Document:

exv10wn

 

EXHIBIT 10.N

EL PASO ENERGY CORPORATION

KEY EXECUTIVE SEVERANCE

PROTECTION PLAN

 

AMENDED AND RESTATED EFFECTIVE AS OF AUGUST 1, 1998

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	SECTION
	 	1	 	ESTABLISHMENT OF PLAN  	 	 	1	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	2	 	DEFINITIONS  	 	 	1	 
	 
	 	2.1	 	Base Salary  	 	 	1	 
	 
	 	2.2	 	Benefits Protection Trust	 	 	1	 
	 
	 	2.3	 	Board  	 	 	2	 
	 
	 	2.4	 	Bonus Amount 	 	 	2	 
	 
	 	2.5	 	Cause  	 	 	2	 
	 
	 	2.6	 	Change in Control  	 	 	3	 
	 
	 	2.7	 	Company  	 	 	3	 
	 
	 	2.8	 	Effective Date 	 	 	4	 
	 
	 	2.9	 	Executive Employee 	 	 	4	 
	 
	 	2.10	 	Good Reason 	 	 	4	 
	 
	 	2.11	 	Notice of Termination  	 	 	5	 
	 
	 	2.12	 	Operating Companies  	 	 	5	 
	 
	 	2.13	 	Participant  	 	 	5	 
	 
	 	2.14	 	Permanent Disability 	 	 	5	 
	 
	 	2.15	 	Severance Benefit  	 	 	5	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	3	 	ELIGIBILITY  	 	 	6	 
	 
	 	3.1	 	Participation  	 	 	6	 
	 
	 	3.2	 	Duration of Participation  	 	 	6	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	4	 	SEVERANCE BENEFITS 	 	 	6	 
	 
	 	4.1	 	Right to Severance Benefit 	 	 	6	 
	 
	 	4.2	 	Amount of Severance Benefit  	 	 	6	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	5	 	TERMINATION OF EMPLOYMENT  	 	 	8	 
	 
	 	5.1	 	Written Notice Required  	 	 	8	 
	 
	 	5.2	 	Termination Date 	 	 	8	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	6	 	ADDITIONAL PAYMENTS BY THE COMPANY 	 	 	8	 
	 
	 	6.1	 	Gross-Up Payment 	 	 	8	 
	 
	 	6.2	 	Determination By Accountant  	 	 	9	 
	 
	 	6.3	 	Notification Required  	 	 	9	 
	 
	 	6.4	 	Repayment  	 	 	10	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	7	 	SUCCESSORS TO COMPANY  	 	 	11	 
	 
	 	7.1	 	Successors and Sale of Operating Companies 	 	 	11	 
	 
	 	 	 	(a)           Successors 	 	 	11	 
	 
	 	 	 	(b)           Sale of Operating Companies 	 	 	11	 

					
	 	 	 	 	 
	 
	El Paso Energy Corporation
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	Key Executive Severance Protection Plan	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 
	SECTION
	 	8	 	AMENDMENT AND PLAN TERMINATION 	 	 	11	 
	 
	 	8.1	 	Amendment and Termination  	 	 	11	 
	 
	 	8.2	 	Form of Amendment  	 	 	12	 
	 
	 	 	 	 	 	 	 	 
	SECTION
	 	9	 	MISCELLANEOUS  	 	 	12	 
	 
	 	9.1	 	Indemnification	 	 	12	 
	 
	 	9.2	 	Employment Status  	 	 	12	 
	 
	 	9.3	 	Validity and Severability  	 	 	12	 
	 
	 	9.4	 	Governing Law; Choice of Forum 	 	 	12	 
	 
	 	9.5	 	Payment to Benefits Protection Trust 	 	 	13	 

					
	 	 	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
	 	- ii -
	 	Table of Contents

 

 

EL PASO ENERGY CORPORATION

KEY EXECUTIVE SEVERANCE PROTECTION PLAN

AMENDED AND RESTATED EFFECTIVE AS OF AUGUST 1, 1998

     WHEREAS, the Board of Directors of El Paso Energy Corporation
recognizes that the threat of an unsolicited takeover of the Company may occur
which can result in significant distractions of its key executive personnel
because of the uncertainties inherent in such a situation; and

     WHEREAS, the Board has determined that it is essential and in the best
interest of the Company and its stockholders to retain the services of its key
executive personnel in the event of a threat of a Change in Control of the
Company and to ensure their continued dedication and efforts in such event
without undue concern for their personal financial and employment security.

     NOW, THEREFORE, in order to fulfill the above purposes, the following
plan has been developed and is hereby adopted.

SECTION 1 ESTABLISHMENT OF PLAN

     As of the Effective Date, the Company hereby establishes a severance
compensation plan known as the El Paso Energy Corporation Key Executive
Severance Protection Plan (the “Plan”) as set forth in this document.

SECTION 2 DEFINITIONS

     As used herein the following words and phrases shall have the
following respective meanings unless the context clearly indicates otherwise.

2.1 BASE SALARY

     The amount a Participant is entitled to receive as wages or salary on
an annualized basis, calculated immediately prior to a Change in Control.

2.2 BENEFITS PROTECTION TRUST

     The El Paso Energy Corporation Benefits Protection Trust.

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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2.3 BOARD

     The Board of Directors of El Paso Energy Corporation.

