Document:

hes-ex102_705.htm

 

Exhibit 10(2)

AMENDMENT NO. 1 dated as of July 10, 2015 (this “Amendment”), to the Five-Year Credit Agreement dated as of January 21, 2015 (the “Credit Agreement”), among HESS CORPORATION, a Delaware corporation; HESS OIL AND GAS HOLDINGS INC., a Cayman Islands exempted company incorporated with limited liability, HESS INTERNATIONAL HOLDINGS LIMITED, a Cayman Islands exempted company incorporated with limited liability, HESS CAPITAL SERVICES LLC, a Delaware limited liability company, HESS (NETHERLANDS) OIL AND GAS HOLDINGS C.V., a limited partnership formed under the laws of The Netherlands, represented by its general partner (beherend vennoot) Hess Netherlands Partnership Holdings, LLC, and HESS OVERSEAS FINANCE INVESTMENTS CENTRE LIMITED, a Cayman Islands exempted company incorporated with limited liability, as Borrowing Subsidiaries, and each other Borrowing Subsidiary from time to time party thereto; the LENDERS from time to time party thereto and JPMORGAN CHASE BANK, N.A., as administrative agent.

Pursuant to the Credit Agreement, the Lenders have agreed to extend credit to the Borrowers on the terms and subject to the conditions set forth therein. 

Pursuant to that certain Equity Interest Purchase Agreement, dated as of June 10, 2015 (the “EIPA”), among Hess TGP Finance Company LLC, a Delaware limited liability company, Hess Investments North Dakota LLC (formerly known as Hess Investments North Dakota Limited), a Delaware limited liability company (“HINDL”), GIP II Blue Holding Partnership, L.P., a Delaware limited partnership (the “GIP JV Partner”), Hess Infrastructure Partners LP (formerly known as Hess USA Investment LP), a Delaware limited partnership, and Hess Infrastructure Partners GP LLC (formerly known as Hess USA Investment LLC), a Delaware limited liability company, a joint venture will be established between HINDL and the GIP JV Partner pursuant to which each will own 50% of the issued and outstanding common units representing limited partner interests of Hess JV (as defined below) and 50% of the issued and outstanding membership interests of Hess JV General Partner (as defined below) (collectively, together with the related transactions, the “Hess JV Transaction”).

The Company has requested an amendment to the Credit Agreement (a) to permit restrictive agreements at Hess JV, Hess JV General Partner and their respective Subsidiaries under Section 6.03 of the Credit Agreement and (b) to modify the application of clause (e) of Article VII of the Credit Agreement to Material Indebtedness of Hess JV, Hess JV General Partner and their respective Subsidiaries.

Each of the Lenders party hereto, collectively constituting the Required Lenders, is willing to agree to such amendment on the terms and subject to the conditions set forth herein.

Each capitalized term used and not otherwise defined herein shall have the meaning assigned to such term in the Credit Agreement.

 

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Accordingly, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the parties hereto agree as follows:

SECTION 1. Amendments. (a) Section 1.01 of the Credit Agreement is hereby amended to insert in the appropriate alphabetical order the following defined terms:

“EIPA” means the Equity Interest Purchase Agreement, dated as of June 10, 2015, among Hess TGP Finance Company LLC, a Delaware limited liability company, HINDL, GIP JV Partner, Hess JV and Hess JV General Partner.

“GIP JV Partner” means GIP II Blue Holding Partnership, L.P., a Delaware limited partnership.

“Hess JV” means Hess Infrastructure Partners LP (formerly known as Hess USA Investment LP), a Delaware limited partnership.

“Hess JV General Partner” means Hess Infrastructure Partners GP LLC (formerly known as Hess USA Investment LLC), a Delaware limited liability company.

“Hess JV Period” means the period commencing on the date of consummation of the Hess JV Transaction and ending on the date, if any, on which Hess JV becomes a wholly owned Subsidiary of the Company.

“Hess JV Transaction” means the establishment of a joint venture between HINDL and the GIP JV Partner pursuant to which each will own 50% of the issued and outstanding common units representing limited partner interests of Hess JV and 50% of the issued and outstanding membership interests of Hess JV General Partner, together with the related transactions contemplated by the EIPA, in each case, on the terms and upon the satisfaction of the conditions set forth in the EIPA, as it may be amended, supplemented, waived or otherwise modified in accordance with the terms thereof.

“HINDL” means Hess Investments North Dakota Limited, a Delaware corporation.

(b) Section 1.01 of the Credit Agreement is hereby further amended to insert a proviso at the end of the definition of “Borrowing Subsidiary” as follows:

“; provided that, notwithstanding anything to the contrary herein, during the Hess JV Period none of Hess JV, Hess JV General Partner or any of their respective Subsidiaries may be designated as a Borrowing Subsidiary”.

(c) Section 1.01 of the Credit Agreement is hereby further amended to amend and restate the proviso set forth at the end of the definition of “Total Capitalization” as follows:

“; provided that in determining the Company’s shareholders’ equity, any interests in Hess JV, Hess JV General Partner, Midstream MLP or any of their Subsidiaries that are not beneficially owned by the Company shall be excluded”.

 

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(d) Section 2.21 of the Credit Agreement is hereby amended to amend and restate clause (a) set forth therein as follows:

“(a) the Facility Fee shall cease to accrue pursuant to Section 2.12(a) on the unused amount of the Commitment of such Defaulting Lender;”

(e) Section 3.12 of the Credit Agreement is hereby amended and restated to read as follows:

“SECTION 3.12. Hess JV Transaction; Midstream MLP IPO. Upon the consummation of the Hess JV Transaction, no Material Adverse Effect has occurred or would reasonably be expected to occur as a result of the consummation of the Hess JV Transaction.  Upon the consummation of the Midstream MLP IPO, no Material Adverse Effect would reasonably be expected to occur as a result of the consummation of the Midstream MLP IPO and the other Midstream MLP IPO Transactions.

(f) Section 6.03 of the Credit Agreement is hereby amended to insert a proviso at the end thereof to read as follows:

“; provided that (a) during the Hess JV Period, the foregoing shall not apply to any such agreement or other arrangement applicable to Hess JV or its Subsidiaries and (b) during the Hess JV Period and so long as Hess JV General Partner shall be the sole general partner of Hess JV, the foregoing shall not apply to any such agreement or other arrangement applicable to Hess JV General Partner”.

