Document:

Exhibit 10.1

 

AMENDMENT NUMBER ONE

TO THE

ANNUAL INCENTIVE PLAN OF CHEVRON PHILLIPS
CHEMICAL COMPANY LLC

 

WHEREAS,
effective January 1, 2001, Chevron Phillips Chemical Company LLC (the “Company”)
established the Annual Incentive Plan of Chevron Phillips Chemical Company LLC
(the “Plan”); and

 

WHEREAS, pursuant to
Section 2 of the Plan, the Compensation Committee of the Board of
Directors of the Company reserves the right to amend the Plan from time to
time.

 

NOW THEREFORE BE IT RESOLVED:

 

1.             Effective January 1,
2005, Section 1, entitled “Target Awards”, of Schedule A of the Plan
is deleted in its entirety, and replaced with the following new Section 1:

 

1.  Target Awards

 

The following target award schedule shall
apply to Participants in the Plan for the Plan Year 2005 and for subsequent
Plan Years unless changed by the Board of Directors or Compensation Committee:

 

	
  Grade Level

  	
   

  	
  Target

  (% of Salary at 12/31 of Plan Year)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  99

  	
   

  	
  80%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  98

  	
   

  	
  60%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  97

  	
   

  	
  55%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  96

  	
   

  	
  50%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  95

  	
   

  	
  45%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  94

  	
   

  	
  40%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  93

  	
   

  	
  35%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  92

  	
   

  	
  30%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  91

  	
   

  	
  27.5%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  90

  	
   

  	
  22.5%

  	
   

  

 

[SIGNATURE ON NEXT PAGE]

 

1

 

IN WITNESS WHEREOF, the Company has caused
this First Amendment to be executed this       
day of April, 2005.

 

 

	
   

  	
  CHEVRON PHILLIPS CHEMICAL
  COMPANY LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: 

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title: 

  	
   

  	
   

  
						

 

2

 

ANNUAL INCENTIVE
PLAN

 

OF

 

CHEVRON PHILLIPS CHEMICAL COMPANY LLC

 

 

Revised by BOD October 24, 2002

 

 

ANNUAL INCENTIVE
PLAN

OF

CHEVRON PHILLIPS
CHEMICAL COMPANY LLC

 

Table of Contents

 

	
  1.

  	
  Interpretation and Definitions

  	
  1

  
	
   

  	
  1.1 General

  	
  1

  
	
   

  	
  1.2 Definitions

  	
  2

  
	
  2.

  	
  Administration

  	
  4

  
	
  3.

  	
  Eligibility and Participation

  	
  5

  
	
  4.

  	
  Awards and Payment of Awards

  	
  5

  
	
  5.

  	
  Recapitalization, Merger, and
  Consolidation; Change in Control

  	
  6

  
	
  6.

  	
  Miscellaneous

  	
  7

  
	
   

  	
   

  
	
  Schedule A – Administrative Procedures

  	
  9

  

 

ii

 

ANNUAL INCENTIVE
PLAN

OF

CHEVRON PHILLIPS
CHEMICAL COMPANY LLC

 

PURPOSE

 

The purpose of the Annual Incentive Plan (the “Plan”) is to attract,
motivate, and retain qualified management personnel by providing to them an
annual incentive compensation plan that will provide competitive compensation
opportunities similar to those of comparable companies in the chemical
industry, align the interests of key management personnel with the interests of
the Company’s shareholders, and assist the Company in achieving its goal of
being the top performer in each of its businesses.

 

The Plan is intended to be a compensation plan for a select group of
management or other highly-compensated employees, within the meaning of ERISA.

 

The Plan shall be effective as of January 1, 2001.

