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 Exhibit 10.41  

 
 

  FOREST OIL CORPORATION    
    
    EXECUTIVE DEFERRED COMPENSATION PLAN    
    

As
Amended and Restated

Effective as of December 1, 2008 

 

  TABLE OF CONTENTS  

					
	ARTICLE

 
	 	 
	 	PAGE 
	 I.
	 	 DEFINITIONS AND CONSTRUCTION
	 	I-1
	 II.
	 	 PARTICIPATION
	 	

II-1
	 III.
	 	 ACCOUNT CREDITS AND ALLOCATIONS OF INCOME OR LOSS
	 	

III-1
	 IV.
	 	 DEEMED INVESTMENT OF FUNDS
	 	

IV-1
	 V.
	 	 IN-SERVICE DISTRIBUTIONS
	 	

V-1
	 VI.
	 	 TERMINATION BENEFITS
	 	

VI-1
	 VII.
	 	 ADMINISTRATION OF THE PLAN
	 	

VII-1
	 VIII.
	 	 ADMINISTRATION OF FUNDS
	 	

VIII-1
	 IX.
	 	 NATURE OF THE PLAN
	 	

IX-1
	 X.
	 	 MISCELLANEOUS
	 	

X-1

i

 

  FOREST OIL CORPORATION  

 EXECUTIVE DEFERRED COMPENSATION PLAN  

 W I T N E S S E T H :  

        WHEREAS, Forest Oil Corporation (the "Company") has heretofore adopted the  FOREST OIL CORPORATION EXECUTIVE
DEFERRED COMPENSATION PLAN (the "Plan") for the benefit of its eligible employees; and 

        WHEREAS, the Company desires to restate the Plan and to amend the Plan in several respects, intending thereby to provide an uninterrupted
and continuing program of benefits; 

        NOW THEREFORE, the Plan is hereby restated in its entirety as follows with no interruption in time, effective as of December 1,
2008, except as otherwise indicated herein: 

ii

 

  I.  

 Definitions and Construction  

        1.1    Definitions.    The capitalized words or terms used in the Plan
and which are not otherwise defined herein shall have the same meanings as such words or terms have in the Retirement Savings Plan of Forest Oil Corporation, as the same may be amended from time to
time. Where the following words and phrases appear in the Plan, they shall have the respective meanings set forth below, unless their context clearly indicates to the contrary. 

	(1)
	Account:    An individual account for each Member to which is credited, from and after the
Effective Date, his deferrals pursuant to Sections 3.1 and 3.3, the Employer Deferrals made on his behalf pursuant to Section 3.2, and which reflects such Account's allocation of
earnings and/or changes in value as provided in Section 3.4. As of the Effective Date, a Member's Account was credited with the balances, if any, as of the day immediately preceding such date
in his "Grandfathered Account" and "Deferral Account" maintained under the Plan as in effect immediately prior to the Effective Date. A Member shall have a 100% nonforfeitable interest in his Account
at all times.

	(2)
	Affiliate:    With respect to a person, any other person with whom the person would be considered
a single employer under section 414(b) of the Code (employees of controlled group of corporations), and any other person with whom the person would be considered a single employer under
section 414(c) of the Code (employees of partnerships, proprietorships, etc., under common control); provided, however, that (a) in applying section 1563(a)(1), (2), and
(3) of the Code for purposes of determining a controlled group of corporations under section 414(b) of the Code, the language "at least 50 percent" shall be used instead of "at
least 80 percent" each place it appears in section 1563(a)(1), (2), and (3) of the Code, and (b) in applying Treasury regulation section 1.414(c)-2 for
purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of section 414(c) of the Code, "at least 50 percent" shall be used
instead of "at least 80 percent" each place it appears in Treasury regulation section 1.414(c)-2.

	(3)
	Bonus Compensation:    The annual incentive bonuses, if any, paid in cash by the Employer to or
for the benefit of a Member for services rendered or labor performed, including the portion thereof that a Member could have received in cash in lieu of (i) deferrals pursuant to
Section 3.3 and (ii) elective contributions made on his behalf by the Employer pursuant to a qualified cash or deferred arrangement (as defined in section 401(k) of the Code) or
pursuant to a plan maintained under section 125 of the Code.

	(4)
	Change of Control:    The occurrence of any one or more of the following events: (i) the
Company shall not be the surviving entity in any merger, consolidation or other reorganization (or survives only as a subsidiary of an entity other than a previously wholly-owned subsidiary of the
Company); (ii) the Company sells, leases or exchanges all or substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary of the Company);
(iii) the Company is to be dissolved and liquidated; (iv) any person or entity, including a "group" as contemplated by section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, acquires or gains ownership or control (including, without limitation, power to vote) of more than 50% of the outstanding shares of the Company's voting stock (based upon voting power); or
(v) as a result of or in connection with a contested election of directors, the persons who were directors of the Company before such election shall cease to constitute a majority of the
Company's Board of Directors. Notwithstanding the foregoing, the term "Change of Control" shall not include any reorganization, merger or consolidation involving solely the Company and one or more
previously wholly-owned subsidiaries of the Company. 

I-1

 
	(5)
	Code:    The Internal Revenue Code of 1986, as amended.

	(6)
	Committee:    The Compensation Committee of the Board of Directors of the Company.

	(7)
	Company:    Forest Oil Corporation.

	(8)
	Compensation:    Amounts equal to a Member's "Compensation," as such term is defined under the
Retirement Savings Plan, including amounts a Member could have received in cash in lieu of deferrals pursuant to Sections 3.1 and 3.3, and without regard to the maximum dollar limitation of
section 401(a)(17) of the Code; provided, however, that for purposes of Section 3.1, Compensation shall not include Bonus Compensation.

	(9)
	Directors:    The Board of Directors of the Company.

	(10)
	Discretionary Contribution Percentage:    For each Plan Year and with respect to each Member, the
percentage obtained by dividing (i) the Employer Discretionary Contribution, if any, allocated to such Member's Employer Contribution Account under the Retirement Savings Plan for such Plan
Year by (ii) the amount of such Member's "Compensation" (as such term is defined in the Retirement Savings Plan) that was considered under the Retirement Savings Plan to determine such
allocation for such Plan Year.

	(11)
	Effective Date:    December 1, 2008, as to this restatement of the Plan, except as
otherwise indicated in specific provisions of the Plan. The original effective date of the Plan was July 1, 1994.

	(12)
	Employer:    The Company and any other adopting entity that adopts the Plan pursuant to the
provisions of Section 2.3.

	(13)
	Employer Deferrals:    Deferrals made by the Employer on a Member's behalf pursuant to
Section 3.2.

	(14)
	Entry Date:    The first day of each Plan Year.

	(15)
	Funds:    The investment funds designated from time to time for the deemed investment of Accounts
pursuant to Article IV.

	(16)
	Match Compensation:    Amounts equal to a Member's Compensation plus amounts of base salary that
a Member elects to defer pursuant to the Salary Deferral Plan.

	(17)
	Member:    Each individual who has been selected for participation in the Plan and who has become
a Member pursuant to Article II.

	(18)
	Plan:    The Forest Oil Corporation Executive Deferred Compensation Plan, as amended from time to
time.

	(19)
	Plan Year:    The twelve-consecutive month period commencing January 1 of each year.

	(20)
	Retirement Savings Plan:    The Retirement Savings Plan of Forest Oil Corporation, as amended
from time to time.

	(21)
	Salary Deferral Plan:    The Forest Oil Corporation Salary Deferral Deferred Compensation Plan.

	(22)
	Termination of Service:    A Member's separation from service with the Employer and its
Affiliates within the meaning of section 409A(a)(2)(A)(i) of the Code (and applicable administrative guidance thereunder).

	(23)
	Trust:    The trust, if any, established under the Trust Agreement.

	(24)
	Trust Agreement:    The agreement, if any, entered into between the Company and the Trustee
pursuant to Article IX. 

I-2

 
	(25)
	Trust Fund:    The funds and properties, if any, held pursuant to the provisions of the Trust
Agreement, together with all income, profits and increments thereto.

	(26)
	Trustee:    The trustee or trustees qualified and acting under the Trust Agreement at any time.

	(27)
	Valuation Date:    Each calendar day. 

        1.2    Number and Gender.    Wherever appropriate herein, words used
in the singular shall be considered to include the plural and words used in the plural shall be considered to include the singular. The masculine gender, where appearing in the Plan, shall be deemed
to include the feminine gender. 

        1.3    Headings.    The headings of Articles and Sections herein are
included solely for convenience, and if there is any conflict between such headings and the text of the Plan, the text shall control. 

I-3

 

  II.  