(g) Section 6.06 of the Credit Agreement is hereby amended and restated to read as follows:

“SECTION 6.06. Transactions with Affiliates. The Company will not, and will not permit any of its Subsidiaries to, enter into or engage in any material transaction (including any sale, lease, transfer, purchase or acquisition of property or assets) with Hess JV, Hess JV General Partner, Midstream MLP, Midstream MLP GP or any of their Subsidiaries, except on terms and conditions, taken as a whole, that are not less favorable to the Company or such Subsidiary in any material respect than those that would prevail in an arm’s-length transaction with unrelated third parties; provided that the foregoing restriction shall not apply to (a) transactions involving any employee benefit plans or related trusts of the Company or any of its Subsidiaries, (b) the payment of reasonable compensation, fees and expenses to, and indemnity provided on behalf of, directors, officers and employees of the Company or any of its Subsidiaries, (c)(i) the Hess JV Transaction and any agreement attached to the EIPA as an exhibit thereto and any transactions contemplated by such agreement or (ii) the Midstream MLP IPO Transactions, the Midstream MLP Drop-Down Transactions or any agreement attached to the Registration Statement as an exhibit thereto and any transactions contemplated by such agreement, (d) transactions entered into with Hess JV, Hess JV General Partner, Midstream MLP, Midstream MLP GP or any of their Subsidiaries (i) (A) in the case of transactions with Hess JV, Hess JV General Partner and their Subsidiaries (other than, following the consummation of the Midstream MLP IPO, Midstream MLP, Midstream MLP GP and their Subsidiaries), on terms and conditions that are fair and reasonable to the Company and its other Subsidiaries (as reasonably determined 

 

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by a Financial Officer of the Company), taking into account the totality of the relationship between the Company and its other Subsidiaries, on the one hand, and Hess JV, Hess JV General Partner and their Subsidiaries (other than, following the consummation of the Midstream MLP IPO, Midstream MLP, Midstream MLP GP and their Subsidiaries), on the other, or (B) following the consummation of the Midstream MLP IPO, in the case of transactions with Midstream MLP, Midstream MLP GP and their Subsidiaries, on terms and conditions that are fair and reasonable to the Company and its other Subsidiaries (as reasonably determined by a Financial Officer of the Company), taking into account the totality of the relationship between the Company and its other Subsidiaries (other than Hess JV, Hess JV General Partner and their Subsidiaries), on the one hand, and Midstream MLP, Midstream MLP GP and their Subsidiaries, on the other, (ii) on terms and conditions approved by the Board of Directors of the Company or (iii) with respect to which the Company shall have delivered to the Administrative Agent a favorable fairness opinion from a third-party appraiser of recognized standing, (e) the purchase of, or any agreement to purchase, any equity interests of Hess JV, Hess JV General Partner or Midstream MLP or the right to exercise any right, option or warrant with respect thereto, (f) any investment in, or credit support with respect to, Hess JV, Hess JV General Partner, Midstream MLP, Midstream MLP GP or any of their Subsidiaries as the Company or any of its Subsidiaries shall deem appropriate to the extent not otherwise prohibited by this Agreement, (g) any corporate sharing agreements with respect to tax sharing and general overhead and administrative matters, or (h) transactions pursuant to any contract or agreement in effect as of the date hereof and set forth on Schedule 6.06.”

(h) Clause (e) of Article VII of the Credit Agreement is hereby amended and restated to read as follows:

“(i) any obligation of the Company or any Significant Subsidiary (other than Hess JV, Hess JV General Partner, Midstream MLP or any of their respective Subsidiaries) in respect of any Material Indebtedness now or hereafter outstanding shall become due by its terms, whether by acceleration or otherwise, and shall not be paid, extended or refunded or any default or event of default shall occur in respect of any such obligation and shall continue for a period of time sufficient to cause or permit the acceleration of maturity thereof, or the Company or any Significant Subsidiary shall fail to pay any Swap Payment Obligation of such Person in excess of $150,000,000 when due and payable (whether by acceleration or otherwise), unless such Person is contesting such Swap Payment Obligation in good faith by appropriate proceedings and has set aside appropriate reserves relating thereto in accordance with GAAP; provided that in the case of any guarantees, endorsements and other contingent obligations in respect of any such obligation for borrowed money of an entity other than the Company or any Consolidated Subsidiary (all of the foregoing being herein called “Accommodation Guarantee Indebtedness”), a default with respect to any Accommodation Guarantee Indebtedness of such Person shall constitute an Event of Default hereunder only if there shall have been a default in the performance by such Person of its obligations with respect to such Accommodation Guarantee Indebtedness and such default shall continue for more than 30 days after a holder or beneficiary of such Accommodation Guarantee Indebtedness shall have demanded the performance of such obligation; or (ii)  to the extent Hess JV, Hess JV General Partner, Midstream MLP or any of their 

 

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respective Subsidiaries constitutes a Significant Subsidiary, any Material Indebtedness of such Significant Subsidiary shall become due or required to be prepaid, repurchased, redeemed or defeased prior to its scheduled maturity, and shall not be paid, extended or refunded;”

SECTION 2. Effectiveness. The effectiveness of this Amendment is subject to the satisfaction of the following conditions precedent:

(a) The Administrative Agent shall have received from the Company and the Required Lenders either (i) a counterpart of this Amendment signed on behalf of such party or (ii) evidence satisfactory to the Administrative Agent (which may include a facsimile or electronic transmission) that such party has signed a counterpart of this Amendment.

The Administrative Agent shall have received, to the extent invoiced, reimbursement or payment of all out‐of‐pocket expenses (including fees, charges and disbursements of counsel) required to be reimbursed or paid by the Company under the Credit Agreement.

SECTION 3. Effect of  Amendment. Except as expressly set forth herein, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of the Lenders, the Issuing Banks or the Administrative Agent under the Credit Agreement or any other Loan Document, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect.  Nothing herein shall be deemed to entitle the Company to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document in similar or different circumstances.  This Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.

SECTION 4. Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a signature page of this Amendment by facsimile or other electronic imaging shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 5. Governing Law. This Amendment shall be construed in accordance with and governed by the law of the State of New York.

SECTION 6. Headings. Section headings used herein are for convenience of reference only, are not part of this Amendment and shall not affect the construction of, or be taken into consideration in interpreting, this Amendment.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written.

 

	
HESS CORPORATION,

	
 
	
 
	
 

	
by
	
 
	
 

	
 
	
 
	
/s/ John P. Rielly

	
 
	
 
	
Name: John P. Rielly

	
 
	
 
	
Title: Senior Vice President and

Chief Financial Officer

 

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SIGNATURE PAGE TO AMENDMENT NO. 1 TO THE 

FIVE-YEAR CREDIT AGREEMENT OF HESS CORPORATION

 

	
Name of Institution: JPMORGAN CHASE BANK, N.A.,

	
 
	
 
	
 

	
by
	
 
	
/s/ Debra Hrelja

	
Name:
	
 
	
Debra Hrelja

	
Title:
	
 
	
Vice President

 

	
Name of Institution: THE BANK OF TOKYO-MITSUBISHI UFJ,LTD.

