ANADARKO PETROLEUM CORPORATION SEVERANCE PLAN AND SUMMARY PLAN DESCRIPTION (As Amended and Restated Effective September 1, 2007)
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ANADARKO PETROLEUM CORPORATION SEVERANCE PLAN
AND SUMMARY PLAN DESCRIPTION
(As Amended and Restated Effective September 1, 2007)
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TABLE OF CONTENTS
Page
ARTICLE I. OVERVIEW .............................................................................................................. 1
ARTICLE II. DEFINITIONS ......................................................................................................... 1
2.1 Affiliate ................................................................................................................... 2
2.2 Base Pay .................................................................................................................. 2
2.3 Basic Severance Amount ........................................................................................ 2
2.4 Benefit Determination Date .................................................................................... 2
2.5 Benefits.................................................................................................................... 2
2.6 Board ....................................................................................................................... 2
2.7 Cause ....................................................................................................................... 2
2.8 Code ........................................................................................................................ 3
2.9 Date of Hire............................................................................................................. 3
2.10 Determination.......................................................................................................... 3
2.11 Effective Date.......................................................................................................... 3
2.12 Eligible Employee ................................................................................................... 3
2.13 Employee................................................................................................................. 3
2.14 Employer ................................................................................................................. 3
2.15 Enhanced Severance Amount.................................................................................. 3
2.16 ERISA ..................................................................................................................... 4
2.17 Person...................................................................................................................... 4
2.18 Plan.......................................................................................................................... 4
2.19 Plan Administrator .................................................................................................. 4
2.20 Plan Sponsor............................................................................................................ 4
2.21 Plan Year ................................................................................................................. 4
2.22 Qualifying Termination........................................................................................... 4
2.23 Resignation.............................................................................................................. 6
2.24 Retirement ............................................................................................................... 6
2.25 Specified Employee................................................................................................. 6
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2.26 WARN Act Notice Pay ........................................................................................... 6
2.27 Week Pay................................................................................................................. 7
2.28 Year of Service........................................................................................................ 7
ARTICLE III. ELIGIBILITY AND BENEFITS ............................................................................ 7
3.1 Commencement....................................................................................................... 7
3.2 Cessation ................................................................................................................. 7
3.3 Non-Discrimination................................................................................................. 7
3.4 Severance Benefits .................................................................................................. 7
ARTICLE IV. SEVERANCE BENEFIT AWARDS ................................................................... 10
4.1 Selection of Employees Eligible to Receive Benefits........................................... 10
4.2 Payment and Taxation of Benefits ........................................................................ 10
4.3 Benefit Exclusions................................................................................................. 10
4.4 Release and Confidentiality Agreement................................................................ 10
4.5 Ineligibility for Re-hire ......................................................................................... 11
ARTICLE V. AMENDMENT, TERMINATION AND ADOPTION OF PLAN........................ 11
5.1 Amendment of Plan............................................................................................... 11
5.2 Termination of Plan............................................................................................... 11
5.3 Adoption of Plan By Additional Employers ......................................................... 12
ARTICLE VI. INTERPRETATION AND DETERMINATIONS............................................... 12
ARTICLE VII. PLAN ADMINISTRATION ............................................................................... 12
7.1 Records and Reports.............................................................................................. 12
7.2 Administrative Powers and Duties........................................................................ 12
7.3 Allocation of Duties and Employment of Agents ................................................. 13
ARTICLE VIII. CLAIMS PROCEDURES.................................................................................. 13
8.1 Notice of Claim ..................................................................................................... 13
8.2 Claims Review Procedure ..................................................................................... 14
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8.3 Exhaustion of Administrative Remedies............................................................... 14
ARTICLE IX. INDEMNIFICATION........................................................................................... 15
ARTICLE X. MISCELLANEOUS............................................................................................... 16
10.1 Integration with Other Payments........................................................................... 16
10.2 Plan Not a Contract of Employment ..................................................................... 16
10.3 Sources of Payment............................................................................................... 16
10.4 Non-Alienation...................................................................................................... 17
10.5 Applicability of Code Section 409A ..................................................................... 17
10.6 No Guarantee of Tax Consequences ..................................................................... 17
10.7 Severability............................................................................................................ 17
10.8 Construction and Interpretation............................................................................. 17
10.9 Governing Law...................................................................................................... 17
APPENDIX A ERISA INFORMATION ................................................................................... 1
ANADARKO PETROLEUM CORPORATION
SEVERANCE PLAN
(As Amended and Restated Effective September 1, 2007)
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WHEREAS, Anadarko Petroleum Corporation (the “Plan Sponsor”) previously adopted the Anadarko Petroleum Corporation Severance Plan (the “Plan”) effective as of July 15, 2003 for the benefit of certain eligible employees; and
WHEREAS, the Plan Sponsor restated and amended the Plan effective as of January 1, 2007 to implement certain enhanced programs that have now expired;
WHEREAS, on August 10, 2006, Anadarko Petroleum Corporation acquired Kerr-McGee Corporation. On August 23, 2006, Anadarko Petroleum Corporation acquired Western Gas Resources, Inc. For one-year periods following the acquisitions, qualifying employees of Kerr-McGee Corporation and Western Gas Resources, Inc. were eligible to participate in severance plans set up for their benefit. The coverages of these plans expired in August 2007. Specifically, the Kerr-McGee Corporation 2005 Special Involuntary Termination Plan for U.S. Non-Bargaining Employees expired on August 10, 2007. The Western Gas Resources, Inc. 2006-2007 Severance Plan expired on August 23, 2007. With these expirations, qualifying employees of Kerr-McGee Corporation and Western Gas Resources are now eligible to participate in this Plan;
WHEREAS, the Plan Sponsor desires to amend and restate the Plan, intending thereby to provide an uninterrupted and continuing program of benefits without a gap or lapse in coverage;
NOW, THEREFORE, the Plan is hereby amended and restated in its entirety, with no interruption or gap in coverage, effective as of September 1, 2007 (the “Effective Date”), unless otherwise specified herein:
ARTICLE I. OVERVIEW
The Plan is intended to provide Eligible Employees with specified severance benefits in the event that an Eligible Employee is terminated from employment in a Qualifying Termination. This Plan is an “employee welfare benefits plan” as defined in Section 3(1) of ERISA. Benefits Determinations will be made in accordance with the terms and conditions of the Plan.