2.4 BONUS AMOUNT

     The term “Bonus Amount” shall mean an amount equal to the Executive
Employee’s maximum bonus which becomes payable to the Executive Employee in the
event of a “change in control” under the Company’s 1995 Incentive Compensation
Plan (or any other bonus plan or program then in effect) but excluding any
single or one time “spot” award, for the fiscal year in which a Change in
Control occurs had he or she continued in employment until the end of such
fiscal year, assuming all performance targets and goals (if applicable) had
been fully met by the Company and by the Executive Employee, as applicable, for
such year.

2.5 CAUSE

     The Company may terminate the Executive Employee’s employment for
“Cause.” A termination for Cause is a termination evidenced by a resolution
adopted in good faith by two-thirds (2/3) of the Board that the Executive
Employee (i) willfully and continually failed to substantially perform his or
her duties with the Company (other than a failure resulting from the Executive
Employee’s incapacity due to physical or mental illness) which failure
continued for a period of at least thirty (30) days after a written notice of
demand for substantial performance has been delivered to the Executive Employee
specifying the manner in which the Executive Employee has failed to
substantially perform, or (ii) willfully engaged in conduct which is
demonstrably and materially injurious to the Company, monetarily or otherwise;
provided, however, that no termination of the Executive Employee’s employment
shall be for Cause as set forth in clause (ii) above until (A) there shall have
been delivered to the Executive Employee a copy of a written notice setting
forth that the Executive Employee was guilty of the conduct set forth in clause
(ii) and specifying the particulars thereof in detail, and (B) the Executive
Employee shall have been provided an opportunity to be heard by the Board (with
the assistance of the Executive Employee’s counsel if the Executive Employee so
desires). No act, nor failure to act, on the Executive Employee’s part shall
be considered “willful” unless he or she has acted, or failed to act, with an
absence of good faith and without a reasonable belief that his or her action or
failure to act was in the best interest of the Company. Notwithstanding
anything contained in this Plan to the contrary, no failure to perform by the
Executive Employee after Notice of Termination is given by the Executive
Employee shall constitute Cause.

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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2.6 CHANGE IN CONTROL

     A “Change in Control” shall be deemed to occur:

          (a) if any person (as such term is used in Sections 13(d)
and 14(d)(2) of the Exchange Act) is or becomes the “beneficial owner”
(as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of El Paso Energy Corporation representing
twenty percent (20%) or more of the combined voting power of El Paso
Energy Corporation’s then outstanding securities;

          (b) upon the first purchase of El Paso Energy
Corporation’s Common Stock pursuant to a tender or exchange offer
(other than a tender or exchange offer made by El Paso Energy
Corporation);

          (c) upon the approval by El Paso Energy Corporation
stockholders of a merger or consolidation, a sale or disposition of
all or substantially all of El Paso Energy Corporation’s assets or a
plan of liquidation or dissolution of El Paso Energy Corporation; or

          (d) if, during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the Board
of Directors of El Paso Energy Corporation cease for any reason to
constitute at least a majority thereof, unless the election or
nomination for the election by El Paso Energy Corporation’s
stockholders of each new director was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who were
directors at the beginning of the period.

Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur if El Paso Energy Corporation either merges or consolidates
with or into another company or sells or disposes of all or
substantially all of its assets to another company, if such merger,
consolidation, sale or disposition is in connection with a corporate
restructuring wherein the stockholders of El Paso Energy Corporation
immediately before such merger, consolidation, sale or disposition
own, directly or indirectly, immediately following such merger,
consolidation, sale or disposition at least eighty percent (80%) of
the combined voting power of all outstanding classes of securities of
El Paso Energy Corporation resulting from such merger or
consolidation, or to which El Paso Energy Corporation sells or
disposes of its assets, in substantially the same proportion as their
ownership in El Paso Energy Corporation immediately before such
merger, consolidation, sale or disposition.

2.7 COMPANY

          El Paso Energy Corporation and the Operating Companies.

			
	 	 	 
	 
	El Paso Energy Corporation

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2.8 EFFECTIVE DATE

     The date the Plan is approved by the Board, or such other date as the
Board shall designate in its resolution approving the Plan, or any amendment or
restatement thereof.

2.9 EXECUTIVE EMPLOYEE

     All employees of the Company employed in an Executive Salary Grade
Position.

2.10 GOOD REASON

     “Good Reason” shall mean the occurrence of any of the following events
or conditions:

          (a) a change in the Executive Employee’s status, title,
position or responsibilities (including reporting responsibilities)
which, in the Executive Employee’s reasonable judgment, represents a
substantial reduction of the status, title, position or
responsibilities as in effect immediately prior thereto; the
assignment to the Executive Employee of any duties or responsibilities
which, in the Executive Employee’s reasonable judgment, are
inconsistent with such status, title, position or responsibilities; or
any removal of the Executive Employee from or failure to reappoint or
reelect him or her to any of such positions, except in connection with
the termination of his or her employment for Cause, Permanent
Disability, as a result of his or her death, or by the Executive
Employee other than for Good Reason;

          (b) a reduction in the Executive Employee’s annual base
salary;

          (c) the requirement by the Company that the Executive
Employee (without the consent of the Executive Employee) to be based
at any place outside a thirty-five (35) mile radius of his or her
place of employment prior to a Change in Control, except for
reasonably required travel on the Company’s business which is not
materially greater than such travel requirements prior to the Change
in Control;

          (d) the failure by the Company to (i) continue in effect
any material compensation or benefit plan, program or practice in
which the Executive Employee was participating at the time of the
Change in Control, including, but not limited to, the Company’s 1995
Omnibus Compensation Plan, the Pension Plan, the Supplemental Benefits
Plan, the 1995 Incentive Compensation Plan, the Deferred Compensation
Plan, and the Retirement Savings Plan, with any amendments and
restatements of such plans made prior to such Change in Control, or
(ii) provide the Executive Employee with compensation and benefits at
least equal (in terms of benefit levels and/or reward opportunities)
to those provided for under each employee benefit plan, program and
practice as in effect immediately prior to the Change in Control (or
as in effect following the Change in Control, if greater);

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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          (e) any material breach by the Company of any provision
of this Plan; or

          (f) any purported termination of the Executive Employee’s
employment for Cause by the Company which does not otherwise comply
with the terms of this Plan as in effect at the time of a Change in
Control.