	
 
	
 
	
 

	
by
	
 
	
/s/ Kevin Sparks

	
Name:
	
 
	
Kevin Sparks

	
Title:
	
 
	
Vice President

 

	
Name of Institution: GOLDMAN SACHS BANK USA,

	
 
	
 
	
 

	
by
	
 
	
/s/ Michelle Latzoni

	
Name:
	
 
	
Michelle Latzoni

	
Title:
	
 
	
Authorized Signatory

 

	
Name of Institution: MORGAN STANLEY BANK, N.A.,

	
 
	
 
	
 

	
by
	
 
	
/s/ Dmitriy Barskiy

	
Name:
	
 
	
Dmitriy Barskiy

	
Title:
	
 
	
Authorized Signatory

 

	
Name of Institution: BANK OF AMERICA, N.A.,

	
 
	
 
	
 

	
by
	
 
	
/s/ Raza Jafferi

	
Name:
	
 
	
Raza Jafferi

	
Title:
	
 
	
Vice President

 

	
Name of Institution: CITIBANK, N.A

	
 
	
 
	
 

	
by
	
 
	
/s/ Maureen Maroney

	
Name:
	
 
	
Maureen Maroney

	
Title:
	
 
	
Vice President

 

	
Name of Institution: WELLS FARGO BANK, N.A.

	
 
	
 
	
 

	
by
	
 
	
/s/ Michael A. Tribolet

	
Name:
	
 
	
Michael A. Tribolet

	
Title:
	
 
	
Managing Director

 

 

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Name of Institution: The Bank of Nova Scotia

	
 
	
 
	
 

	
by
	
 
	
/s/ J. Frazell

	
Name:
	
 
	
J. Frazell

	
Title:
	
 
	
Director

 

	
Name of Institution: Scotiabanc Inc.

	
 
	
 
	
 

	
By
	
 
	
/s/ J.F. Todd

	
Name:
	
 
	
J.F. Todd

	
Title:
	
 
	
Managing Director

 

	
Name of Institution: BNP PARIBAS

	
 
	
 
	
 

	
by
	
 
	
/s/ Claudia Zarate

	
Name:
	
 
	
Claudia Zarate

	
Title:
	
 
	
Director

	
 
	
 
	
 

	
by
	
 
	
/s/ Nicolas Anberree

	
Name:
	
 
	
Nicolas Anberree

	
Title:
	
 
	
Vice President

 

	
Name of Institution: DNB Capital LLC

	
 
	
 
	
 

	
by
	
 
	
/s/ Jill Ilski

	
Name:
	
 
	
Jill Ilski

	
Title:
	
 
	
First Vice President

	
 
	
 
	
 

	
by
	
 
	
/s/ Asluv Tveit

	
Name:
	
 
	
Asluv Tveit

	
Title:
	
 
	
First Vice President

 

	
Name of Institution: HSBC Bank USA, National Association

	
 
	
 
	
 

	
by
	
 
	
/s/ Douglas A. Whiddon

	
Name:
	
 
	
Douglas A. Whiddon

	
Title:
	
 
	
Director

 

8

 

 

	
Name of Institution: Sumitomo Mitsui Banking Corporation

	
 
	
 
	
 

	
by
	
 
	
/s/ James D. Weinstein

	
Name:
	
 
	
James D. Weinstein

	
Title:
	
 
	
Managing Director

 

	
Name of Institution: Banco Bilbao Vizcaya Argentaria, S.A. New York Branch

	
 
	
 
	
 

	
by
	
 
	
/s/ Veronica Incera

	
Name:
	
 
	
Veronica Incera

	
Title:
	
 
	
Managing Director

 

	
For any Lender requiring a second signature block:

	
 
	
 
	
 

	
by
	
 
	
/s/ Mauricio Benitez

	
Name:
	
 
	
Mauricio Benitez

	
Title:
	
 
	
Director

 

	
Name of Institution: CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK

	
 
	
 
	
 

	
by
	
 
	
/s/ Michael Willis

	
Name:
	
 
	
Michael Willis

	
Title:
	
 
	
Managing Director

 

	
For any Lender requiring a second signature block:

	
 
	
 
	
 

	
by
	
 
	
/s/ David Gurghigian

	
Name:
	
 
	
David Gurghigian

	
Title:
	
 
	
Managing Director

 

	
Name of Institution: ING CAPITAL LLC

	
 
	
 
	
 

	
by
	
 
	
/s/ Cheryl LaBelle

	
Name:
	
 
	
Cheryl LaBelle

	
Title:
	
 
	
Managing Director

 

9

 

 

	
For any Lender requiring a second signature block:

	
 
	
 
	
 

	
by
	
 
	
/s/ Hans Beekmans

	
Name:
	
 
	
Hans Beekmans

	
Title:
	
 
	
Director

 

	
Name of Institution: INTESA SANPAOLO S.p.A.

	
 
	
 
	
 

	
by
	
 
	
/s/ Glen Binder

	
Name:
	
 
	
Glen Binder

	
Title:
	
 
	
VP

	
 
	
 
	
 

	
by
	
 
	
/s/ Franco Di Mario

	
Name:
	
 
	
Franco Di Mario

	
Title:
	
 
	
FVP and Head of Credit

 

	
Name of Institution: Mizuho Bank, Ltd.

	
 
	
 
	
 

	
by
	
 
	
/s/ Leon Mo

	
Name:
	
 
	
Leon Mo

	
Title:
	
 
	
Authorized Signatory

 

	
Name of Institution: Standard Chartered Bank

	
 
	
 
	
 

	
by
	
 
	
/s/ Steve Aloupis

	
Name:
	
 
	
Felipe Macia A2789

	
Title:
	
 
	
Managing Director Syndications Americas

	
 
	
 
	
 

	
by
	
 
	
/s/ Robin Francis

	
Name:
	
 
	
Robin Francis

	
Title:
	
 
	
Manager LDU Americas, Standard Chartered Bank

 

	
Name of Institution: Bank of China, New York Branch

	
 
	
 
	
 

	
by
	
 
	
/s/ Dong Yuan

	
Name:
	
 
	
Dong Yuan

	
Title:
	
 
	
Executive Vice President

 

10

 

 

	
Name of Institution: BRANCH BANKING AND TRUST COMPANY

	
 
	
 
	
 

	
by
	
 
	
/s/ Janet L. Wheeler

	
Name:
	
 
	
Janet L. Wheeler

	
Title:
	
 
	
Vice President

 

	
Name of Institution: COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES

	
 
	
 
	
 

	
by
	
 
	
/s/ Diane Pockaj

	
Name:
	