ARTICLE II. DEFINITIONS
The following terms will have the meanings ascribed to them below unless the context reasonably requires a different meaning.
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2.1 Affiliate means such term as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended.
2.2 Base Pay
means the annual rate of base compensation paid by the Employer to an
Eligible Employee (including amounts which the Eligible Employee could have received in cash had he not elected to contribute to an employee benefit plan maintained by the Plan Sponsor), excluding overtime pay, bonuses, employee benefits, added premiums, differentials, components of foreign service assignments, and all forms of incentive compensation. For an Eligible Employee who is paid by the hour, the annual rate of base compensation is determined by multiplying the Eligible Employee’s base hourly rate of pay times 2,080 hours except where the Eligible Employee’s annual effective compensation includes scheduled overtime, as determined by the Employer, in which case the annual rate of base compensation will be determined by multiplying the Eligible Employee’s base hourly rate times the effective annual work hours. For an Eligible Employee who is not paid by the hour, the annual rate of base compensation is determined by multiplying the Eligible Employee’s monthly rate of pay times twelve (12). For a regular part-time Eligible Employee, the annual rate of base compensation is determined by multiplying the Eligible Employee’s hourly rate by the product of (a) the normally scheduled weekly work hours divided by forty (40) hours, times (b) 2,080 hours. Base Pay shall be determined effective as of the date of the Eligible Employee’s Qualifying Termination.
2.3 Basic Severance Amount
means the amount of Benefits payable as set forth in Section 3.4(a).
2.4 Benefit Determination Date
means a date established for an Eligible Employee by the Employer, in its discretion, to adjust for breaks in service as the Employer deems appropriate, to comply with any purchase or sale agreement covenant, or for such other purposes as the Employer deems appropriate or advisable.
2.5 Benefits
means either the Basic Severance Amount or Enhanced Severance Benefits that are awarded to an Eligible Employee hereunder due to his Qualifying Termination.
2.6 Board
means the Board of Directors of the Plan Sponsor.
2.7 Cause
means (a) substandard work performance or repeated unreliability that has not been cured to the Employer’s satisfaction; (b) workplace misconduct; (c) excessive absenteeism; (d) violation of safety rules; (e) violation of Employer’s policies, including without limitation, the Employer’s “Code of Business Conduct and Ethics”; (f) fraud or other dishonesty against the Employer; (g) engagement in conduct that the Employee knows or should know is materially injurious to the business or reputation of the Employer; (h) falsifying Employer or Employee records (including an employment application); (i) on-the-job intoxication or being under the influence of alcohol or an illegal narcotic or a drug not being used as prescribed; (j) unauthorized use of Employer equipment or confidential information of an Employer or of a third party who has entrusted such information to the Employer; or (k) conviction of a felony or a misdemeanor involving moral turpitude. Whether an Employee has been terminated for Cause will be determined by the Employer in the exercise of its discretion.
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2.8 Code means the Internal Revenue Code of 1986, as amended.
2.9 Date of Hire means the most recent date that the Eligible Employee was hired (or rehired, as the case may be) by the Employer.
2.10 Determination
means the decision of the Plan Administrator concerning whether to award Benefits under the Plan to an Eligible Employee, and the type, amount and duration of such Benefits.
2.11 Effective Date
means September 1, 2007, the effective date of this amendment and restatement of the Plan.
2.12 Eligible Employee
means any Employee (as designated on an Employer’s payroll) who is classified as a regular full-time or regular part-time Employee. Notwithstanding the previous sentence, the definition of “Eligible Employee” excludes (a) any individual who is a party to an individual written agreement or contract with an Employer providing for severance payments or benefits upon such individual’s termination of employment with the Employer; (b) any individual designated as being a “limited benefit” or “limited benefit only” employee in the Employer’s payroll records; (c) any individual who is covered by the Anadarko Petroleum Corporation Officer Severance Plan; (d) any employee whose employment terms and conditions are subject to being governed by a collective bargaining agreement, unless such agreement provides for coverage under the Plan; (e) any individual covered by, or otherwise eligible to receive benefits under (i) a severance plan or program of any type including but not limited to the Kerr-McGee Corporation 2005 Special Involuntary Termination Plan for U.S. Non-Bargaining Employees or the Western Gas Resources, Inc. 2006-2007 Severance Plan or (ii) certain provisions providing for severance benefits arising out of the June 22, 2006 Agreement and Plan of Merger between the Plan Sponsor and Western Gas Resources, Inc.; and/or (f) any individual who is not on the Employer’s United States payroll.
2.13 Employee
means an individual who is employed by an Employer as an employee on its U.S. payroll records and receives an IRS Form W-2 from the Employer. The term “Employee” excludes any local foreign nationals, independent contractors, persons employed by an independent contractor, or any person with a status other than that of an employee on the Employer’s U.S. payroll records. If the Employer is not treating or classifying a worker as an employee subject to payroll tax withholding, as conclusively evidenced by the Employer’s failure to withhold taxes from his compensation, such worker shall not be eligible for Benefits under the Plan even if, in fact, such worker is determined to be, or reclassified as, an employee for payroll taxes or any other purpose.
2.14 Employer
means the Plan Sponsor and any Affiliate or other company which has adopted the Plan with the express consent of the Board.
2.15 Enhanced Severance Amount
means the amount of Benefits payable as set forth in Section 3.4(b).
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2.16 ERISA
means the Employee Retirement Income Security Act of 1974, as
amended, and the regulations and other authority issued thereunder by the appropriate governmental authority.
2.17 Person
means any individual, firm, corporation, partnership, company, joint
venture, association, joint-stock company, limited liability company, trust, unincorporated organization, or other entity.
2.18 Plan
means the Anadarko Petroleum Corporation Severance Plan and Summary Plan Description, as it may be amended from time to time. The Plan document shall also serve as the summary plan description of the Plan for all purposes of ERISA.