 Participation  

        2.1    Participation.    Prior to each Entry Date, the Committee, in
its sole discretion, shall select and notify those management or highly compensated employees of the Employer who shall be eligible to become Members as of such Entry Date. Any such eligible employee
may become a Member on such Entry Date by executing and filing with the Committee, prior to such Entry Date, the form prescribed by the Committee. Such form shall include, among other things
prescribed by the Committee, the consent of such Member to be subject to all of the terms and provisions of the Plan including, without limitation, the Compensation deferral provisions set forth in
Section 3.1. Subject to the provisions of Section 2.2, a Member shall remain eligible to defer Compensation and Bonus Compensation hereunder and receive an allocation of Employer
Deferrals for each Plan Year following his initial year of participation in the Plan. By participating in the Plan for a Plan Year, a Member agrees that he shall not make any changes during such Plan
Year to his deferral election with respect to Before-Tax Contributions for such Plan Year under the Retirement Savings Plan. 

        2.2    Cessation of Active Participation.    Notwithstanding any
provision herein to the contrary, an individual who has become a Member of the Plan shall cease to be entitled to defer Compensation and Bonus Compensation hereunder or receive an allocation of
Employer Deferrals effective as of the Entry Date of any subsequent Plan Year designated by the Committee. Any such Committee action shall be communicated to the affected individual prior to such
Entry Date. Further, an individual who has become a Member of the Plan may cancel his Compensation and/or Bonus Compensation deferrals hereunder and his right to receive an allocation of Employer
Deferrals, effective as of the Entry Date of any subsequent Plan Year, by executing and delivering to the Employer the form prescribed by the Committee prior to such Entry Date and within the time
period prescribed by the Committee. An
individual described in the preceding provisions of this Section may again become entitled to defer Compensation and Bonus Compensation hereunder and receive an allocation of Employer Deferrals
beginning on any subsequent Entry Date selected by the Committee in its sole discretion. 

        2.3    Adopting Entities.    It is contemplated that other entities
may adopt the Plan and thereby become an Employer. Any such entity, whether or not presently existing, may become a party hereto by appropriate action of its officers without the need for approval of
its board of directors or of the Committee or the Directors; provided, however, that such entity must be an Affiliate of the Company. The provisions of the Plan shall apply separately and equally to
each Employer and its employees in the same manner as is expressly provided for the Company and its employees, except that (a) the power to appoint or otherwise affect the Trustee and the power
to amend or terminate the Plan or amend the Trust Agreement shall be exercised by the Committee alone and (b) the determination of whether a Change of Control has occurred shall be made based
solely on the Company. Any Employer may, by appropriate action of its officers without the need for approval of its board of directors (or noncorporate counterpart) or the Committee or the Directors,
terminate its participation in the Plan effective immediately prior to the start of any subsequent Plan Year. Moreover, the Committee may, in its discretion, terminate an Employer's Plan participation
effective immediately prior to the start of any subsequent Plan Year; provided, however, that if an Employer ceases to be an Affiliate of the Company, such Employer's Plan participation may be
terminated by the Committee effective immediately upon such cessation. 

II-1

 

  III.  

 Account Credits and Allocations of Income or Loss  

        3.1    Member Deferrals (other than with respect to Bonus
Compensation).    

        (a)   For
each payroll period in which a Member's Before-Tax Contributions under the Retirement Savings Plan are limited as a result of the limitations contained
in section 401(a)(17) and/or 402(g) of the Code, the Employer shall withhold from such Member's Compensation for such payroll period and the Member shall defer hereunder the amount by which
such Member's Before-Tax Contributions to the Retirement Savings Plan are reduced solely because of the application of such limitations; provided, however, that (i) any amount
withheld and deferred pursuant to this sentence shall be determined based upon the assumption that the Member's election with respect to the percentage rate of his Before-Tax Contributions
under the Retirement Savings Plan in effect during such payroll period is equal to the percentage rate of his Before-Tax Contributions in effect on the first day of the Plan Year in which
such payroll period occurs and (ii) the limitation contained in section 402(g) of the Code for a Plan Year shall be determined by including in such limitation the "catch-up
contributions", if any, a Member is eligible to defer under the Retirement Savings Plan for such Plan Year pursuant to section 414(v) of the Code. For purposes of determining the amount of a
Member's Compensation to be withheld and deferred under the preceding sentence (for each payroll period in which a Member's Before-Tax Contributions under the Retirement Savings Plan are
limited as described in the preceding sentence), the amount of the Member's Compensation shall be deemed to be the Member's Match Compensation. Notwithstanding the foregoing, the maximum amount that
may be withheld and deferred for any payroll period shall be the amount of 80% of the Member's Compensation for such period. 

        (b)   For
each Plan Year in which a Member's Before-Tax Contributions under the Retirement Savings Plan are limited as a result of the limitations contained in
section 401(k)(3) and/or 415 of the Code, the Company shall withhold from such Member's Compensation and the Member shall defer hereunder an amount equal to the reduction in such Member's
Before-Tax Contributions to the Retirement Savings Plan as a result solely of the application of such limitations. 

        (c)   A
Member's Compensation deferrals shall become effective as of the Entry Date which is coincident with or next following the date the Member executes and files with the
Committee the form described in Section 2.1. A Member's Compensation deferrals shall remain in force and effect unless and until such deferrals are to cease in accordance with the provisions of
Section 2.2. Compensation for a Plan Year not deferred by a Member pursuant to the above paragraphs shall be received by such Member in cash. Compensation deferrals made by a Member shall be
credited to such Member's Account as of the date upon which the Compensation deferred would have been received by such Member in cash had no deferral been made pursuant to this Section 3.1. 

        3.2    Employer Deferrals.    

        (a)   As
of the last day of each payroll period, the Employer shall credit a Member's Account with an amount which equals a specified percentage (the "Match Percentage") of
the deferrals made by such Member pursuant to Section 3.1(a) (determined without regard to the final sentence thereof, which provides that the maximum amount that may be withheld and deferred
for any payroll period shall be the amount of 80% of the Member's Compensation for such period) and Section 3.1(b) during such payroll period that are not in excess of a specified percentage
(the "Compensation Percentage") of such Member's Match Compensation for such payroll period. For purposes of the preceding sentence, the Match Percentage and the Compensation Percentage for a
particular payroll period shall be determined based on the formula used for determining the amount of Employer Matching Contributions under the Retirement Savings Plan for such payroll 

III-1

 

period.
For example, if the Retirement Savings Plan provides that the Employer Matching Contributions for a payroll period shall equal 100% of the Before-Tax Contributions that were made
by a participant during such payroll period that were not in excess of 8% of such participant's compensation for such payroll period, then the Match Percentage for such payroll period shall equal
100%, and the Compensation Percentage for such payroll period shall equal 8%. 

        (b)   As
of the last day of each Plan Year, the Employer shall credit a Member's Account with an amount equal to the difference, if any, between (i) the Discretionary
Contribution Percentage applicable to such Member for such Plan Year multiplied by such Member's Compensation for such Plan Year, and (ii) the Employer Discretionary Contribution allocated to
such Member's Employer Contribution Account under the Retirement Savings Plan for such Plan Year. Further, as of the last day of each Plan Year in which the Employer Matching Contributions and/or
Employer Discretionary Contributions under the
Retirement Savings Plan on behalf of a Member are limited as a result of the limitations contained in section 401(m)(2) and/or 415 of the Code, the Employer shall credit such Member's Account
with an amount equal to the reduction in such Member's share of such contributions to the Retirement Savings Plan as a result solely of the application of such limitations. 

        (c)   As
of any date selected by the Committee, the Employer may credit a Member's Account with such amount, if any, as the Committee shall determine in its sole discretion.
Such credits may be made on behalf of some Members but not others, and such credits may vary in amount among individual Members. 

        3.3    Deferrals of Bonus Compensation.    

        (a)   In
accordance with the procedures established from time to time by the Committee, a Member may annually elect to defer a percentage of 10% or any whole multiple of 10%
(but in no event more than 100%) of his Bonus Compensation for the Plan Year. Bonus Compensation not so deferred by such election shall be received by such Member in cash. A Member's election to defer
an amount of his Bonus Compensation pursuant to this Section shall be made by executing a Bonus Compensation deferral election in accordance with Paragraph (b) below pursuant to which the
Member authorizes the Employer to reduce his Bonus Compensation in the elected amount and the Employer, in consideration thereof, agrees to credit an equal amount to the Member's Account. Bonus
Compensation deferrals (including net income or net loss allocated with respect thereto) made by a Member shall be credited to his Account as of a date determined in accordance with the procedures
established from time to time by the Committee; provided, however, that such deferrals shall be credited to the Account no later than 30 days after the date upon which the Bonus Compensation
deferred would have been received by such Member in cash if he had not elected to defer such amount pursuant to this Section 3.3. 