 
	
Diane Pockaj

	
Title:
	
 
	
Managing Director

	
 
	
 
	
 

	
by
	
 
	
/s/ Kiuli Chan

	
Name:
	
 
	
Kiuli Chan

	
Title:
	
 
	
Director

 

	
Name of Institution: The Northern Trust Company

	
 
	
 
	
 

	
by
	
 
	
/s/ Sophia E. Love

	
Name:
	
 
	
Sophia E. Love

	
Title:
	
 
	
Senior Vice President

 

	
Name of Institution: U.S. Bank National Association

	
 
	
 
	
 

	
by
	
 
	
/s/ John M. Eyerman

	
Name:
	
 
	
John M. Eyerman

	
Title:
	
 
	
Vice President

 

 

11hes-ex103_706.htm

 

Exhibit 10(3)

CHANGE IN CONTROL

TERMINATION BENEFITS AGREEMENT

THIS CHANGE IN CONTROL TERMINATION BENEFITS AGREEMENT (the "Agreement"), dated as of the 3rd day of August, 2015, is between Hess Corporation, a Delaware corporation (the "Company"), and Michael R. Turner (the "Executive").

WITNESSETH:

WHEREAS, the Company considers it essential to the best interests of the Company and its stockholders that its management be encouraged to remain with the Company and to continue to devote full attention to the Company's business in the event of a transaction or series of transactions that could result in a change in control of the Company through a tender offer or otherwise;

WHEREAS, the Company recognizes that the possibility of a change in control and the uncertainty which it may raise among management may result in the departure or distraction of management personnel to the detriment of the Company and its stockholders;

WHEREAS, the Executive is a key executive of the Company;

WHEREAS, the Company believes the Executive has made valuable contributions to the productivity and profitability of the Company;

WHEREAS, should the Company receive a proposal for, or otherwise consider any such transaction, in addition to the Executive's regular duties, the Executive may be called upon to assist in the assessment of such proposals, advise management and the Board of Directors of the Company (the "Board") as to whether a proposed transaction would be in the best interests of the Company and its stockholders, and to take such other actions as the Board might determine to be appropriate; 

WHEREAS, the Board has determined that it is in the best interests of the Company and its stockholders to assure that the Company will have the continued services of the Executive, notwithstanding the possibility, threat or occurrence of a change in control of the Company and believes that it is imperative to diminish the potential distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened change in control, to assure the Executive's full attention and dedication to the Company in the event of any threatened or pending change in control, and to provide the Executive with appropriate severance arrangements following a change in control; and

 

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WHEREAS, the Company intends that the Agreement comply with, or not be subject to, section 409A of the Internal Revenue Code of 1986, as amended (the "Code"), and guidance and regulations issued thereunder, so that, notwithstanding any other provision of the Agreement, the Agreement shall be interpreted, operated and administered in a manner consistent with this intention.

NOW, THEREFORE, to assure the Company that it will have the continued undivided attention and services of the Executive and the availability of the Executive's advice and counsel notwithstanding the possibility, threat or occurrence of a change in control of the Company, and to induce the Executive to remain in the employ of the Company and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto, each intending to be legally bound hereby, agree as follows:

1. Change in Control.

For purposes of the Agreement, a Change in Control shall be deemed to have taken place if any of the following shall occur:  

(a) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act")), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either the then (i) outstanding shares of Common Stock of the Company (the "Outstanding Company Common Stock") or (ii) combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the "Outstanding Voting Securities") provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition by the Company or any of its subsidiaries, (ii) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any of its subsidiaries, (iii) any acquisition by any company with respect to which, following such acquisition, more than 60% of, respectively, the then outstanding shares of common stock of such company and the combined voting power of the then outstanding voting securities of such company entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Voting Securities immediately prior to such acquisition in substantially the same proportions as their ownership, immediately prior to such acquisition, of the Outstanding Company Common Stock and Outstanding Voting Securities, as the case may be, or (iv) any acquisition by one or more Hess Entity (for this purpose a "Hess Entity" means (A) Mr. John Hess or any of his children, parents or siblings, (B) any spouse of any person described in Section (A) above, (C) any trust with respect to which any of the persons described in (A) has substantial voting authority (D) any affiliate (as such term is defined in Rule 12b-2 under the Exchange Act) of any person described in (A) above, (E) the Hess Foundation Inc., or (F) any persons comprising a group controlled (as such term is defined in such Rule 12b-2) by one or more of the foregoing persons or entities described in this Section 1(a)(iv)); or

 

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(b) Within any 24 month period, individuals who, immediately prior to the beginning of such period, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director during such period whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened solicitation to which Rule 14a-ll of Regulation 14A promulgated under the Exchange Act applies or other actual or threatened solicitation of proxies or consents; or

(c) Consummation of a reorganization, merger or consolidation, in each case, with respect to which all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Voting Securities immediately prior to such reorganization, merger or consolidation do not, following such reorganization, merger or consolidation, beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the company resulting from such reorganization, merger or consolidation in substantially the same proportions as their ownership, immediately prior to such reorganization, merger or consolidation, of the Outstanding Company Common Stock and Outstanding Voting Securities, as the case may be; or

(d) Consummation of (i) a complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially all of the assets of the Company, other than to a company, with respect to which following such sale or other disposition, more than 60% of, respectively, the then outstanding shares of common stock of such company and the combined voting power of the then outstanding voting securities of such company entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Voting Securities immediately prior to such sale or other disposition in substantially the same proportion as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and Outstanding Voting Securities, as the case may be. The term "the sale or other disposition of all or substantially all of the assets of the Company" shall mean a sale or other disposition in a transaction or series of related transactions involving assets of the Company or of any direct or indirect subsidiary of the Company (including the stock of any direct or indirect subsidiary of the Company) in which the value of the assets or stock being sold or otherwise disposed of (as measured by the purchase price being paid therefor or by such other method as the Board determines is appropriate in a case where there is no readily ascertainable purchase price) constitutes more than two-thirds of the fair market value of the Company (as hereinafter defined). The "fair market value of the Company" shall be the aggregate market value of the then Outstanding Company Common Stock (on a fully diluted basis) plus the aggregate market 

 

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value of the Company's other outstanding equity securities. The aggregate market value of the shares of Outstanding Company Common Stock shall be determined by multiplying the number of shares of such Common Stock (on a fully diluted basis) outstanding on the date of the execution and delivery of a definitive agreement with respect to the transaction or series of related transactions (the "Transaction Date") by the average closing price of the shares of Outstanding Company Common Stock for the ten trading days immediately preceding the Transaction Date. The aggregate market value of any other equity securities of the Company shall be determined in a manner similar to that prescribed in the immediately preceding sentence for determining the aggregate market value of the shares of Outstanding Company Common Stock or by such other method as the Board shall determine is appropriate. 