2.19 Plan Administrator
means the Plan Sponsor which is designated as the “plan administrator” as defined in Section 3(16)(A) of ERISA.
2.20 Plan Sponsor
means Anadarko Petroleum Corporation or any successor in interest thereto.
2.21 Plan Year
means the twelve-month period ending on December 31 of each year.
2.22 Qualifying Termination
means an involuntary termination of the Eligible Employee’s employment with the Employer and all its Affiliates due to elimination of the Eligible Employee’s position, or at the convenience or discretion of the Employer as authorized by the Plan Sponsor’s Vice President of Human Resources. The term Qualifying Termination does not include a Resignation or Retirement by the Eligible Employee. In addition, the term Qualifying Termination does not include the occurrence of any of the following events, as determined by the Plan Administrator in its discretion, even if coincident with an otherwise Qualifying Termination:
(a) a termination of employment for Cause;
(b) a termination of employment on account of the Employee’s death or disability;
(c) any termination which the Employer expects to be of short duration and pursuant to which the Eligible Employee is subject to reemployment with the Employer within a reasonable period of time;
(d) any termination of an Eligible Employee’s employment with the Employer by reason of continued failure or inability of the Eligible Employee to perform the Eligible Employee’s duties or responsibilities with the Employer (provided that there is compliance with the obligations, if any, of the Employer under the Americans with Disabilities Act and any applicable state disability law);
(e) any termination resulting from, or in connection with, any corporate sale transaction (including, without limitation, a sale of any assets of the Employer, a
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sale of any assets of any affiliate or subsidiary of the Employer, a sale of the stock of a subsidiary or affiliate of the Employer, or any combination of the foregoing) where continued employment is available to the Eligible Employee without an extended break in employment, except to the extent provided below with respect to “Special Divestitures”;
(f) an outsourcing of services by the Employer to a third-party service provider where continued employment with the third-party service provider is made available to the Eligible Employee without an extended break in employment;
(g) a termination where the Eligible Employee had provided the Employer with a notice of intent to resign or retire prior to the termination occurring;
(h) a termination where the Eligible Employee has been absent from work and his or her position has been filled by another, provided that the Family and Medical Leave Act and any other applicable law has been complied with; or
(i) a termination if the Eligible Employee is eligible to receive benefits under the Anadarko Petroleum Corporation Change of Control Severance Pay Plan, or any other severance plan sponsored by an Employer or an Affiliate, as a result of or in connection with such termination.
The provisions of Section 2.22(e)
(above) will be inapplicable in the event that all of the following occur:
(a) The employment position of the Eligible Employee is eliminated as a direct consequence of a divestiture of a significant corporate asset as determined by the Plan Sponsor (a “Divestiture”);
(b) The Plan Sponsor, in its discretion, declares the Divestiture to be a “Special Divestiture” under the Plan; and
(c) One of the following two situations happens:
(i) The Eligible Employee is offered continued employment with the purchaser of the assets associated with the Special Divestiture, the Eligible Employee refuses such continued employment, and the Eligible Employee does not enter into an employment relationship with the purchaser of such assets (or any of its affiliates) for a one-year period after the Special Divestiture is completed. (In the event that the Eligible Employee enters an employment relationship with the purchaser of such assets, or any of its affiliates, during the one-year period, and the Employee’s Base Pay with the asset purchaser is equal to or greater than the Base Pay received by the Eligible Employee immediately prior to his or her termination of employment, the Eligible Employee will be obligated, at the Plan Administrator’s discretion, to repay to the Plan all Benefits received and
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the Plan Administrator may undertake all available, legal and equitable means to recover this obligation due.)
(ii) The Eligible Employee accepts continued employment with the purchaser of the assets associated with the Special Divestiture and the Eligible Employee’s Base Pay with the asset purchaser is less than the Base Pay received by the Eligible Employee immediately prior to his or her termination of employment. For avoidance of doubt, if an Eligible Employee accepts an offer of employment from a purchaser incident to a Special Divestiture and the Eligible Employee’s Base Pay with the purchaser is equal to or greater than the Employee’s Base Pay immediately prior to termination of employment, the Eligible Employee will not have incurred a Qualifying Termination.
The Plan Administrator will determine, in its complete discretion, whether there has been a Qualifying Termination. In addition, the Plan Administrator, in its discretion, may require an Eligible Employee to provide documentation, signed and sworn statements, and other information as reasonably requested to substantiate whether a Qualifying Termination has occurred, particularly following a Special Divestiture.
2.23 Resignation
means the Eligible Employee’s voluntary termination of his employment relationship with an Employer, other than a Retirement.
2.24 Retirement
means any voluntary termination of employment after an Eligible Employee (a) becomes eligible for early or normal retirement benefits under the Anadarko Retirement Plan or other qualified defined benefit retirement plan maintained by an Employer, and (b) has given notice to the Employer that he intends to retire as of a specified date (regardless of whether he elects immediate commencement of his benefit under the Anadarko Retirement Plan or other plan.)
2.25 Specified Employee. “Specified Employee” means an Employee who is a “key employee” (as defined in Code Section 416(i) without regard to Code Section 416(i)(5)) of the Employer (or an entity which is considered to be a single employer with the Employer under Code Sections 414(b) or 414(c)), as determined under Code Section 409A at any time during the twelve (12) month period ending on December 31, but only if the Employer is considered to have any stock that is publicly traded on an established securities market or otherwise under Code Section 409A. An Eligible Employee who is a key employee (as determined under the preceding sentence) will be deemed to be a Specified Employee for the period of April 1 through March 31 following such December 31, except as otherwise may be required under Code Section 409A.
2.26 WARN Act Notice Pay
means any payments made to an Eligible Employee by an Employer in lieu of providing a minimum notice of termination with the intent of complying with the requirements or the purposes of the Worker Adjustment and Retraining Notification Act
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(29 USC §§ 2101 – 2109) and any other similar state or federal law mandating the provision of notice to employees prior to employment termination.