        (b)   A
Member's annual election to defer a percentage of his Bonus Compensation earned with respect to a Plan Year under Paragraph (a) of this Section must be made
prior to the start of such Plan Year and in accordance with the procedures established by the Committee, and shall become effective as of the first day of such Plan Year. Notwithstanding the
foregoing, in accordance with the transition relief provided under Internal Revenue Service Notice 2007-86 concerning deferral elections made with respect to short-term
deferrals, a Member's election to defer a percentage of his Bonus Compensation earned with respect to the Plan Year beginning on January 1, 2008, may be made at any time during the month of
December, 2008, and shall become effective as of December 31, 2008. A deferral election under this Section with respect to a Plan Year shall be irrevocable as of the last day of the year
immediately preceding such Plan Year; provided, however, that any such election with respect to the Plan Year beginning on January 1, 2008, shall be irrevocable as of December 31, 2008.
A Member's deferral election with respect to 

III-2

 

Bonus
Compensation for a Plan Year shall apply to such Bonus Compensation even if it is paid after the close of such Plan Year. 

        3.4    Earnings Credits; Valuation of Accounts.    All amounts
credited to a Member's Account shall be deemed invested as soon as administratively feasible among the Funds as provided in Article IV, and the balance of each Account shall reflect the result
of daily pricing of the assets in which such Account is deemed invested from time to time until the time of distribution. 

III-3

 

   IV.  

 Deemed Investment of Funds  

        Each Member shall designate, in accordance with the procedures established from time to time by the Committee, the manner in which the
amounts allocated to his Account shall be deemed to be invested from among the Funds made available from time to time for such purpose by the Committee. Such Member may designate one of such Funds for
the deemed investment of all the amounts allocated to his Account or he may split the deemed investment of the amounts allocated to his Account between such Funds in such increments as the Committee
may prescribe. If a Member fails to make a proper designation, then his Account shall be deemed to be invested in the Fund or Funds designated by the Committee from time to time in a uniform and
nondiscriminatory manner. 

        A
Member may change his deemed investment designation for future deferrals to be allocated to his Account. Any such change shall be made in accordance with the procedures established by
the Committee, and the frequency of such changes may be limited by the Committee. 

        A
Member may elect to convert his deemed investment designation with respect to the amounts already allocated to his Account. Any such conversion shall be made in accordance with the
procedures established by the Committee, and the frequency of such conversions may be limited by the Committee. 

IV-1

 

  V.  

 In-Service Distributions  

        5.1    Domestic Relations Order.    The Plan shall permit such
acceleration of the time or schedule of a payment to an individual other than a Member as may be necessary to fulfill a domestic relations order (as defined in section 414(p)(1)(B) of the
Code). 

        5.2    No Other In-Service Distributions.    Except as
provided in Section 5.1, in-service distributions shall not be permitted under the Plan. Members shall not be permitted to make withdrawals from the Plan prior to a Termination of
Service. Members shall not, at any time, be permitted to borrow from the Trust Fund. Following a Member's Termination of Service, the amounts credited to such Member's Account shall be payable to such
Member in accordance with the provisions of Article VI. 

V-1

 

  VI.  

 Termination Benefits  

        6.1    Amount of Benefit.    Subject to Section 6.2, upon a
Member's Termination of Service, the Member, or, in the event of the Member's death, the Member's designated beneficiary (as determined under Section 6.3), shall become entitled to receive a
benefit equal in value to the aggregate balance in the Member's Account. The value of a Member's Account shall be determined as of the date payments are to commence from such Account pursuant to
Section 6.2 (provided, however, that if an installment payment form was elected pursuant to Section 6.2, the amount of the installment payments shall be recalculated annually in
accordance with the method set forth in Section 6.2(b)). 

        6.2    Time and Form of Payment.    

        (a)   Subject
to the delayed payment restriction of Section 6.2(e), payment of a Member's benefit under Section 6.1 shall commence on one of the following dates
irrevocably elected by such Member in writing on the form prescribed by the Committee on or before the date he becomes a Member of the Plan: 

        (1)   the
first day of the second calendar month following the month in which the Member's Termination of Service occurs; or 

        (2)   January 15
of any one of the next 10 succeeding calendar years (as elected by the Member) following the calendar year in which the Member's Termination of Service
occurs; or 

        (3)   February 1
of the year following the calendar year in which the Member's Termination of Service occurs (provided, however, that the time of payment provided for
in this clause (3) may not be elected by any Member from and after the Effective Date). 

In
the event such Member fails to timely elect the date upon which payment of his benefit under Section 6.1 is to commence, such payment shall commence at the time provided in clause (1) of the
preceding sentence. 

        (b)   Payment
of a Member's benefit under Section 6.1 shall be made in one of the following forms of payment irrevocably elected by such Member in writing on the form
prescribed by the Committee on or before the date he becomes a Member of the Plan: 

        (1)   a
single lump sum payment; or 

        (2)   annual
installment payments for any whole number of years elected by such Member, with the first installment to be paid on the date payment of such Member's benefit is
scheduled to commence pursuant to Section 6.2(a) and the subsequent installments to be paid on the annual anniversaries of such date; provided, however, that the installment period elected by
such Member must be limited to a number of years that will permit all annual installments to be completed by no later than (i) the 10th anniversary of the date payment of
such Member's benefit is scheduled to commence pursuant to Section 6.2(a) if such Member elected that his benefit commence at the time provided in clause (1) of Section 6.2(a),
(ii) January 15 of the 10th calendar year following the calendar year in which such Member's Termination of Service occurs if such Member elected that his benefit
commence at a time provided in clause (2) of Section 6.2(a), or (iii) February 1 of the 10th calendar year following the calendar year in which such
Member's Termination of Service occurs if such Member elected that his benefit commence at a time provided in clause (3) of Section 6.2(a). The amount of each annual installment shall be
computed by dividing the Member's unpaid balance in his Account (determined initially as of the date payment of such Member's benefit is scheduled to commence pursuant to Section 6.2(a) and, in
subsequent years during the 

VI-1

 

elected
installment period, on the annual anniversary of such date) by the number of annual installments remaining. 

In
the event such Member fails to timely elect the form in which his benefit under Section 6.1 is to be paid, such benefit shall be paid in the form of a single lump sum payment. 

        (c)   Notwithstanding
the provisions of Sections 6.2(a) and 6.2(b) to the contrary, and in accordance with the transition relief provided under Internal Revenue Service
Notice 2007-86, during a period selected by the Company (which period shall begin no earlier than the Effective Date and shall end no later than December 31, 2008), each Member who
has not incurred a Termination of Service as of the Effective Date and whose benefit under Section 6.1 would not otherwise be paid prior to January 1, 2009, shall be afforded the
opportunity to elect a new time and/or form of payment with respect to all (but not less than all) of such Member's Section 6.1 benefit. During the period selected by the Company for making
such election, each Member described in the preceding sentence may irrevocably elect in writing on the form prescribed by the Company (i) a new time of payment from among any of the permissible
payment dates described in clauses (1) and (2) of Section 6.2(a) and/or (ii) a new form of payment from among any of the permissible payment forms described in
clauses (1) and (2) of Section 6.2(b). The Committee may, in its sole discretion, choose not to honor a Member's election under this Section 6.2(c) by providing written
notice of such decision to such Member on or before December 31, 2008. 

        (d)   Notwithstanding
the preceding provisions of this Section 6.2, on or after January 1, 2009, a Member may, on the form prescribed by the Committee, modify
his elections as to time of payment and/or form of benefit payment with respect to all (but not less than all) of his Section 6.1 benefit; provided, however, that (i) such new election
may not take effect until at least 12 months after the date on which the new election is made, (ii) the payment (or installment payments) with respect to which the new election is made
must be deferred for a period of not less than five years from the date such payment would otherwise have been paid (or five years from the date the first installment was scheduled to be paid in the
case of installment payments), (iii) any new election that relates to payment at a specified time (or pursuant to a fixed schedule) may not be made less than 12 months prior to the date
the payment is scheduled to be paid (or 12 months prior to the date the first amount was scheduled to be paid in the case of installment payments), (iv) the new time of payment under the
new election, if applicable, must be a date that could have been elected by the Member under Section 6.2(a) if such Member had initially elected such date under Section 6.2(a) or 6.2(c),
and (v) the new form of payment under the new election, if applicable, must be a form of payment that could have been elected by the Member under Section 6.2(b) or 6.2(c) after taking
into account any change in time of payment. For purposes of the Plan, the entitlement to installment payments shall be treated as the entitlement to a single payment for purposes of
section 409A of the Code and applicable administrative guidance thereunder. 