 

1.             Interpretation and
Definitions

 

1.1          General.

 

(a)           Interpretation. 
Unless a clear contrary intention appears, for purposes of construction
of this Plan and all related Plan Documents:

 

(i)            the
singular number includes the plural number and vice versa;

 

(ii)           reference
to any person includes such person’s successors and assigns but, if applicable,
only if such successors and assigns are permitted by the Plan Documents, and
reference to a person in a particular capacity excludes such person in any
other capacity or individually;

 

(iii)          reference
to any gender includes each other gender;

 

(iv)          reference
to any agreement, document or instrument means such agreement, document or
instrument as amended or modified and in effect from time to time in accordance
with the terms thereof;

 

(v)           reference
to any law means such law as amended, modified, codified, replaced or
reenacted, in whole or in part, and in effect from time to time, including rules and
regulations promulgated thereunder, and reference to any section or other
provision of any law means that provision of such law from time to time in
effect and constituting the substantive amendment, modification, codification,
replacement or reenactment of such section or other provision;

 

 

(vi)          reference
in any Plan Document to any article, section, appendix, schedule or
exhibit means such article or section thereof or appendix, schedule or
exhibit thereto;

 

(vii)         “hereunder”, “hereof”, and words of similar
import shall be deemed references to a Plan Document as a whole and not to any
particular article, section or other provision thereof;

 

(viii)        “including” (and with the correlative meaning “include”)
means including without limiting the generality of any description preceding
such term;

 

(ix)           “or”
is not exclusive;

 

(x)            relative
to the determination of any period of time, “from” means “from and including”
and “to” means “to but excluding;” and

 

(xi)           references
to days, weeks, months, quarters and years are references to such periods as
determined by the Gregorian calendar.

 

(b)           Accounting Terms.  In
each Plan Document, unless expressly otherwise provided, accounting terms shall
be construed and interpreted, and accounting determinations and computations
shall be made, in accordance with generally accepted accounting principles.

 

(c)           Conflict in Plan Documents. 
If there is any conflict between any two or more Plan Documents, such
Plan Documents shall be interpreted and construed, if possible, so as to avoid
or minimize such conflict but, to the extent (and only to the extent) of such
conflict, the Plan Document dealing most specifically with the matter as to
which there is a conflict shall prevail and control.

 

1.2          Definitions

 

(a)           “Affiliate”
means an entity which controls, is controlled by, or is under common control
with, the Company. For purposes hereof, an entity shall be deemed to control
another entity if the first entity directly or indirectly owns at least fifty
percent (50%) of the stock, partnership interests or membership interests of
the second entity, or if, by the ownership of stock, by contract or otherwise,
the first entity has the right to select the management or direct the policies
of the second entity.

 

(b)           “Award”
means an award of cash made pursuant to the Plan.

 

(c)           “Board”
means the Board of Directors of the Company.

 

(d)           “Bonus
Level Employee” means, (i) with respect to Employees on the U.S. Dollar
payroll of a Participating Employer, those Employees who are employed within

 

2

 

pay grades 90 through 99, and (ii) with respect to Employees who
are not on a U.S. Dollar payroll, those Employees who are employed within pay
grades which are deemed by the Compensation Committee to be equivalent to
grades 90 through 99.

 

(e)           “ChevronTexaco”
means ChevronTexaco Corporation or such entity as may be controlled by
ChevronTexaco that directly or indirectly holds a membership interest in the
Company.

 

(f)            “Change
in Control” of the Company shall mean an occurrence which the Board determines,
in its sole discretion, to be a change of control and generally may include
instances when: (i) any person or persons acting together as a single
entity, other than ChevronTexaco Corporation or ConocoPhillips, acquires more
than fifty percent (50%) of the Company’s assets or voting ownership interests;
(ii) during any period of two consecutive years, individuals who at the
beginning of the two-year period constitute the Board cease for any reason to
constitute a majority of the Board; (iii) a merger or consolidation of the
Company with any other corporation or entity is consummated; or (iv) the
owners of the Company approve a plan of complete liquidation or dissolution of
the Company or an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets.

