Exhibit 10.1
CHANGE IN CONTROL
AGREEMENT
THIS AGREEMENT, made
and entered into as of the 17 th day of December, 2008 and
effective as of December 31, 2008 by and between CABOT
OIL & GAS CORPORATION, with its principal office at
1200 Enclave Parkway, Houston, Texas 77077 (together with its
successors and assigns permitted under this Agreement, the
“Company”), and
(the “Executive”),
WITNESSETH:
WHEREAS, on November 3, 1995,
the Compensation Committee of the Board of Directors of the Company
authorized and adopted a Change in Control Program to provide for
certain benefits to certain of the officers of the Company in the
event of certain terminations of employment, and determined that
such program would be in the best interests of the Company;
and
WHEREAS, on July 17, 2001, upon
the recommendation of its Compensation Committee, the Board of
Directors of the Company authorized and adopted certain
modifications to the Change in Control Program; and
WHEREAS, the Company and the
Executive entered into an agreement effective as of
(the “2001 Agreement”), setting forth the rights and
responsibilities of the parties pursuant to the Company’s
modified Change in Control Program; and
WHEREAS, the Company and the
Executive now desire to adopt changes, including changes necessary
to cause the 2001 Agreement to comply with the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”) and the related regulations and guidance
thereunder (collectively, “Section 409A”), such
amendment to be evidenced by entering into this agreement (the
“Agreement”), which supersedes and replaces the 2001
Agreement.
NOW, THEREFORE, in consideration of
the premises and mutual covenants contained herein and for other
good and valuable consideration, the receipt of which is mutually
acknowledged, the Company and the Executive (each, individually, a
“Party” and, collectively,
the “Parties”) agree as follows:
1. Definitions :
(a) “ Annual
Compensation ” shall mean the sum of (I) the
Executive’s Base Salary in effect immediately prior to the
Change in Control or, if greater, immediately prior to the
Executive’s termination and (II) the greater of (1) 100%
of the Executive’s target Bonus with respect to the fiscal
year during which the Change in Control occurred or, if greater,
the fiscal year during which the Executive’s termination
occurred and (2) the Executive’s actual Bonus paid
(including any amount deferred at the election of the Executive)
with respect to any of the three fiscal years immediately preceding
the Change in Control or, if termination of employment occurs prior
to a Change in Control, termination of employment.
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(b) “ Base Salary
” shall mean the Executive’s annualized base rate of
pay with the Company.
(c) “ Beneficiary
” shall mean the person or persons named by the Executive
pursuant to Section 10 hereof or, in the event no such person
is named or survives the Executive, his estate.
(d) “ Board ”
shall mean the Board of Directors of the Company.
(e) “ Bonus ”
shall mean the cash amount, excluding any amount relating to the
vesting of options or granting of performance shares or vesting of
restricted stock or any other long-term incentive award, in excess
of the Executive’s Base Salary, awarded to the Executive in
any year.
(f) “ Cause ”
shall mean:
(I) dishonesty by the Executive
which results in significant loss to the Company and significant
personal enrichment to the Executive;
(II) a material failure of the
Executive to perform his obligations under this Agreement (other
than any such failure resulting from incapacity due to physical or
mental illness); or
(III) the willful and continued
failure of the Executive to perform substantially the
Executive’s duties with the Company or one of its affiliates
(other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial
performance is delivered to the Executive by the Board or the Chief
Executive Officer of the Company which specifically identifies the
manner in which the Board or Chief Executive Officer believes that
the Executive has not substantially performed the Executive’s
duties.
(g) “ Change in Control
” shall mean:
(I) The acquisition by any
individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) (a
“Person”) of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of
either (1) the then outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”) or
(2) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting
Securities”); provided, however, that for purposes of
this subsection (I), the following acquisitions shall not
constitute a Change of Control: (i) any acquisition directly
from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any entity
controlled by the Company or (iv) any acquisition by any
entity pursuant to a transaction which complies with clauses (1),
(2) and (3) of subsection (III) of this definition;
or
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(II) Individuals who, as of the date
hereof, constitute the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the
Board; provided, however , that any individual becoming a
director subsequent to the date hereof whose election, or
nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for
this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors or
other actual or threatened solicitation of proxies or consents by
or on behalf of a Person other than the Board; or
(III) Consummation of a
reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the
Company (a “Business Combination”), in each case,
unless, following such Business Combination, (1) all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or
indirectly, more than 50% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the entity resulting
from such Business Combination (including, without limitation, an
entity that as a result of such transaction owns the Company or all
or substantially all of the Company’s assets either directly
or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business
Combination, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be,
(2) no Person (excluding any entity resulting from such
Business Combination or any employee benefit plan (or related
trust) of the Company or such entity resulting from such Business
Combination) beneficially owns, directly or indirectly, 35% or more
of, respectively, the then outstanding shares of common equity of
the entity resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of such
entity except to the extent that such ownership existed prior to
the Business Combination and (3) at least a majority of the
members of the board of directors of the corporation, or the
similar managing body of a non-corporate entity, resulting from
such Business Combination were members of the Incumbent Board at
the time of the execution of the initial agreement, or of the
action of the Board, providing for such Business Combination;
or
(IV) Approval by the stockholders of
the Company of a complete liquidation or dissolution of the
Company, other than a liquidation or dissolution in connection with
a transaction to which subsection (III) applies.
Notwithstanding the foregoing, none
of the events described in subsections (I) through (IV) above
shall constitute a Change in Control unless such event also meets
the requirements of Section 409A(a)(2)(A)(v) of the Code and
the related regulations and guidance.
