EXHIBIT 10.52
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AMENDED AND RESTATED AGREEMENT
RESPECTING CHANGE OF CONTROL AND
EXECUTIVE BENEFIT PLAN ENTITLEMENTS
This amended and restated agreement respecting change of control and
executive
benefit plan entitlements made as of the 23rd day of September,
2008.
BETWEEN:
NEXEN INC., a corporation incorporated under the
laws of Canada
(hereinafter referred to as the "Corporation")
- and -
CHARLES W. FISCHER
(hereinafter referred to as the "Executive")
RECITALS:
1. The
Executive, as
President & Chief
Executive Officer
("CEO") of the
Corporation, is
considered by the Board to be an essential officer and
employee of the Corporation, who is both integral to the
operation and
development of the Corporation, and has acquired outstanding skills,
unique experience
and possesses an extensive background in, and
knowledge of, the Corporation's business, operations and the industry
in which it is engaged.
2. In
the event of a Change of Control, there is a possibility that the
employment of the Executive would be terminated without just cause or
adversely modified and
the Executive
has expressed concern in that
regard to the Corporation.
3. The
Board recognizes that
it is essential and in the best interests of
the Corporation and its shareholders that the Corporation retain the
continued dedication of the Executive to the Executive's office and
the
Executive's employment during the uncertain period prior to, during
and
following a Change of Control.
4. The Board
further believes that the past service of
the Executive and
the Executive's
integral role in the
development and operation of the
Corporation requires that the Corporation ensure that in the event
of a
Change of Control the
Executive is treated in a manner that is
fair,
reasonable,
consistent with
industry standards and in the best
interests of the Corporation.
5. The
Corporation
and the Executive entered into a Change of Control
Agreement on
October 22, 1999, which was amended by an Amending
Agreement dated
December 25, 2000 (collectively the "Original
Agreement") to agree on the terms and conditions which would govern
the
termination or
modification
of the employment of the Executive
following a Change of Control.
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6. The
Original Agreement
was replaced and
superseded by an
Amended and
Restated
Change of Control
Agreement on December
13, 2001, which
was
amended by an Amending Agreement dated May 30, 2003 (collectively,
the
"Current
Agreement") which,
among
other matters, detailed the
Corporation's security and funding obligations in respect of the
Change
of Control Obligations
(as hereinafter defined), provided for the
securitization and
funding of the Executive Benefit Plan Obligations
(as hereinafter
defined) and provided for the cessation of the
Executive's coverage under the Statement of Company Procedure
Regarding
the Securitization of
Nexen Inc. Restated
Executive Benefit
Plan, as
amended or replaced from time to time (the "Securitization
Procedure").
7. The
Corporation and the
Executive wish to amend the Current Agreement
as herein provided
and, in doing so, wish to restate the Current
Agreement as herein amended (the "Restated Agreement").
NOW THEREFORE, in consideration of the mutual covenants and
agreements set forth
in this Restated
Agreement and for other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged by the Parties, the
Parties agree as follows:
ARTICLE 1
DEFINITIONS
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1.1 In this
Restated Agreement, the following terms shall mean as follows:
(a) "ACTING
JOINTLY OR IN CONCERT" for the purposes of this
Restated Agreement,
a Person is acting
jointly or in concert
with another
Person
if such Person has any agreement,
arrangement or
understanding (whether
formal or informal and
whether or not in
writing) with such other Person for the
purpose of
acquiring,
offering to acquire, or voting any
Common Shares
of the Corporation (other than customary
agreements with and between underwriters and banking group
or
selling group
members with respect to a distribution of
securities by way
of prospectus or private placement or
pursuant to a pledge of securities in the ordinary course of
business).
(b) "ACTUARY"
has the meaning
referred to in Section 11.2 of this
Restated Agreement.
(c)
"AFFILIATE" and "ASSOCIATE" have the meaning ascribed to
such
terms in National Instrument 45-106.
(d)
"ANNIVERSARY DATE" has the meaning referred to in Section 11.3
of this Restated Agreement.
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(e) "ANNUAL
BASE SALARY" means the annual base salary of the
Executive payable by
the Corporation at the
end of the month
immediately preceding the Date of Termination.
(f) "ANNUAL
TARGET BONUS" means the Executive's annual target
bonus as determined by the Board to be in effect for the
calendar year in which a Change of Control occurs.
(g) "BANK" has
the meaning
referred to in Section 11.2 of this
Restated Agreement.
(h)
"BENEFICIAL
OWNER" for
the purposes of this Restated
Agreement, a Person
shall be deemed to be the "BENEFICIAL
OWNER" and
to have "BENEFICIAL OWNERSHIP" of and to
"BENEFICIALLY OWN":
(i) any
securities as to which such Person or any of such
Person's Affiliates or Associates is the owner at law
or in equity;
(ii)
any securities as to which such Person or any of such
Person's Affiliates
or Associates has a right to
acquire (i) upon
the exercise of any Convertible
Securities or
(ii) pursuant to any agreement,
arrangement or
understanding, whether
such right is
exercisable immediately within a period of sixty (60)
days thereafter
and whether or not on
condition or
the happening
of any contingency, (other than (a)
customary agreements
with and between
underwriters
and banking group and
selling group members with
respect to the distribution to the public or pursuant
to a private
placement of securities, or (b) pursuant
to a pledge of securities in the ordinary course of
business); and
(iii) any
securities which are
Beneficially
Owned within
the meaning of clauses
(a) or (b) above by any other
Person with which such Person is Acting Jointly or in
Concert,
provided, however,
that a Person
shall not be deemed the
"Beneficial Owner" or to have "Beneficial Ownership" of or to
"Beneficially Own" any
security where such Person is the
registered holder of securities as a result of carrying on the
business of or acting as nominee for a securities depository.
For purposes of this
Restated Agreement,
the percentage of
Common Shares
Beneficially Owned by any Person, shall be and
be deemed to be the product determined by the formula:
100 x A/B
Where:
A = the number
of votes for the election of all directors
generally attaching to the Common Shares Beneficially
Owned by such Person; and
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B = the number
of votes for the election of all directors
generally attaching to all outstanding Common Shares.
For the purposes
of the foregoing formula, where a Person
Beneficially Owns unissued Common Shares which may be acquired
pursuant to Convertible Securities, such Common Shares shall
be deemed to be outstanding for the purpose of calculating the
percentage of Common Shares Beneficially Owned by such
Person
in both the
numerator and the denominator, but no other
unissued Common Shares
which may be acquired
pursuant to any
other outstanding
Convertible
Securities
shall, for the
purposes of that calculation, be deemed to be outstanding.
(i) "BOARD"
means the Board of
Directors of the
Corporation
as
constituted from time to time.
(j) "CBCA"
means the CANADA BUSINESS CORPORATIONS ACT, as amended
from time to time, and any successor legislation thereto.
(k)
"CALCULATION DATE" has the meaning referred to in Section 11.5
of this Restated Agreement.
(l) "CHANGE OF
CONTROL" means the occurrence of any of:
(i) the
purchase or
acquisition of any
Common Shares or
Convertible Securities
by a Beneficial
Owner which
results in the Beneficial Owner owning, or exercising
control or
direction
over,
Common
Shares
or
Convertible Securities
such that, assuming
only the
conversion of
Convertible
Securities
Beneficially
Owned or over which control or direction is exercised
by the Beneficial
Owner, the Beneficial
Owner would
own, or exercise
control or direction
over, Common
Shares carrying
the right to cast more than
thirty-five percent
(35%) of the votes
attaching to
all Common Shares; or
(ii)
the substantial
completion of: (i) the
liquidation,
dissolution or winding-up of the Corporation; or (ii)
the sale, lease or other disposition of all or
substantially all of
the assets of the
Corporation;
or
(iii) a
situation in which
individuals who were members of
the Board immediately prior to:
(A) a
meeting of the shareholders of the
Corporation
involving a contest
for, or an
item of business
relating to, the
election
of directors; or
(B) an
amalgamation,
arrangement,
merger or
other consolidation
or combination of the
Corporation with another Person,
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shall not constitute a majority of the Board
following such election or transaction; or
(iv)
the completion of any
transaction or the
first of a
series of transactions
which would have the
same or
similar effect
as any transaction or series of
transactions referred
to in paragraphs (i),
(ii) or
(iii) above; or
(v) a
determination
by the Board that, for
the purposes
of this Restated
Agreement, a Change of
Control has
occurred or is imminent.
(m) "CHANGE
OF CONTROL OBLIGATIONS" means the Company's
obligations to make the lump sum payments described in Section
8.1 of this Restated Agreement to the Executive.
(n) A "CHANGE
OF CONTROL OBLIGATIONS
- DESIGNATED EVENT" shall be
deemed to have occurred if:
(i) the
Corporation fails to arrange for the extension or
replacement of a Letter of Credit in accordance with
the terms of this Restated Agreement; or
(ii)
the Executive's
employment
is terminated in
accordance with
Section 5.1, 6.1 or 7.1 of this
Restated Agreement.
(o) "COMMON
SHARES" means the common shares of the Corporation.
(p)
"CONVERTIBLE SECURITIES" means:
(i) any right
(contractual or otherwise and regardless of
whether such right constitutes a security) to acquire
Common Shares from the Corporation; or
(ii)
any security issued by the Corporation from time to
time (other
than the rights
issued pursuant to a
shareholders'
rights
protection plan,
if any)
carrying any exercise, conversion or exchange right,
which is then
exercisable or
exercisable within a
period of
sixty (60) days from
that time pursuant
to which the
holder
thereof may acquire
Common Shares or other
securities which
are convertible into or exercisable or exchangeable for Common
Shares (in each case,
whether such right is then exercisable
or exercisable
within a period of
sixty (60) days from
that
time and whether or not on condition or the happening of any
contingency).