2.27 Week Pay means an Eligible Employee’s Base Pay divided by fifty-two (52).
2.28 Year of Service
means, with respect to an Eligible Employee, the full year and
any prorated portion of a year included in such Eligible Employee’s continuous employment by the Employer from his Date of Hire or his Benefit Determination Date, as the case may be, to the effective date of his Qualifying Termination (determined by subtracting the Date of Hire or Benefit Determination Date, as applicable, from the Qualifying Termination date, whichever produces the greater number of Years of Service).
ARTICLE III. ELIGIBILITY AND BENEFITS
3.1 Commencement. An Eligible Employee will be covered under the Plan as of the Effective Date. After the Effective Date, an Employee shall become covered under the Plan when he becomes an Eligible Employee.
3.2 Cessation. An Employee will cease to be an Eligible Employee as of the earlier of (a) the date that he ceases to qualify as an Eligible Employee, (b) the date on which the Plan is terminated, or (c) the date on which the Plan is amended to eliminate his eligibility.
3.3 Non-Discrimination. All Eligible Employees will be treated under the Plan on a non-discriminatory basis without regard to their race, color, religion, national origin, sex, disability, or age or other reason prohibited by applicable law.
3.4 Severance Benefits. The Benefits for an Eligible Employee shall be computed as follows:
(a) Basic Severance Amount. An Eligible Employee who has incurred a Qualifying Termination shall be entitled to the Basic Severance Amount, which is payable in a lump sum cash payment after his termination of employment. The Basic Severance Amount is equal to one Week Pay multiplied by the Eligible Employee’s Years of Service. For purposes of calculating the Basic Severance Amount, Years of Service will be rounded up to the next whole year. The Basic Severance Amount shall not be less than eight (8) Weeks Pay or greater than fifty-two (52) Weeks Pay.
(b) Enhanced Severance Benefits. An Eligible Employee who has incurred a Qualifying Termination may instead receive the Enhanced Severance Amount and other Benefits, as described in this Section 3.4(b), provided that he first executes (and does not revoke, if applicable) a release agreement as described in Section 4.4, as a condition precedent to receipt of the Enhanced Severance Amount and other Benefits. The Enhanced Severance Amount and other Benefits are:
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(1) Enhanced Severance Amount
– An Eligible Employee entitled to receive
the Enhanced Severance Amount will receive such lump sum payment after the release agreement described in Section 4.4
becomes effective and
binding. The Enhanced Severance Amount shall be equal to the product of (A) multiplied by (B), where:
(A) equals the sum of (i) and (ii) below, rounded up to the next whole integer:
(i) Years of Service multiplied by two (2), and
(ii) Base Pay divided by 10,000 and then multiplied by two (2); and
(B) equals one Week Pay.
The Enhanced Severance Amount, when considering any offsets allowed by this Section 3.4, shall not be less than thirteen (13) Weeks Pay or greater than sixty-five (65) Weeks Pay. The Enhanced Severance Amount will be offset by any Basic Severance Amount that the Eligible Employee has received.
The Employer, in its complete discretion, may make an additional cash payment that is above and beyond the Enhanced Severance Amount to any Eligible Employee to which the Eligible Employee has no legally binding right unless and until any such additional payment is actually made and received by the Eligible Employee. Any such additional payment provided to an Eligible Employee shall not be construed to be a Benefit under the Plan but, nevertheless, may still be incorporated into the release agreement referenced in Section 4.4 in the Employer’s discretion.
(2) COBRA Coverage at Subsidized Rates. If the Eligible Employee is entitled to continuation of benefits under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), then the applicable rates for group major medical and dental shall be at active employee contribution rates for six (6) months following the date of the Eligible Employee’s termination of employment. At the expiration of the six (6) month period, the contribution rates shall then be the COBRA rates. It will be the Eligible Employee’s responsibility to comply with all COBRA procedures and requirements including the election of COBRA coverage and the timely payment of premiums.
(3) Bonus Payment. If the Eligible Employee would have been eligible for a bonus payment under the Anadarko Incentive Plan (“AIP”) for the year in which he is terminated, the Eligible Employee shall receive an additional severance Benefit as provided under this subsection. Provided that the
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Eligible Employee has not received any AIP payment for the year in which he terminates employment, the additional severance Benefit shall be equal to the bonus target percentage determined under the AIP for the year in which the termination occurs multiplied by the Eligible Employee’s eligible earnings (as determined under the AIP) for that year. Eligibility, and the determination of the amount due, for this Benefit is to be determined by the Employer in its sole discretion.
(c) Bifurcation of Part-Time and Full-Time Service. Any Eligible Employee who is classified as a regular part-time Employee at the time he incurs a Qualifying Termination, but who was a regular full-time Employee at any time during his Years of Service, shall have his Benefits calculated as follows:
(1) The Basic Severance Amount pursuant to Section 3.4(a), if applicable, will be the sum of (A) and (B), where (A) is the Basic Severance Amount computed using his Years of Service as a regular part-time Employee and his Base Pay as a regular part-time Employee and (B) is the Basic Severance Amount computed using his Years of Service as a regular full-time Employee and his Base Pay determined as if he was classified as a regular full-time Employee as of the date of his Qualifying Termination; and
(2) The Enhanced Severance Amount pursuant to Section 3.4(b)(1), if applicable, shall be computed as described in paragraph (c)(1) above, except the benefit factor described in Section 3.4(b)(1)(A)(ii)
shall be determined using his current Base Pay as a regular part-time Employee.
(d) Outplacement Services. An Eligible Employee who receives either a Basic Severance Amount or an Enhanced Severance Benefit shall also be entitled to receive reasonable outplacement assistance, in such form and under such criteria as approved in advance by the Plan Administrator in its discretion. Such outplacement assistance must be provided to the Eligible Employee within the 12-month period following his Qualifying Termination.
(e) Offset.