2.11 NOTICE OF TERMINATION

     “Notice of Termination” shall mean a notice which indicates the
specific provisions in this Plan relied upon as the basis for any termination
of employment and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive
Employee’s employment under the provision so indicated. No purported
termination of employment shall be effective without such Notice of
Termination.

2.12 OPERATING COMPANIES

     Subsidiary companies of the Company designated by the Company.

2.13 PARTICIPANT

     An Executive Employee who meets the eligibility requirements of
Section 3.

2.14 PERMANENT DISABILITY

     A Participant shall be deemed to have become permanently disabled for
purposes of this Plan if the Chief Executive Officer of the Company (or, in the
case of a determination with respect to the Chief Executive Officer, the Board)
finds, upon the basis of medical evidence satisfactory to him or her, that the
Participant is totally disabled, whether due to physical or mental condition,
so as to be prevented from engaging in further employment by the Company and
that such disability will be permanent and continuous during the remainder of
his or her life.

2.15 SEVERANCE BENEFIT

     The benefit payable in accordance with Section 4 of the Plan.

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
	 	Page 5

 

 

SECTION 3 ELIGIBILITY

3.1 PARTICIPATION

     Each Executive Employee shall automatically be entitled to be a
Participant in the Plan as of the Effective Date, or his or her date of hire by
the Company, whichever occurs later.

3.2 DURATION OF PARTICIPATION

     A Participant shall cease to be a Participant in the Plan if he or she
ceases to be an Executive Employee at any time prior to a Change in Control or,
if his or her employment is terminated following a Change in Control under
circumstances where he or she is not entitled to a Severance Benefit under the
terms of this Plan. A Participant entitled to payment of a Severance Benefit
shall remain a Participant in the Plan until the full amount of the Severance
Benefit has been paid to him or her.

SECTION 4 SEVERANCE BENEFITS

4.1 RIGHT TO SEVERANCE BENEFIT

          (a) A Participant shall be entitled to receive from the
Company a Severance Benefit in the amount provided in Section 4.2 if
(i) a Change in Control has occurred and (ii) within two years
thereafter, the Participant’s employment with the Company terminates
for any reason, except that notwithstanding the provisions of this
paragraph (a), no benefits under this Plan will be payable should the
Participant’s termination of employment be (A) for Cause, (B) by
reason of Permanent Disability, (C) voluntarily initiated by the
Participant for other than Good Reason, or (D) by reason of the
Participant’s death.

          (b) Notwithstanding any other provision of the Plan, the
sale, divestiture or other disposition of an Operating Company (or
part thereof), shall not be deemed to be a termination of employment
of employees employed by such Operating Company, and such employees
shall not be entitled to benefits from the Company under this Plan as
a result of such sale, divestiture, or other disposition, or as a
result of any subsequent termination of employment, provided the
provisions of Section 7.1(b) have been satisfied.

4.2 AMOUNT OF SEVERANCE BENEFIT

     If a Participant’s employment is terminated in circumstances entitling
him or her to a Severance Benefit as provided in Section 4.1,
such Participant shall be entitled to the following benefits:

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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          (a) the Company shall pay to the Participant, as
severance pay and in lieu of any further salary for periods subsequent
to the Termination Date (as specified in Section 5.2), in a single
payment (without any discount for accelerated payment), an amount in
cash equal to three (3) times the sum of (A) the Participant’s Base
Salary and (B) the Bonus Amount;

          (b) for a period of eighteen (18) months subsequent to
the Participant’s termination of employment, the Company shall at its
expense continue on behalf of the Participant and his or her
dependents and beneficiaries, the basic life insurance, flexible
spending account, medical and dental benefits which were being
provided to the Participant at the time of termination of employment.
The benefits provided in this Subsection 4.2(b) shall be no less
favorable to the Participant, in terms of amounts and deductibles and
costs to him or her, than the coverage provided the Participant under
the plans providing such benefits at the time Notice of Termination is
given. The Company’s obligation hereunder to provide the foregoing
benefits shall terminate if the Participant obtains health benefits
coverage under a subsequent employer’s benefit plans. The Company
also shall pay a lump sum equal to the amount of any additional income
tax payable by the Participant and attributable to the benefits
provided under this subparagraph (b) at the time such tax is imposed
upon the Participant;

          (c) the Company shall pay a lump sum pension supplement
payable under the terms of the El Paso Energy Corporation Supplemental

