MCFE.

 

Cash Cost excludes production severance taxes.  Additionally, the calculation of Cash Cost for the Canadian business unit shall be calculated at the Plan exchange rate ignoring any variance between the actual exchange rate and the exchange rate assumed in the Plan.

 

Targets

 

Measured against an approved annual plan with:

 

·                  Threshold equal to achievement of 105% of Business Plan objective (See Attachment 1B)

 

·                  Target equal to achievement of 100% of Business Plan objective (See Attachment 1B)

 

·                  Outstanding equal to achievement of 90% of Business Plan objective (See Attachment 1B)

 

 

Forest Oil Corporation

2011 Annual Incentive Plan

Financial Measure

Bankable Value PV10

 

Objective

 

Measure the creation of value (NAV) by the Company through the addition of proved reserves, lower lease operating expense (LOE), lower well costs, lower future development Capex, marketing enhancements, remedial work, and other efforts.

 

Definition

 

Bankable Value PV10 will measure the increase in value added on December 31, 2011 over the baseline value as of December 31, 2010, expressed as a percent of growth in PV10, using the same database assumptions for each date.

 

The measure of Bankable Value PV10 will be pre-tax, debt-adjusted, share-count adjusted and price-adjusted so that the effects of tax, added debt, increased share count and price during the year are neutralized. Divestitures and land investments are excluded from the calculation. Acquisitions are included in the calculation.

 

The baseline for calculation of Bankable Value PV10 will be the year-end 2010 calculation of PV10 from the SEC reserve report (SMOG).  The value of any properties sold during 2011 is subtracted, the value of capital investments during 2011 (drilling, land, acquisitions) is added and 2011 operating income is subtracted to arrive at a Reference PV10.  The current year SEC PV10 is then calculated and adjusted for prices as of December 31, 2010 to arrive at an Ending PV10.  The Bankable Value PV10 for 2011 will be the percentage change in the Ending PV10 over the Reference PV10.

 

All reserve calculations are based on SEC reserve rules.

 

Targets

 

·                  See Attachment 1C.

 

 

Forest Oil Corporation

2011 Annual Incentive Plan

Operating Measure

Business Unit and Department Performance Objectives

 

Objective

 

Measure the achievement of key objectives that are established for each business unit and department for each year.

 

Definition

 

Objectives that are key to the success of each business unit or department have been established by the CEO.  Objectives will be established for each corporate staff department that directly support the achievement of business unit and other staff department objectives.  Established objectives are specific to each business unit or department, well-defined and to the extent possible, measurable.

 

Targets

 

Performance Objectives will be established for the Canadian, Eastern Region, Western Region, Southern Region, International, and New Ventures Business Units as well as for each corporate administrative or support department.  Awards to business unit and department participants will be based on the achievement of performance objectives established for the business unit or department in which they work.

 

At year-end 2011 the achievement of performance objectives for each business unit as well as for each corporate administrative or support department will be evaluated and assigned a completion percentage by the CEO over a range of 0 — 200%.  This completion percentage will be multiplied by the 40% relative weighting for Business Unit/Department Performance Objectives and included in the calculation of the overall completion percentage for the business unit or department.

 

 

Attachment 1

 

2011

 

	
Goal Description
    	
 
    	
Weighting
    	
 
    	
Target
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Production (Full Year)
    	
 
    	
20
    	
%
    	
See   Attachment1A
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Cash Cost
    	
 
    	
20
    	
%
    	
See   Attachment 1B
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Bankable Value PV10
    	
 
    	
20
    	
%
    	
See   Attachment 1C
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Business Unit/Department Performance Objectives
    	
 
    	
40
    	
%
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total Weighting
    	
 
    	
100
    	
%
    	
 
    	
 
    

 

 

Attachment 1A

 

2011 Production (BCFE)

 

	
Business Unit
    	
 
    	
Threshold
    	
 
    	
Target
    	
 
    	
Outstanding
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Company*
    	
 
    	
175.8
    	
 
    	
185.1
    	
 
    	
203.6
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Canada
    	
 
    	
36.1
    	
 
    	
38.0
    	
 
    	
41.8
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Eastern
    	
 
    	
37.5
    	
 
    	
39.5
    	
 
    	
43.4
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Western
    	
 
    	
69.2
    	
 
    	
72.9
    	
 
    	
80.2
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Southern
    	
 
    	
33.0
    	
 
    	
34.7
    	
**
    	
38.2
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
International*
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
New Ventures
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    

 

*Awards to Business Unit participants will be based on the Production performance of the Business Unit in which they work with the exception of International, New Ventures and corporate department participants, whose awards will be based on total company results.