The amount of Benefits determined pursuant to this Section 3.4
shall be reduced by the total of the following items, unless otherwise waived by the Employer in its discretion:
(1) WARN Act Notice Pay;
(2) payments of any kind (whether or not designated as severance pay) made to an Eligible Employee by the Employer pursuant to any other severance plan, employment or other contract, or change of control arrangement, as a result of the termination of employment of such Eligible Employee;
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(3) post-termination salary payments made to the Eligible Employee by the Employer in its discretion for the purpose of facilitating transition of the Eligible Employee into the workforce and to which the Eligible Employee is not otherwise entitled to receive; and
(4) any Basic Severance Amount received (i.e., if an Eligible Employee is entitled to receive an Enhanced Severance Amount under Section 3.4(b)(1)
and has previously received a Basic Severance Amount, any Enhanced Severance Amount will be reduced by the Basic Severance Amount received); and/or
(5) any amounts owed to the Employer by the Eligible Employee for any reason.
ARTICLE IV. SEVERANCE BENEFIT AWARDS
4.1 Selection of Employees Eligible to Receive Benefits. The Plan Administrator will evaluate each case to determine whether Benefits are warranted under the terms and conditions of the Plan. No Eligible Employee will be eligible to receive Benefits hereunder unless and until he has incurred a Qualifying Termination and he has been selected by the Plan Administrator to receive Benefits.
4.2 Payment and Taxation of Benefits. Unless otherwise provided herein, an Eligible Employee will receive payment of his Benefits in a lump sum cash payment, less applicable withholdings as soon as practicable following the date of his Qualifying Termination, but in no event later than the 15th day of the third month following the end of the calendar year in which such termination occurs. In the event an Eligible Employee dies after a Qualifying Termination but prior to receiving entire payment of his Benefits, his remaining Benefits shall be paid to his surviving lawful spouse, if any, or if not, then to his estate. Taxes and any other applicable withholdings will be withheld from Benefits by the Employer.
4.3 Benefit Exclusions. A terminated Employee will not be eligible to further participate in any of the employee benefit plans or programs of an Employer, except as required by the express terms of such plan or program or by applicable law or regulation as determined by the Plan Administrator.
4.4 Release and Confidentiality Agreement. As a condition to receipt of any Enhanced Severance Amount, an Eligible Employee who has incurred a Qualifying Termination must first execute and deliver to the Employer a release and confidentiality agreement in the form established and provided by the Employer, to fully release the Employer and its Affiliates, and the shareholders, partners, officers, directors, employees and agents of the Employer and its Affiliates, from and against any and all claims and causes of action of any kind or character, including but not limited to all claims or causes of action arising out of such Eligible Employee’s employment with the Employer or the termination of such employment. The release and confidentiality agreement shall be on a form provided by the Employer, in a settlor or
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nonfiduciary capacity, for such purpose. Irrespective of an Eligible Employee’s execution of the required release and confidentiality agreement, the performance of the Employer’s obligations hereunder and the receipt and acceptance of Benefits by such Eligible Employee shall constitute full settlement and release of all such claims and causes of action.
If the Enhanced Severance Amount has been paid to an Eligible Employee and such Eligible Employee thereafter fails to comply in full with the terms of such release and confidentiality agreement, such agreement shall remain valid and enforceable. Further, if an Eligible Employee breaches the requirements and obligations of the agreement, the Employer may require the Eligible Employee to refund to the Employer an amount equal to the excess of his Enhanced Severance Amount over his Basic Severance Amount and, moreover, the Employer shall have the right to offset against any further monies or benefits owed to such Eligible Employee (to the extent such offset is not prohibited by applicable law which cannot be waived) the Enhanced Severance Amount excess that such Eligible Employee is obligated to return and repay to the Employer. The obligation to refund an Enhanced Severance Amount excess, as stated herein, shall be subject to the requirements of the Age Discrimination in Employment Act or the Older Worker’s Benefit Protection Act.
4.5 Ineligibility for Re-hire. Any Eligible Employee receiving Basic Severance or Enhanced Severance will be ineligible, for a period of one year following termination of employment, to enter into any employment relationship with the Plan Sponsor, an Employer, or an Affiliate unless (i) the reemployment is approved by the Vice President of Human Resources, and (ii) the Eligible Employee repays the full amount of the Benefits received.
ARTICLE V. AMENDMENT, TERMINATION AND ADOPTION OF PLAN
5.1 Amendment of Plan. The Plan Sponsor, in its complete discretion, may amend the Plan at any time without advance notice by a written instrument, effective as of the date specified therein, that is (a) authorized or ratified by action of the Board (or committee of the Board designated for such purpose) or by the Chief Executive Officer of the Plan Sponsor, and (b) identified as an amendment or restatement of the Plan. The Vice President of Human Resources of the Plan Sponsor may (a) amend the Plan to make clarifications or modifications to the Plan’s provisions provided that such alterations do not result in a decrease or increase in benefits available under the Plan, or (b) execute any written Plan amendment to effectuate any amendment authorized by the Board (or committee of the Board designated for such purpose) or by the Chief Executive Officer of the Plan Sponsor. No Eligible Employee has any vested interest in, or any other rights to receive, any Benefits under the Plan unless and until actually paid to him or on his behalf.
5.2 Termination of Plan. The Plan Sponsor, in its complete discretion, may terminate the Plan for any reason, in whole or in part, without advance notice by adoption of a written instrument to such effect that is approved or ratified by the Board (or committee of the Board designated for such purpose) or by the Chief Executive Officer of the Plan Sponsor. No Benefits hereunder shall be vested until actually paid to, or on behalf of, the Eligible Employee.
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5.3 Adoption of Plan By Additional Employers. Any Affiliate of the Plan Sponsor may adopt the Plan for the benefit of its Eligible Employees with the express consent of the Plan Sponsor as evidenced by action of the Board (or committee of the Board designated for such purposes) or by any officer of the Plan Sponsor. Any such Affiliate which has adopted the Plan shall be an Employer hereunder.
Any Employer may, by action of its board of directors (or committee of such board designated for such purpose) or noncorporate counterpart (or committee of such counterpart designated for such purpose) that is communicated in writing to the Secretary of the Plan Sponsor or the Board, terminate its participation in the Plan as of the effective date as specified or approved by the Plan Sponsor. Moreover, the Board (or committee of the Board designated for such purpose) or the Chief Executive Officer of the Plan Sponsor may, in its or his discretion, terminate the Plan participation of any adopting Employer at any time by written instrument, effective as of the date specified therein.