Benefit Plan (“Supplemental Plan”) equal to a pension calculated by
adding three years of additional credited pension service to the
Participant’s existing credited pension service as of the termination
of the Participant’s employment, and then by calculating the
Participant’s pension in accordance with the formula provided in the
pension plan. A Participant who is entitled to a pension supplement
under any other agreement between such Participant and the Company may
elect, in writing, to receive the pension supplement provided under
this subparagraph (c) in lieu of, but not in addition to, such other
pension supplement as may be provided by such other agreement. In the
event that no election is made, the Participant shall forego his or
her right to receive the pension supplement provided under this
subparagraph;

          (d) the Company shall transfer to the Participant, all
right, title or other ownership interest it may have in any
automobile, if any, then being provided by the Company for use by the
Participant;

          (e) the Company shall transfer to the Participant, any
right, title or ownership in any club memberships provided by the
Company;

     The amounts provided for in Section 4.2(a), (c), (d) and (e) shall be
paid or transferred within thirty (30) days after the Executive Employee’s
termination of employment. The Participant shall not be required to mitigate
the amount of any

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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payment provided for in this Plan by seeking other employment or otherwise and
no such payment shall be offset or reduced by the amount of any compensation or
benefits provided to the Executive Employee in any subsequent employment.

SECTION 5 TERMINATION OF EMPLOYMENT

5.1 WRITTEN NOTICE REQUIRED

     Any purported termination of employment, either by the Company or by
the Participant, shall be communicated by written Notice of Termination to the
other.

5.2 TERMINATION DATE

     In the case of the Participant’s death, the Participant’s Termination
Date shall be his her date of death. In all other cases, the Participant’s
Termination Date shall be the date specified in the Notice of Termination
subject to the following:

          (a) If the Participant’s employment is terminated by the
Company for Cause or due to Permanent Disability, the date specified
in the Notice of Termination shall be at least thirty (30) days from
the date the Notice of Termination is given to the Participant,
provided that in the case of Permanent Disability the Participant
shall not have returned to the full-time performance of his or her
duties during such period of at least thirty (30) days; and

          (b) If the Participant terminates his or her employment
for Good Reason, the date specified in the Notice of Termination shall
not be more than sixty (60) days from the date the Notice of
Termination is given to the Company.

SECTION 6 ADDITIONAL PAYMENTS BY THE COMPANY

6.1 GROSS-UP PAYMENT

     In the event it shall be determined that any payment or distribution
of any type by the Company to or for the benefit of the Participant, whether
paid or payable or distributed or distributable pursuant to the terms of this
Plan or otherwise (the “Total Payments”), would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
“Code”) or any interest or penalties with respect to such excise tax (such
excise tax, together with any such interest and penalties, are collectively
referred to as the “Excise Tax”), then the Participant shall be entitled to
receive an additional payment (a “Gross-Up Payment”) in an amount such that
after payment by the Participant of all taxes (including any interest or
penalties imposed with respect to such taxes), including any Excise Tax,
imposed upon the Gross-Up Payment, the Participant retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Total Payments.
Payment of the Gross-Up Payment shall be made in accordance with Section 6.3.

			
	 	 	 
	 
	El Paso Energy Corporation

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6.2 DETERMINATION BY ACCOUNTANT

     All determinations required to be made under this Section 6, including
whether a Gross-Up Payment is required and the amount of such Gross-Up Payment,
shall be made by the independent accounting firm retained by the Company on the
date of Change in Control (the “Accounting Firm”), which shall provide detailed
supporting calculations both to the Company and the Participant within 15
business days of the date of termination, if applicable, or such earlier time
as is requested by the Company. If the Accounting Firm determines that no
Excise Tax is payable by the Participant, it shall furnish the Participant with
an opinion that he or she has substantial authority not to report any Excise
Tax on his or her federal income tax return. Any determination by the
Accounting Firm shall be binding upon the Company and the Participant. As a
result of the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up payments which will not have been made by the Company
should have been made (“Underpayment”), consistent with the calculations
required to be made hereunder. In the event that the Company exhausts its
remedies pursuant to Section 6.3 and the Participant thereafter is required to
make a payment of any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of the Participant.

6.3 NOTIFICATION REQUIRED

     The Participant shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of the Gross-Up Payment. Such notification shall be given as soon
as practicable but no later than ten (10) business days after the Participant
knows of such claim and shall apprise the Company of the nature of such claim
and the date on which such claim is requested to be paid. The Participant
shall not pay such claim prior to the expiration of the thirty (30) day period
following the date on which it gives such notice to the Company (or such
shorter period ending on the date that any payment of taxes with respect to
such claim is due). If the Company notifies the Participant in writing prior
to the expiration of such period that it desires to contest such claim, the
Participant shall:

          (a) give the Company any information reasonably requested
by the Company relating to such claim,

          (b) take such action in connection with contesting such
claim as the Company shall reasonably request in writing from time to
time, including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by the
Company,

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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          (c) cooperate with the Company in good faith in order to
effectively contest such claim,

          (d) permit the Company to participate in any proceedings
relating to such claim, provided, however, that the Company shall bear
and pay directly all costs and expenses (including additional interest
and penalties) incurred in connection with such contest and shall
indemnify and hold the Participant harmless, on an after-tax basis,
for any Excise Tax or income tax, including interest and penalties
with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limitation on the foregoing
provisions of this Section 6.3, the Company shall control all
proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in
respect of such claim and may, at its sole option, either direct the
Participant to pay the tax claimed and sue for a refund, or contest
the claim in any permissible manner, and the Participant agrees to
prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however,
that if the Company directs the Participant to pay such claim and sue
for a refund, the Company shall advance the amount of such payment to
the Participant, on an interest-free basis and shall indemnify and
hold the Participant harmless, on an after-tax basis, from any Excise
Tax or income tax, including interest or penalties with respect
thereto, imposed with respect to such advance or with respect to any
imputed income with respect to such advance; and further provided that
any extension of the statute of limitations relating to payment of
taxes for the taxable year of the Participant with respect to which
such contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company’s control of the contest
shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Participant shall be entitled to
settle or contest, as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.