(q) "DATE
OF TERMINATION" means the date upon which the
Executive's employment
is terminated pursuant to Section 4.1,
5.1, 6.1 or 7.1
of this Restated Agreement. For greater
clarity, the Date of Termination means the date upon which the
Corporation provides
the Executive with
written, verbal or
other notice that the Executive's employment has been or will
be terminated pursuant
to Section 4.1 or
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6.1 of this Restated
Agreement or the date upon which the
Executive
provides the
Corporation
with
written notice
terminating the Executive's employment pursuant to Section 4.1
or 5.1 or for Good Reason pursuant to Section 7.1.
(r)
"DISABILITY"
means, where
due to a physical or mental
condition, the
Executive is rendered
totally and permanently
unable to perform the
Executive's
duties for a
consecutive
period of two (2) years or more during which the Executive has
been in receipt of
long term disability
insurance benefits
from the insurance carrier normally utilized by the
Corporation.
(s) "DISPUTE"
has the meaning
referred to in Section 12.1 of this
Restated Agreement.
(t) "EFFECTIVE
DATE" means the date upon which a Change of Control
occurs.
(u)
"EMPLOYMENT BENEFITS"
means the employment
benefits to which
the Executive is
entitled by virtue of any written, oral or
implied agreement with
the Corporation.
For the purposes
of
this Restated Agreement, "Employment Benefits" shall
include,
but is not limited to, the following:
(i) the
Executive's
entitlement to any dental or general
medical care;
(ii)
the Executive's
entitlement
to receive long term
disability
benefits from
the insurance carrier
normally utilized by the Corporation;
(iii) the
Executive's entitlement to pension benefits under
the terms of any pension plan with the Corporation;
(iv)
the Executive's
entitlement
to a monthly car
allowance from the Corporation;
(v) the
Executive's
entitlement to
contributions by the
Corporation to the Corporation's savings plan;
(vi)
the
Executive's
entitlement
to receive from the
Corporation financial
counseling services, at a cost
of $3,500.00
per year (or as the same may be
increased from time to time by the Corporation); and
(vii) the
Executive's
entitlement
to receive from the
Corporation
security monitoring
services at the
Executive's personal residence.
(v) "EXECUTIVE
BENEFIT PLAN" has the meaning referred to in
Section 8.1(b) of this Restated Agreement.
(w) "EXECUTIVE
BENEFIT PLAN
OBLIGATIONS" means the
Corporation's
outstanding
obligations under the
Executive Benefit Plan
to
the Executive.
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(x) An
"EXECUTIVE BENEFIT
PLAN OBLIGATIONS
- DESIGNATED
EVENT"
shall be deemed to have occurred if:
(i) a Change
of Control occurs;
(ii)
the Corporation
makes an assignment
for the benefit
of creditors
or files a petition in
bankruptcy
or
becomes insolvent or bankrupt;
(iii) a
receiver, trustee or liquidator of or for the
Corporation is appointed and is not discharged within
a period of sixty days;
(iv)
the net worth of the Corporation, described as
shareholder equity
in the consolidated financial
statements of the
Corporation
as disclosed in the
annual and
quarterly
consolidated financial
statements of the
Corporation,
is less than $400
million;
(v) the
Corporation fails to arrange for the extension or
replacement of a Letter of Credit in accordance with
the terms of this Restated Agreement;
(vi)
the Executive has provided written notification to
the Trustee and to the
Corporation of the failure by
the Corporation
to pay any amount owed to or in
respect of the Executive under the Executive Benefit
Plan within thirty days of the due date specified in
the Executive Benefit Plan (together with a statement
of the amount
due and owing) either to the person
entitled thereto
pursuant to the
Executive Benefit
Plan or to the Trust in accordance with the
provisions of Section 11.6(h); or
(vii) at
any time the Board
adopts a resolution to the
effect that, for purposes of this Restated Agreement,
an Executive Benefit
Plan Obligations
- Designated
Event has occurred or is imminent.
(y) "GOOD
REASON" means any of the following, unless the Executive
shall have
given the Executive's express written consent
thereto:
(i)
INCONSISTENT DUTIES.
The assignment to the Executive
of any duties inconsistent with the Executive's
status as an executive
officer of the Corporation or
a material alteration
in the nature or status of the
Executive's
responsibilities or
duties or reporting
relationship from
those in effect
immediately prior
to a Change of Control;
(ii)
REDUCED SALARY. A reduction by the Corporation in the
Executive's Annual
Base Salary in effect on the
Effective Date
or as the same may be increased
thereafter from time
to time or the failure
by the
Corporation to grant the Executive salary increases
at a rate commensurate with the increases accorded to
other executives of the Corporation;
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(iii)
RELOCATION. The
Corporation requiring
the Executive
to be based anywhere
other than where the
Executive
is based at the time a
Change of Control occurs,
except for
required travel on the Corporation's
business to an extent
substantially
consistent with
the Executive's
business travel
obligations in the
ordinary course of
business immediately
prior to a
Change of Control;
(iv)
INCENTIVE COMPENSATION
PLANS. The failure by the
Corporation to
continue in effect any incentive
compensation plan in which the Executive
participates,
including, but not
limited to, the
Incentive Compensation
Plan or the Stock Option Plan
or any other similar
plans adopted prior to a Change
of Control,
unless the
Executive is eligible to
participate in, and is entitled to the opportunity to
receive a comparable
level of benefits under, an
ongoing, substitute
or alternative plan (it being
understood that the
manner or method of payment and
the form of
consideration
need not be the same as
existed in the original plans); or the failure by the
Corporation to continue the Executive's participation
therein on at least as
favourable a basis,
both in
terms of the amount
of benefits available to the
Executive and
the level of the Executive's
participation relative
to other participants, as
existed at the time a Change of Control occurs;
(v) EMPLOYMENT
BENEFITS AND
PERQUISITES. The
failure by
the Corporation to
continue to provide the Executive
with Employment
Benefits at least as
favourable as
those enjoyed by the Executive immediately prior to a
Change of Control, including any pension plan,
benefit plan
or any retirement arrangement
established for
the Executive, or any of the
Corporation's life
insurance,
medical, health and
accident, disability
or savings
plans in which the
Executive was
participating at the
time a Change of
Control occurs;
the taking of any action by the
Corporation that
would directly or indirectly
materially reduce any
such benefits
or deprive the
Executive of any material perquisite enjoyed by the
Executive at the time
a Change of
Control occurs,
including, without
limitation
and to the extent
applicable, the use of
a car, aircraft,
secretarial
services, office
space,
telephones,
computer
facilities, expense reimbursement,
financial
counselling, and
professional
fees and club dues
reimbursement; or the
failure by the
Corporation to
provide the
Executive with the number of paid
vacation days to which
the Executive is
entitled in
accordance with the
Corporation's
normal vacation
practice in effect
at the time a Change
of Control
occurs;
(vi)
NO ASSUMPTION
BY SUCCESSOR. The failure of the
Corporation to obtain a satisfactory agreement from a
successor to
assume and agree to perform this
Restated Agreement. Alternatively, if the business or
undertaking in connection with which the Executive's
services are
principally
performed is sold at any
time after
a Change of Control occurs, and the
Executive's employment
is transferred
as a result,
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the failure
or refusal of the purchaser of such
business or undertaking to provide the Executive with
the same
or a comparable position, duties,
compensation and benefits, as described in paragraphs
(iv) and (v) above, as
provided to the
Executive by
the
Corporation
immediately
prior to a
Change of
Control;
(vii)
DISPOSITION OF
"ALL OR SUBSTANTIALLY ALL". The
disposition by
the Corporation
of all or
substantially all of
the assets of the
Corporation,
as contemplated
herein, notwithstanding that the
Executive's services
were or were
not principally
performed for such business.
(z) "HEARING"
has the meaning
referred to in Section 12.7 of this
Restated Agreement.
(aa)
"HEARING DATE" has the meaning referred to in Section 12.7 of
this Restated Agreement.
(bb)
"INCENTIVE
COMPENSATION PLAN"
means any bonus or
incentive
compensation plan of the Corporation in which the Executive is
entitled to
receive benefits in the month immediately
preceding a Change of Control.
(cc)
"JUST CAUSE" means:
(i) the
failure by the Executive to substantially perform
the Executive's duties
according to the terms of the
Executive's employment in existence immediately prior
to a Change of
Control after the Corporation has
given the Executive reasonable notice of such failure
and a reasonable opportunity to correct it; or
(ii)
where the Executive
engages in any
criminal act or
dishonesty resulting or intended to result, directly
or indirectly, in the
personal gain of the Executive
at the Corporation's expense.
(dd)
"LETTER OF CREDIT" has the meaning referred to in Section 11.2
of this Restated Agreement.
(ee)
"MONTHLY BASE SALARY" means the monthly salary payable to the
Executive by the Corporation in effect at the end of the month
immediately preceding the Effective Date.
(ff)
"NOTICE OF DISPUTE"
has the meaning referred to in Section
12.1 of this Restated Agreement.
(gg)
"OBLIGATIONS" means,
collectively,
the Change of Control
Obligations and the Executive Benefit Plan Obligations.
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(hh)
"PARTIES" means
the Corporation, and its successors and
permitted assigns,
and the Executive and the Executive's
heirs, executors and
administrators and
"PARTY" means either
one of them.
(ii)
"PERSON" includes an
individual,
partnership,
association,
body corporate,
trustee, executor, administrator, legal
representative
and any national, provincial, state or
municipal government or any agency thereof.
(jj)
"REFUNDABLE TAX
ACCOUNT" means the refundable tax account
maintained in
respect of the Trust by the Canada Revenue
Agency.
(kk)
"REGISTERED PENSION
PLAN" has the meaning referred to in
Section 8.1(b) of this Restated Agreement.