 

**Eagle Ford production is included in Southern Region.

 

The Threshold, Target and Outstanding objectives are directly related to the 2011 capital expenditures plan of $737 million, which excludes corporate capital (and the underlying oil and gas price assumptions) as approved by the Forest Oil Corporation Board of Directors.  To the extent that (i) the Company incurs more or less than $737 million in capital expenditures in 2011, or (ii) oil and gas prices are materially different from those assumed in the foregoing plan, management and the Compensation Committee will adjust the objectives appropriately.

 

 

Attachment 1B

 

2011 Cash Cost

 

	
 
    	
 
    	
($/MCFE)
    	
 
    
	
Business Unit
    	
 
    	
Threshold
    	
 
    	
Target
    	
 
    	
Outstanding
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Company *
    	
 
    	
.636
    	
 
    	
.606
    	
 
    	
.545
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Canada
    	
 
    	
.846
    	
 
    	
.806
    	
 
    	
.725
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Eastern
    	
 
    	
.734
    	
 
    	
.699
    	
 
    	
.629
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Western
    	
 
    	
.387
    	
 
    	
.360
    	
 
    	
.324
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Southern
    	
 
    	
.838
    	
 
    	
.798
    	
 
    	
.718
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
International*
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
New Ventures*
    	
 
    	
—
    	
 
    	
—
    	
 
    	
—
    	
 
    

 

*Awards to Business Unit participants will be based on the Cash Cost performance of the Business Unit in which they work with the exception of International, New Ventures and corporate department participants, whose awards will be based on total Company results.

 

The Threshold, Target and Outstanding objectives are directly related to the 2011 capital expenditures plan of $737 million, which excludes corporate capital (and the underlying oil and gas price assumptions) as approved by the Forest Oil Corporation Board of Directors.  To the extent that (i) the Company incurs more or less than $737 million in capital expenditures in 2011, or (ii) oil and gas prices are materially different from those assumed in the foregoing plan, management and the Compensation Committee will adjust the objectives appropriately.

 

 

Attachment 1C

 

Bankable Value PV10

 

	
(MM$)
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Threshold
    	
 
    	
Target
    	
 
    	
Outstanding
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
5
    	
%
    	
10
    	
%
    	
15
    	
%
    

 

The Bankable Value PV10 results for the company will comprise the consolidated results of the Eastern, Western, Southern, Canadian, International and New Ventures business units. PV10 for Canada will be calculated through the date of any spin-off of those assets to occur during 2011. PV10 for International will be based on 1) the results of initiatives in Italy and 2) results in South Africa up to the date of any divestiture during 2011 and excluding the effect of any divestiture that may occur.

 

PV10 for New Ventures and all corporate staff groups for 2011 will equal the combined results for the company. PV10 will be calculated for New Ventures for the period December 31, 2010 to December 31, 2012 and those results will be included in the PV10 results for the company for purposes of 2012 annual incentive compensation awards.ex104.htm

 

EXHIBIT 10.4

 

Advanced Credit Technologies, Inc.

 

Subscription Agreement

 

 

 

 

 

 

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

  

 

  

  

  

Advanced Credit Technologies, Inc.

 

Subscription Agreement Information

 

Roy Aafredt

 

PO BOX 96

Eden ,SD. 57232                                           $25,000                      11/2009                      250,000 common                                shares

$10,000                      08/2010                      100,000 common                                shares

701-588-4135                                                      Consulting                                           100,000 common                                shares

Richard Wagner

1350 3rd Ave South

Fargo, ND. 58103                                           $10,000                      01/2010                      100,000 common                                shares

701-235-6155

Paul Staffile

14303 Patty Berg Drive

Fort Meyers, FL. 33919                                                      $5000                      02/2010                      50,000 common                                shares

239-433-4423

J. Michael Cullen

3032 23rd Ave SW

Fargo, ND.  58103                                           $10,000                      03/2010                      100,000 common                                shares

701-371-4036

Todd Thomas

8407 Haeg Drive

Bloomington, MN. 55431                                           $7500                      03/2010                      75,000 common                                shares

$2500                      07/2010                      25,000 common                                shares

952-881-5088

Edward Roos

5415 SW 22nd Ave

Cape Coral, FL. 33917                                                      $5000                      03/2010                      50,000 common                                shares

239-542-3339

Tabatha & Eric Melby                                                      $5000                      04/2010                      50,000 common                                shares

17945 230th Ave

Detroit Lakes, MN. 56501

218-439-6405

Karl & Joni Benardchik

17160 County Road 2

Walcott, ND. 58077                                           $6000                      04/2010                      60,000 common                                shares

701-899-1341

Charles Gillette

3905  24th St

Sioux Falls, SD. 57103                                                      $10,000                      05/2010                      100,000 common                                shares

605-334-2517

Craig Tevedahl

11059 SD Highway 27

Britton, SD. 57430                                           $5000                      05/2010                      50,000 common                                shares