        (e)   With
respect to a Member who is identified as a specified employee within the meaning of section 409A(a)(2)(B)(i) of the Code (and applicable administrative
guidance thereunder), payment of the Member's Section 6.1 benefit shall not commence until the later of (i) the time elected by the Member in accordance with the preceding provisions of
this Section 6.2 or (ii) the earlier of (A) the date that is six months after the Member's Termination of Service or (B) the date of death of the Member. If the event any
payments are delayed pursuant to the preceding sentence beyond the time elected by the Member in accordance with the preceding provisions of this Section 6.2, such payments that the Member
would have otherwise been entitled to during the first six months following the Member's Termination of Service (or, if earlier, prior to his date of death) shall be accumulated and paid to the Member
on the date that is six months after the Member's Termination of Service or to the Member's designated beneficiary on the date of the Member's death, as applicable. By participating in the Plan, all
Members agree to be bound by the 

VI-2

 

Company's
determination of the Employer's specified employees in accordance with any of the methods permitted under the regulations issued under section 409A of the Code. 

        6.3    Designation of Beneficiaries.    

        (a)   Each
Member shall have the right to designate the beneficiary or beneficiaries to receive payment of his benefit in the event of his death. Each such designation shall
be made by executing the beneficiary designation form prescribed by the Committee and filing same with the Committee. Any such designation may be changed at any time by execution of a new designation
in accordance with this Section. 

        (b)   If
no such designation is on file with the Committee at the time of the death of the Member or such designation is not effective for any reason as determined by the
Committee, then the designated beneficiary or beneficiaries to receive such benefit shall be as follows: 

        (i)    If
a Member leaves a surviving spouse, his benefit shall be paid to such surviving spouse; 

        (ii)   If
a Member leaves no surviving spouse, his benefit shall be paid to such Member's executor or administrator, or to his heirs at law if there is no administration of
such Member's estate. 

        6.4    Accelerated Pay-Out of Certain Benefits.    The
Plan shall permit such acceleration of the time or schedule of a payment to an individual other than a Member as may be necessary to fulfill a domestic relations order (as defined in
section 414(p)(1)(B) of the Code). 

        6.5    Payment of Benefits.    To the extent the Trust Fund has
sufficient assets, the Trustee shall pay benefits to Members or their beneficiaries, except to the extent the Employer pays the benefits directly and provides adequate evidence of such payment to the
Trustee. To the extent the Trustee does not or cannot pay benefits out of the Trust Fund, the benefits shall be paid by the Employer. Any benefit payments made to a Member or for his benefit pursuant
to any provision of the Plan shall be debited to such Member's Account. All benefit payments pursuant to any provision of the Plan shall be made in cash to the fullest extent practicable. 

        6.6    Unclaimed Benefits.    In the case of a benefit payable on
behalf of a Member, if the Committee is unable to locate the Member or beneficiary to whom such benefit is payable, upon the Committee's determination thereof, such benefit shall be forfeited to the
Employer. Notwithstanding the foregoing, if subsequent to any such forfeiture the Member or beneficiary to whom such benefit is payable makes a valid claim for such benefit, such forfeited benefit
(without any adjustment for earnings or loss after the time of such forfeiture) shall be restored to the Plan by the Employer and paid in accordance with the Plan. 

VI-3

 

  VII.  

 Administration of the Plan  

        7.1    The Committee.    The general administration of the Plan shall
be vested in the Committee. 

        7.2    Self-Interest of Members.    No member of the
Committee shall have any right to vote or decide upon any matter relating solely to himself under the Plan or to vote in any case in which his individual right to claim any benefit under the Plan is
particularly involved. In any case in which a Committee member is so disqualified to act and the remaining members cannot agree, the Directors shall appoint a temporary substitute member to exercise
all the powers of the disqualified member concerning the matter in which he is disqualified. 

        7.3    Committee Powers and Duties.    The Committee shall supervise
the administration and enforcement of the Plan according to the terms and provisions hereof and shall have all powers necessary to accomplish these purposes, including, but not by way of limitation,
the right, power, and authority: 

        (a)   To
make rules, regulations, and bylaws for the administration of the Plan that are not inconsistent with the terms and provisions hereof, and to enforce the terms of the
Plan and the rules and regulations promulgated thereunder by the Committee; 

        (b)   To
construe in its discretion all terms, provisions, conditions, and limitations of the Plan; 

        (c)   To
correct any defect or to supply any omission or to reconcile any inconsistency that may appear in the Plan in such manner and to such extent as it shall deem in its
discretion expedient to effectuate the purposes of the Plan; 

        (d)   To
employ and compensate such accountants, attorneys, investment advisors, and other agents, employees, and independent contractors as the Committee may deem necessary
or advisable for the proper and efficient administration of the Plan; 

        (e)   To
determine in its discretion all questions relating to eligibility; 

        (f)    To
determine whether and when a Member has incurred a Termination of Service, and the reason for such termination; 

        (g)   To
make a determination in its discretion as to the right of any person to a benefit under the Plan and to prescribe procedures to be followed by distributees in
obtaining benefits hereunder; 

        (h)   To
receive and review reports from the Trustee as to the financial condition of the Trust Fund, including its receipts and disbursements; and 

        (i)    To
establish or designate Funds as investment options as provided in Article IV. 

        7.4    Claims Review.    

        (a)   Definitions.    For purposes of this Section, the following terms, when capitalized, will be defined as
follows: 

        (1)   Act:    The Employee Retirement Income Security Act of 1974, as amended. 

        (2)   Adverse Benefit Determination:    Any denial, reduction or termination of or failure to provide or make payment
(in whole or in part) for a Plan benefit, including any denial, reduction, termination or failure to provide or make payment that is based on a determination of a Claimant's eligibility to participate
in the Plan. Further, any invalidation of a claim for failure to comply with the claim submission procedure will be treated as an Adverse Benefit Determination. 

VII-1

 

        (3)   Benefits Administrator:    The Company's Benefits Supervisor, or such other person or office to whom the
Committee has delegated day-to-day Plan administration responsibilities and who, pursuant to such delegation, processes Plan benefit claims in the ordinary course. 

        (4)   Claimant:    A Member or beneficiary or an authorized representative of such Member or beneficiary who has
filed or desires to file a claim for a Plan benefit. 

        (b)   Filing of Benefit Claim.    To file a benefit claim under the Plan, a Claimant must obtain from the
Benefits Administrator the information and benefit election forms, if any, provided for in the Plan and otherwise follow the procedures established from time to time by the Committee or the Benefits
Administrator for claiming Plan benefits. If, after reviewing the information so provided, the Claimant needs additional information regarding his Plan benefits, he may obtain such information by
submitting a written request to the Benefits Administrator describing the additional information needed. A Claimant may only request a Plan benefit by fully completing and submitting to the Benefits
Administrator the benefit election forms, if any, provided for in the Plan and otherwise following the procedures established from time to time by the Committee or the Benefits Administrator for
claiming Plan benefits. 

        (c)   Processing of Benefit Claim.    Upon receipt of a fully completed benefit claim from a Claimant, the Benefits
Administrator shall determine if the Claimant's right to the requested benefit, payable at the time or times and in the form requested, is clear and, if so, shall process such benefit claim without
resort to the Committee. If the Benefits Administrator determines that the Claimant's right to the requested benefit, payable at the time or times and in the form requested, is not clear, it shall
refer the benefit claim to the Committee for review and determination, which referral shall include: 

        (1)   All
materials submitted to the Benefits Administrator by the Claimant in connection with the claim; 

        (2)   A
written description of why the Benefits Administrator was of the view that the Claimant's right to the benefit, payable at the time or times and in the form requested,
was not clear; 

        (3)   A
description of all Plan provisions pertaining to the benefit claim; 

        (4)   Where
appropriate, a summary as to whether such Plan provisions have in the past been consistently applied with respect to other similarly situated Claimants; and 

        (5)   Such
other information as may be helpful or relevant to the Committee in its consideration of the claim. 

If
the Claimant's claim is referred to the Committee, the Claimant may examine any relevant document relating to his claim and may submit written comments or other information to the Committee to
supplement his benefit claim. Within 90 days of receipt of a fully completed benefit claim form from a Claimant that has been referred to the Committee by the Benefits Administrator (or such
longer period as may be necessary due to unusual circumstances or to enable the Claimant to submit comments, but in any event not later than will permit the Committee sufficient time to fully and
fairly consider the claim and make a determination within the time frame provided in Section 7.4(d)), the Committee shall consider the referral regarding the claim of the Claimant and make a
decision as to whether it is to be approved, modified or denied. If the claim is approved, the Committee shall direct the Benefits Administrator to process the approved claim as soon as
administratively practicable. 