(ll)
"RESTATED AGREEMENT" means this amended and restated agreement
respecting change
of control and executive benefit plan
entitlements as it may
be amended, restated
or supplemented
from time to time, and
the expressions
"hereof", "herein",
"hereto", "hereunder", "hereby", and similar expressions refer
to this Restated
Agreement and, unless
otherwise
indicated,
refer to Articles or Sections in this Restated Agreement only.
(mm)
"SECURITIZATION
PROCEDURE" has the meaning referred to in the
recitals of this Restated Agreement.
(nn)
"SEVERANCE PERIOD"
means the thirty-six (36) month period
immediately following the Date of Termination.
(oo)
"STOCK OPTION
PLAN" means any stock
option plan or plans
of
the Corporation
pursuant to which the
Executive is granted
options by the Corporation to acquire Common Shares.
(pp)
"SUBSIDIARY" has the meaning ascribed to it in the CBCA.
(qq)
"TAX ACT" means the Income Tax Act (Canada) and the
Regulations thereunder, both as amended from time to time.
(rr)
"TERM" has the meaning
referred to in Section 3.1 of this
Restated Agreement.
(ss)
"TRUST" has the
meaning referred to in
Section 11.1 of
this
Restated Agreement.
(tt)
"TRUST AGREEMENT" has
the meaning referred to in Section 11.1
of this Restated Agreement.
(uu)
"TRUSTEE" means CIBC
Mellon Trust Company or such other trust
company duly
incorporated
under the laws of Canada or any
province thereof whom the Company may designate as the trustee
in connection
with
the security and funding of the
Obligations.
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(vv)
"VALUATION
DATE" has the meaning
referred to in Section
11.3
of this Restated Agreement.
ARTICLE 2
SCOPE OF RESTATED AGREEMENT
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2.1 The
Parties intend
that this Restated Agreement sets out (a) their
respective rights and
obligations
upon the occurrence of
a Change of
Control and in connection with the securitization and funding of the
Change of Control
Obligations;
and (b) their
respective
rights and
obligations regarding
the securitization and
funding of the Executive
Benefit Plan Obligations. This Restated Agreement does not
provide for
any other terms of the
Executive's employment
with the Corporation,
except as expressly provided for herein.
2.2 The
Parties hereby confirm that except as otherwise expressly stated
in
this Restated
Agreement, insofar as
the securitization and funding of
the Executive Benefit Plan Obligations is concerned, the terms of this
Restated Agreement
shall govern and the terms of the
Securitization
Procedure shall not be applicable.
2.3 This
Restated Agreement shall automatically terminate upon the death
of
the Executive or where
due to the Disability
of the Executive, the
Executive is materially incapacitated from performing the
Executive's
duties. In the event
of the death or Disability of the Executive, the
Executive (or the Executive's estate) shall be entitled to receive
from
the Corporation
all unpaid Annual Base
Salary, Employment
Benefits,
unpaid business expenses and vacation entitlement accrued to the date
of the death or
Disability of the
Executive.
The Executive (or the
Executive's estate) shall also be entitled to receive any and all
death
or Disability benefits
in a manner consistent with, and at least equal
in amount to, those provided by the Corporation to senior executives
(or their estate) under such plans, programs and policies in effect
at
the date of Disability or death of the Executive, and the Corporation
shall have no further
obligations to the Executive or the Executive's
estate under this Restated Agreement. Any entitlements of the
Executive
(or the Executive's
estate) under the Executive Benefit Plan which
remain following the
termination of this Restated Agreement pursuant to
this Section
2.3 shall then commence to be covered under the
Securitization Procedure.
2.4 If the
Executive's
employment is
terminated by either Party, for any
reason, prior
to a Change of Control in any manner, other than
expressly provided
for in this Restated Agreement, this Restated
Agreement shall automatically terminate and the Corporation
shall have
no further
obligations
to the Executive hereunder. Any remaining
entitlements of the
Executive under the
Executive Benefit Plan
which
remain following the termination of this Restated Agreement
pursuant to
this Section
2.4 shall then commence to be covered under the
Securitization Procedure.
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ARTICLE 3
TERM OF RESTATED AGREEMENT
--------------------------
3.1 Subject to
termination of this Restated Agreement prior to a Change of
Control, this Restated
Agreement shall remain in effect for a
period
concluding thirteen
(13) months
following the Effective Date (the
"Term"), at
which time this Restated Agreement shall terminate;
provided however that
the payment of compensation and benefits to the
Executive under this
Restated Agreement
shall continue beyond the end
of the Term in
accordance
with the applicable provisions of this
Restated Agreement.
Any remaining
entitlements of the Executive under
the Executive Benefit
Plan which remain
following the
termination of
this Restated
Agreement pursuant to this Section 3.1 shall then
commence to be covered under the Securitization Procedure.
ARTICLE 4
TERMINATION FOR JUST CAUSE OR FOR OTHER THAN GOOD REASON
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4.1 If the
Executive's
employment
is terminated for Just Cause, or is
terminated by the Executive, other than pursuant to Section 5.1 of
this
Restated Agreement or for other than Good Reason, following a
Change of
Control, the
Corporation
shall pay to the
Executive, if not
already
paid, the fraction of
the unpaid Annual Base Salary accrued during the
then current fiscal
year of the
Corporation, all
accrued Employment
Benefits, all
unpaid reasonable business expenses and all unpaid
vacation pay accrued up to and including the Date of Termination, and
thereafter, the
Corporation shall have
no further obligations
to the
Executive under this Restated Agreement.
4.2 Nothing in
this Restated
Agreement shall serve to derogate
from the
vested rights of the Executive to pension benefits, Stock Option Plans
or any other Employment Benefits to which the Executive is
entitled up
to the Date of Termination.
ARTICLE 5
VOLUNTARY TERMINATION
---------------------
5.1 In the
event of a Change of
Control, the Executive shall have the
unfettered right,
within thirty (30)
days after the twelve (12) month
period following
the Effective Date, to elect to provide the
Corporation with written notice terminating his employment.
Upon being
provided such
written notice, the Corporation shall pay to the
Executive the
remuneration
referred to in Article
8 of this Restated
Agreement.
5.2
Notwithstanding
Section 5.1 of this
Restated Agreement, and in the
event that a Change of Control occurs as a result of a hostile
bid for
the takeover of the Corporation, there shall be no requirement for
the
Executive to wait for
the expiry
of the twelve (12) month period
following the Effective Date of a Change of Control,
in order for the
Executive to
exercise the right granted to provide written notice
terminating his
employment.
<PAGE>
-13-
In the circumstances of a hostile bid resulting in a Change of
Control,
the Executive shall have the unfettered right, within 30 days
following
the
Effective Date of a Change of Control, to elect to provide the
Corporation with
written notice terminating his employment. Upon
providing such written notice to the Corporation, the Corporation
shall
pay to the Executive the remuneration referred to in Article 8 of
this
Restated Agreement.
For the purposes of
this section,
"hostile bid"
means a take-over bid,
exchange offer or
tender offer to acquire more
than 35% of the Common
Shares which has not been approved by the Board
of Directors prior to its public announcement or commencement.
5.3 Any
reference to Section
5.1 of this Restated
Agreement,
within the
body of the Change of Control Agreement, shall be deemed to include a
reference to Section 5.2 of this Restated Agreement (with such Section
references to be used interchangeably).
ARTICLE 6
TERMINATION BY CORPORATION
--------------------------
6.1 If the
Executive's employment
is terminated by the Corporation within
the thirteen (13) month period following the Effective Date, for
reason
other than Just Cause,
death or Disability,
the Corporation shall pay
to the Executive
the remuneration referred to in Article 8 of this
Restated Agreement.
ARTICLE 7
TERMINATION FOR GOOD REASON
---------------------------
7.1 In the
event of a Change of
Control, the
Executive may, within the
twelve (12)
month period following the Effective Date and upon
providing the Corporation with ten (10) days written notice,
terminate
the Executive's
employment with the Corporation for Good Reason. Upon
being provided
with such notice, the Corporation shall pay to the
Executive the
remuneration
referred to in Article
8 of this Restated
Agreement.
ARTICLE 8
COMPENSATION UPON TERMINATION
-----------------------------
8.1 If the
Executive's employment
is terminated in accordance with Section
5.1, 6.1 or 7.1 of this Restated Agreement:
(a) the
Corporation shall
forthwith, but in any
event within ten
(10) days from receipt by the Corporation of a Release
executed by
the Executive substantially in the form of
Schedule "A", pay to the Executive:
(i) if
not previously paid, that portion of the
Executive's accrued
but unpaid Monthly
Base Salary,
any accrued but unpaid
bonus to which the
Executive
is entitled for the preceding calendar year under any
Incentive Compensation
Plan, all unpaid
reasonable
business expenses and all accrued but unused vacation
pay earned
or payable to the Executive by the
Corporation for the
period from the beginning of the
Corporation's then
current fiscal
year, up to and
including the Date of Termination;
<PAGE>
-14-
(ii)
a lump sum cash
payment equal to the Executive's
Monthly Base
Salary and
one-twelfth
(1/12) of the
Executive's Annual Target Bonus for each month of the
Severance Period;
(iii) a
lump sum payment equal to thirteen percent (13%) of
the Executive's Annual
Base Salary for the Severance
Period representing the value of the group health and
welfare benefits for the Severance Period;
(iv)
a lump sum
payment representing the value of the
Executive's monthly
car allowance for the
Severance
Period;
(v)
a lump
sum payment representing the value of the
Corporation's
contributions to
the Corporation's
savings plan (at a
rate of six percent
(6%) of the
Executive's Annual
Base Salary)
for the Severance
Period;
(vi)
a lump sum
payment representing the value of the
Executive's
entitlement to
receive
from
the
Corporation financial
counseling
services for the
Severance Period; and
(vii) a
lump sum payment representing the value of the
Executive's
entitlement to
receive
from
the
Corporation
security monitoring
services at the
Executive's personal
residence for the Severance
Period;
(b) with
respect to the Executive's entitlement to pension
benefits under the
Pension Plan for
Employees of Nexen
Inc.