6.4 REPAYMENT

     If, after the receipt by the Participant of an amount advanced by the
Company pursuant to Section 6.3, the Participant becomes entitled to receive
any refund with respect to such claim, the Participant shall (subject to the
Company’s complying with the requirements of Section 6.3) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the
Participant of an amount advanced by the Company pursuant to Section 6.3, a
determination is made that the Participant shall not be entitled to any refund
with respect to such claim and the Company does not notify the Participant in
writing of its intent to contest such denial of refund prior to the expiration
of thirty (30)

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
	 	Page 10

 

 

days after such determination, then such advance shall be forgiven and shall
not be required to be repaid and the amount of such advance shall offset, to
the extent thereof the amount of Gross-Up Payment required to be paid.

SECTION 7 SUCCESSORS TO COMPANY

7.1 SUCCESSORS AND SALE OF OPERATING COMPANIES

  (a)  Successors

This Plan shall bind 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, in the same manner
and to the same extent that the Company would be obligated under this
Plan if no succession had taken place. In the case of any transaction
in which a successor would not by the foregoing provision or by
operation of law be bound by this Plan, the Company shall require such
successor expressly and unconditionally to assume and agree to perform
the Company’s obligations under this Plan, in the same manner and to
the same extent that the Company would be required to perform if no
such succession had taken place.

(b) Sale of Operating Companies

In the event that one or more Operating Companies (or part thereof)
are sold, divested, or otherwise disposed of by the Company subsequent
to a Change in Control, the Company shall require such purchaser or
acquirer, as a condition precedent to such purchase or acquisition, to
assume, and agree to perform the Company’s obligations under the Plan,
in the same manner, and to the same extent that the Company would be
required to perform if no such acquisition or purchase had taken
place. In such circumstances, the purchaser or acquirer shall be
solely responsible for providing any benefits payable under this Plan
to such employees.

SECTION 8 AMENDMENT AND PLAN TERMINATION

8.1 AMENDMENT AND TERMINATION

          This Plan may be terminated or amended in any respect by resolution
adopted by two-thirds (2/3) of the Board, provided, however, that no such
amendment or termination of the Plan may be made if such amendment or
termination would adversely affect any right of an Executive Employee who
became a Participant prior to the later of (a) the date of adoption of any such
amendment or termination, or (b) the effective date of any such amendment or
termination, and provided further, that the Plan no longer shall be subject

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
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to amendment, change, substitution, deletion, revocation or termination in any
respect whatsoever following a Change in Control. The Board of Directors
amended and restated the Plan effective as of August 1, 1998, in connection
with the reorganization of the Company into a holding company structure whereby
El Paso Energy Corporation became the publicly held company and El Paso Natural
Gas Company became a wholly owned subsidiary. This Plan was assumed by El Paso
Energy Corporation pursuant to an Assignment and Assumption Agreement effective
as of August 1, 1998, by and between El Paso Energy Corporation and El Paso
Natural Gas Company.

8.2 FORM OF AMENDMENT

     The form of any amendment or termination of the Plan shall be a
written instrument signed by a duly authorized officer or officers of the
Company, certifying that the amendment or termination has been approved by the
Board.

SECTION 9 MISCELLANEOUS

9.1 INDEMNIFICATION

     If, after a Change in Control, a Participant institutes any legal
action in seeking to obtain or enforce, or is required to defend in any legal
action the validity or enforceability of, any right or benefit provided by this
Plan, the Company will pay for all actual legal fees and expenses as they are
incurred by such Participant.

9.2 EMPLOYMENT STATUS

     This Plan does not constitute a contract of employment or impose on
the Company any obligation to retain the Participant as an Employee, to change
the status of the Participant’s employment as an Executive Employee, or to
change any employment policies of the Company.

9.3 VALIDITY AND SEVERABILITY

     The invalidity or unenforceability of any provision of the Plan shall
not affect the validity or enforceability of any other provision of the Plan,
which shall remain in full force and effect, and any prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

9.4 GOVERNING LAW; CHOICE OF FORUM

     The validity, interpretation, construction and performance of the Plan
shall in all respects be governed by the laws of the State of Texas. A
Participant shall be entitled to enforce the provisions of this Plan in any
state or federal court located in the State of Texas, in addition to any other
appropriate forum.

9.5 PAYMENT TO BENEFITS PROTECTION TRUST

     Notwithstanding any other provision of the Plan, the Company shall not
be required to make any payment to a Participant under the terms of this Plan
if such payment is otherwise made to the Participant by the Benefits Protection
Trust in accordance with the provisions of said Benefits Protection Trust.

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
	 	Page 12

 

 

     IN WITNESS WHEREOF, the Company has caused the Plan to be amended and
restated effective as of August 1, 1998.