        (d)   Notification of Adverse Benefit Determination.    In any case of an Adverse Benefit Determination of a claim
for a Plan benefit, the Committee shall furnish written notice to the affected Claimant within a reasonable period of time but not later than 90 days after receipt of 

VII-2

 

such
claim for Plan benefits (or within 180 days if special circumstances necessitate an extension of the 90-day period and the Claimant is informed of such extension in writing
within the 90-day period and is provided with an extension notice consisting of an explanation of the special circumstances requiring the extension of time and the date by which the
benefit determination will be rendered). Any notice that denies a benefit claim of a Claimant in whole or in part shall, in a manner calculated to be understood by the Claimant: 

        (1)   State
the specific reason or reasons for the Adverse Benefit Determination; 

        (2)   Provide
specific reference to pertinent Plan provisions on which the Adverse Benefit Determination is based; 

        (3)   Describe
any additional material or information necessary for the Claimant to perfect the claim and explain why such material or information is necessary; and 

        (4)   Describe
the Plan's review procedures and the time limits applicable to such procedures, including a statement of the Claimant's right to bring a civil action under
section 502(a) of the Act following an Adverse Benefit Determination on review. 

        (e)   Review of Adverse Benefit Determination.    A Claimant has the right to have an Adverse Benefit Determination
reviewed in accordance with the following claims review procedure: 

        (1)   The
Claimant must submit a written request for such review to the Committee not later than 60 days following receipt by the Claimant of the Adverse Benefit
Determination notification; 

        (2)   The
Claimant shall have the opportunity to submit written comments, documents, records, and other information relating to the claim for benefits to the Committee; 

        (3)   The
Claimant shall have the right to have all comments, documents, records, and other information relating to the claim for benefits that have been submitted by the
Claimant considered on review without regard to whether such comments, documents, records or information were considered in the initial benefit determination; and 

        (4)   The
Claimant shall have reasonable access to, and copies of, all documents, records, and other information relevant to the claim for benefits free of charge upon
request, including (i) documents, records or other information relied upon for the benefit determination, (ii) documents, records or other information submitted, considered or generated
without regard to whether such documents, records or other information were relied upon in making the benefit determination, and (iii) documents, records or other information that demonstrates
compliance with the standard claims procedure. 

The
decision on review by the Committee will be binding and conclusive upon all persons, and the Claimant shall neither be required nor be permitted to pursue further appeals to the Committee. 

        (f)    Notification of Benefit Determination on Review.    Notice of the Committee's final benefit determination
regarding an Adverse Benefit Determination will be furnished in writing or electronically to the Claimant after a full and fair review. Notice of an Adverse Benefit Determination upon review will: 

        (1)   State
the specific reason or reasons for the Adverse Benefit Determination; 

        (2)   Provide
specific reference to pertinent Plan provisions on which the Adverse Benefit Determination is based; 

        (3)   State
that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information
relevant to the Claimant's claim for benefits including (i) documents, records or other information relied 

VII-3

 

upon
for the benefit determination, (ii) documents, records or other information submitted, considered or generated without regard to whether such documents, records or other information were
relied upon in making the benefit determination, and (iii) documents, records or other information that demonstrates compliance with the standard claims procedure; and 

        (4)   Describe
the Claimant's right to bring an action under section 502(a) of the Act. 

The
Committee shall notify a Claimant of its determination on review with respect to the Adverse Benefit Determination of the Claimant within a reasonable period of time but not later than
60 days after the receipt of the Claimant's request for review unless the Committee determines that special circumstances require an extension of time for processing the review of the Adverse
Benefit Determination. If the Committee determines that such extension of time is required, written notice of the extension (which shall indicate the special circumstances requiring the extension and
the date by which the Committee expects to render the determination on review) shall be furnished to the Claimant prior to the termination of the initial 60-day review period. In no event
shall such extension exceed a period of 60 days from the end of the initial 60-day review period. In the event such extension is due to the Claimant's failure to submit necessary
information, the period for making the determination on a review will be tolled from the date on which the notification of the extension is sent to the Claimant until the date on which the Claimant
responds to the request for additional information. 

        (g)   Exhaustion of Administrative Remedies.    Completion of the claims procedures described in this Section will be
a condition precedent to the commencement of any legal or equitable action in connection with a claim for benefits under the Plan by a Claimant or by any other person or entity claiming rights
individually or through a Claimant; provided, however, that the Committee may, in its sole discretion, waive compliance with such claims procedures as a condition precedent to any such action. 

        (h)   Payment of Benefits.    If the Benefits Administrator or Committee determines that a Claimant is entitled to a
benefit hereunder, payment of such benefit will be made to such Claimant (or commence, as applicable) as soon as administratively practicable after the date the Benefits Administrator or Committee
determines that such Claimant is entitled to such benefit or on such other date as may be established pursuant to the Plan provisions. 

        (i)    Authorized Representatives.    An authorized representative may act on behalf of a Claimant in pursuing a
benefit claim or an appeal of an Adverse Benefit Determination. An individual or entity will only be determined to be a Claimant's authorized representative for such purposes if the Claimant has
provided the Committee with a written statement identifying such individual or entity as his authorized representative and describing the scope of the authority of such authorized representative. In
the event a Claimant identifies an individual or entity as his authorized representative in writing to the Committee but fails to describe the scope of the authority of such authorized representative,
the Committee shall assume that such authorized representative has full powers to act with respect to all matters pertaining to the Claimant's benefit claim under the Plan or appeal of an Adverse
Benefit Determination with respect to such benefit claim. 

        7.5    Employer to Supply Information.    The Employer shall supply
full and timely information to the Committee, including, but not limited to, information relating to each Member's Compensation, Bonus Compensation, age, retirement, death, or other cause of
Termination of Service and such other pertinent facts as the Committee may require. The Employer shall advise the Trustee of such of the foregoing facts as are deemed necessary for the Trustee to
carry out the Trustee's duties under the Plan and the Trust Agreement. When making a determination in connection with the Plan, the Committee shall be entitled to rely upon the aforesaid information
furnished by the Employer. 

VII-4

 

        7.6    Indemnity.    To the extent permitted by applicable law, the
Company shall indemnify and save harmless the Directors and each member of the Committee against any and all expenses, liabilities and claims (including legal fees incurred to defend against such
liabilities and claims) arising out of their discharge in good faith of responsibilities under or incident to the Plan. Expenses and liabilities arising out of willful misconduct shall not be covered
under this indemnity. This indemnity shall not preclude such further indemnities as may be available under insurance purchased by the Company or provided by the Company under any bylaw, agreement,
vote of stockholders or disinterested directors or otherwise, as such indemnities are permitted under applicable law. 

VII-5

 

  VIII.  

 Administration of Funds  

        8.1    Payment of Expenses.    All expenses incident to the
administration of the Plan and Trust, including but not limited to, legal, accounting, Trustee fees, and expenses of the Committee, may be paid by the Employer and, if not paid by the Employer, shall
be paid by the Trustee from the Trust Fund, if any. 

        8.2    Trust Fund Property.    All income, profits, recoveries,
contributions, forfeitures and any and all moneys, securities and properties of any kind at any time received or held by the Trustee, if any, shall be held for investment purposes as a commingled
Trust Fund pursuant to the terms of the Trust Agreement. The Committee shall maintain an Account in the name of each Member, but the maintenance of an Account designated as the Account of a Member
shall not mean that such Member shall have a greater or lesser interest than that due him by operation of the Plan and shall not be considered as segregating any funds or property from any other funds
or property contained in the commingled fund. No Member shall have any title to any specific asset in the Trust Fund, if any. 

VIII-1

 

   IX.  

 Nature of the Plan  

        The Employer intends and desires by the adoption of the Plan to recognize the value to the Employer of the past and present services of
employees covered by the Plan and to encourage and assure their continued service with the Employer by making more adequate provision for their future retirement security. The establishment of the
Plan is, in part, made necessary by certain benefit limitations which are imposed on the Retirement Savings Plan by the Code. The Plan is intended to constitute an unfunded, unsecured plan of deferred
compensation for a select group of management or highly compensated employees of the Employer. Plan benefits herein provided are a contractual obligation of the Employer and shall be paid out of the
Employer's general assets. Nevertheless, subject to the terms hereof and of the Trust Agreement, the Employer may transfer money or other property to the Trustee to provide Plan benefits hereunder,
and the Trustee shall pay Plan benefits to Members and their beneficiaries out of the Trust Fund. 