 

(g)           “Committee”
or “Compensation Committee” means the Compensation Committee of the Board.

 

(h)           “Company”
means the Chevron Phillips Chemical Company LLC and any successor entity.

 

(i)            “Date
of Termination” means the date on which a Participant ceases to be a regular,
full-time Employee.

 

(j)            “Disability”
means disability as determined under the Long-Term Disability Plan of Chevron
Phillips Chemical Company LP.

 

(k)           “Employee”
means any full-time employee of a Participating Employer.

 

(l)            “ERISA”
means the Employee Retirement Income Security Act of 1974.

 

(m)          “Layoff”
means termination of employment by reason of layoff pursuant to the Chevron
Phillips Chemical Company LP Layoff Pay Plan or a similar layoff pay plan
adopted by a Participating Employer.

 

(n)           “Participant”
means an Employee to who has been designated as a participant pursuant to Section 3.

 

3

 

(o)           “Participating
Employer” means any direct or indirect subsidiary entity of the Company which,
with the Company’s consent, has adopted the Plan.

 

(p)           “ConocoPhillips”
means ConocoPhillips, or such entity as may be controlled by ConocoPhillips
that directly or indirectly holds a membership interest in the Company.

 

(q)           “Plan”
means the Chevron Phillips Chemical Company LLC Annual Incentive Plan.

 

(r)            “Plan
Year” means a period of twelve (12) months beginning on January 1 of any
year.

 

(s)           “Plan
Document” means this Plan, any Administrative Procedures that may from time to
time be adopted by the Committee, and any other document defining the rights
and liabilities of any Participant.

 

(t)            “Retirement”
means retirement pursuant to the Retirement Income Plan of Chevron Phillips
Chemical Company LP, or any retirement plan of any Participating Employer.

 

(u)           “Salary”
means the annualized base rate of a Participant as of December 31 of the
Plan Year with respect to which an Award is made or, in the case of the
termination of a Participant’s employment by reason of Disability, Retirement,
Layoff or death, the base rate of the Participant on the date of such
Participant’s Termination of Service.

 

(v)           “Termination
of Service” means the cessation of a Participant’s status as an Employee for
any reason.

 

2.             Administration

 

(a)           The
Plan shall be administered by the Committee.

 

(b)           The
Committee may establish, from time to time and at any time, subject to the
limitations of the Plan as set forth herein, such rules and regulations,
and amendments and supplements thereto, as it deems necessary to comply with
applicable law and for the proper administration of the Plan.

 

(c)           A
majority of the members of the Committee shall constitute a quorum.  The vote of a majority of a quorum shall
constitute action by the Committee provided that at least one member of the
Committee appointed by ChevronTexaco and one member appointed by ConocoPhillips
concurs therein.

 

(d)           No
member of the Board or the Committee shall be personally liable for any action
taken, or determination made, in respect of the Plan in good faith. Each

 

4

 

member of the Board and the Committee shall be fully justified in
relying upon or acting in good faith upon any opinion, report or information
furnished in connection with the Plan by any accountant, counsel, or other
specialist (including financial officers of the Company, whether or not such
persons are Participants in the Plan).

 

(e)           This
Plan may be adopted by such subsidiary entities of the Company as the Board or
Committee may approve, whereupon such entities shall become Participating
Employers. The Committee shall administer the Plan for the benefit of all
Participating Employers.

 

(f)            The
Committee may delegate to the officers or other employees of the Company or any
Participating Employer such authorities and responsibilities with respect to
the administration of the Plan as it may deem appropriate.

 

(g)           Determinations
by the Committee and its designees with respect to the construction operation
or interpretation of any Plan Document shall be final, binding and conclusive on
the Company, Participating Employers, Employees and Participants.

 

3.             Eligibility and
Participation

 

(a)           Except
as hereinafter provided, all Bonus Level Employees shall be Participants in the
Plan.