(Defined Benefit Option) (the "Registered Pension Plan"), if
any, and the Executive's related entitlement under the Nexen
Inc. Restated
Executive Benefit Plan (the "Executive Benefit
Plan"), if any:
(i) the
Corporation shall
recognize the Severance Period
for purposes
of determining the Executive's
entitlement;
(ii)
for calculation purposes, the Executive's entitlement
is the benefit
which would have been determined
assuming that
the Executive had been employed
throughout
the Severance
Period,
including
recognition of:
(A) additional
service that would have been
credited for the Severance Period;
(B) monthly
salary equal to the Executive's
Monthly Base Salary throughout the Severance
Period;
(C)
pensionable bonus
for the year of the
Date
of Termination, and for each subsequent year
or portion
thereof during the Severance
Period, determined
at the Annual Target
Bonus level.
Average
bonus
will
be
determined over the
three years to the
end
of the Severance Period, including any
partial calendar years; and
<PAGE>
-15-
(D) the
Executive shall be deemed to retire, and
the pension to
commence, upon the
later of
the completion of the
Severance Period
and
the
attainment
of age fifty-five (55),
without any
applicable
early
retirement
reduction; and
(iii) the
pension entitlements
described in this Section
8.1(b) shall, to the extent legally permissible, be
provided through the Registered Pension Plan. To the
extent that it is not legally permissible to provide
such pension
entitlements
through the Registered
Pension Plan,
the Corporation shall pay to the
Executive a
lump sum payment representing the
settlement value of the additional Executive Benefit
Plan benefit
determined
in accordance with the
assumptions set forth in Schedule "B-1";
(iv)
any entitlements of the Executive under the Executive
Benefit Plan which
have previously
been funded in
accordance with Article 11 but not previously settled
in accordance with Article 11 shall be settled by the
Corporation in accordance with the assumptions set
forth in Schedule "B-1";
(c) the
Corporation
shall provide the
Executive with
executive
outplacement
counselling
to be provided by a firm to be
selected by the Executive, at a cost to the Corporation not to
exceed $25,000.00;
(d) all of the
Executive's outstanding unexercisable stock options
under any Stock Option Plan shall become exercisable; and
(e) where the
Executive has been relocated, at the request of the
Corporation, within
the two (2) year period immediately prior
to the Effective Date,
if so requested by the Executive, the
Corporation
shall relocate
the Executive back to the
Executive's prior location.
8.2 The
estimated value as of April 1, 2008 of Sections 8.l(a)(ii) to
8.1(c) are set out in Schedule "C". Schedule "C" provides estimated
values only and actual values shall be calculated in accordance with
this Restated
Agreement at the time
of entitlement
or payment under
this Restated Agreement.
8.3 If the
Executive's
employment
is terminated in the circumstances
described in Section 5.1, 6.1 or 7.1 of this Restated Agreement, the
remuneration and
benefits payable under this Article 8 shall not
be
reduced if the Executive obtains alternative employment.
8.4 Unless
expressly provided
otherwise in this
Restated Agreement,
all
payments to be made to
the Executive
under this Article 8 shall be
subject to required statutory deductions at source by the
Corporation.
<PAGE>
-16-
ARTICLE 9
CONFIDENTIAL INFORMATION
------------------------
9.1 If the
Executive's
employment is
terminated in any manner whatsoever
due to or following a Change of Control, the Executive agrees to keep
confidential all
information of a confidential or proprietary nature
concerning the Corporation, its Affiliates, Associates and
Subsidiaries
and their respective operations, opportunities, areas of present,
past
or future interests, assets, finances, technology, intellectual
property, business
and affairs, and further agrees not to use such
information, data or
technology for personal advantage, provided that
nothing herein shall
prevent the disclosure
of information
which is
publicly available
or which is required to be disclosed by the
Executive under appropriate statute, rules of law or legal
process.
ARTICLE 10
RIGHTS AND OBLIGATIONS OF EXECUTIVE UPON TERMINATION
----------------------------------------------------
10.1
Subject to Section 9.1 of this Restated Agreement, the Executive shall
not be prohibited in any manner whatsoever from obtaining
alternative
employment with or
otherwise forming or
participating
in a business
competitive to the business of the Corporation after the
termination of
the Executive's employment with the Corporation.
10.2
Upon the termination of the Executive's employment for any reason, the
Executive shall tender
the Executive's
resignation from any
position
the Executive may hold as an officer or director of the
Corporation or
any of its Affiliates, Associates or Subsidiaries.
10.3
If the Executive's
employment
is terminated in the circumstances
described in Section 5.1, 6.1 or 7.1 of this Restated Agreement, the
Corporation shall
continue to purchase
and maintain, to the extent
available in the marketplace at reasonable cost to the Corporation,
on
behalf of the Executive, director and officer liability
insurance for
the applicable
limitation
period following the date upon which the
Executive ceases to
serve as a director or officer of the Corporation,
and the Executive's
existing agreement to
receive indemnity from
the
Corporation for acts taken by the Executive in the Executive's
capacity
as an officer of the Corporation shall remain in effect.
10.4
Upon termination of the Executive's employment pursuant to Section
5.1,
6.1 or 7.1 of this Restated Agreement, the Corporation shall
reimburse
the Executive
for ongoing legal fees and disbursements which the
Executive may
reasonably
incur in connection with this Restated
Agreement (but this Restated Agreement only), including any litigation
concerning the validity or enforceability of, or liability under, any
provision of this
Restated Agreement or
any action by the
Executive.
The Corporation shall pay such fees and reimbursements to the
Executive
promptly as such fees and disbursements become due.
<PAGE>
-17-
ARTICLE 11
SECURITIZATION AND FUNDING PROCEDURE
------------------------------------
11.1
The Corporation
has established and
maintains a trust for the benefit
of the Executive
and persons claiming through him (the "Trust")
pursuant to the terms and conditions of a trust agreement (the "Trust
Agreement") between the Corporation and the Trustee. The Trust
shall be
funded in accordance with the provisions of this Restated Agreement
and
the Trust Agreement.
11.2
To provide security against a failure by the Corporation to either
fund
or settle the
Obligations in accordance with the terms of this Article
11, the Trust Agreement provides for the funding of the
Trust with the
proceeds of an
irrevocable
letter of credit which satisfies the
requirements of this
Restated Agreement (a
"Letter of Credit") in the
event that
the Corporation does not provide funding or effect
settlement when
required to do so hereunder and in accordance with the
terms hereof.
The Corporation confirms that the Letter of Credit
currently
held by the
Trustee has been issued by a major Canadian
chartered bank
(the "Bank") in an amount calculated by the
Corporation's consulting actuary (who at all times shall be a
Fellow of
the Canadian Institute of Actuaries) (the "Actuary") in accordance
with
the provisions of Section 11.5 of this Restated Agreement.
11.3
On each February 1st (the "Anniversary Date"), the Corporation shall
request a report from
the Actuary as to the amount calculated, as at
the next succeeding
April 1st (the
"Valuation Date"),
in accordance
with the provisions
of Section 11.5 of
this Restated
Agreement. The
Corporation shall
provide the Actuary with the data it requires to
prepare such
report. Upon completion of each such report, the
Corporation shall
arrange for the Actuary to provide a summary of same
to the Trustee.
Prior to the funding
and/or settlement of
all of the Obligations
in
accordance with the terms of this Restated Agreement, the Corporation
shall, within forty-five days after the applicable Anniversary Date
and
in accordance with the terms of the report received from the
Actuary:
(a)
either:
(i) arrange
for a Letter of Credit
to be provided by the
Bank to the Trustee to
replace the Letter of
Credit
then held by the Trustee. The replacement Letter of
Credit shall be:
(A)
substantially in the
form of the Letter
of
Credit then held by the Trustee;
(B)
in an
amount calculated by the Actuary as at
the applicable
Valuation Date in accordance
with the provisions of
Section 11.5 of this
Restated Agreement; and
<PAGE>
-18-
(C) for a term
which commences on the date of
its issuance and expires one year following
the applicable Valuation Date; or
(ii)
confirm to the Trustee in writing that the Letter of
Credit then
held by the
Trustee will be extended
automatically
for a further one-year term. The
confirmation to the
Trustee shall include
evidence
from the Bank as to any amendment to the applicable
Letter of Credit, any such amendment to be consistent
with the report
prepared by the Actuary as at the
applicable Valuation Date; and
(b) contribute
to the Trust an amount equal to twice the fee
charged by the Bank in
connection
with the Letter of
Credit
extension or replacement, as applicable. The Corporation shall
withhold one-half
of such amount and shall remit the said
one-half of such
amount to the Canada Revenue Agency on
account of the tax which is exigible pursuant to the Tax Act
in connection with such contribution to the Trust. The Trustee
shall remit the remaining one-half of such amount to the
Bank
in consideration
for the Letter of Credit extension or
replacement, as applicable.
When a replacement
Letter of Credit has
been provided in
accordance
with the terms of this Section 11.3, an existing Letter of Credit
shall
be surrendered and cancelled.
11.4
If, during
the term of a Letter
of Credit issued pursuant to this
Restated Agreement, the Corporation, acting reasonably,
concludes that
there has been a significant change in the Obligations
since the date
of the last report prepared by the Actuary pursuant to Section 11.3 of
this Restated
Agreement, the
Corporation shall
request a report from
the Actuary as to the then current value of the Obligations,
calculated
in accordance
with the provisions of Section 11.5 of this
Restated
Agreement. Upon
receipt of the report, the Corporation shall provide a
summary of same to the Trustee and arrange, together with the Trustee,
for any required
increase or decrease in the amount of the
Letter of
Credit for the
balance of the term of
such Letter of Credit.