        The
Committee, in its sole discretion, may establish the Trust and direct the Employer to enter into the Trust Agreement. Notwithstanding the foregoing, immediately prior to the
occurrence of a Change of Control, the Employer shall enter into the Trust Agreement and shall fund the Trust with money or other property having an aggregate value equal to not less than the
aggregate balance in the Accounts maintained under the Plan on behalf of all Members and beneficiaries (determined as of the day immediately preceding the date of such funding of the Trust); provided,
however, that the Employer shall not be required to take the actions described in this sentence if such actions would result in adverse tax consequences to one or more of the Members pursuant to
Section 409A(b) of the Code. If the Employer enters into the Trust Agreement, then the Employer shall remain the owner of all assets in the Trust Fund and the assets shall be subject to the
claims of the Employer's creditors if the Employer ever becomes insolvent. For purposes hereof, the Employer shall be considered "insolvent" if (a) the Employer is unable to pay its debts as
such debts become due or (b) the Employer is subject to a pending proceeding as a debtor under the United Sates Bankruptcy Code (or any successor federal
statute). The chief executive officer of the Employer and its board of directors shall have the duty to inform the Trustee in writing if the Employer becomes insolvent. Such notice given under the
preceding sentence by any party shall satisfy all of the parties' duty to give notice. When so informed, the Trustee shall suspend payments to the Members and hold the assets for the benefit of the
Employer's general creditors. If the Trustee receives a written allegation that the Employer is insolvent, the Trustee shall suspend payments to the Members and hold the Trust Fund for the benefit of
the Employer's general creditors, and shall determine in the manner specified in the Trust Agreement whether the Employer is insolvent. If the Trustee determines that the Employer is not insolvent,
the Trustee shall resume payments to the Members. No Member or beneficiary shall have any preferred claim to, or any beneficial ownership interest in, any assets of the Trust Fund, and, upon
commencement of participation in the Plan, each Member shall have agreed to waive his priority credit position, if any, under applicable state law with respect to the assets of the Trust Fund. 

IX-1

 

  X.  

 Miscellaneous  

        10.1    Not Contract of Employment.    The adoption and maintenance of
the Plan shall not be deemed to be a contract between the Employer and any person or to be consideration for the employment of any person. Nothing herein contained shall be deemed to (a) give
any person the right to be retained in the employ of the Employer, (b) restrict the right of the Employer to discharge any person at any time, (c) give the Employer the right to require
any person to remain in the employ of the Employer, or (d) restrict any person's right to terminate his employment at any time. 

        10.2    Alienation of Interest Forbidden.    The interest of a Member
or his beneficiary or beneficiaries hereunder may not be sold, transferred, assigned, or encumbered in any manner, either voluntarily or involuntarily, and any attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber, or charge the same shall be null and void; neither shall the benefits hereunder be liable for or subject to the debts, contracts, liabilities, engagements or torts
of any person to whom such benefits or funds are payable, nor shall they be an asset in bankruptcy or subject to garnishment, attachment or other legal or equitable proceedings. Notwithstanding the
foregoing, the Plan shall comply with the terms of a domestic relations order as provided in Sections 5.1 and 6.4. 

        10.3    Withholding.    All Compensation and Bonus Compensation
deferrals and Employer Deferrals and payments provided for hereunder shall be subject to applicable withholding and other deductions as shall be required of the Employer under any applicable local,
state or federal law. 

        10.4    Amendment and Termination(a) .    The Committee may from time
to time, in its discretion, amend, in whole or in part, any or all of the provisions of the Plan; provided, however, that no amendment may be made that would impair the rights of a Member with respect
to amounts already allocated to his Account. The Committee may terminate the Plan, in whole or in part, at any time. In the event that the Plan is terminated, the balance in an affected Member's
Account shall be paid to such Member or his designated beneficiary at the time specified by the Committee in a single lump sum, cash payment in full satisfaction of all of such Member's or
beneficiary's benefits hereunder. Notwithstanding the preceding provisions of this Section, (a) to the extent required by section 409A of the Code, the Plan may not be amended or
terminated in a manner that would give rise to an impermissible acceleration of the time or form of a payment of a benefit under the Plan pursuant to section 409A(a)(3) of the Code and any
regulations or guidance issued thereunder and (b) if the Committee determines that the terms of the Plan do not, in whole or in part, satisfy the requirements of section 409A of the
Code, then the Committee may, in its sole discretion, amend the Plan (without obtaining the consent of any Member) in such manner as the Committee deems appropriate to comply with section 409A
of the Code and any regulations or guidance issued thereunder. 

        10.5    Severability.    If any provision of the Plan shall be held
illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining provisions hereof; instead, each provision shall be fully severable and the Plan shall be construed and
enforced as if said illegal or invalid provision had never been included herein. 

        10.6    Guaranty.    Notwithstanding any provisions of the Plan to the
contrary, in the event any Affiliate of the Company that adopts the Plan pursuant to Section 2.3 hereof fails to make payment of the benefits due under the Plan on behalf of its Members,
whether directly or through the Trust, the Company shall, during the period that such entity is an Affiliate of the Company, be liable for and shall make payment of such benefits due as a guarantor of
such entity's obligations hereunder. The guaranty obligations provided herein shall (a) be satisfied directly and not through the Trust and (b) terminate with respect to a particular
entity as of the date such entity ceases to be an Affiliate of the Company. 

        10.7    Governing Laws.    All provisions of
the Plan shall be construed in accordance with the laws of Colorado except to the extent preempted by federal law.

X-1

 

 
        EXECUTED this 31st day of December, 2008. 

					
	

 	
 	
 FOREST OIL CORPORATION
	
 	
 	
By:	
 	
/s/ H. CRAIG CLARK

  Name: H. Craig Clark

Title: President and CEO

iii

QuickLinks

FOREST OIL CORPORATION EXECUTIVE DEFERRED COMPENSATION PLANExhibit 10.39

 

Execution Copy

 

The material marked by asterisks within brackets ([**]) on pages 1
and 5 of this document has been omitted pursuant to a request for confidential
treatment from the Commission in accordance with 17 C.F.R. § 240.24b-2.

 

CONFIDENTIAL

 

December 17,
2008

 

VIA HAND DELIVERY

 

Anthony J. Huck

[**]

 

Dear Tony:

 

This letter will confirm the agreement (the “Agreement”) that has been
reached by and between you and Investment Technology Group, Inc. (“ITG” or
the “Company”) in connection with your separation from service with ITG.

 

1.             Separation
from Service.

 

(a)           Effective the close of business December 15,
2008 (the “Separation Date”), upon mutual agreement between you and the
Company, you voluntarily resigned from all positions with the Company and its
subsidiaries, including your positions as Managing Director and a member of the
applicable boards of directors of the Company’s subsidiaries on which you
served and any committee(s) thereof. 
You agree promptly to execute any documents necessary to effectuate such
resignations.

 

(b)           On the Separation Date, you received
a final paycheck which included a payment for all unpaid compensation you have
earned through the Separation Date, less any applicable deductions and
withholdings.  If you are a participant
in the Investment Technology Group, Inc. 401(k) Plan, you will cease
to participate in that plan as of the Separation Date.  A contribution to the 401(k) plan (based
on the historical amount you have elected to contribute to such plan) will be
deducted from your final paycheck.  Specific information concerning
the distribution of your 401(k) Plan account will be forwarded to you
separately.  Except as set forth herein,
you are not entitled to any additional compensation, bonuses, payments, benefits,
damages, attorneys’ fees or costs of any kind from ITG and the Releasees (as defined in Paragraph 3
below).

 

2.             Separation
Payments and Benefits. 
Subject to your execution and non-revocation of this Agreement and in
consideration for your agreement to be bound by the

 

 

promises set forth in
Paragraph 4 of this Agreement, in addition to the amounts described in
Paragraph 1 above:

 

(a)           The Company will pay you, in nine (9) monthly
installments, the aggregate amount of Two Million One Hundred Eight Thousand
Dollars ($2,108,000).  The first of the
nine (9) installments will be made within thirty (30) business days of the
Separation Date (subject in all respects to your execution and non-revocation
of this Agreement as described above), with subsequent payments on each monthly
anniversary of the first payment date.

 

(b)           The Company will pay to you within
thirty (30) business days of the Separation Date (subject in all respects to
your execution and non-revocation of this Agreement as described above), in one
lump sum, Seven Hundred Sixty-Five Thousand Dollars ($765,000) in satisfaction
of any remaining bonus payments that you may claim are owed to you in respect
of 2008.  This 2008 bonus payment is in
addition to the amount payable pursuant to Paragraph 1(b) above; provided
that there are no amounts due under Paragraph 1(b) above with respect to
your 2008 bonus.

 

(c)           If you timely elect to continue group health coverage under COBRA, the
Company will provide you with continued coverage under the Company’s health
insurance program for the twelve (12) month period following the Separation
Date at the Company’s sole cost and expense (subject in all respects to your
execution and non-revocation of this Agreement as described above); provided,
however, that this continued coverage will cease when you commence
full-time employment at another firm.  The COBRA health care continuation coverage
period under section 4980B of the Internal Revenue Code of 1986, as amended
(the “Code”)
will run concurrently with the foregoing period of continued coverage.