ARTICLE VI. INTERPRETATION AND DETERMINATIONS
The Plan Administrator reserves the absolute and unilateral right, power and discretion to administer, and to interpret, construe and construct, the terms and provisions of the Plan, including, without limitation, correcting any error or defect, supplying any omission, and reconciling any inconsistency. The Plan Administrator also reserves the absolute and unilateral right and power to make all Determinations and other decisions that may impact any claim for eligibility or Benefits, including fact-finding and factual decisions, in its discretion. Subject to the claims review procedures in Section 8.2, any Determination, computation or interpretation made by the Plan Administrator under the Plan will be final and binding on all Eligible Employees and other persons and entities. If, due to errors in drafting, any Plan provision does not accurately reflect its intended meaning, as demonstrated by consistent interpretations or other evidence of intent, or as determined by the Plan Administrator in its discretion, the provision will be considered ambiguous and will be interpreted by the Plan Administrator in such manner as determined by the Plan Administrator. The Plan Administrator, in its discretion, may amend the Plan retroactively to cure any such ambiguity.
ARTICLE VII. PLAN ADMINISTRATION
7.1 Records and Reports. The Plan Administrator will keep such written records of Plan transactions as it deems to be necessary or appropriate. The Plan Administrator will be responsible for complying with all applicable reporting, filing and disclosure requirements estab-lished for the Plan by (a) the U.S. Department of Labor under applicable provisions of ERISA, including the filing of any required annual report on IRS Form 5500 series, or (b) any other governmental authority.
7.2 Administrative Powers and Duties. The Plan Administrator will have the right and power to take all actions reasonably required to carry out the terms, conditions, and pro-visions of the Plan, including, but not limited to, the following:
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(a) To determine all questions concerning the individual rights of Employees or former Employees under the Plan;
(b) To make administrative rules and regulations which are not inconsistent with the terms and provisions of the Plan;
(c) To review claims and to render Determinations;
(d) To file or cause to be filed such annual reports, returns, schedules, descriptions, financial statements and other information as may be required by any law or regulation, agency, or authority;
(e) To obtain from the Employer, Employees, or other interested persons, such information as may be necessary or appropriate for the administration of the Plan;
(f) To determine the proper amount, manner, and time of payment of Benefits;
(g) To notify interested persons of any material amendment or any termination of the Plan, to the extent required by ERISA;
(h) To prescribe such forms, releases and other documents as may be appropriate under the Plan; and
(i) To perform such other acts as it deems necessary or appropriate to administer the Plan in accordance with its terms and provisions, or as may otherwise be required by applicable law.
7.3 Allocation of Duties and Employment of Agents. In writing, or by custom, practice or in operation, the Plan Administrator may provide for the allocation or delegation of any of its duties hereunder among officers or employees of an Employer including, without limitation, the officers of an Employer who may qualify as Eligible Employees. The Plan Administrator will also be authorized to engage or employ agents, attorneys, accountants, consultants, and other advisors which it deems to be necessary or appropriate to assist in discharging its duties hereunder.
ARTICLE VIII. CLAIMS PROCEDURES
8.1 Notice of Claim. Normally, an Eligible Employee does not need to present a formal claim for Benefits payable under the Plan. However, in the event that an Eligible Employee or other person (referred to as the “Claimant”) has a claim for any Benefits that he believes were not provided in accordance with the terms and provisions of the Plan or otherwise, the Claimant must file a claim with the Plan Administrator within six (6) months from the date of the affected Employee’s termination of employment with an Employer. Any Claimant who fails to file a claim within such 6-month period will completely and irrevocably forfeit and lose any and all rights that he may have, or had, to receive any Benefits under the Plan at any time.
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Prior to authorizing and awarding any Benefits hereunder, the Plan Administrator may require the Claimant to provide additional information, and to complete any required or requested releases, forms or other documents hereunder, including filing of all claims and requests for payment from any other source.
8.2 Claims Review Procedure. If any claim for Benefits filed by a Claimant is wholly or partially denied, the Plan Administrator will notify the Claimant of its decision in writing. Such notification will be written in a manner calculated to be understood by the average Claimant, and will contain (a) specific reasons for the denial, (b) specific reference to pertinent Plan provisions, (c) a description of any additional material or information necessary for the Claimant to perfect such claim and an explanation of why such material or information is necessary, and (d) information as to the steps to be taken if the Claimant wishes to submit a request for review. Such notification will be given within 60 days after the claim is received by the Plan Administrator (or within 120 days if special circumstances require an extension of time for processing the claim, and if written notice of such extension and circumstances is given to the Claimant within the initial 60-day period). If such notification is not given within such period, the claim will be considered denied as of the last day of such period and the Claimant may then request a review of the claim.
Within 60 days after the date on which a Claimant receives a written notice of a denied claim (or, if applicable, within 60 days after the date on which such denial is considered to have occurred) the Claimant (or his duly authorized representative) may (a) file a written request (including pertinent documents) with the Plan Administrator for a review of the denied claim, and (b) submit written issues and comments to the Plan Administrator. The Plan Administrator will review the claim and notify the Claimant of its decision in writing. Such notification will be written in a manner calculated to be understood by the Claimant and will contain specific reasons for the decision, as well as specific references to pertinent Plan provisions. The decision on review will be made within 60 days after the request for review is received by the Plan Administrator, or within 120 days if special circumstances require an extension of time for processing the request, such as a decision by the Plan Administrator to hold a hearing, provided that written notice of such extension and circumstances is given to the Claimant within the initial 60-day period. If the decision on review is not made within such period, the claim will be considered denied as of the last day of such period. All final Determinations and decisions concerning claims made pursuant to these claims review procedures will not be subject to further review by anyone, but will be final, conclusive and binding on the Claimant and all other persons and entities. To the extent the Plan Administrator has been granted discretionary authority under the Plan, the Plan Administrator’s prior exercise of such authority will not obligate it to exercise its authority in a like fashion thereafter.