	 	 	 	 	 	 	 
	 	 	 	 	EL PASO ENERGY CORPORATION
	 
	 	 	 	 	 	 
	

	 	 	 	By
	 	/s/ Joel Richards III
	

	 	 	 	 	 	 
	 	 	 	 	Title: Executive Vice President
	 
	 	 	 	 	 	 
	ATTEST:	 	 	 	 
	 
	 	 	 	 	 	 
	By

	 	/s/ David L. Siddall	 	 	 	 
	

	 	 	 	 	 	 
	Title: Corporate Secretary	 	 	 	 

			
	 	 	 
	 
	El Paso Energy Corporation

Key Executive Severance Protection Plan
	 	Page 13exv10wp

 

EXHIBIT 10.P

EL PASO ENERGY CORPORATION

DIRECTOR CHARITABLE AWARD PLAN

AMENDED AND RESTATED EFFECTIVE AS OF AUGUST 1, 1998

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	SECTION 1 ESTABLISHMENT, PURPOSE, AND DURATION 
	 	 	1	 
	1.1 Establishment of the Plan 
	 	 	1	 
	1.2 Purpose of the Plan 
	 	 	1	 
	1.3 Duration of the Plan 
	 	 	1	 
	 
	 	 	 	 
	SECTION 2 DEFINITIONS AND CONSTRUCTION 
	 	 	1	 
	 
	 	 	 	 
	SECTION 3 ADMINISTRATION 
	 	 	3	 
	3.1 Management Committee 
	 	 	3	 
	3.2 Decisions Binding 
	 	 	4	 
	 
	 	 	 	 
	SECTION 4 ELIGIBILITY AND PARTICIPATION 
	 	 	4	 
	4.1 Eligibility
	 	 	4	 
	4.2 Actual Participation 
	 	 	4	 
	 
	 	 	 	 
	SECTION 5 CHARITABLE AWARDS 
	 	 	4	 
	5.1 Size of Charitable Awards 
	 	 	4	 
	5.2 Designation of Donees 
	 	 	4	 
	5.3 Changes in Designations of Donees 
	 	 	5	 
	5.4 Security for Donations 
	 	 	5	 
	5.5 Change in Control 
	 	 	5	 
	5.6 Payment of Charitable Awards 
	 	 	6	 
	 
	 	 	 	 
	SECTION 6 AMENDMENT, MODIFICATION, AND TERMINATION 
	 	 	6	 
	 
	 	 	 	 
	SECTION 7 INDEMNIFICATION 
	 	 	6	 
	 
	 	 	 	 
	SECTION 8 MISCELLANEOUS 
	 	 	7	 
	8.1 Successors 
	 	 	7	 
	8.2 Nontransferability 
	 	 	7	 
	8.3 Gender and Number 
	 	 	7	 
	8.4 Severability 
	 	 	7	 
	8.5 Governing Law 
	 	 	7	 

	 	 	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	-i-
	 	Table of Contents

 

 

EL PASO ENERGY CORPORATION

DIRECTOR CHARITABLE AWARD PLAN

AMENDED AND RESTATED EFFECTIVE AS OF AUGUST 1, 1998

SECTION 1 ESTABLISHMENT, PURPOSE, AND DURATION

1.1 ESTABLISHMENT OF THE PLAN

     El Paso Energy Corporation, a Delaware corporation (hereinafter referred to as the “Company”), hereby establishes a charitable award program
for Directors (as defined below), to be known as the “El Paso Energy
Corporation Director Charitable Award Plan” (hereinafter referred to as the
“Plan”), as set forth in this document. The Plan provides for the contribution
by the Company of one million dollars ($1,000,000) on behalf of each Director,
to Charitable Organizations (as defined below)of each Director’s choice subject
to the terms and provisions of this Plan.

     The Board of Directors of the Company amended and restated effective as of August 1, 1998. The term “Effective Date” shall mean January 15, 1992.

1.2 PURPOSE OF THE PLAN

     The purpose of the Plan is to promote the mutual interest of the Directors and the Company to support worthy Charitable Organizations, and to
enhance the positive image of the Company.

     The Plan is further intended to acknowledge the service of the Company’s Directors, and to aid the Company in its ability to attract,
motivate, and retain the services of highly qualified Directors, upon whose
judgment, interest, and special effort the continued successful operation of
the Company largely is dependent.

1.3 DURATION OF THE PLAN

     The Plan commenced on the Effective Date and shall remain in effect until terminated by the Board of Directors.

SECTION 2 DEFINITIONS AND CONSTRUCTION

     Whenever used in this Plan, the following terms shall have the meanings set forth below and, when the meaning is intended, the initial letter
of the word is capitalized.

     (a) “Board” or “Board of Directors” means the Board of Directors of the Company.

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 1

 

 

     (b) “Change in Control” of the Company shall be deemed to have occurred if the conditions set forth in any one or more of the following
paragraphs shall have been satisfied:

     (i) any person (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange Act) being or becoming the “beneficial
owner” (as defined in Rule 13d-3 of the Exchange Act) directly or
indirectly, of securities of the Company representing twenty percent
(20%) or more of the combined voting power of the then outstanding
securities of the Company,

     (ii) the first purchase of the Company’s Common Stock pursuant to a tender or exchange offer (other than a tender or
exchange offer made by the Company),

     (iii) the approval by the Company’s stockholders of a merger or consolidation, a sale or disposition of all or substantially
all of the Company’s assets or a plan of liquidation or dissolution of
the Company, or

     (iv) during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board
of Directors of the Company ceasing for any reason to constitute at
least a majority thereof, unless the election or nomination for the
election by the Company’s stockholders of each new director was
approved by a vote of at least two-thirds of the directors then still
in office who were directors at the beginning of the period.

Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur if the Company either merges or consolidates with or into
another company or sells or disposes of all or substantially all of
its assets to another company, if such merger, consolidation, sale or
disposition is in connection with a corporate restructuring wherein
the stockholders of the Company immediately before such merger,
consolidation, sale or disposition own, directly or indirectly,
immediately following such merger, consolidation, sale or disposition
at least eighty percent (80%) of the combined voting power of all
outstanding classes of securities of the company resulting from such
merger or consolidation, or to which the Company sells or disposes of
its assets, in substantially the same proportion as their ownership in
the Company immediately before such merger, consolidation, sale or
disposition.

     (c) “Charitable Award” means, individually or collectively, a donation to be made to a Charitable Organization chosen by a Participant
pursuant to the terms of Section 5 herein.

     (d) “Charitable Organization” means any public or private charitable organization in the United States or its possessions which is a
corporation, trust,

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 2

 

 

community chest, fund, foundation, or association, provided contributions to
such entity are deductible under Section 170(c) of the Code.

     (e) “Code” means the Internal Revenue Code of 1986, as amended, or any successor statute, and the Treasury Regulations promulgated thereunder.

     (f) “Committee” means the management committee as specified in Section 3 herein.

     (g) “Company” means El Paso Energy Corporation, a Delaware corporation, or any successor thereto as provided in Section 8.1 herein.

     (h) “Director” means any individual who is a member of the Board of Directors of the Company.

     (i) “Effective Date” means the date on which the Plan became effective, as designated by the Board of Directors pursuant to Section 1.1
herein.

     (j) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor Act thereto.

     (k) “Participant” means a Director of the Company who has been notified of his or her eligibility to participate in this Plan, pursuant to
Section 4.2 herein.

     (l) “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act, and used in Sections 13(d) and 14(d)
thereof, including a “group” as defined in Section 13(d).

     (m) “Qualified Donee” means any Charitable Organization which has not been denied status as a Qualified Donee by the Board of Directors, pursuant
to Section 5.2 herein.

SECTION 3 ADMINISTRATION

3.1 MANAGEMENT COMMITTEE

     The Plan shall be administered by the Board of Directors and a management committee (the “Committee”) consisting of the Chief Executive
Officer and such other senior officers as he or she shall designate. The
Committee shall interpret the Plan, prescribe, amend, and rescind rules
relating to it, select eligible Participants, and take all other actions
necessary for its administration. No member of the Committee shall vote on any
matter that pertains solely to himself or herself.

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 3

 

 

3.2 DECISIONS BINDING

     All determinations and decisions made by the Board of Directors and/or the Committee pursuant to the administration of this Plan shall be final,
conclusive, and binding on all parties, including the Company, its
stockholders, employees, Participants, and their estates and beneficiaries.

SECTION 4 ELIGIBILITY AND PARTICIPATION

4.1 ELIGIBILITY

     Persons who are elected to serve on the Board of Directors on or after the Effective Date shall be eligible to participate in this Plan on the second
anniversary of the date of their election to the Board; provided, however, that
such Directors must have continuously served on the Board throughout such
two-year period.

4.2 ACTUAL PARTICIPATION

     Subject to the terms and conditions of this Plan, the Committee shall notify each eligible Director of his or her eligibility to participate in this
Plan as soon as practicable following the date that each such Director first
becomes eligible for participation.

SECTION 5 CHARITABLE AWARDS

5.1 SIZE OF CHARITABLE AWARDS

     Each Participant shall have the right to designate Qualified Donees to which an aggregate of up to one million dollars ($1,000,000) shall be donated
by the Company on behalf of the Participant. Participants may designate up to
four Qualified Donees; provided, however, that the total funds which shall be
donated by the Company on behalf of any one Participant shall not exceed one
million dollars ($1,000,000).

5.2 DESIGNATION OF DONEES

     Each Participant shall nominate Charitable Organizations to receive Charitable Awards by providing formal notice of such nominations to the
Committee. Following the receipt of the nominations of organizations, the
Committee will approve the nomination or recommend to the Board that the
nomination be denied. In the event the Committee does not recommend to the
Board that the nomination be denied within six months of receipt of such
nomination, the nomination shall be deemed accepted by the Committee. Further,
if the Participant should die before the Committee, or the Board in the case of
denials, acts on the nominations, such nomination shall be deemed accepted
provided the nominee is a qualified Charitable Organization, as defined herein.
The Board of

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 4

 

 

Directors, by majority vote, shall have the authority to deny status as a
Qualified Donee to any organization nominated by a Participant. In the event
one or more organizations nominated by a Participant for status as a Qualified
Donee are denied such status by the Board of Directors, the Participant may
nominate additional organizations to receive a Charitable Award, subject to the
approval of the Committee (or the denial by the Board, as applicable). If a
Participant fails to designate a Qualified Donee, the Charitable Award to be
made on behalf of such Participant shall lapse.

     All nominations of organizations to receive Charitable Awards shall be made on a Charitable Award Nomination Form, which shall specify the following:
(i) the name of the nominated organization; (ii) the amount desired by the
Participant to be donated to the organization; (iii) the name under which the
donation is to be made; and (iv) any other terms and provisions deemed
necessary by the Board of Directors or the Committee. Each completed
Charitable Award Nomination Form shall be submitted to the Executive Vice
President, Human Resources and Administration.