 

(d)           All outstanding stock options you
hold as of the Separation Date that are not already vested and exercisable as
of the Separation Date will automatically terminate as of the Separation
Date.  Outstanding stock options that you
hold that are already vested as of the Separation Date are hereby amended to
remain exercisable until the end of the applicable option term (August 1,
2010) pursuant to the terms of the applicable stock option grant agreement
evidencing such outstanding vested stock options.  All outstanding restricted stock units that
have not yet become vested as of the Separation Date shall be forfeited.  In addition, all stock unit awards granted to
you under the Company’s Amended and Restated Stock Unit Award Program Subplan
(the “SUA Program”) that are not already vested as of the Separation Date will
be forfeited.  Shares subject to stock
unit awards granted to you under the SUA Program that are already vested as of the
Separation Date will be issued to you in accordance with the terms of the SUA
Program.  The foregoing treatment of your
equity incentive awards is subject in all respects to your execution and
non-revocation of this Agreement as described above.

 

2

 

3.             General
Release of All Claims.

 

(a)           Except as provided
in (f) below, you, on behalf of yourself, your spouse, children, estate,
successors and assigns, release and give up any and all claims you may have
against ITG and the Releasees (as defined below), jointly and individually, of
whatever kind whatsoever to the maximum extent provided by law, including but
not limited to, claims arising out of your employment or the termination of
your employment with the Company.  This
includes all claims based on anything that has occurred from the beginning of
time to the date of your signing of this Agreement, regardless of whether you
know of the claim or of your right to make a claim.  This release includes, but is not limited to,
any claims under: the Age Discrimination in Employment Act, 29 U.S.C. Section 621,
et seq., the Older Workers’ Benefits Protection Act, the Rehabilitation Act of
1973, the Worker Adjustment and Retraining Notification Act, 42 U.S.C. Section 1981,
Title VII of the Civil Rights Act of 1964, the Sarbanes-Oxley Act of 2002, the
Family and Medical Leave Act, the Equal Pay Act, the Employee Retirement Income
Security Act of 1974 (“ERISA”) (including, but not limited to, claims for
breach of fiduciary duty under ERISA), the Americans With Disabilities Act, the
New York Executive Law, the New York Labor Law, and all amendments to those
laws; any claims under any other federal, state, or local employment
discrimination law, and any claim under any other federal, state or local law
dealing with employment or benefits, or concerning any other matter whatsoever;
any claim under any agreement, whether express or implied; and any public
policy, contract, tort or other common law claim.

 

(b)           The Company releases
and gives up any and all claims it may have against you or your executors,
administrators, successors or assigns of whatever kind whatsoever to the
maximum extent provided by law, including but not limited to, claims arising
out of your employment with the Company or the termination thereof.  This includes all claims based on anything
that has occurred from the beginning of time to the date the Company signs this
Agreement, regardless of whether the Company knows of the claim or of its right
to make a claim; provided that the claims released by the Company will not
include any claims arising from your willful misconduct, misrepresentation or
fraud or any act or omission by you constituting criminal conduct or a
violation of the rules and/or regulations of any regulatory agency or
self-regulatory organization.  This
release includes, but is not limited to, any claim under any agreement, whether
express or implied and any public policy, contract, tort or other common law
claim.

 

(c)           You agree that your
employment and contractual relationship, if any, with ITG and the Releasees is
severed as of the Separation Date and that none of ITG and the Releasees have
any obligation to reemploy you.

 

3

 

(d)           You represent and
warrant that you have received and reviewed your final paycheck and you hereby
acknowledge and agree that you have received all amounts due from the Company
through the Separation Date including, but not limited to, the following: (i) all
compensation earned, (ii) payment for all accrued but unused paid vacation
time, and (iii) reimbursement for all reasonable and necessary business,
travel and entertainment expenses incurred on behalf of the Company.

 

(e)           For purposes of this
Agreement, the term “ITG and the Releasees” includes ITG and its past, present
and future direct and indirect parents, subsidiaries, affiliates, divisions,
predecessors, successors, and assigns, and their respective current and former
officers, directors, shareholders, representatives, agents and employees, in
their official and individual capacities, jointly and individually.

 

(f)            The only claims
that you are not waiving and releasing under this Agreement are claims you may
have for: (i) unemployment, state disability, worker’s compensation,
and/or paid family leave insurance benefits pursuant to the terms of applicable
state law; (ii) continuation of existing participation in ITG-sponsored
group health insurance program under the federal law known as “COBRA” and/or
under an applicable state law counterpart(s); (iii) any benefits
entitlements that are vested as of your Separation Date pursuant to the terms
of an ITG-sponsored benefit plan; (iv) any claim not waivable by law; (v) any
claim you may have to receive any amounts payable to you under this Agreement
or any other claim to enforce your rights under this Agreement; (vi) any
claim you may have to indemnification as an officer, director or employee of
the Company and its subsidiaries pursuant to the articles of incorporation or
by-laws (or other governing instruments) of the Company and its subsidiaries
and (vii) any claim or right that may arise after the date you execute
this Agreement.

 

4.             Continuing Obligations Following Your Separation
from Service.

 

(a)           You agree, upon
reasonable notice from the Company, to provide truthful and reasonable
cooperation, including but not limited to your appearance at interviews with
the Company’s counsel, (i) in connection with the defense of any and all
charges, complaints, claims, liabilities, obligations, promises, agreements,
demands and causes of action of any nature whatsoever, which are asserted by
any person or entity concerning or related to any matter that arises out of or
concerns events or occurrences during your employment with the Company, and (ii) concerning
requests for information about the business of the Company or your involvement
or participation therein.  The Company
will reimburse you for reasonable and necessary travel and other expenses which
you may incur at the specific request of the Company and as approved by the
Company in accordance with its policies and procedures established from time to
time.

 

4

 

(b)           By signing below,
you represent and warrant that you have returned and/or agree to immediately
return to the Company any and all original and duplicate copies of all files,
calendars, books, records, notes, manuals, computer disks, diskettes and any
other magnetic and other media materials and any and all Company property and
equipment, including, but not limited to, computers and modems you have in your
possession or under your control belonging to ITG or the Releasees and
containing confidential or proprietary information concerning ITG or the
Releasees or their customers or operations. 
You have also returned your Company keys, credit cards, etc., to the
Company.  By signing this Agreement, you
confirm that you have not retained in your possession or under your control any
of the documents or materials described in this section.

 

(c)           You agree
that for a period of three (3) months following the Separation Date, you
will be on garden leave and will not in any manner, directly or indirectly,
engage or participate in, any business, entity or endeavor other than civic or
charitable activities.  For
the period beginning on the first day of the fourth (4th) month following your
Separation Date through the nine (9) month anniversary of the Separation
Date, you will not in any manner, directly or indirectly, engage, participate
or be interested in any business, entity or endeavor with [**].  You will be deemed to be directly or
indirectly engaged or participating in, a business, entity or endeavor with
[**] if you are a principal, agent, stockholder (or other proprietary or
financial interest holder), director, officer, employee, salesperson, sales
representative, broker, partner, individual proprietor, lender, consultant or
otherwise.

 

(d)           You
agree that you will not, for a period of one (1) year following the
Separation Date, directly or indirectly: 
(i) solicit or canvas the trade or patronage of, or sell to (A) any
former or existing clients of ITG for which you directly or indirectly provided
services or for which you had significant responsibility as an employee of ITG
during the two (2) years prior to your Separation Date, or (B) any
person or entity that becomes a client of ITG during the one (1) year
period following your Separation Date and for which you participated in a
proposal to provide services during the two (2) years prior to your
Separation Date; or (ii) induce or attempt to influence any employee,
contractor or consultant of ITG to terminate his employment or relationship
with ITG or solicit for employment any persons who were employees, contractors
or consultants of ITG at any time during your employment with ITG.

 

(e)           You agree that you
will not, at any time hereafter, make, or cause to be made, any statement,
observation or opinion, in each case, of a public nature, that disparages,
impugns or in any way reflects adversely upon the business, good will or
reputation of the Company or any Releasees. 
The restriction in the preceding sentence will include, but not be
limited to, your agreement that you will not, without the prior consent of the
Company, initiate any contacts with, nor respond to any inquiries from, the
media concerning the Company, your employment with 

 

5

 

the Company and/or your separation from service with the Company.  The Company will not, at any time hereafter,
issue or authorize any public statement, observation or opinion that
disparages, impugns or in any way reflects adversely upon your reputation.  The provisions of this Paragraph 4(e) will
not impair either party’s right to provide truthful testimony or other
information as required by law or regulatory requirement.

 

(f)            You agree that you
have certain confidentiality and other obligations under the terms of that
certain Employee Agreement with respect to Confidential and Proprietary
Information and Non-Solicitation dated December 1, 1995 which are hereby
incorporated by reference and made part of this Agreement, and that such
obligations survive your termination of employment even if you do not sign or
if you revoke this Agreement.