2. Circumstances Triggering Receipt of Termination Benefits.

(a) Subject to Section 2(c), the Company will provide the Executive with the benefits set forth in Section 4 upon the Executive's Separation from Service that is initiated:

(i) by the Company at any time within the first 24 months after a Change in Control;

(ii) by the Executive for "Good Reason" (as defined in Section 2(b) below) at any time within the first 24 months after a Change in Control; or

(iii) by the Company or the Executive pursuant to Section 2(d).

For purposes of this Agreement, the term "Separation from Service" or "Separate(s/d) from Service" means a "separation from service" within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code") and Treasury Regulations thereunder.

(b) In the event of a Change in Control, the Executive may Separate from Service for "Good Reason" and receive the payments and benefits set forth in Section 4 upon the occurrence of one or more of the following events (regardless of whether any other reason, other than Cause as provided below, for such Separation from Service exists or has occurred):

(i) Failure to elect or reelect or otherwise to maintain the Executive in the office or the position, or at least a substantially equivalent office or position, of or with the Company (or any successor thereto), which the Executive held immediately prior to a Change in Control, or the removal of the Executive as a director of the Company (or any successor thereto), if the Executive shall have been a director of the Company immediately prior to the Change in Control;

(ii) (A) Any material adverse change in the nature or scope of the Executive's authorities, powers, functions, responsibilities or duties from those in effect 

 

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immediately prior to the Change in Control, (B) a reduction in the Executive's annual base salary rate, (C) a reduction in the Executive's annual incentive compensation target or any material reduction in the Executive's other bonus opportunities, or (D) the termination or denial of the Executive's ability to participate in Employee Benefits (as defined in Section 4(b)) or retirement benefits (as described in Section 4(c)) or a material reduction in the scope or value thereof, any of which is not remedied by the Company within 10 days after receipt by the Company of written notice from the Executive of such change, reduction or termination, as the case may be;

(iii) The liquidation, dissolution, merger, consolidation or reorganization of the Company or transfer of all or substantially all of its businesses and/or assets, unless the successor or successors (by liquidation, merger, consolidation, reorganization, transfer or otherwise) to which all or substantially all of its businesses and/or assets have been transferred (directly or by operation of law) assumed all duties and obligations of the Company under this Agreement pursuant to Section 9(a);

(iv) The Company requires the Executive to change the Executive's principal location of work to a location that is in excess of 30 miles from the location thereof immediately prior to the Change in Control, or requires the Executive to travel in the course of discharging the Executive's responsibilities or duties at least 20% more (in terms of aggregate days in any calendar year or in any calendar quarter when annualized for purposes of comparison to any prior year) than was required of the Executive in any of the three full years immediately prior to the Change in Control without, in either case, the Executive's prior written consent;

(v) Without limiting the generality or effect of the foregoing, any material breach of this Agreement by the Company or any successor thereto, which breach is not remedied within 10 days after written notice to the Company from the Executive describing the nature of such breach.

(c) Notwithstanding Sections 2(a) and (b) above, no benefits shall be payable by reason of this Agreement in the event of:

(i) The Executive's Separation from Service by reason of the Executive's death or Disability, unless the Executive has previously given a valid "Notice of Termination" pursuant to Section 3. For purposes hereof, "Disability" shall be defined as the inability of the Executive due to illness, accident or other physical or mental disability to perform the Executive's duties for any period of six consecutive months or for any period of eight months out of any 12-month period, as determined by an independent physician selected by the Executive (or the Executive's legal representative) and reasonably acceptable to the Company, provided that the Executive does not return to work on substantially a full-time basis within 30 days after written notice from the Company, pursuant to Section 3, of the intent to terminate the Executive's employment due to Disability; 

 

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(ii) The Executive's retirement on or after Normal Retirement Date  pursuant to the Company's Employees' Pension Plan; provided, however, that if the Executive Separates from Service for Good Reason at such time of retirement, the Executive's retirement shall be treated hereunder as a Separation from Service for Good Reason and the Executive shall be entitled to the benefits provided in Section 4 hereof;

(iii) The Executive's Separation from Service for Cause. For the purposes hereof, "Cause" shall be defined as (A) a felony conviction of the Executive or the failure of the Executive to contest prosecution for a felony, (B) the Executive's gross and willful misconduct in connection with the performance of the Executive's duties with the Company and/or its subsidiaries or (C) the willful and continued failure of the Executive to substantially perform the Executive's duties with the Company (or any successor thereto) after a written demand from the Company's internal Executive Committee, any successor or similar internal management committee or, absent any such committee, its Chief Executive Officer (such committee, or the Chief Executive Officer, being the "Notifying Party") for substantial performance which specifically identifies the manner in which the Notifying Party believes that the Executive has not performed the Executive's duties with the Company, any of which is directly and materially harmful to the business or reputation of the Company or any subsidiary or affiliate. Notwithstanding the foregoing, the Executive shall not be deemed to have Separated from Service for "Cause" hereunder unless and until the Executive shall have been afforded, after reasonable notice, an opportunity to appear, together with counsel (if the Executive chooses to have counsel present), before the Notifying Party, if the Notifying Party is a committee, or in the event that the Notifying Party is the Chief Executive Officer, the three most highly compensated senior executive officers of the Company, not including the Chief Executive Officer (such Notifying Party or the three senior executive officers, as the case may be, being the "Hearing Party"), and after such hearing there shall have been delivered to the Executive a written determination by the Hearing Party that, in the good faith opinion of the Hearing Party the Executive shall have been Separated from Service for "Cause" as herein defined and specifying the particulars thereof in detail.Nothing herein will limit the right of the Executive or the Executive's beneficiaries to contest the validity or propriety of any such determination. This Section 2(c) shall not preclude the payment of any amounts otherwise payable to the Executive under any of the Company's employee benefit plans, pension plans, stock plans, programs and arrangements.

(d) A Separation from Service initiated by the Company without Cause or by the Executive for an event that would constitute Good Reason following a Change in Control that occurs, in either event, prior to a Change in Control, but occurs (i) not more than 180 days prior to the date on which a Change in Control occurs and (ii) (x) at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control or (y) otherwise arose in connection with, or in anticipation of, a Change in Control, shall be deemed to be a Separation from Service without Cause within the first 24 months after a Change in Control for purposes of this Agreement and 

 

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the date of such Change in Control shall be deemed to be the date immediately preceding the date the Executive's Separation from Service.