 

(b)           Notwithstanding
Section 3(a), the Committee may from time to time select additional
Employees or classes of Employees for participation in the Plan, and may direct
that specific Bonus Level Employees, or classes of Bonus Level Employees be
removed from participation. Any such determination may be made at any time
prior to the payment of awards with respect to any Plan Year, and may be made
with respect to participation during all or any part of any Plan Year.

 

4.             Awards and Payment of Awards

 

(a)           As
soon as practicable following the beginning of each Plan Year, the Committee
shall (i) make such determinations as it may deem appropriate with respect
to the selection of Participants for such Plan Year; (ii) establish target
awards for such Participants; and (iii) establish performance measures
under which determinations may be made as to whether awards will be paid for
such Plan Year and, if so, the amounts to be paid.

 

(b)           The
matters described in Section 4(a) applicable to any Plan Year shall
be set forth in an Administrative Procedures document.  The Administrative Procedures for the 2001
Plan Year are attached hereto. 
Administrative Procedures applicable to subsequent Plan Years, when
adopted by the Committee, shall be substituted for the Administrative
Procedures attached hereto.

 

5

 

(c)           Awards,
if determined to be payable pursuant to the Administrative Procedures, shall be
payable to Participants as soon as practicable following the date on which such
determination is made for any Plan Year. All such Awards shall be payable in
cash, unless another form of payment is specified by the Committee.
Notwithstanding the foregoing, Participants may elect to defer receipt of all
or part of any Award, and to have the same credited to an account under the
Company’s nonqualified deferred compensation plan, provided that such
Participant is otherwise eligible to participate in such plan. Any such
election must be made at such time, and in such manner, as may be specified by
the Committee.

 

(d)           In
the event of a Participant’s termination of employment by reason of Retirement,
Disability, Layoff or death, or by reason of such Participant’s transfer to the
payroll of an Affiliate which is not a Participating Employer, the award, if
any, payable to such Participant for the Plan Year in which such termination
occurs shall be equal to the product of (i) the Award that would have been
payable to such Participant if such termination had not occurred, and (ii) a
fraction, the numerator of which is the number of days in such Plan Year for
which the Participant participated in the Plan, and the denominator of which is
365. Notwithstanding the foregoing, the Committee may, in its sole discretion,
determine that a greater or lesser amount shall be paid. Any amount payable by
reason of a Participant’s death, shall be paid to such Participant’s estate or
to such other individuals or entities as the Committee shall direct.

 

(e)           In
the event of a Participant’s termination of employment, prior to the payment of
Awards for any Plan Year, for reasons other than Retirement, Disability, Layoff
or death, the Award, if any, which would have been payable for such Plan Year
shall be forfeited; provided, the Committee may in its sole discretion
determine to pay all or any portion of any such Award.

 

(f)            The
payment of any Award may be made subject to such conditions as the Committee
may specify. Any such conditions may be specified in respect of Participants as
a whole, individual Participants, or classes of Participants.

 

5.             Recapitalization,
Merger, and Consolidation; Change in Control

 

(a)           The
existence of this Plan and the Awards granted hereunder shall not affect in any
way the right or power of the Company or those entities holding membership
interests in the Company to make or authorize adjustments, reorganizations, or
other changes in the Company’s capital structure and its business, or any
merger or consolidation of the Company, or the dissolution or liquidation of
the Company, or any sale or transfer of all or part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or
otherwise.

 

6

 

(b)           In
the event of a Change in Control, all target awards outstanding shall thereupon
automatically be accelerated and payable in full. The amount of such awards
shall be determined in the Committee’s discretion on the assumption that the
Plan Year then in effect ended on the date on which the Change in Control
occurred. The determination of the Committee that any of the foregoing
conditions has been met shall be binding and conclusive on all parties.
Notwithstanding the foregoing, in the event that, incident to a Change in
Control, provision is made for the transfer of rights under this Plan to
another or successor Plan, Participants shall be allowed to make such transfer.

