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Exhibit 10.01
Valero Energy Corporation
Annual Bonus Plan
Adopted April 28, 2004
Table of
Contents
INTRODUCTION
The Valero Energy Corporation
Annual Bonus Plan (hereinafter referred to as the
“Plan”) has been established for the purpose of
providing bonus compensation to eligible designated employees of
Valero Energy Corporation and its Affiliates (hereinafter
collectively referred to as the “Company”). The Company
intends and desires to create individual performance incentive by
providing bonus compensation awards based upon individual
contributions to Company profitability by eligible designated
employees. Such bonus compensation is intended to encourage levels
of individual performance that will assure focus by employees on
continued Company profitability. It is further intended that when
added to other forms of compensation the bonus compensation awards
will result in total compensation to employees in amounts that are
competitive when Company performance is compared to peer
organizations.
Article 1
– Definitions
For purposes of the Plan, unless
the context requires otherwise, the following terms should have the
meanings set forth below.
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1.1
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“Affiliate” means (a) any entity
that, directly or indirectly through one or more intermediaries, is
controlled by the Company and (b) any entity in which the Company
has a significant equity interest, in each case determined by the
Committee.
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1.2
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"Board" means
the Board of Directors of the Company.
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1.3
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“Bonus
Target” means a percentage established to represent a normal
or average bonus percentage determined through competitive survey
analysis and based on each position’s relative importance to
the overall financial success of the Company.
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1.4
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"Committee"
means the Compensation Committee of the Board.
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1.5
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"Company" means
Valero Energy Corporation and its Affiliates.
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1.6
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“Discretionary Adjustment Factor”
means the authority of the Committee to adjust the Company’s
total calculated bonus awards upward or downward by up to 25% based
upon such factors as the Committee deems appropriate, and
ultimately to determine whether to award a bonus to any
individual.
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1.7
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"Employee"
means an employee of the Company.
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1.8
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“Fair
Market Value” means, with respect to any property (including,
without limitation, any shares, units or other securities), the
fair market value of such property determined by such methods or
procedures as shall be established from time to time by the
Committee. Notwithstanding the foregoing, unless otherwise
determined by the Committee, the Fair Market Value of Company
shares on a given date for purposes of the Plan shall be the mean
of the high and low sales prices of the shares on the New York
Stock Exchange Consolidated Exchange as reported in the
consolidation transaction reporting system on such date or, if such
Exchange is not open for trading on such date, on the next
following date when such Exchange is open for trading.
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1.9
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"Participant"
means an Employee who is selected by the Committee to participate
in the Plan.
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1.10
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“Peer
Group” means those companies in the petroleum and energy
services industry sector designated by the Committee as comparator
companies which will be benchmarked for determining the
Company’s performance as measured by selected Performance
Criteria.
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1.11
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“Performance Criteria” means those
performance measures approved by the Compensation Committee that
determine the level of Bonus Target to be earned, subject to the
Discretionary Adjustment Factor.
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1.12
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"Plan Year"
means the Company's fiscal year.
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1.13
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"Plan" means
the Valero Energy Corporation Annual Bonus Plan.
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2.1
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The Plan shall
be administered by the Committee. The Committee shall consist of no
less than three “Non-Employee Directors” (as defined in
Rule 16b-3 under the Securities Exchange Act of 1934, as amended
from time to time). In the event the Committee fails to meet the
foregoing criteria, then additional non-employee persons shall be
appointed by the Board for purposes of administering this Plan so
that the committee administering this Plan shall be composed solely
of three or more Non-Employee Directors.
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2.2
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The Committee
is empowered to:
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2.21
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Review
and approve all determinations relating to the eligibility of
Participants;
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2.22
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Make
rules and regulations for the administration of the Plan which are
not inconsistent with the terms and provisions
hereof;
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2.23
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Construe
all terms, provisions, conditions, and limitations of the Plan in
good faith. All such determinations shall be final and conclusive
on all parties of interest;
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2.24
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Review
and approve determinations and computations concerning the amounts
to which any Participant or his beneficiary
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