1
AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AMENDMENT, made and entered into the 29th day of January, 1996, by
and between EL PASO NATURAL GAS COMPANY, a Delaware corporation (the "Company")
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ of El Paso, Texas (the "Executive").
WHEREAS, the Company and Executive entered into an Employment Agreement
dated July 31, 1992 (the "Employment Agreement"). Any capitalized term not
separately defined herein shall have the same meaning as it has under the
Employment Agreement;
WHEREAS, the Compensation Committee of the Company's Board of Directors
has determined that it is the best interest of the Company to have the
Executive's compensation more closely aligned to the interests of the Company's
stockholders by providing Executive with exclusively stock-based compensation;
and
WHEREAS, it is understood that the provisions of Section 3(b) and new
Section 3(d) of the Employment Agreement constitute benefit formula adjustments
required by the Employment Agreement for purposes of Section 5.1(c) of the
Company's Supplemental Benefits Plan, as amended and restated effective January
15, ▇▇▇▇ (▇▇▇ "▇▇▇ ▇▇▇"); and
WHEREAS, references in the Employment Agreement to Section 4.1 of
the SBP shall now refer to Section 5.1 of the New SBP; and
WHEREAS, both the Company and the Executive (the "Parties") now desire to
amend the Employment Agreement.
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, and for other consideration mutually acknowledged, the
Parties agree as follows:
1
2
1. This Amendment shall be effective on February 1, 1996 and
shall remain in effect for five (5) years thereafter (the "Amendment Term"). In
no event shall this Amendment have any effect on the Letter Agreement between
the Company and the Executive, dated January 13, 1995, except that shares of
Company restricted stock which vest based upon the achievement of certain
established performance targets shall vest only to the extent such performance
targets have been achieved.
2. Section 3(a), which currently refers to Section 3(b), is
amended to refer to Sections 3(b), 3(c) and 3(d), and a new Section 3(d) is
added to read as follows:
Executive hereby agrees to forego his right to receive payment
of his base salary until the earlier of (i) the occurrence of
a Change in Control, or (ii) the end of the Amendment Term
(the "Election"); provided however, that
(a) base salary, at the current level or as adjusted as
described in clause (b) below, shall remain in effect,
notwithstanding the Election, for purposes of
calculating all the Executive's other compensation and
benefits under any Company plans and arrangements,
including, but not limited to, the Company's 1995
Incentive Compensation Plan, the SBP and the Company's
Senior Executive Survivor Benefit Plan (as such plans
may be amended from time to time) and any Company
successor plans thereto.
(b) the Compensation Committee shall continue to
review the Executive's annual salary level for
increase in the ordinary course, provided any
increased salary shall continue to be subject to the
Election as provided herein, and
2
3
(c) in applying Section 5.1 of the SBP, the Pension Plan
benefit formula shall be applied as if the Executive
had actually been paid, on a timely basis, any amounts
of base salary covered by the Election and such
amounts had been includable in the calculation of
Final Average Monthly Earnings, it being intended that
the Executive's pension benefits as otherwise
determined under the Employment Agreement shall be the
same as if the Election had not been made,
3. Clause (A) of Section 4(b)(i) is amended to read as follows:
Salary, at the rate in effect on the date of termination of
employment, but only for the period, if any, from the end of
the Amendment Term, to the end of the Term.
4. Clauses (i) through (iii) of Section 4(c) are renumbered as
clauses (ii) through (iv), and a new clause (i) is added to read as follows:
Executive shall be entitled to salary under Section 4(b)(i)(A)
from the date of termination of employment through the end of
the Term, without regard to the Election or the Amendment
Term.
5. The Executive agrees that the Election does not constitute
"Good Reason" for purposes of the SPP, so long as the Election does not result
in a diminution in any of the Executive's other rights to compensation and
benefits during his employment.
6. Pursuant to Section 3(a) of the Employment Agreement, the
Executive hereby gives written consent the changes in the Company's
compensation and benefit plans in connection with the Company's restructuring
and cost-cutting efforts.
3
4
7. This Amendment shall be governed by and construed and
interpreted in accordance with the laws of the State of Texas without reference
to the principles of conflicts of law thereunder.
8. This Amendment may be executed in counterparts.
IN WITNESS WHEREOF, the undersigned have executed this Amendment on
the date first written above.
EL PASO NATURAL GAS COMPANY
/s/ ▇▇▇ ▇. LOVE
-----------------------------------
▇▇▇ ▇. Love, Chairman,
Compensation Committee
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇ III
-----------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇ III
Senior Vice President
▇▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇
-----------------------------------
4