 

(g)           You acknowledge and
agree that the restrictions and agreements contained in Paragraphs 4(a) through
4(f), in view of the nature of the business in which ITG and the Releasees are
engaged, are reasonable, necessary and in the Company’s best interests in order
to protect the legitimate interests of ITG and the Releasees, and that any
violation thereof shall be deemed to be a material breach of this agreement and
that the Company shall be entitled to pursue any and all remedies available to
it in a court of competent jurisdiction including, but not limited to
application for temporary, preliminary, and permanent injunctive relief as well
as damages, an equitable accounting of all earnings, profits and other benefits
arising from such violation.  In the
event the Company brings an action to redress a violation of Paragraphs 4(a) through
4(f), the prevailing party in any claims in such action shall be entitled to
recover all of its reasonable attorneys’ fees and costs incurred in connection
therewith.  If the Company prevails in
any claims in such action, you will be liable for the return of the separation
payments and benefits and for the return of any profits realized in connection
with your exercising or receiving payment with respect to any of the equity
incentive awards that were amended as set forth in Paragraph 2.

 

5.             No
Admissions.  The Company
and you agree that nothing contained in this Agreement is an admission by the
Company or you of any wrongdoing, liability, unlawful conduct or breach of any
duty or obligation.

 

6.             Confidentiality.  You agree that you have kept, and will keep,
the existence and terms of this Agreement confidential, and will not disclose
them to anyone except your attorneys, financial advisors and immediate family
members, whom you will advise of this confidentiality provision.  No other disclosure will be permitted
except:  (a) pursuant to an action
to enforce the terms of this Agreement, in which case it will be introduced
under seal to the court, (b) in response to a request by any governmental
or regulatory agency, (c) as may be required by any state or federal law
or regulation, or (d) in response to compulsory process of law.  The parties

 

6

 

further agree that
nothing in this Agreement will prohibit or restrict you from providing
information to, testifying or otherwise assisting in any investigation or
proceeding brought by, any federal, state or local regulatory agency, law
enforcement agency, legislative body, or self-regulatory organization.

 

7.             Governing
Law.  This Agreement will
be construed under the laws of the State of New York.

 

8.             Entire Agreement.  This
Agreement cancels, supersedes and replaces any and all prior agreements
(written, oral or implied-in-fact or in law) between you and the Company
regarding all of the subjects covered by this Agreement except as otherwise
specifically proivded in this Agreement. 
This Agreement is the full, complete and exclusive agreement between you
and the Company regarding the subjects covered by this Agreement, and neither
you nor the Company is relying on any representation or promise that is not
expressly stated in this Agreement.  This
Agreement may not be changed unless the changes are in writing and signed by
each of the parties.

 

9.             Severability.  With the exception of Paragraph 3, if any
provision of this Agreement or the application thereof is held invalid, the
invalidity will not affect other provisions or applications, and to this end
the provisions of this Agreement are declared to be severable.  In the event Paragraph 3 is held
unenforceable by any court having competent jursidiction over this Agreement in
connection with any action initiated or otherwise prosecuted by you, the
Company’s obligations under Paragraph 2 will be null and void, and you will be
liable for the return of the separation payments and benefits and for the
return of any profits realized in connection with your exercising or receiving
payment with respect to any of the equity incentive awards that were amended as
set forth in Paragraph 2.

 

10.           Review and Revocation
Period.  You understand
and acknowledge that, under the Older Workers Benefit Protection Act, you have
at least twenty-one (21) days to consider signing this Agreement.  Please note that you may not sign this Agreement prior to the
Separation Date.  This Agreement, should
you choose to accept it, must be signed during the period beginning on the
Separation Date and ending on December 23, 2008.  This deadline will be extended to the next business day should it fall
on a Saturday, Sunday or holiday recognized by the U.S. Postal Service.  You further understand and acknowledge
that you will have seven (7) days following the date of your execution of
this Agreement within which to revoke this Agreement (this deadline will be extended to the next business day should it fall
on a Saturday, Sunday or holiday recognized by the U.S. Postal Service.),
and that this Agreement will not become effective or enforceable until that
seven (7) day revocation period has expired.  In the event you seek to revoke this
Agreement, you must provide the Company with written

 

7

 

notice no later than the
close of business on the seventh (7th) day following your execution of this
Agreement.  Any notice of revocation will
be sent to P. Mats Goebels, Managing Director, General Counsel, Investment
Technology Group, Inc., 380 Madison Avenue, 4th Floor, New York, NY,
10017.  You are hereby advised to consult
with an attorney of your choice prior to executing this Agreement.

 

YOU
UNDERSTAND THAT THIS AGREEMENT RELEASES ANY AND ALL CLAIMS AND RIGHTS YOU MAY HAVE
AGAINST THE COMPANY AND ALL OF THE OTHER RELEASEES AS SET FORTH ABOVE, AND THAT
BY SIGNING THIS AGREEMENT, YOU ACKNOWLEDGE AND AFFIRM THAT:  (1) YOU ARE COMPETENT; (2) YOU WERE
AFFORDED A REASONABLE TIME PERIOD OF TWENTY-ONE (21) DAYS TO REVIEW AND
CONSIDER THIS AGREEMENT AND HAVE BEEN ADVISED TO DO SO WITH AN ATTORNEY OF YOUR
CHOICE; (3) YOU HAVE READ AND UNDERSTAND AND ACCEPT THIS AGREEMENT AS
FULLY AND FINALLY RESOLVING, WAIVING AND RELEASING ANY AND ALL CLAIMS AND
RIGHTS WHICH YOU MAY HAVE AGAINST THE COMPANY AND THE OTHER RELEASEES AS
SET FORTH ABOVE; (4) NO PROMISES OR INDUCEMENTS HAVE BEEN MADE TO YOU
EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT; AND (5) YOU HAVE
SIGNED THIS AGREEMENT FREELY, KNOWINGLY AND VOLUNTARILY, INTENDING TO BE
LEGALLY BOUND BY ITS TERMS.

 

11.           Application of Section 409A
of the Internal Revenue Code.

 

(a)           This Agreement will be interpreted to
avoid any penalty sanctions under section 409A of the Code.  If any payment or benefit cannot be provided
or made at the time specified herein without you incurring sanctions under
section 409A of the Code, then such benefit or payment will be provided in full
at the earliest time thereafter when such sanctions will not be imposed.  For purposes of section 409A of the Code, all
payments to be made upon your termination of employment under this Agreement
may only be made upon your “separation from service” within the meaning of such
term under section 409A of the Code, each payment made under this Agreement
will be treated as a separate payment and the right to a series of installment
payments under this Agreement will be treated as a right to a series of
separate payments.  In no event will you,
directly or indirectly, designate the calendar year of payment.

 

(b)           All reimbursements and in-kind
benefits provided under this Agreement will be made or provided in accordance
with the requirements of section 409A of the Code, including, where applicable,
the requirement that (i) any reimbursement will be for expenses incurred
during your lifetime (or during a shorter period of time specified in this
Agreement), (ii) the amount of expenses eligible for reimbursement, or in
kind benefits provided, during a calendar year may not affect the expenses
eligible for reimbursement, or in kind benefits to be provided, in any other
calendar year, (iii) the reimbursement of an eligible expense will be made
on or before the last day of the calendar year following the year in which the
expense is incurred, and 

 

8

 

(iv) the
right to reimbursement or in kind benefits is not subject to liquidation or exchange
for another benefit.

 

(c)           Notwithstanding any provision of this
Agreement to the contrary, if, at the time of your “separation from service”
with the Company, the Company has securities which are publicly traded on an
established securities market and you are a “specified employee” (within the
meaning of such term under section 409A of the Code) and it is necessary to
postpone the commencement of any compensation payments or benefits otherwise
payable pursuant to this Agreement as a result of your “separation from service”
to prevent any accelerated or additional tax under section 409A of the Code,
then the Company will postpone the commencement of the payment of any such
payments or benefits hereunder (without any reduction in such payments or benefits
ultimately paid or provided to you) that are not otherwise paid within the
short-term deferral and separation pay plan exceptions under section 409A of
the Code, until the first payroll date that occurs after the date that is six
months following your “separation of service” with the Company.  If any payments are postponed due to such
requirements, such postponed a mounts will be paid in a lump sum to you on the
first payroll date that occurs after the date that is six (6) months
following your “separation of service” with the Company.  If you die during the postponement period
prior to the payment of postponed amount, the amounts withheld on account of
section 409A of the Code will be paid to the personal representative of your estate
within sixty (60) days after the date of your death.

 

[SIGNATURE PAGE FOLLOWS]

 

9

 

Very
truly yours,

 

 

INVESTMENT
TECHNOLOGY GROUP, INC.

 

	
  By:

  	
  /s/ Robert C. Gasser

  	
   

  
	
   

  	
  Robert C. Gasser

  	
   

  

 

 

AGREED TO AND
ACCEPTED BY:

 

 

	
  /s/
  Anthony J. Huck

  	
   

  
	
  Anthony J. Huck

  	
   

  

 

 

Dated:  December 18, 2008

 

10

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