8.3 Exhaustion of Administrative Remedies. Completion of the claims procedures described in Sections 8.1 and 8.2
is a condition precedent to the commencement of any legal or equitable action in connection with a claim for benefits under the Plan by a Claimant or by any other person or entity claiming rights individually or through a Claimant; provided, however, the Plan Administrator may, in its discretion, waive compliance with such claims procedures as a condition precedent to filing of any such action. Any legal or equitable action in connection with,
15
or arising out of, a claim for benefits under the Plan, including any claim denial, must be brought not later than one year following a final decision by the Plan Administrator on the claim pursuant to Section 8.2.
ARTICLE IX. INDEMNIFICATION
To the full extent permitted by law, each adopting Employer (and their successors in interest), jointly and severally, shall indemnify and hold harmless each past, present and future Employee who acts in the capacity of an agent, delegate or representative of the Plan Administrator under the Plan (hereafter, all such indemnified persons will be jointly and severally referred to as “Plan Administration Employee”) against, and each Plan Administration Employee will be entitled without further act on his part to indemnity from the Employer for, any and all losses, claims, damages, judgments, settlements, liabilities, expenses and costs (and all actions in respect thereof and any legal or other expenses in giving testimony or furnishing documents in response to a subpoena or otherwise), including the cost of investigating, preparing or defending any pending, threatened or anticipated possible action, claim, suit or other proceeding, whether or not in connection with litigation in which the Plan Administration Employee is a party, (collectively, the “Losses”), as and when incurred, directly or indirectly, relating to, arising out of, or resulting from his being, or having been, a Plan Administration Employee. Notwithstanding the preceding sentence, such indemnity shall not include any Losses incurred by such Plan Administration Employee (a) with respect to any matters as to which he is finally adjudged in any such action, suit or proceeding to have been guilty of gross negligence or intentional misconduct in the performance of his duties as a Plan Administration Employee, or (b) with respect to any matter to the extent that a settlement thereof is effected in an amount in excess of the amount approved by the Plan Sponsor (which approval will not be unreasonably withheld), and further, no right of indemnification hereunder will be available to, or enforceable by, any such Plan Administration Employee unless, within twenty-five (25) days after his actual receipt of service of process in any such action, suit or other proceeding (or such longer period as may be approved by the Plan Sponsor), he has offered the Plan Sponsor the opportunity to handle and defend same, and the decision by the Plan Sponsor to handle such proceeding will conclusively determine that the Plan Administration Employee is entitled to the indemnity provided herein. The foregoing right of indemnification will be in addition to any liability that the Employer may otherwise have to the Plan Administration Employee.
The Employer’s obligation hereunder to indemnify the Plan Administration Employee will exist without regard to the cause or causes of the matters for which indemnity is owed and expressly includes (but is not limited to) the Losses, directly or indirectly, relating to, arising out of, or resulting from any one or more of the following:
(i) the sole negligence or fault of any Plan Administration Employee or combination of Plan Administration Employees;
(ii) the sole negligence or fault of the Employer;
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(iii) the sole negligence or fault of third parties;
(iv) the concurrent negligence or fault or any combination of the Plan Administration Employee and/or the Employer and/or any third party; and
(v) any other conceivable or possible combination of fault or negligence, it being the specific intent of the Employer to provide the maximum possible indemnification protection hereunder, but excluding any such Losses that are found by a court of competent jurisdiction to have resulted solely from gross negligence or intentional misconduct on the part of the Plan Administration Employee.
The Employer will be liable for any settlement of any claim against the Plan Administration Employee made with the written consent of the Employer, which consent will not be unreasonably withheld. The foregoing right of indemnification will inure to the benefit of the heirs, executors, administrators and personal representatives of each Plan Administration Employee, and will be in addition to all other rights to which the Plan Administration Employee may be entitled as a matter of law, contract, or otherwise.
Notwithstanding anything in this Article IX
to the contrary, the foregoing right of indemnification shall apply only to the extent that any claims of the Plan Administration Employee are not fully reimbursed or paid pursuant to any applicable fiduciary liability insurance coverage maintained by the Employer.
ARTICLE X. MISCELLANEOUS
10.1 Integration with Other Payments. The Benefits payable under the Plan shall be reduced by any other compensation paid to the terminated Employee with respect to the Employee’s termination of employment by the Employer. Benefits paid under the Plan are not intended to duplicate pay-in-lieu-of-notice, severance pay, or any other severance pay benefits that are provided under other severance benefit plans maintained by the Employer, or pursuant to applicable laws such as the WARN Act. Should such other severance benefits be payable, Benefits under the Plan will be reduced accordingly or, alternatively, Benefits previously paid under the Plan will be treated as having been paid to satisfy such other benefit obligations. In either case, the Plan Administrator, in its discretion, will determine how to apply this provision, and it may override other provisions in the Plan in doing so.
10.2 Plan Not a Contract of Employment. Nothing contained in the Plan will be construed as (a) an employment contract between an Employer and any Employee, (b) a right of any Employee to be continued in the employment of an Employer, or (c) a limitation of the right of an Employer to discharge any Employee, with or without Cause, at any time. All Employees will be subject to discharge to the same extent as if the Plan had never been adopted.
10.3 Sources of Payment. The Benefits provided under the Plan will be paid from the general assets of the Employer in accordance with the terms and provisions of the Plan. Nothing herein will be construed to require the Employer to maintain any trust, fund, or otherwise segre-
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gate any amount for the benefit of any person. Furthermore, no person with a claim for Benefits hereunder will have any claim against, right to, security or other interest in, any fund, account, or assets of any Employer.
10.4 Non-Alienation. Except as otherwise provided in Section 4.2
in the event of the
Employee’s death prior to receipt of all of his Benefits, any remaining Benefits should not be subject in any manner to alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, prior to actually being received by the person entitled to the Benefits. Any attempt to alienate, sell, assign, pledge, charge or otherwise transfer or encumber any right to Benefits provided hereunder will be void and without effect.
