Exhibit 10.4
FIRST AMENDMENT TO
SEVERANCE AGREEMENT
THIS FIRST AMENDMENT TO SEVERANCE AGREEMENT ("First Amendment"), dated
effective as of __________, ____ (the "Effective Date"), is made by and between
Forest Oil Corporation, a New York corporation (the ""Company"), and
______________ ("Executive").
WHEREAS, the Company and Executive have heretofore entered into that
certain Severance Agreement dated __________, ____ (the "Severance Agreement");
and
WHEREAS, the Company and Executive desire to amend the Severance Agreement
in certain respects;
NOW, THEREFORE, in consideration of the premises set forth above and the
mutual agreements set forth herein, the Company and Executive hereby agree,
effective as of the Effective Date, that the Severance Agreement shall be
amended as hereafter provided:
1. Paragraph 1(a) of the Severance Agreement shall be deleted and the
following shall be substituted therefor:
"(a) 'ANNUAL COMPENSATION' shall mean an amount equal to the greater
of:
(i) Executive's annual base salary at the annual rate in effect
at the date of his Involuntary Termination;
(ii) Executive's annual base salary at the annual rate in effect
sixty days prior to the date of his Involuntary Termination; or
(iii) Executive's annual base salary at the annual rate in effect
immediately prior to a Change of Control if Executive's employment
shall be subject to an Involuntary Termination within two years after
such Change of Control.
Notwithstanding the foregoing, if Executive's employment shall be subject
to an Involuntary Termination within two years after such Change of
Control, then the amount determined pursuant to the preceding sentence
shall be increased by the amount of the Annual Bonus. For purposes of the
preceding sentence, the term 'Annual Bonus' shall mean the annual bonus
most recently paid by the Company to Executive prior to the date of his
Involuntary Termination; provided, however, that if Executive was employed
by the Company for only a portion of the year
with respect to which such bonus was paid, then the `Annual Bonus' shall
equal an amount determined by annualizing the bonus received by Executive
based on the ratio of the number of days Executive was employed by the
Company during such year to 365 days; provided, further, that if Executive
has not received an annual bonus from the Company at any time prior to the
date of his Involuntary Termination, then the `Annual Bonus' shall equal
the amount of Executive's target annual bonus for the year in which such
termination occurs."
2. Paragraph 1(j)(ii) of the Severance Agreement shall be deleted and the
following shall be substituted therefor:
"(ii) in the case of an Involuntary Termination which occurs within
two years after the date upon which a Change of Control occurs, a period
commencing on the date of such Involuntary Termination and continuing for
thirty months."
3. The following new subparagraph (d) shall be added to the end of
Paragraph 4 of the Severance Agreement:
"(d) Cause any and all outstanding options to purchase common stock of
the Company held by Executive to remain exercisable for twelve months after
the last day of Executive's employment with the Company (but in no event
shall any such option be exercisable for (i) a longer period than the
original term of such option or (ii) a shorter period than that already
provided for under the terms of such option)."
4. The existing text of Paragraph 6 of the Severance Agreement shall be
designated as subparagraph (a), and the following new subparagraph (b) shall be
added to the end of Paragraph 6 of the Severance Agreement:
"(b) On or before the date upon which a Change of Control occurs (the
"Change of Control Date"), the Compensation Committee shall make a
determination under the Company's annual incentive plan as to whether
bonuses under such plan for the year during which the Change of Control
Date occurs are due based on partial year results through the Change of
Control Date, and, if the Compensation Committee determines that such
bonuses are due, then the Compensation Committee shall also determine the
amount of such bonus that shall be paid to Executive. On or before the
Change of Control Date, the Company shall pay to Executive the amount of
Executive's bonus that has been determined by the Compensation Committee in
accordance with the preceding sentence."
5. This First Amendment (a) shall supersede any prior agreement between
the Company and Executive relating to the subject matter of this First Amendment
and (b) shall be binding upon and inure to the benefit of the parties hereto and
any successors to the Company and all persons lawfully claiming under Executive.
6. As amended hereby, the Severance Agreement is specifically ratified
and reaffirmed.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
First Amendment effective as of the Effective Date.
"COMPANY"
FOREST OIL CORPORATION
By:
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NAME: XXXXXX X. XXXXXXX
TITLE: CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
"EXECUTIVE"
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