3. Notice of Termination.

Any Separation from Service as contemplated by Section 2 shall be communicated by written "Notice of Separation" to the other party hereto.  Any "Notice of Separation" shall (i) indicate the effective date of the Separation from Service, which shall not be less than 30 days or more than 60 days after the date the Notice of Separation is delivered (the "Separation Date"), (ii) cite the specific provision in this Agreement relied upon, and (iii) except for a Separation from Service pursuant to Section 2(d), shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for such Separation from Service including, if applicable, the failure by the Company, after provision of written notice by the Executive, to effect a remedy pursuant to the final clause of Section 2(b)(ii) or 2(b)(v). 

4. Benefits upon Separation from Service.

Subject to the conditions set forth in Section 2, the following benefits shall be paid or provided to the Executive:

(a) Compensation.

The Company shall pay to the Executive two times the sum of (i) "Base Pay", which shall be an amount equal to the greater of (A) the Executive's rate of annual base salary (prior to any deferrals) on the date of the Executive's Separation from Service, or (B) the Executive's rate of annual base salary (prior to any deferrals) immediately prior to the Change in Control, plus (ii) "Incentive Pay", which shall be an amount equal to the greater of (X) the target annual bonus payable to the Executive under the Company's incentive compensation plan or any other annual bonus plan for the fiscal year of the Company in which the Change in Control occurred or (Y) the highest annual bonus earned by the Executive under the Company's incentive compensation plan or any other annual bonus plan (whether paid currently or on a deferred basis) during the three fiscal years of the Company immediately preceding the fiscal year of the Company in which the Change in Control occurred. In addition, the Executive shall receive a pro rata portion of the target bonus for the fiscal year in which the Executive's termination of employment occurs.

The amount payable under Section 4(a) shall be paid to the Executive in a lump sum payment by the 60th day following the date of the Executive's Separation from Service.  Notwithstanding the foregoing, payment of such amounts may not be made to a Key Employee (as defined in Section 4(g)) upon a Separation from Service before the date which is six months after the date of the Key Employee's Separation from Service (or, if earlier, the date of death of the Key Employee).  Any payments that would otherwise be made during this period of delay shall be accumulated and paid on the first day of the 

 

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seventh month following the date of the Executive’s Separation from Service (or, if earlier, the first day of the month after the Participant’s death).   

In the event payment of the amount payable under Section 4(a) is delayed for six months pursuant to the immediately preceding paragraph, the Company shall as soon as administratively practicable following the date of the Executive’s Separation from Service (i) establish an irrevocable grantor trust of which the Company is the grantor, and a bank or trust company reasonably acceptable to the Executive is the trustee (the "Grantor Trust"), and (ii) contribute to the Grantor Trust the full such amount payable under Section 4(a).  The Grantor Trust shall be a "rabbi trust," the assets of which shall be used solely for the purpose of satisfying the Company’s obligations under Section 4(a) of this Agreement; provided, however, that such assets shall be subject to the claims of the Company’s general creditors in the event of the Company’s bankruptcy (or similar insolvency proceeding), and the Grantor Trust shall not cause any amount payable under this Agreement to be funded for tax purposes.  

(b) Welfare Benefits.

For a period of 24 months following the date of the Executive's Separation from Service (the "Continuation Period"), the Company shall arrange to provide the Executive with benefits (the "Employee Benefits"), including travel accident, major medical, dental care and other welfare benefit programs, substantially similar to those in effect immediately prior to the Change in Control, or, if greater, to those that the Executive was receiving or entitled to receive immediately prior to the date of the Executive's Separation from Service (or, if greater, immediately prior to the reduction, termination, or denial described in Section 2(b)(ii)(D)). If and to the extent that any benefit described in this Section 4(b) is not or cannot be paid or provided under any policy, plan, program or arrangement of the Company or any subsidiary, as the case may be, then the Company will itself pay or provide for the payment to the Executive, the Executive's dependents and beneficiaries of such Employee Benefits along with, in the case of any benefit which is subject to tax because it is not or cannot be paid or provided under any such policy, plan, program or arrangement of the Company or any subsidiary, an additional amount such that after payment by the Executive, or the Executive's dependents or beneficiaries, as the case may be, of all taxes so imposed, the recipient retains an amount equal to such taxes. Employee Benefits otherwise receivable by the Executive pursuant to this Section 4(b) will be reduced to the extent comparable welfare benefits are actually received by the Executive from another employer during the Continuation Period, and any such benefits actually received by the Executive shall be reported by the Executive to the Company. In addition, the Executive shall receive additional age and service credit for the Continuation Period for purposes of the Executive's eligibility to receive any retiree medical benefits.

To the extent the continuation of the Employee Benefits under this Section 4(b) is, or ever becomes, taxable to the Executive and to the extent the Employee Benefits that are medical benefits continue beyond the period in which the Executive would be entitled 

 

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(or would, but for this Agreement, be entitled) to continuation coverage under a group health plan of the Company under Code section 4980B (COBRA) if the Executive elected such coverage and paid the applicable premiums, the Company shall administer such continuation of coverage consistent with the following additional requirements as set forth in Treas. Reg. § 1.409A-3(i)(1)(iv):  

(i) The Executive’s eligibility for Employee Benefits in one year shall not affect the Executive’s eligibility for Employee Benefits in any other year;

(ii) Any reimbursement of eligible expenses will be made on or before the last day of the year following the year in which the expense was incurred; and 

(iii) Executive’s right to Employee Benefits shall not be subject to liquidation or exchange for another benefit.  

In the event the preceding sentence applies and the Executive is a Key Employee (as defined in Section 4(g)), provision of Employee Benefits after the COBRA period shall commence on the first day of the seventh month following the date of the Executive’s Separation from Service (or, if earlier, the first day of the month after the Executive’s death). 

(c) Retirement Benefits.

The Executive shall be deemed to be completely vested in the Executive's currently accrued benefits under the Company's Employees' Pension Plan and the Company's Pension Restoration Plan or other supplemental pension plan ("SERP") in effect as of the date of the Change in Control (collectively, the "Plans"), regardless of the Executive's actual vesting service credit thereunder. In addition, the Executive shall be deemed to earn age and service credit for benefit calculation purposes thereunder for the Continuation Period. The additional retirement benefits to be paid pursuant to the Plans shall be calculated as though the Executive's compensation rate for the years during the Continuation Period equaled the sum of Base Pay plus Incentive Pay. Any benefits payable pursuant to this Section 4(c) that are not payable out of the Plans for any reason (including but not limited to any applicable benefit limitations under the Employee Retirement Income Security Act of 1974, as amended, or any restrictions relating to the qualification of the Company's Employees' Pension Plan under Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code")) shall be paid directly by the Company out of its general assets at the time and form in which such benefits would have been payable under the applicable Plan.

(d) Stock Based Compensation Plans.