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(h) “ Confidential
Information ” shall mean information about the Company or
any of its Subsidiaries or their respective businesses, products
and practices, disclosed to or known or obtained by the Executive
as a direct or indirect consequence of or through the
Executive’s employment with the Company, which information is
not generally known in the business in which the Company or such
Subsidiaries are or may be engaged. However, Confidential
Information shall not include under any circumstances any
information with respect to the foregoing matters which is
(I) available to the public from a source other than the
Executive, (II) released in writing by the Company to the
public or to persons who are not under a similar obligation of
confidentiality to the Company and who are not parties to this
Agreement, (III) obtained by the Executive from a third party
not under a similar obligation of confidentiality to the Company,
(IV) required to be disclosed by any court process or any
government or agency or department of any government, or
(V) the subject of a written waiver executed by the Company
for the benefit of the Executive.
(i) “ Constructive
Termination Without Cause ” shall mean a termination of
the Executive’s employment at his initiative as provided in
Section 2 within 30 days following the occurrence, without the
Executive’s prior written consent, of one or more of the
following events:
(I) any loss of the
Executive’s titles or positions in effect at the time of a
Change in Control or any adverse change in the position to which
the Executive reports or the principal departmental functions that
report to the Executive at the time of a Change in Control
(reporting relationships) that in any case results in a diminution
of the Executive’s responsibility or the Executive’s
access to the Chief Executive Officer of the Company;
(II) the assignment to the Executive
of any duties inconsistent in any respect with the
Executive’s position (including status, offices, titles and
reporting relationships), authority, duties or responsibilities as
in effect on the date of a Change in Control, or any other action
by the Company which results in a diminution in such position,
authority, duties or responsibilities, excluding action not taken
in bad faith and which is remedied by the Company promptly after
receipt of notice thereof given by the Executive;
(III) any reduction in total
aggregate compensation, including, but not limited to, the
aggregate benefits of all fringe benefits, Bonus opportunity,
long-term incentive opportunity or perquisites applicable to the
Executive immediately prior to a Change in Control, or any
reduction in Base Salary, Bonus opportunity or long-term incentive
opportunity from that immediately preceding a Change in
Control;
(IV) the relocation of the
Executive’s office location as assigned to him by the Company
to a location more than 35 miles from his office location at the
time of a Change in Control;
(V) any failure by the Company to
comply with any of the provisions of this Agreement, other than a
failure not occurring in bad faith and which is remedied by the
Company promptly after receipt of notice thereof given by the
Executive;
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(VI) any purported termination by
the Company of the Executive’s employment otherwise than as
expressly permitted by this Agreement for Cause; or
(VII) any failure by the Company to
comply with and satisfy Section 5 of this Agreement, provided
that the successor contemplated by Section 5 has received, at
least 10 days prior to the giving of notice of constructive
termination by the Executive, written notice from the Company or
the Executive of the requirements of Section 5 of the
Agreement.
(j) “ Disability
” shall mean that the Executive has met one of the following
requirements:
(i) As a result of a medically
determinable physical or mental impairment that can be expected to
result in death or to last for a continuous period of not less than
12 months, the Executive is (A) unable to engage in any
substantial gainful activity or (B) receiving income
replacement benefits or a period of not less than six months under
the Cabot Group Health and Welfare Plan; or
(ii) The Executive has been
determined to be disabled in accordance with the terms of the Cabot
Group Health and Welfare Plan, provided, however, that the terms of
such plan define disability in a manner consistent with Treasury
Regulations Section 1.409A-3(i)(4).
(k) “ Initial Term
” shall mean the period commencing on
and
ending
.
(l) “ Potential Change in
Control Period ” shall mean the period beginning on the
date a Potential Change in Control occurs and ending on the earlier
to occur of (I) the expiration of 12 months thereafter or (II)
the Board determining in good faith that there is no longer a risk
of a Change in Control occurring.
(m) “ Potential Change in
Control ” shall be deemed to have occurred,
if:
(I) the Company enters into an
agreement, the consummation of which would result in the occurrence
of a Change in Control;
(II) any person (including the
Company) publicly announces an intention to take or to consider
taking actions which if consummated would constitute a Change in
Control;
(III) any Person, who is or becomes
the beneficial owner, directly or indirectly, of securities of the
Company representing 9.5% or more of the combined voting power of
the Company’s then outstanding securities, increases his
beneficial ownership of such securities by 5% or more over the
percentage so owned by such Person on the date hereof;
or
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(IV) the Board adopts a resolution
to the effect that, for purposes of this Agreement, a potential
Change in Control has occurred.
(n) “ Subsidiary
” shall mean any corporation in which the Company either
(I) controls more than 50% of the voting power of all
securities of such corporation or (II) owns more than 50% of the
total value of all equity securities of such
corporation.
(o) “ Term ”
shall mean the term of this Agreement, which shall consist of the
Initial Term and any extensions thereof.
(p) “ Termination
Benefits ” shall mean:
(I) an amount of cash equal to the
product of (A) Annual Compensation times (B) three;
and
(II) immediate vesting of and lapse
of restrictions with respect to all of the Executive’s
equity-based incentive awards that remain outstanding at the time
of the Executive’s termination without Cause or Constructive
Termination Without Cause, whether or not such would be the result
under the provisions of any applicable award Agreements; provided
that (i) the application of this Section 1(p)(II) to
performance-based awards shall remain subject to the terms of the
applicable award agreement for purposes of calculating the amount
of and the timing of payment of benefits thereunder and (ii), to
the extent applicable, each of the Executive’s unexercised
options or stock appreciation rights (“SARs”) shall
immediately become and shall remain exercisable (without regard to
any provision with respect to expiration upon termination of
employment) until the earlier to occur of exercise of the option or
SAR or the expiration of the option or SAR at the end of its full
term; and
(III) at the Executive’s
election, and subject to the Executive’s payment of the
applic