In the
event that a
replacement
Letter of Credit is to be issued in the
circumstances
described in this Section 11.4, the Corporation and the
Trustee shall
arrange for such replacement Letter of Credit to be
provided by the Bank
to the Trustee to
replace the Letter of Credit
then held by the
Trustee. Upon
receipt of a replacement Letter of
Credit pursuant to
this Section 11.4, the Trustee shall surrender for
cancellation the
Letter of Credit
then held by it
pursuant to this
Restated Agreement and the Trust Agreement.
In the event that all or any portion of the fee referred to in Section
11.3 of this Restated Agreement, is refunded by the Bank as a
result of
a decrease in the amount of a Letter of Credit pursuant to this
Section
11.4, such amount (together with any resulting refundable Tax)
shall be
received by the Trustee for deposit to the Trust.
Upon receipt of an
Authorized Instruction (as defined in the Trust Agreement), the
Trustee
shall pay and transfer such amounts (less any applicable tax which it
will remit as required by the Tax Act on behalf of the Corporation) to
the Corporation for its sole and exclusive use and benefit.
<PAGE>
-19-
In the event that an additional fee is required to be paid to the
Bank
as a result of an increase in the amount of a Letter of Credit
pursuant
to this Section 11.4, the Corporation shall contribute to the Trust
an
amount equal
to twice the additional fee. The Corporation shall
withhold one-half of
such amount and shall remit the said one-half of
such amount to the
Canada Revenue Agency on account of the tax which is
exigible pursuant to
the Tax Act in connection with such contribution
to the Trust. The
Trustee shall remit the remaining one-half of such
amount to the Bank in payment of its additional fee.
11.5
A Letter of Credit issued pursuant to this Restated Agreement
shall:
(i) be an
irrevocable standby letter of credit;
(ii)
obligate the Bank to satisfy demand for payment made
by the Trustee in
accordance with the
terms of this
Restated Agreement and the Trust Agreement;
(iii)
permit partial drawings; and
(iv)
provide that the Bank
must notify the
Trustee on or
before thirty days prior to the expiry of a Letter of
Credit of any notice of non-extension provided by the
Bank to the Corporation.
The amount of a Letter of Credit pursuant to this Restated Agreement
shall be calculated
by the Actuary in
accordance
with the following
subparagraphs of this Section 11.5.
(a) Assuming
the lump sum payments
referred to in Section
8.1(a)
of this Restated
Agreement are equal to the amount
thereof
provided by the Corporation.
(b) Assuming
the service of the Executive will terminate, in
accordance with
Section 5.1, 6.1, or 7.1 of this Restated
Agreement, on
the next succeeding March 31st after the
Valuation Date (the "Calculation Date").
(c) Using the
Executive's demographic data, including base salary,
target bonus and current marital status as of the Valuation
Date, provided by the Corporation.
(d) Using the
Yearly Maximum Pensionable Earnings (Y.M.P.E.) used
to determine the amount of the Canada Pension Plan Benefit and
Tax Act maximum defined benefit pension dollar limit as at the
Valuation Date.
(e) Assuming
all Obligations are included.
(f) Using
the actuarial methods, assumptions and calculation
methodology described in Schedule "B-2.
(g) Applying a
load of 15% to the amount determined in accordance
with subparagraphs
(b) through (f) of
this Section
11.5 to
provide for
fluctuations
in the Interest Discount Rate,
<PAGE>
-20-
Consumer Price Index and other plan experience during the term
of the Letter of Credit, as described in Schedule "B-2".
(h) Applying
a load to one-half of the amount determined in
accordance with
subparagraphs (a) through (g) of this Section
11.5 to provide for the cost associated with the borrowings
described in
subparagraph
(k) of this Section 11.5, as
described in Schedule "B-2".
(i) Including
a settlement
expense to the amount
determined
in
subparagraph (h),
with the aggregate settlement expense
allowance for all
obligations secured
equal to $250,000,
or
where the Valuation
Date is after
December 31, 2008, the
aggregate settlement
expense allowance will be increased at
the rate equal to the increase in the Consumer Price Index, as
described in Schedule "B-2", plus 1% for each year after 2008.
(j) Assuming
the Obligations will be promptly settled with the
Executive upon
occurrence of a Designated Event described in
Section 1.1(n)(ii).
(k) Assuming a
loan will be secured
to permit settlement
of the
Obligations prior to
receipt of the
Refundable Tax
Account
from the Canada
Revenue Agency.
The assumed
interest rate
payable on the loan shall be as described in Schedule "B-2".
The cost associated with the borrowings shall be assumed to be
paid from the Trust.
(l) The
liabilities calculated
in accordance with
subparagraphs
(a) through (k) above shall be offset by:
(i) the
Refundable Tax Account, if any; and
(ii)
the assets contained in the Trust, if any.
11.6
(a) If an
Executive Benefit Plan
Obligations -
Designated Event
shall occur, the Corporation shall be required to
immediately
fund the Executive Benefit Plan Obligations in accordance with
the most recent report
prepared by the Actuary pursuant to
Section 11.3 of this Restated Agreement. Notwithstanding the
foregoing, if
an Executive Benefit Plan Obligations -
Designated Event
described in Section
1.1(x)(i) and a Change
of Control Obligations - Designated Event described in Section
1.1(n)(ii) shall occur
simultaneously, the
Corporation shall
be required to settle the Executive Benefit Plan Obligations
forthwith in accordance with the provisions of Schedule "B-1".
(b) If:
(i) the
employment of the
Executive is terminated by the
Corporation for any
reason other than as a result of
the death,
disability
or retirement of such
Executive; and
<PAGE>
-21-
(ii)
such Executive files
with the Corporation a
written
request that
it fund the Executive Benefit Plan
Obligations,
the Corporation
shall be required to immediately fund the
Executive Benefit Plan Obligations in accordance with the most
recent
report prepared by the Actuary pursuant to Section 11.3
of this Restated Agreement.
(c) Upon the
earlier of:
(i) learning
of the occurrence
of an Executive
Benefit
Plan Obligations
- Designated Event described in
Section 1.1(x)(v) or (vi) of this Restated Agreement;
or
(ii)
receipt of a written
notice of the
occurrence of an
Executive Benefit Plan Obligations - Designated Event
described in
any of the other subparagraphs of
Section 1.1(x)
of this Restated Agreement, which
notice has
been signed by two executives of the
Corporation, one of
whom must be
either the Chief
Financial Officer
or the General Counsel of the
Corporation and which
notice must, in the case of an
Executive Benefit Plan Obligations - Designated Event
described in
Section 1.1(x)(i) of this Restated
Agreement,
indicate which
subparagraph
of the
definition of "Change of Control" is applicable,
the Trustee shall
promptly give notice to the Corporation in
writing that it
intends to draw on that portion of the Letter
of Credit which is
referable to the
Executive Benefit Plan
Obligations and
contribute
the proceeds
thereof (less any
applicable withholding
tax which it will remit as required by
the Tax Act on behalf
of the Corporation) to the Trust on
behalf of the
Corporation
in order to fund the Executive
Benefit Plan
Obligations,
unless it receives satisfactory
proof within nine days of such notice that the Corporation has
funded or settled, as
applicable, the
Executive Benefit Plan
Obligations itself
in accordance with the terms of this
Restated
Agreement.
Unless the Corporation
advises the Trustee in writing that it
has funded or settled,
as applicable, the
Executive Benefit
Plan Obligations in accordance with the terms of this Restated
Agreement and has provided the Trustee with satisfactory proof
thereof within
nine days of the date of the
aforementioned
notice, the Trustee
shall draw on that
portion of the Letter
of Credit which is
referable to the
Executive Benefit Plan
Obligations on the tenth day following the date of such notice
(or the next following business day if such tenth day is not a
business day)
and contribute
the proceeds
thereof (less any
applicable withholding
tax which it will remit as required by
the Tax Act on behalf
of the Corporation) to the Trust on
behalf of the Corporation.
Notwithstanding the
foregoing,
in the event an Executive
Benefit Plan
Obligations
- Designated Event described in
Section 1.1(x)(v)
or (vi) of this Restated Agreement has
<PAGE>
-22-
triggered the
operation of this
Section 11.6 and the failure
which gave rise to the
occurrence of such
Executive Benefit
Plan Obligations - Designated Event has been remedied prior to
the expiration
of the notice period provided for in this
Section 11.6(c),
the Trustee shall not take the action
described in the immediately preceding paragraph hereof and
all of the provisions of this Restated Agreement shall
continue to
apply to the
same extent and as fully as they
would have in the
event that
such Executive Benefit Plan
Obligations - Designated Event had not occurred.
(d) Upon
receipt of a written notice of the occurrence of the
events described in both subparagraphs (i) and (ii) of Section
11.6(b) of this
Restated Agreement (which notice has been
signed by the Executive and sworn before a notary public), the
Trustee shall
promptly give notice to the Corporation in
writing that it
intends to draw on that portion of the Letter
of Credit which is
referable to the
Executive Benefit Plan
Obligations and
contribute the
proceeds (less any applicable
withholding tax which it will remit as required by the Tax Act
on behalf of the
Corporation)
to the Trust on behalf
of the
Corporation in
order to fund the Executive Benefit Plan
Obligations unless it receives satisfactory proof within nine
days of the date of
such notice
that the Corporation has
funded the
Executive Benefit Plan Obligations itself in
accordance with the terms of this Restated Agreement.
Unless the Corporation
advises the Trustee in writing that it
has funded
the Executive Benefit Plan Obligations in
accordance with the
terms hereof and has provided the Trustee
with satisfactory
proof thereof within
nine days of the date
of the aforementioned notice, the Trustee shall draw upon that
portion of the
Letter of Credit
which is referable to the
Executive
Benefit Plan
Obligations on the tenth day following
the date of such notice (or the next following business day if
such tenth
day is not a
business day) and contribute the
proceeds (less any
applicable withholding
tax which it will
remit as required by the Tax Act on behalf of the Corporation)
to the Trust on behalf of the Corporation.