605-880-7506

Pablo Silva

1327 SE 25th Terrace

Cape Coral, FL. 33904                                                      $5000                      05/2010                      50,000 common                                shares

239-362-6556

John Cancelliere                                           $1250                      05/2010                      12,500 common                                shares

501 Avellino Isles Circle #39201

Naples, FL. 34119

239-216-2267

Dave O'Brien                                           $1250                      05/2010                      12,500 common                                shares

16051 Briarcliff Lane

Fort Myers, FL. 33912

239-633-3253

Darrell Vasvick

1509 17th St S

Fargo, ND. 58103                                           $5000                      05/2010                      50,000 common                                shares

701-261-3412

Kim Winters

415 SW 14th Court

Pompano Beach, FL. 33060                                                      $5000                      06/2010                      50,000 common                                shares

954-695-2416

Joyce Lehr

4515 SW 14th Court

Pompano Beach, FL. 33060                                                      $5000                      06/2010                      50,000 common                                shares

954-782-6962

Donald E Smith

22545 North Pearl Lake

Detroit Lakes, MN. 56501                                           $5000                      06/2010                      50,000 common                                shares

$6000                      12/2010                      60,000 common                                shares

218-849-5759

Chad Wolf

1156 42nd Ave West #A

West Fargo, ND. 58078                                                      $2500                      06/2010                      25,000 common                                shares

701-730-4572

Jill Kornblatt-Danford

805 Saddle Hill

Marietta, GA. 30068                                                      $5000                      06/2010                      50,000 common                                shares

$5000                      07/2010                      50,000 common                                shares

770-850-8458

Lawrence Hauskins

8300 Norman Center Drive #1150

Bloomington, MN. 55437                                           $5000                      07/2010                      50,000 common                                shares

952-484-3954

Mary McAlpin

3597 Tuckers Farm

Marietta, GA. 30067                                                      $5000                      07/2010                      50,000 common                                shares

770-984-2643

Paul & Beth Norcia

18183 Lansford Path

Lakeville, MN. 55044                                                      $10,000                      08/2010                      100,000 common            shares

952-412-7200

Ruben Zak

3856 Luverne St                                                      $1250                      05/2010                      12,500                      commonshares

Fort Myers, FL. 33091                                                      $5000                      09/2010                      50,000                      commonshares

Consulting                                100,000  common                                shares

239-223-2241

Patrick DeRosa

12070 Lucca Street

Fort Myers, FL. 33966                                                      $2500                      09/2010                      25,000                      commonshares

201-681-1581

William & Sue Griz

3683 Recreation Lane

Naples, FL. 34116                                           $5000                      10/2010                      50,000                      common                      shares

239-450-5386

Lawrence Maloney

20750 Idaho Ave

Lakeville, MN. 55044                                                      $5000                      11/2010                      50,000                      commonshares

651-270-9285

Nan Bowen

100 Royal Oaks Drive

Double Oak, TX. 75077                                                      $5000                      11/2010                      50,000                      commonshares

817-681-5999

Nancy Schlagel-Maloney

20750 Idaho Ave

Lakeville, MN. 55044                                                      $5000                      12/2010                      50,000                      commonshares

651-460-1701

Brad Alsterlund                                                      $7500                      12/2010                      75,000                      commonshares

13563 Foxberry Road

Savage, MN. 55378

952-445-7514

JR Venegas                                           $3000                      12/2010                      30,000                      common                      shares

11139 Cresthaven Trail                                                      $2000                      01/2011                      20,000                      commonshares

Woodbury, MN. 55129

651-270-9003

2011 Investors

Thomas S Montibrand                                                      $2500                      01/2011                      25,000                      commonshares

2192 129th CT NE                                           $1000                      02/2011                      10,000                      common                      shares

Blaine, MN. 55434                                           $1000                      03/2011                      10,000                      common                      shares

$12500                                05/2011                      125,000 common                                shares

763-300-7879

Infinity Capital Group/Tomer Moshe

$1000                      01/2011                      10,000                      common                      shares

110 Tudor Court

Lakewood, NJ. 08701

732-857-0587

Elizabeth James                                                      $10,000                      01/2011                      100,000  common                                shares

1759 Stuart Road West

Princeton, NJ. 08540

609-203-4204

Rebecca Spinler                                           $5000                      04/2011                      50,000                       common                      shares

 

111 East Kellogg Blvd #3203

 

St Paul, MN. 55101    612-710-9960

 

Greg Montbriand                                           $1000                      05/2011                      10,000                       common                      shares

19367 Ellington Trail

Farmington, MN. 55024

651-463-9507

______________________________________________________________________________

Christopher Melander                                                      $8000                      05/2011                      80,000                       commonshares

19658 Jersey Ave

Lakeville, MN. 55044

952-469-6605

______________________________________________________________________

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