 

6.             Miscellaneous

 

(a)           Awards
shall be nontransferable and nonassignable, except that such Awards may be
transferred (i) by testamentary instrument or by the laws of descent and
distribution, or (ii) to such individual or entity as the Committee may
designate in the event of a Participant’s death.

 

(b)           The
Board may at any time and from time to time amend the Plan. Any such amendments
may be made effective with respect to any Plan Year and with respect to any
awards which, as of the date of amendment, have not become payable.

 

(c)           The
establishment of the Plan shall not confer any legal rights upon any Employee
or other person to continued employment, nor shall it interfere with the right
of the Company or any Participating Employer (which right is hereby reserved)
to discharge any Employee and to treat him or her without regard
to the effect which that treatment might have upon him or
her as a Participant or potential Participant.

 

(d)           In
the event that any Participant engages in any activity which the Committee
judges to be detrimental to the Company or any Participating Employer, or
otherwise fails to substantially perform his or her obligations as an Employee,
the Committee may, at any time prior to payment of an award to a Participant,
cancel or reduce the award in whole or in part.

 

(e)           Neither
the adoption of this Plan nor any action of the Board or the Committee shall be
deemed to give any person any right to be granted an Award, except as otherwise
specifically provided herein.

 

(f)            The
Company shall have the right to deduct from all amounts paid hereunder, any
federal, state, local, or other taxes required by law to be withheld with
respect to such payments.

 

(g)           THE
VALIDITY, CONSTRUCTION AND EFFECT OF THE PLAN, ANY PLAN DOCUMENTS, AND ANY
ACTIONS TAKEN OR RELATING TO THE PLAN SHALL BE DETERMINED IN ACCORDANCE WITH
THE

 

7

 

LAWS OF THE STATE OF TEXAS APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED WITHIN SUCH STATE.

 

(h)           The
Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Company, expressly 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 them if no such succession had taken
place.

 

(i)            The
Plan shall be unfunded. Neither the Company, any Participating Employer, the
Committee, nor the Board shall be required to segregate any assets or secure
any liability that may at any time exist under the Plan.

 

8

 

SCHEDULE A

 

Administrative Procedures

 

Plan Year 2001

 

1.     Target
Awards

 

The following target award schedule shall
apply to Participants in the Plan for the Plan Year 2001 and for subsequent
Plan Years unless changed by the Board of Directors or Compensation Committee:

 

	
  Grade

  Level

  	
   

  	
  Target

  (% of Salary at 12/31 of Plan Year)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  99

  	
   

  	
  65%

  	
   

  
	
  98

  	
   

  	
  60%

  	
   

  
	
  97

  	
   

  	
  55%

  	
   

  
	
  96

  	
   

  	
  50%

  	
   

  
	
  95

  	
   

  	
  45%

  	
   

  
	
  94

  	
   

  	
  40%

  	
   

  
	
  93

  	
   

  	
  35%

  	
   

  
	
  92

  	
   

  	
  30%

  	
   

  
	
  91

  	
   

  	
  27.5%

  	
   

  
	
  90

  	
   

  	
  22.5%

  	
   

  

 

2.     Assignment to Award Units

 

The Company has established Award Units for purposes of the Employee
Incentive Plan (“EIP”) applicable to Employees generally. Each Participant
shall be deemed to be a member of the Award Unit through which such individual
would participate in the EIP if such individual were not a Participant in this
Plan.

 

3.     Calculation of Awards

 

The award payable to each Participant shall be determined under the
following formula:

 

	
  Award

  	
  =

  	
   

  	
  S * T * X/7%

  

 

Where:

 

S              is
the Participant’s Salary;

 

T             is
the Participants target award, determined under Paragraph 1 above; and

 

9

 

X             is the percentage of EIP Target paid to Employees in the Award Unit to which the
Participant is assigned.

 

The above calculation may result in an award
ranging from 0% up to 200% of the Target.