(e) For
purposes of determining the required amount of funding
or
the portion
of the Letter of Credit to be drawn on for
purposes of this Section 11.6, the Trustee shall refer to the
most recent report
prepared by the Actuary for purposes of
this Restated Agreement and, in particular, to the portion of
the report
dealing
with
the Executive Benefit Plan
Obligations. In preparing the portion of its report respecting
Executive Benefit Plan
Obligations, the
Actuary shall adhere
to the following:
(i) Assuming
that the Executive, if then in active
employment, will remain in active employment with the
Corporation as an officer until the Calculation Date
and that the Executive's employment with the
Corporation will terminate on the Calculation Date.
<PAGE>
-23-
(ii)
Using the Executive's
demographic
data, including
base salary, actual
bonus history, target
bonus and
current marital
status as of the Valuation Date,
provided by the Corporation.
(iii)
Using the Canada
Pension Plan
Benefit and Tax Act
maximum defined
benefit pension dollar limit as at
the Valuation Date.
(iv)
Assuming the
Executive's
target bonus percentage
remains at the level
specified by the Corporation
pursuant to subparagraph (ii) above.
(v) Assuming
only Executive Benefit
Plan Obligations are
included.
(vi)
Assuming the payments
under the Executive Benefit
Plan would be made from the Trust.
(vii)
Using the actuarial methods, assumptions and
calculation methodology described in Schedule "B-2.
(viii) Applying
loads as described in
Schedule "B-2" to the
amount determined in
accordance
with the preceding
subparagraphs of this
Section 11.6(e) to provide for
future contingencies and expenses of the Trust.
(ix)
Calculating the
estimated amount
required to settle
the Executive Benefit
Plan Obligations based
on the
actuarial
methods,
assumptions and
calculation
methodology described in Schedule "B-2", increased by
the loads described in the following subparagraph.
(x) Applying
loads as described in
Schedule "B-2" to the
amount
determined
in accordance
with subparagraph
(ix) to provide for:
(A)
fluctuations in the
Interest Discount
Rate
and Consumer Price
Index during the term of
the Letter of Credit; and
(B) the
cost associated with the loan to be
secured as allowed under the Trust Agreement
to permit settlement of the Executive
Benefit Plan Obligations prior to receipt of
the Refundable
Tax Account from the
Canada
Revenue
Agency. The assumed interest rate
payable on the loan shall be as described in
Schedule "B-2"
and shall be applied to
one-half of the amount in subparagraph (ix).
The cost associated with the borrowings
shall be assumed to be paid from the Trust.
(xi)
Taking the larger amount for the Executive of:
(A) the amount
determined
in accordance with
subparagraphs (i) through (viii), and
<PAGE>
-24-
(B) the amount
determined
in accordance with
subparagraphs (ix) and (x).
(xii) The
amount determined in accordance with subparagraph
(xi) above shall be offset by:
(A) the
Refundable Tax Account, if any;
(B) the assets
contained in the Trust, if any.
(f) In the
event that the Executive Benefit Plan Obligations have
been funded in
accordance with the
terms hereof as a
result
of:
(i) the
Corporation making an
assignment for the benefit
of creditors or filing
a petition in
bankruptcy or
becoming insolvent or bankrupt;
(ii)
a receiver,
trustee or liquidator of or for the
Corporation being
appointed and not being discharged
within a period of sixty days;
(iii) a
voluntary
dissolution
or wind-up of the
Corporation; or
(iv)
a sale or disposition of all or substantially all of
the assets of the Corporation,
and the Executive Benefit Plan has been terminated in
connection therewith,
the Executive Benefit
Plan Obligations
shall be promptly settled by the Trustee with the Executive by
way of a lump sum payment from the Trust. For this purpose,
the benefit entitlements of each Executive shall be determined
by the Actuary in
accordance with the
terms of the Executive
Benefit Plan and the
amount of the lump sum payment shall be
determined by the Actuary using the assumptions set forth in
Schedule "B-1". Notice of termination of the Executive Benefit
Plan shall be provided
to the Trustee by the Corporation,
failing which by two
executives of the
Corporation,
one of
whom must be either the Chief Financial Officer or the General
Counsel of the Corporation.
Any assets of the Trust remaining after full satisfaction of
(i) the Executive
Benefit Plan
Obligations
pursuant to the
preceding paragraph and (ii) any further obligations pursuant
to the terms of the Trust Agreement, shall be returned to the
Corporation.
(g) In the
event the Executive Benefit Plan shall be terminated at
any time either in whole or in part in relation to the
Executive subsequent
to the funding of the Executive Benefit
Plan Obligations in
accordance with the
terms hereof,
then,
provided Section
11.6(f) of this
Restated Agreement is not
otherwise applicable,
the Executive Benefit
Plan Obligations
shall be promptly settled by the Trustee with the Executive by
way of a lump sum payment from the Trust.
<PAGE>
-25-
For this purpose, the
benefit entitlements
of the Executive
shall be determined
by the Actuary in accordance with the
terms of the Executive Benefit Plan and the amount of the lump
sum payment
shall be determined by the Actuary using the
assumptions set
forth in Schedule "B-1". Notice of the
termination of the Executive Benefit Plan shall be provided to
the Trustee
by the Corporation, failing which by two
executives of the Corporation, one of whom must be either the
Chief Financial
Officer
or the General Counsel of the
Corporation.
Any assets of the Trust remaining after full satisfaction of
(i) the Executive
Benefit Plan Obligations and (ii) any
further obligations
pursuant to the terms of the Trust
Agreement, shall be returned to the Corporation.
(h) In the
event:
(i) of a
dispute as to whether a payment to or in respect
of the Executive is properly due and payable pursuant
to the Executive Benefit Plan; and
(ii)
such dispute
cannot be resolved by the parties
thereto within the
time frame specified
in Section
1.1(x)(vi) of this Restated Agreement,
the amount in dispute
shall be remitted
to the Trustee for
deposit to the Trust.
Upon final settlement
of the dispute,
the amount so deposited (together with any earnings,
profits
and increments thereon
and after deduction of
any authorized
payments allocable
thereto, both as
determined in accordance
with the terms of the Trust Agreement), less any applicable
withholding tax which
will be remitted as required by the Tax
Act, shall be paid to that party to the dispute which is found
to be entitled thereto. Prior to such amount being paid out of
the Trust in accordance with the terms hereof, the Corporation
shall instruct
the Actuary to take
such amount into
account
when preparing
its report for purposes of this Restated
Agreement.
(i) In the
event that a Change of Control Obligations - Designated
Event described
in Section 1.1(n)(ii) of this Restated
Agreement shall
occur subsequent to the funding of the
Executive Benefit Plan
Obligations
in accordance with the
terms of this Restated
Agreement, the
Corporation
shall be
required to settle the
Executive Benefit Plan Obligations
forthwith in an amount determined by the Actuary in accordance
with the provisions of Schedule "B-1".
(j) Subject
to Section 11.6(f), 11.6(g) and 11.6(i) of this
Restated Agreement,
in the event that the
Executive Benefit
Plan Obligations have been funded in accordance with the terms
hereof, all or a
portion of such Executive Benefit Plan
Obligations may, at
the discretion
of the Corporation, be
promptly settled with the Executive.
For this purpose, the
benefit entitlements
of the Executive
shall be determined
by the Actuary in accordance with the
terms of the Executive
Benefit Plan. In such
circumstances,
the Corporation
reserves the right to settle the
Executive
Benefit Plan
Obligations by way of
a lump sum payment to the
<PAGE>
-26-
Executive provided
that the amount of each such payment is
determined by the Actuary in accordance with the assumptions
set forth in Schedule "B-1".
11.7
(a) If
a Change of Control Obligations - Designated Event
described in Section
1.1(n)(i) of this Restated Agreement
shall occur, the Corporation shall be required to
immediately
fund the Change of Control Obligations in accordance with
the
most recent report prepared by the Actuary pursuant to Section
11.3 of this Restated Agreement.
(b) If
a Change of Control Obligations - Designated Event
described in Section
1.1(n)(ii) of this
Restated Agreement
shall occur, the
Corporation shall be
required to settle the
Change of Control Obligations forthwith in accordance with the
provisions of Schedule "B-1", upon receipt by the
Corporation
of a Release executed by the Executive in the form attached to
this Restated Agreement as Schedule "A".
(c) Upon the
earlier of:
(i) learning
of the occurrence of a Change of Control
Obligations - Designated Event described in Section
1.1(n)(i) of this Restated Agreement; or
(ii)
receipt of a written
notice of the
occurrence of a
Change of Control
Obligations
- Designated Event
described in
Section 1.1(n)(ii) of this Restated
Agreement, which
notice has been signed by the
Executive and sworn
before a notary
public and has
annexed thereto a
Release executed by
the Executive
in the form attached
to this Restated
Agreement as
Schedule "A",
the Trustee shall
promptly give notice to the Corporation in
writing that it
intends to draw on that portion of the Letter
of
Credit which is referable to the Change of Control
Obligations and
contribute
the proceeds
thereof (less any
applicable withholding
tax which it will remit as required by
the Tax Act on behalf
of the Corporation) to the Trust on
behalf of the
Corporation
in order to fund
the Change of
Control Obligations,
unless it receives
satisfactory
proof
within nine
days of such
notice that the Corporation has
funded or settled,
as applicable, the Change of Control
Obligations itself
in accordance with the terms of this
Restated Agreement.
Unless the
Corporation advises
the Trustee in writing that it
has funded or settled,
as applicable,
the Change of
Control
Obligations in
accordance
with the terms of this Restated
Agreement and has provided the Trustee with satisfactory proof
thereof within
nine days of the date of the
aforementioned
notice, the Trustee
shall draw on that
portion of the Letter
of Credit which is referable to the Change of Control
Obligations on the tenth day following the date of such notice
(or the next following business day if such tenth day is not a
<PAGE>
-27-
business day) and contribute the proceeds (less any applicable
withholding tax which it will remit as required by the Tax Act
on behalf of the
Corporation)
to the Trust on behalf
of the
Corporation.