(i) Any issued and outstanding stock options shall vest and become exercisable on the date of the Executive's Separation from Service (to the extent they have not already become vested and exercisable) and any other stock-based awards under any compensation plan or program maintained by the Company (including, without 

 

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limitation, awards of restricted stock and book value appreciation units) and the  Executive's rights thereunder shall vest on the date of the Executive's Separation from Service (to the extent they have not already vested) and any performance criteria under any such compensation plan or program shall be deemed met at target as of the date of the Executive's Separation from Service.

(ii) If and to the extent that any benefit or entitlement (or portion thereof) described in paragraph (i) above is not able to be implemented by the Company under the then applicable terms of any plan, program or award agreement applicable to the Executive, to the extent permitted by Code section 409A, the Company shall pay to the Executive cash and/or other property (including, without limitation, common stock of the Company or any successor thereto) with a value, as determined by the Board, equal to the value of any such option, award or other entitlement (or portion thereof) that the Executive was not able to receive under paragraph (i) above, such payment shall be made upon the date provided in Section 4(a) following the Executive's  Separation from Service and such payment shall be in full satisfaction of the option, award or other entitlement (or portion thereof) to which such payment relates.

(e) Defined Contribution Deferred Compensation Plans.

The Company shall pay to the Executive all other amounts of tax-qualified and nonqualified deferred compensation accrued or earned by the Executive through the date of the Executive's Separation from Service, and amounts otherwise owing under the then existing plans and policies of the Company, other than those amounts described in Section 4(c), including but not limited to, all amounts of compensation previously deferred by the Executive (together with any accrued interest or other earnings thereon) and not yet paid by the Company, under the terms and conditions and time and form of payment of the underlying applicable arrangements, plans or policies of the Company.

(f) Outplacement Services.

If so requested by the Executive, reasonable outplacement services shall be provided to the Executive by a professional outplacement firm or provider selected by the Executive that is reasonably acceptable to the Company at a cost to the Company not in excess of $30,000; provided, however, that such reasonable outplacement expenses must be incurred on or before the last day of the second year following, and payment of such expenses is actually made before the last day of the second year following, the year in which the Executive's Separation from Service occurred.

(g) Key Employee.

For purposes of this Section 4, the term "Key Employee" means an employee treated as a "specified employee" as of his Separation from Service under Code section 409A(a)(2)(B)(i), i.e., a key employee (as defined in Code section 416(i) without regard to paragraph (5) thereof) of the Company or its affiliates if the Company’s or its affiliate's 

 

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stock is publicly traded on an established securities market or otherwise.  Key Employees shall be determined in accordance with Code section 409A using a December 31 identification date.  A listing of Key Employees as of an identification date shall be effective for the 12-month period beginning on the April 1 following the identification date.

5. Golden Parachute Provisions.

(a) Notwithstanding any provision of this Agreement to the contrary, in the event that any amount or benefit to be paid or provided under this Agreement or otherwise to the Executive constitutes a "parachute payment" within the meaning of Section 280G of the Code, and but for this provision, would be subject to the excise tax imposed by Section 4999 of the Code (such tax or taxes, together with any equivalent state or local excise taxes and any interest and penalties, being hereafter collectively referred to as the "Excise Tax"), then the totality of those amounts shall be either: (a) delivered to the Executive in full, or (b) delivered to the Executive as to such lesser extent which would result in no portion of such payments and benefits being subject to the Excise Tax, whichever of the foregoing amounts, taking into account the applicable federal, state and local income and employment taxes and the Excise Tax, results in the receipt by the Executive on an after-tax basis, of the greatest amount of such payments and benefits, notwithstanding that all or some portion of such amount may be taxable under Section 4999 of the Code.  Any reduction of any amount required by this provision shall occur in the following order: (1) reduction of cash payments to the Executive under this Agreement or otherwise; (2) reduction of vesting acceleration of stock options or other stock-based awards under this Agreement or otherwise; and (3) reduction of other benefits paid or provided to the Executive.  If two or more stock options or other stock-based awards are granted on the same date, each option or award will be reduced on a pro rata basis (dollar-for-dollar).

(b) Unless the Company and the Executive otherwise agree, any determination required under this Section 5 shall be made in writing by the Company’s outside auditors immediately prior to the Change in Control (the "Accounting Firm"), whose determination shall be conclusive and binding upon the Executive and the Company for all purposes.  

(c) The Company and the Executive shall each provide the Accounting Firm access to and copies of any books, records and documents in the possession of the Company or the Executive, as the case may be, reasonably requested by the Accounting Firm, and otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determinations and calculations contemplated by Section 5(b). 

(d) The fees and expenses of the Accounting Firm for its services in connection with the determinations and calculations contemplated by Section 5(b) shall be borne by the Company. 

 

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6. No Mitigation Obligation; Obligations Absolute. 

The payment of the severance compensation by the Company to the Executive in accordance with the terms of this Agreement is hereby acknowledged by the Company to be reasonable, and the Executive will not be required to mitigate the amount of any payment or other benefit provided in this Agreement by seeking other employment or otherwise, nor will any profits, income, earnings or other benefits from any source whatsoever create any mitigation, offset, reduction or any other obligation on the part of the Executive hereunder or otherwise, except as expressly provided in the second to last sentence of Section 4(b). The obligations of the Company to make the payments and provide the benefits provided herein to the Executive are absolute and unconditional and may not be reduced under any circumstances, including without limitation any set-off, counterclaim, recoupment, defense or other right which the Company may have against the Executive or any third party at any time.

7. Legal Fees and Expenses.

It is the intent of the Company that the Executive not be required to incur legal fees and the related expenses associated with the interpretation, enforcement or defense of the Executive's rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to the Executive hereunder. Accordingly, if, following a Change in Control, it should appear to the Executive that the Company has failed to comply with any of its obligations under this Agreement or in the event that the Company or any other person takes or threatens to take any action to declare this Agreement void or unenforceable, or institutes any litigation or other action or proceeding designed to deny, or to recover from, the Executive any or all of the benefits provided or intended to be provided to the Executive hereunder, the Company irrevocably authorizes the Executive from time to time to retain counsel of the Executive's choice, at the expense of the Company as hereafter provided, to advise and represent the Executive in connection with any such interpretation, enforcement or defense, including without limitation the initiation or defense of any litigation or other legal action, whether by or against the Company or any director, officer, stockholder or other person affiliated with the Company, in any jurisdiction. Notwithstanding any existing or prior attorney-client relationship between the Company and such counsel, the Company irrevocably consents to the Executive's entering into an attorney-client relationship with such counsel, and in that connection the Company and the Executive agree that a confidential relationship shall exist between the Executive and such counsel. Without respect to whether the Executive prevails, in whole or in part, in connection with any of the foregoing, the Company will pay and be solely financially responsible for all reasonable attorneys' fees and related expenses incurred by the Executive in good faith in connection with any of the foregoing; provided, however, that the Company shall have no obligation hereunder to pay any attorneys' fees or related expenses with respect to any frivolous claims made by the Executive. Payments by the Company shall be made in accordance with the rules immediately below, upon written request of the Executive which must be accompanied by such evidence of eligible fees and expenses as the Company may reasonably require.