 

4.             Performance
and Other Adjustments

 

In the case of the Chief Executive Officer (“CEO”) or other employees
who, in the Committee’s judgment, do not provide services to a single SBU,
Facility, Technology Group or Staff, the Committee shall make a special
determination as to the manner in which any such individual’s award shall be
calculated.

 

In the event the Committee determines that an individual Participant or
group of Participants has made contributions to the success of the Company
which deserve special recognition, the Committee may provide for such
enhancement of the awards payable to them as the Committee may deem
appropriate. Conversely, if the Committee determines that an individual
Participant or group of Participants has failed to make such contribution as
would have been justified by application of the formula described in paragraph
3 above, the Committee may reduce or cancel the award payable to any such
Participant.

 

10Exhibit 10.1

 

AMENDMENT TO EMPLOYMENT AGREEMENT

 

Amendment (“Amendment”),
dated April 27, 2005, to the Employment Agreement, dated as of October 23,
2001 (the “Agreement”), among, Arch Capital Group Ltd., a Bermuda company
(“Parent”), Arch Reinsurance Ltd, a Bermuda company (“Arch Re”),
and Dwight R. Evans (the “Executive”). 
Capitalized terms used without definition herein have the meanings given
to them in the Agreement.

 

WHEREAS, the Executive
has been appointed by the Board of Parent to serve as the Chairman and Chief
Executive Officer of Arch Worldwide Reinsurance Group; and, in that connection,
Executive has been issued a work permit by the Bermuda government authorities;

 

NOW, THEREFORE, in
consideration of the premises and mutual covenants contained herein, the
parties have agreed to amend the Agreement as follows:

 

1.               Parent hereby
assumes all of Arch Re’s rights and obligations under the Agreement; all
references in the Agreement to the “Company” and “Companies” shall be to Parent;
and Arch Re is released from all of its obligations under the Agreement.

 

2.               The first sentence
of Section 3.01 shall be amended and restated in its entirety as follows:

 

“During the
Employment Period, the Executive shall serve as Chairman and Chief Executive
Officer of Arch Worldwide Reinsurance Group and shall have such
responsibilities, powers and duties as may from time to time be prescribed by
the Board of Directors of the Company; provided that
such responsibilities, powers and duties are substantially consistent with
those customarily assigned to individuals serving in such position at
comparable companies.”

 

3.               SECTION 4.04 shall be hereby amended and restated
as follows:

 

“SECTION 4.04.  Expenses.  The Company shall reimburse the
Executive for all reasonable expenses incurred by him in the course of
performing his duties under this Agreement which are consistent with the
Company’s policies in effect from time to time with respect to travel,
entertainment and other business expenses (“Reimbursable
Expenses”), subject to the
Company’s requirements with respect to reporting and
documentation of expenses.  In addition,
the Company will reimburse the Executive, on an after-tax basis, for his
reasonable expenses incurred in traveling between Bermuda and the United
States.”

 

4.               All other
provisions of the Agreement shall remain in full force and effect.  This amendment shall be governed by and
construed in accordance with the laws of Bermuda, without giving effect to
principles of conflict of laws, and may be executed in two counterparts, each
of which shall constitute one and the same instrument.

 

 

IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date
and year first above written.

 

	
   

  	
  ARCH
  CAPITAL GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Constantine Iordanou

  	
   

  
	
   

  	
  Printed
  Name:

  	
  Constantine
  Iordanou

  	
   

  
	
   

  	
  Title:

  	
  President
  and Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ARCH
  REINSURANCE LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/
  Marc Grandisson

  	
   

  
	
   

  	
  Printed
  Name:

  	
  Marc
  Grandisson

  	
   

  
	
   

  	
  Title:

  	
  President
  and Chief Operating Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Dwight R. Evans

  	
   

  
	
   

  	
  Dwight
  R. Evans

  
							

 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00083-of-00352.parquet"}]]