Notwithstanding the
foregoing,
in the event a Change of
Control Obligations -
Designated Event
described in
Section
1.1(n)(i) of
this Restated Agreement has triggered the
operation of this Section 11.7 and the failure which gave rise
to the occurrence
of such Change of Control Obligations -
Designated Event has
been remedied prior to the expiration of
the notice period
provided for in this Section 11.7(c), the
Trustee shall not take the action described in the immediately
preceding paragraph
hereof and all of the
provisions of this
Restated Agreement
shall continue to apply to the same extent
and as fully as they would have in the event that such Change
of Control Obligations - Designated Event had not occurred.
(d) The
required amount of funding or the portion of the Letter of
Credit to be drawn on for purposes of this Section 11.7
shall
be determined
by the Actuary and shall be the amount
determined in accordance with Sections 11.5(a) through (l) of
this Restated
Agreement offset by the amount determined in
accordance with subparagraphs 11.6(e)(i) through (xii) of this
Restated Agreement. The settlement amount for purposes of this
Section 11.7
shall be determined in accordance with the
provisions of Schedule "B-1".
(e) In the
event that the Change of Control Obligations have been
funded in accordance
with the terms hereof as a result of the
occurrence of a Change
of Control Obligations
- Designated
Event described in Section 1.1(n)(ii), the Change of Control
Obligations shall be
promptly settled with
the Executive in
accordance with the provisions of Schedule "B-1".
11.8
The actuarial methods
and assumptions
described in Schedule "B-1" and
Schedule "B-2" shall
be reviewed from time to time. Any amendments to
Schedule "B-1" and/or
Schedule "B-2" as a
result of such review shall
be dealt with in accordance with Section 13.6.
11.9
The Trustee shall surrender the Letter of Credit to the Corporation
for
cancellation upon the earliest of:
(a) receipt by
the Trustee of a
written direction
signed by the
Corporation and
the Executive directing surrender of the
Letter of Credit;
(b) receipt by
the Trustee of a
written direction
signed by the
Corporation confirming
that it has funded
and/or settled the
Obligations in accordance with the terms hereof, together with
evidence which
is satisfactory to the Trustee that such
funding and/or settlement has occurred; and
<PAGE>
-28-
(c) receipt by
the Trustee of a
written direction
signed by the
Corporation confirming
that the Corporation
has no remaining
Obligations to the Executive, together with evidence which
is
satisfactory to
the Trustee that the Corporation has no
remaining Obligations to the Executive and that a copy of such
written direction has been provided to the Executive.
11.10 The
Trust shall be terminated by the Trustee upon the earliest of:
(a) receipt by
the Trustee of a
written direction
signed by the
Corporation and the
Executive confirming
the termination of
the Trust;
(b) the
entire depletion of the Trust Fund through payments
pursuant to the
terms of the Trust
Agreement,
in the event
that such depletion
occurs subsequent to the funding of
the
Obligations in
accordance
with the terms of this Restated
Agreement; and
(c) receipt by
the Trustee of a
written direction
signed by the
Corporation confirming
that the Corporation
has no remaining
Obligations to the Executive, together with evidence which
is
satisfactory to
the Trustee that a copy of such written
direction has been provided to the Executive.
Upon the termination of the Trust, any assets of the Trust which
remain
after the satisfaction of any remaining Obligations of the Corporation
to the Executive shall be returned to the Corporation.
11.11 The
Corporation
and the Executive hereby acknowledge that the
Corporation is
entering into agreements similar to this Restated
Agreement with certain of its other executives and that the
Corporation
may, at its sole discretion, arrange for one or more Letters of
Credit
to satisfy its responsibilities under this Restated Agreement and
such
other agreements. In the event that one Letter of Credit is
obtained to
satisfy the
Corporation's
responsibilities
under
this Restated
Agreement and some or
all of such other
agreements, references
to a
"Letter of
Credit" in this Restated Agreement shall be read as
references to that
portion of such Letter of Credit which is referable
to the responsibilities of the Corporation to the Executive.
The Corporation and the Executive also acknowledge that the
Corporation
may, at its sole discretion, enter into one or more Trust
Agreements to
satisfy its
responsibilities under
this Restated
Agreement and such
other agreements. In the event that one Trust Agreement is entered
into
to satisfy the
Corporation's
responsibilities
under this Restated
Agreement and
some or all of such
other agreements, references to
"Trust", "Trust
Agreement", "Trustee"
and "Refundable Tax Account" in
this
Restated Agreement shall be read with such modifications as may
be
necessary in the context.
11.12 At
the discretion of the
Corporation and
subject to the provisions of
applicable law, in the
event that all or a portion of the Obligations
are funded in
accordance
with Article 11 hereof and an actuarial
surplus (determined by actuarial valuation in accordance with the
terms
<PAGE>
-29-
of the report prepared as at the immediately preceding Valuation Date
in accordance with Section 11.3 of this Restated Agreement) arises
as a
result thereof:
(a) all or a
portion of such actuarial surplus may be used in the
determination of or to reduce the funding otherwise required
to be provided by the Corporation hereunder; or
(b) any
surplus assets may, to the extent that they exceed 110% of
the amount required to
fund that portion of
the Obligations
which has been funded (as determined by the report prepared as
at the immediately preceding Valuation Date in accordance with
Section 11.3 of this
Restated Agreement)
be returned to the
Corporation.
ARTICLE 12
EXPEDITED ARBITRATION
---------------------
12.1
If, pursuant to Section 7.1 of this Restated Agreement, the Executive
provides written
notice of the Executive's intention to terminate the
Executive's employment
for Good Reason, and
the Corporation
believes
that there is no Good
Reason, or, alternatively, if, pursuant to
Section 4.1 of
this Restated Agreement, the Corporation provides
written notice of its intention to terminate the Executive's
employment
for Just Cause and the Executive believes there is no Just Cause,
the
Corporation or the Executive, as applicable, shall, within ten (10)
days of having been
provided such notice, provide written notice
("Notice of
Dispute")
to the other Party of the dispute (the
"Dispute").
12.2
The Parties agree that any and all Disputes under Section 12.1 of this
Restated Agreement will be resolved by way of a single
Arbitrator.
12.3
(a) Within
fifteen (15) days of provision of the Notice of
Dispute, the
Parties shall agree upon and appoint a
neutral
Arbitrator from the
then current
roster maintained by the
Alberta Mediation and Arbitration Society to act as Arbitrator
of the Dispute; or
(b) If no
person acceptable
to both Parties has
been agreed upon
and appointed within
fifteen (15) days, then either Party may
make immediate
application
to the Court of
Queen's Bench of
Alberta, Judicial
District of Calgary,
to have an Arbitrator
appointed.
12.4
The Parties
acknowledge and agree
that the purpose of this Article 12
is to avoid delays and facilitate resolution of the Dispute in a
just,
speedy and cost-effective manner.
12.5
Consistent with the
expedited nature of
arbitration,
the Arbitrator
will direct
and control the scope and timing of the exchange of
information between
the Parties and will take such steps as the
Arbitrator deems necessary to achieve a just, speedy and
cost-effective
<PAGE>
-30-
resolution of the Dispute. The Arbitrator has the exclusive
right and
power to resolve all issues related to the exchange of
information in
the arbitration process.
12.6
The Parties agree that the Arbitrator is only authorized to determine
whether the Executive had Good Reason for terminating the Executive's
employment, or alternatively, whether the Corporation had Just
Cause to
terminate the Executive's employment.
12.7
A hearing will occur within forty-five (45) days of the
appointment of
the Arbitrator (the
"Hearing"). The time
of the Hearing (the "Hearing
Date") will be scheduled by the Arbitrator after consultation with the
Parties. The
Hearing will be governed by the rules set out in the
ARBITRATION ACT S.A. 1991, c.A-43, as modified by the Arbitrator in
the
interests of achieving a just, speedy and cost-effective
resolution of
the Dispute. The
Arbitrator may require written submissions of fact in
the Dispute to be provided seven (7) days before the Hearing
Date.
12.8
The Arbitrator
will use best
efforts to
provide a written
decision
within seven (7) days of the conclusion of the Hearing.
12.9
The Parties agree that the decision of the Arbitrator will be final
and
binding upon the Parties.
ARTICLE 13
GENERAL
-------
13.1
The headings of the Articles and paragraphs in this Restated
Agreement
are inserted for
convenience only and
shall not affect the meaning or
construction of this Restated Agreement.
13.2
This Restated
Agreement
shall
be construed and interpreted in
accordance with the
laws of the Province
of Alberta
and the federal
laws of Canada as applicable therein.
13.3
If any provision of this Restated Agreement is determined to be
void or
unenforceable in
whole or in part,
it shall be and be
deemed to be
severed from this Restated Agreement without affecting or impairing
the
validity of any other provision herein.
13.4
Any notice required
or permitted to be given under this Restated
Agreement shall be in
writing and shall be properly given if delivered
by hand delivery
or mail or other
form of electronic communication
capable of transmission confirmation to the following address:
a. IN
THE CASE OF THE CORPORATION TO:
----------------------------------
Nexen Inc.
801 - 7th Avenue S.W.
Calgary, AB T2P
3P7
Attention: General
Manager, Compensation and Benefits
<PAGE>
-31-
b. IN
THE CASE OF THE EXECUTIVE TO:
--------------------------------
the last address of the Executive in the records of the
Corporation or to such
other address as the
Parties may from
time to time specify by notice given in accordance herewith.
13.5
This Restated
Agreement shall enure to the benefit of and
be binding
upon the Executive and the Executive's heirs, executors and
administrators and upon the Corporation and its successors and
assigns.