 

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The Company shall administer such reimbursements consistent with the following additional requirements as set forth in Treas. Reg. § 1.409A-3(i)(1)(iv):  

(i) The Executive’s eligibility for reimbursement of eligible legal fees and expenses in one year shall not affect Executive’s eligibility for eligible legal fees in any other year;

(ii) Any reimbursement of eligible legal fees and expenses shall be made on or before the last day of the year following the year in which the expense was incurred; and 

(iii) The Executive’s right to the reimbursement of eligible legal fees and expenses shall not be subject to liquidation or exchange for another benefit.  

8. Continuing Obligations.

The Executive hereby agrees that all documents, records, techniques, business secrets and other information which have come into the Executive's possession from time to time during the Executive's employment with the Company shall be deemed to be confidential and proprietary to the Company and, except for personal documents and records of the Executive, shall be returned to the Company. The Executive further agrees to retain in confidence any confidential information known to him concerning the Company and its subsidiaries and their respective businesses so long as such information is not otherwise publicly disclosed, except that Executive may disclose any such information required to be disclosed in the normal course of the Executive's employment with the Company or pursuant to any court order or other legal process or as necessary to enforce the Executive's rights under this Agreement.

9. Successors.

(a) The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company, by agreement in form and substance reasonably satisfactory to the Executive to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. Failure of such successor entity to enter into such agreement prior to the effective date of any such succession (or, if later, within three business days after first receiving a written request for such agreement) shall constitute a breach of this Agreement and shall entitle the Executive to terminate employment pursuant to Section 2(a) (ii) and to receive the payments and benefits provided under Section 4. As used in this Agreement, "Company" shall mean the Company as herein before defined and any successor to its business and/or assets as aforesaid which executes and delivers the Agreement provided for in this Section 9 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law.

(b) This Agreement shall inure to the benefit of and be enforceable by the Executive's personal or legal representatives, executors, administrators, successors, heirs, 

 

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distributees, devisees and legatees. If the Executive dies while any amounts are payable to him hereunder, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to the Executive's designee or, if there is no such designee, to the Executive's estate.

10. Notices.

For all purposes of this Agreement, all communications, including without limitation notices, consents, requests or approvals, required or permitted to be given hereunder will be in writing and will be deemed to have been duly given when hand delivered or dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or five business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service such as FedEx, UPS, or Purolator, addressed to the Company (to the attention of the Secretary of the Company, with a copy to the General Counsel of the Company) at its principal executive office and to the Executive at the Executive's principal residence, or to such other address as any party may have furnished to the other in writing and in accordance herewith, except that notices of changes of address shall be effective only upon receipt.

11. Governing Law.

THE VALIDITY, INTERPRETATION, CONSTRUCTION AND PERFORMANCE OF THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

12. Miscellaneous.

No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in a writing signed by the Executive and the Company. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement (or in any employment or other written agreement relating to the Executive).

Nothing expressed or implied in this Agreement will create any right or duty on the part of the Company or the Executive to have the Executive remain in the employment of the Company or any subsidiary prior to or following any Change in Control. The Company may withhold from any amounts payable under this Agreement all federal, state, city or other taxes as the Company is required to withhold pursuant to any law or government regulation or ruling. In the event that the Company refuses or otherwise fails to make a payment when due and it is ultimately decided that the Executive is entitled to such payment, such payment shall be increased to reflect an interest factor, compounded annually, equal to the prime rate in effect as of the date the payment was first due plus 

 

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two points. For this purpose, the prime rate shall be based on the rate identified by Chase Manhattan Bank as its prime rate.

13. Separability.

The invalidity or unenforceability of any provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

14. Non-assignability.

This Agreement is personal in nature and neither of the parties hereto shall, without the consent of the other, assign or transfer this Agreement or any rights or obligations hereunder, except as provided in Section 9. Without limiting the foregoing, the Executive's right to receive payments hereunder shall not be assignable or transferable, whether by pledge, creation of a security interest or otherwise, other than a transfer by will or by the laws of descent or distribution, and in the event of any attempted assignment or transfer by the Executive contrary to this Section 14 the Company shall have no liability to pay any amount so attempted to be assigned or transferred to any person other than the Executive or, in the event of death, the Executive's designated beneficiary or, in the absence of an effective beneficiary designation, the Executive's estate.

15. Effectiveness; Term.

This Agreement will be effective and binding as of the date first above written immediately upon its execution and shall continue in effect through the second anniversary of such date; provided, however, that the term of this Agreement shall automatically be extended for an additional day for each day that passes so that there shall at any time be two years remaining in the term unless the Company provides written notice to the Executive that it does not wish the term of this Agreement to continue to be so extended, in which case the Agreement shall terminate on the second anniversary of such notice if there has not been a Change in Control prior to such second anniversary. In the event that a Change in Control has occurred during the term of this Agreement, then this Agreement shall continue to be effective until the second anniversary of such Change in Control. Notwithstanding any other provision of this Agreement, if, prior to a Change in Control, the Executive ceases for any reason to be an employee of the Company and any subsidiary (other than a termination of employment pursuant to Section 2(d) hereof), thereupon without further action the term of this Agreement shall be deemed to have expired and this Agreement will immediately terminate and be of no further effect. For purposes of this Section 15, the Executive shall not be deemed to have ceased to be an employee of the Company and any subsidiary by reason of the transfer of the Executive's employment between the Company and any subsidiary, or among any subsidiaries. Notwithstanding any provision of this Agreement to the contrary, the parties' respective rights and obligations under Sections 4 through 9 will survive any termination or expiration of this Agreement or the termination of the Executive's employment following a Change in Control for any reason whatsoever.

 

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16. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same agreement.

17. Prior Agreement. This Agreement supersedes and terminates any and all prior similar agreements by and among Company (and/or a subsidiary) and the Executive.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and delivered as of the day and year first above set forth.

 

	
 
	
 
	
HESS CORPORATION

	
 
	
 
	
 

	
/s/ Michael R. Turner
	
 
	
By:
	
 
	
/s/ John B. Hess

	
 

Michael R. Turner
	
 
	
 

Name:
	
 
	
 

John B. Hess

	
 
	
 
	
 

Title:
	
 
	
 

Chief Executive Officer

 

 

16

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