5.3 CHANGES IN DESIGNATIONS OF DONEES

     Participants may, at any time, nominate an alternative Charitable Organization to receive a Charitable Award (subject to Committee approval, as
described in Section 5.2 herein). In addition, Participants may, at any time,
request a change in the amount of money to be donated to each such Qualified
Donee, or a change in the name under which the donation is to be made, subject
to approval (as described in Section 5.2 herein).

     Changes in the designation of Qualified Donees or in any other terms applicable to the Charitable Awards, shall be made on a Charitable Award
Nomination Form, which shall specify the new or additional organizations
nominated to receive a Charitable Award, the amount of money to be donated in
the name of the Participant to each Qualified Donee, and any other terms or
provisions deemed necessary by the Board of Directors or the Committee.

5.4 SECURITY FOR DONATIONS

     The Company’s obligations under this Plan may be unfunded and unsecured promises to donate money in the future. No Qualified Donee shall
have the right to a donation solely by virtue of the designation of such
Qualified Donee by a Participant. Following the death of a Participant, the
rights of each Qualified Donee designated by the Participant shall be those of
a general unsecured creditor of the Company.

5.5 CHANGE IN CONTROL

     Notwithstanding any other provision of this Plan, upon a Change in Control of the Company, the commitment of the Company to donate the Charitable
Awards to the Qualified Donees shall become an irrevocable obligation.
Following a Change in Control, the Board of Directors may not amend, modify, or
terminate the Charitable

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 5

 

 

Awards of the Participants in a way which would decrease the value of the
donations. In addition, following a Change in Control, the Participants shall
retain the right to change the designations of their Qualified Donees, pursuant
to Section 5.3 herein, without Board or Committee review.

5.6 PAYMENT OF CHARITABLE AWARDS

     As soon as practicable following the death of a Participant, the Company shall donate the Charitable Awards to the Qualified Donees, in the
amounts requested by the Participant and approved by the Board of Directors or
Committee. Such payment shall be made in one lump sum. No contribution will
be made under this Plan to an otherwise Qualified Donee if the payment thereof
will result in the receipt of property or other direct economic benefits to the
Company or its subsidiaries or to the Participants or to the family members of
any Participant.

SECTION 6 AMENDMENT, MODIFICATION, AND TERMINATION

     Except as set forth in Section 5.5, the Board may from time to time amend, suspend, or terminate the Plan, in whole or in part, and if the Plan is
suspended or terminated, the Board may reinstate any or all of its provisions.
The Committee may amend the Plan provided that it may not suspend or terminate
the Plan or substantially increase the administrative cost of the Plan or the
obligations of the Company. The Board of Directors amended and restated the
Plan effective as of August 1, 1998, in connection with the reorganization of
the Company into a holding company structure whereby El Paso Energy Corporation
became the publicly held company and El Paso Natural Gas Company became a
wholly owned subsidiary. This Plan was assumed by El Paso Energy Corporation
pursuant to an Assignment and Assumption Agreement effective as of August 1,
1998, by and between El Paso Energy Corporation and El Paso Natural Gas
Company.

SECTION 7 INDEMNIFICATION

     Each individual who is or shall have been a member of the Committee, or of the Board, shall be indemnified and held harmless by the Company against
and from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by him or her in connection with or resulting from any
claim, action, suit, or proceeding to which he or she may be a party or in
which he or she may be involved by reason of any action taken or failure to act
under this Plan and against and from any and all amounts paid by him or her in
settlement thereof, with the Company’s approval, or paid by him or her in
satisfaction of any judgment in any such action, suit, or proceeding against
him or her, provided he or she shall give the Company an opportunity, at its
own expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf.

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 6

 

 

     The foregoing right in indemnification shall not be exclusive of any other rights of indemnification to which such individuals may be entitled under
the Company’s Restated Certificate of Incorporation or By-laws, as a matter of
law, or otherwise, or any power that the Company may have to indemnify them or
hold them harmless.

SECTION 8 MISCELLANEOUS

8.1 SUCCESSORS

     All obligations of the Company under this Plan shall be binding on any successor to the Company, whether the existence of such successor is the result
of a direct or indirect purchase, merger, consolidation, or otherwise, of all
or substantially all of the business and/or assets of the Company.

8.2 NONTRANSFERABILITY

     The right to nominate organizations to receive Charitable Awards under this Plan shall be personal to Participants, and may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated.

8.3 GENDER AND NUMBER

     Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine; the plural shall include the
singular, and the singular shall include the plural.

8.4 SEVERABILITY

     In the event any provision of this Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of this Plan, and this Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.

8.5 GOVERNING LAW

     To the extent not preempted by Federal law, this Plan, and all agreements hereunder, shall be construed in accordance with and governed by the
laws of the State of Texas.

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 7

 

 

     IN WITNESS WHEREOF, the Company has caused the Plan to be amended and restated effective as of August 1, 1998.

	 	 	 	 	 	 	 
	 	 	 	 	EL PASO ENERGY CORPORATION
	 
	 	 	 	 	 	 
	

	 	 	 	By
	 	/s/ Joel Richards III
	

	 	 	 	 	 	 
	 	 	 	 	Title: Executive Vice President
	 
	 	 	 	 	 	 
	ATTEST:	 	 	 	 
	 
	 	 	 	 	 	 
	By

	 	/s/ David L. Siddall	 	 	 	 
	

	 	 	 	 	 	 
	Title: Corporate Secretary	 	 	 	 

	 	 	 
	 
	El Paso Energy Corporation

Director Charitable Award Plan

	 	Page 8

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