13.6
This Restated
Agreement constitutes
the entire agreement
relating to
the respective
rights
and obligations of the Parties upon the
occurrence of a Change
of Control. No amendment or waiver of this
Restated Agreement
shall be binding
unless executed in writing by the
Parties.
Notwithstanding the foregoing,
(a) any amendment to Article 11 of this Restated Agreement,
Schedule "B-1" or
Schedule "B-2" which
is required to ensure
that the balance remaining in the Trust after the required tax
has been withheld and remitted to the Canada Revenue Agency is
sufficient to satisfy the fee levied by the Bank in connection
with the issuance
of a Letter of
Credit may be made by the
Corporation
without the
prior written approval of the
Executive; and
(b) the
Corporation may amend,
modify or waive Article 11 of this
Restated Agreement, Schedule "B-1" and Schedule "B-2" in whole
or in part, at such
time and from time to
time, and in such
manner and to such
extent as it may deem
advisable without
obtaining the approval
of the Executive,
provided that such
amendment,
modification or
waiver, as the case
may be, does
not adversely affect the securitization in accordance with the
terms hereof of those Obligations which have accrued up to the
date of such amendment, modification or waiver, as the case
may be.
13.7
The Parties agree that the rights, entitlements and benefits set
out in
this Restated
Agreement to be paid to the Executive upon a Change of
Control shall be in
full satisfaction
of all rights of the
Executive
under applicable law in effect from time to time as a result
thereof.
13.8
Neither Party can
waive or shall be deemed to have waived any right it
has under this Restated Agreement except to the extent that such
waiver
is in writing.
13.9
Nothing contained
in this Restated Agreement shall be construed as
limiting the ability of the Corporation to amend, modify or terminate
the Executive
Benefit Plan in whole
or in part, at such time and from
time to time, and in
such manner
and to such
extent as it may deem
advisable.
<PAGE>
-32-
The Parties have
executed this
Restated Agreement effective the date first
written above.
NEXEN INC.
Per: (signed)
--------------------------------
Per: (signed)
--------------------------------
SIGNED, SEALED & DELIVERED
in the presence of
(signed)
(signed)
-------------------------------
-------------------------------------
WITNESS
CHARLES W. FISCHER
<PAGE>
SCHEDULE "A"
------------
AMENDED AND RESTATED AGREEMENT
RESPECTING CHANGE OF CONTROL AND
EXECUTIVE BENEFIT PLAN ENTITLEMENTS
In order to receive
the entitlements referred to in the Article 8 of this
Restated Agreement,
the Executive
shall execute the
attached Release,
fully
releasing the Corporation from all further claims in relation to
the Executive's
employment or Employment Benefits and the termination thereof upon payment of
the remuneration
and benefits referred to in Article 8 of this Restated
Agreement. The
attached Release shall not, however, require that the Executive
relinquish or release
any rights to indemnity which the Executive may, as an
officer or director of the Corporation or any of its Affiliates,
Associates and
Subsidiaries, have
as against the Corporation or any of its Affiliates,
Associates and Subsidiaries, for costs, charges and expenses
reasonably incurred
by the Executive in respect of any civil, criminal or administrative
action or
proceeding to which
the Executive is made
a party by reason of being or having
been a director
or officer of the Corporation or any of its Affiliates,
Associates and Subsidiaries, where:
(a) the
Executive has acted honestly and in good faith with a view
to the best interests of the Corporation or any of its
Affiliates, Associates and Subsidiaries; and
(b) in
the case of a criminal or administrative action or
proceeding enforced by
a monetary penalty,
the Executive had
reasonable grounds for
believing the Executive's conduct was
lawful.
<PAGE>
FINAL RELEASE
-------------
KNOW ALL MEN BY THESE
PRESENTS that I, CHARLES W. FISCHER, of the City of
Calgary, in the Province of Alberta, in consideration of the
amounts provided in
that certain Amended
and Restated Agreement
Respecting
Change of Control
and
Executive Benefit Plan
Entitlements (the "Restated Agreement") dated as of the
______ day of
____________, 2008
between myself and NEXEN INC. and for
other
good and valuable consideration, the receipt and sufficiency of
which is hereby
acknowledged, do for myself, my executors and assigns hereby
remise, release and
forever discharge the Corporation, and any associated, affiliated, predecessor
or parent corporation of the Corporation and their present and
former directors,
officers, agents
and employees (the "Releasees"), including each of their
respective successors,
heirs, administrators and assigns,
from all manner of
actions, causes of
action, debts,
obligations,
covenants, claims or
demands,
whatsoever which I may
ever have had, now have, or can, shall or may hereafter
have against the
Releasees or any of
them, by reason of or
arising out of any
cause, matter
or thing whatsoever done, occurring or existing up to and
including the present date and, in particular, without in any way restricting
the generality
of the foregoing, in respect of all claims of any nature
whatsoever, past,
present or future, directly or indirectly related to or
arising out of or in connection with my relationship with the Releasees, as an
employee, officer or
director, and the
termination of my
employment from
the
Corporation including, but not limited to, any claims related to
any entitlement
I may have or may have had to any payment or claim either at common
law or under
the EMPLOYMENT
STANDARDS CODE, HUMAN RIGHTS, CITIZENSHIP AND MULTICULTURALISM
ACT or any other
applicable legislation
governing or related
to my employment
with the Releasees.
AND FOR THE SAID
CONSIDERATION, I,
CHARLES W. FISCHER,
represent and
warrant
that I have not assigned to any person, firm or corporation any of the
actions,
causes of action,
claims, suits,
executions or demands which I release by this
Release, or with
respect to which I agree not to make any claim or take any
proceeding herein.
IT IS FURTHER ACKNOWLEDGED that the payment to me includes full
compensation and
consideration for the
loss of my employment benefits, as provided by the
Releasees, and that
all of my employment benefits and privileges shall cease on
the date of termination of my employment, except as otherwise
expressly provided
in the Restated
Agreement.
I further acknowledge that I have received all
benefits due to me and
have no further claim
against the
Releasees for such
benefits. I further
accept sole responsibility to replace such benefits which I
<PAGE>
-2-
wish to continue or to exercise conversion privileges where applicable with
respect to such
benefits and, in
particular any life
insurance and
long-term
disability benefits.
In the event that I become disabled following termination
of my employment,
I covenant not to sue
the Releasees
for insurance or
other
benefits or loss of
same and hereby
release the Releasees from any and all
further obligations or liabilities arising therefrom.
Notwithstanding
anything contained herein, this Release shall not extend to
or
affect, or
constitute a release
of, my right to sue,
claim against or recover
from the Releasees
and shall not
constitute
an agreement to refrain from
bringing, taking or maintaining any action against the Releasees in
respect of:
(a) any
corporate indemnity existing by statute, contract
or pursuant to any of the constating documents of the
Corporation provided
in my favour in
respect of my
having acted at any
time as a director,
officer or
both of
the Corporation;
(b) my
entitlement
to any insurance
maintained for the
benefit or
protection
of the directors and/or
officers of
the Corporation, including without
limitation,
directors' and
officers' liability
insurance; or
(c) my
entitlement to any amounts or compensation due to
me under the terms of my employment pursuant to the
Restated Agreement.
IT IS HEREBY AGREED that the terms of the Restated Agreement and of
this Release
will be kept
confidential. No party
hereto shall communicate any such terms to
any third party under any circumstances whatsoever, excepting any necessary
communication with my legal and financial advisors, as required, on the express
condition that they
maintain the
confidentiality
thereof, and any
disclosure
which is required by law, although either party shall be at
liberty to disclose
to third parties
that a mutually acceptable Release was agreed upon. The
invalidity and
unenforceability
of any provision of this Release shall not
affect the validity or
enforceability of any
other provision of
this Release,
which shall remain in full force and effect.
<PAGE>
-3-
I HEREBY DECLARE that
I have read all of this Release, fully understand the
terms of this Release and voluntarily accept the consideration
stated herein as
the sole consideration
for this Release for the purpose of making a full
and
final settlement with
the Releasees. I
further acknowledge
and confirm that I
have been given an adequate period of time to obtain independent legal counsel
regarding the meaning and the significance of the terms herein and
the covenants
mutually exchanged.
IT IS HEREBY AGREED THAT as a term of the termination of my employment from
the
Corporation, and in
consideration of the amount noted above, I hereby resign as
officer and director of the Corporation and its affiliates.
IN WITNESS
WHEREOF, I have hereunto set my hand and seal this
_____ day of
______________ in the year _________.
-------------------------------------
CHARLES W. FISCHER
-------------------------------------
WITNESS (signature)
-------------------------------------
WITNESS (print name)
<PAGE>
SCHEDULE "B-1"
--------------
AMENDED AND RESTATED AGREEMENT
RESPECTING CHANGE OF CONTROL AND
EXECUTIVE BENEFIT PLAN ENTITLEMENTS
METHODOLOGY AND ASSUMPTIONS FOR DETERMINING SETTLEMENT VALUE
PURPOSE
In accordance
with the terms of the
Restated Agreement, the purpose of this
Schedule "B-1" is to outline the calculation approach such that, after tax has
been paid on a lump sum settlement value, the remaining balance is intended to
be sufficient to provide after-tax monthly payments equivalent to the after-tax
monthly payments
the Executive would have received under the terms of the
Executive Benefit Plan as provided for under this Restated
Agreement.
OVERVIEW FOR DEFINED BENEFIT PENSION
The following
outlines the
actuarial methods, assumptions and calculation
process to be used in determining the lump sum settlement
value of the
defined
benefit pension
entitlements under the
Executive Benefit Plan
when settlement
occurs in accordance with Section 11 of the Restated Agreement. Section 300 of
the Income Tax
Regulations
establishes the
procedure applicable in using an
after-tax lump sum to purchase a prescribed annuity:
1.