10.5 Applicability of Code Section 409A. To the extent the Plan provides for nonqualified deferred compensation, it is intended to comply with the provisions of Code Section 409A effective as of September 1, 2005. If any provision herein results in the imposition of an excise tax on any Eligible Employee under Section 409A, such provision will be reformed to avoid any such imposition in such manner as the Plan Administrator determines, with the advice of legal counsel, is appropriate to comply with Section 409A.
10.6 No Guarantee of Tax Consequences. No representation, commitment or guarantee is made that any amounts paid under the Plan will be excludable from the recipient’s gross income for any tax purpose, or that any other tax treatment will apply or be available to such person.
10.7 Severability. Any provision in the Plan that is prohibited or unenforceable in any jurisdiction by reason of applicable law shall, as to such jurisdiction, be ineffective only to the extent of such prohibition or unenforceability without invalidating or affecting the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
10.8 Construction and Interpretation. Whenever the context of the Plan so requires, any gender will include the other gender, and words used in the singular or plural will include the other. The words “herein,” “hereof,” “hereunder,” and other similar compounds of the word “here” will refer to the entire Plan, not to any particular article, section or provision of the Plan. Headings of articles and sections as used herein are inserted solely for convenience and reference and do not create any inference as to the construction of the Plan.
10.9 Governing Law. The terms, conditions and provisions of the Plan will be construed, governed and enforced under the laws of the State of Texas, except as may be preempted by ERISA or other controlling federal law. This Plan is an “employee welfare benefit plan”, as defined in Section 3(1) of ERISA, established solely for the purpose of providing severance benefits to Eligible Employees, shall be construed accordingly.
[Signature page follows.]
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IN WITNESS WHEREOF, the Plan Sponsor has caused this amended and restated Plan to be duly executed in its name and on its behalf by its duly authorized officer, to be effective as of the Effective Date.
ANADARKO PETROLEUM CORPORATION
By:
Name:
Title:
A-1
APPENDIX A
ERISA INFORMATION
(1) Name of Plan: Anadarko Petroleum Corporation Severance Plan.
(2) Plan Sponsor and Plan Administrator:
Anadarko Petroleum Corporation c/o Human Resources Department 1201 Lake Robbins Drive The Woodlands, Texas 77380 (832) 636-1000
(3) Federal Taxpayer Identification Number for Plan Sponsor: 76-0146568
(4) Plan Number: 507
(5) Type of Plan: The Plan is a self-funded “employee welfare benefit plan” subject to ERISA that provides severance pay benefits. No trust is maintained in connection with the Plan and the Plan is not considered to be “funded” for ERISA purposes.
(6) Type of Administration: The Plan is administered by the Plan Administrator with benefits provided in accordance with the terms and conditions of the Plan.
(7) Agent for Service of Legal Process:
Mr. Robert K. Reeves Senior Vice President, General Counsel & Chief Administrative Officer Anadarko Petroleum Corporation 1201 Lake Robbins Drive The Woodlands, Texas 77380
Process may also be served on the Plan Administrator at the address in item (2) above.
(8) Sources of Contributions: The adopting Employers provide all contributions to the Plan. No employee contributions are required.
A-2
YOUR ERISA RIGHTS
As a Eligible Employee under the Plan, you are entitled to certain rights and protections under ERISA. These rights are described below. ERISA provides that all Plan participants shall be entitled to:
(i) Examine, without charge, at the Plan Administrator’s office, all Plan documents, including insurance contracts and copies of documents filed by the Plan with the U.S. Department of Labor (such as detailed annual reports and Plan descriptions);
(ii) Obtain copies of Plan documents and other Plan information upon written request to the Plan Administrator. The Plan Sponsor, as Plan Administrator, may impose a reasonable charge for the copies.
(iii) Receive a summary of the Plan’s summary annual financial report, if applicable. The Plan Administrator is required to furnish each participant with a copy of the summary annual report if it is required to prepare one.
In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer, or any other person, may fire you or otherwise discriminate against you to prevent you from obtaining a benefit or exercising your rights under ERISA. If your claim for a benefit is denied in whole or in part, you must receive a written explanation of the reason for the denial. You have the right to have the Plan Administrator review and reconsider your claim.
Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request materials from the Plan Administrator and do not receive them within 30 days, you may file suit in a federal court. In such case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.
If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court. If it should happen that the Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor; or you may file suit in a federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.
If you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, you should contact the nearest area office of the U.S. Employee Benefits Security Administration,
A-3
Department of Labor, as listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20210.
Anadarko Petroleum Corporation
FIRST AMENDMENT TO SEVERANCE PLAN AND
SUMMARY PLAN DESCRIPTION
THIS FIRST AMENDMENT (“AMENDMENT”) is made effective as of January 1, 2008 (the “Effective Date”), by Anadarko Petroleum Corporation, a Delaware corporation (the “Company”), and amends the Anadarko Petroleum Corporation Severance Plan and Summary Plan Description as amended and restated effective as of September 1, 2007 (the “Plan”) in order to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
Article VIII of the Plan is amended, in its entirety, to read as follows:
ARTICLE VIII. CLAIMS PROCEDURES
8.1 Claims Review Procedure.
(a) Filing a Claim. A Claimant or his authorized representative may file a claim for Benefits under the Plan (hereafter, referred to as a “Claimant”). Any claim must be in writing and submitted to the Plan Administrator at such address as may be specified from time to time. Claimants will be notified in writing of approved claims, which will be processed as claimed. A claim is considered approved only if its approval is communicated in writing to the Claimant.
(b) Denial of Claim. In the case of the denial of a claim respecting Benefits paid or payable with respect to a Participant, a written notice will be furnished to the Claimant within 90 days of the date on which the claim is received by the Plan Administrator. If special circumstances (such as for a hearing) require a longer period, the Claimant will be notified in writing, prior to the expiration of the 90-day period, of the reasons for an extension of time; provided, however, that no extensions will be permitted beyond 90 days after the expiration of the initial 90-day period.
(c) Reasons for Denial. A denial or partial denial of a claim will be dated and signed by the Plan Administrator and will clearly set forth:
(i) the specific reason or reasons for the denial;
(ii) specific reference to pertinent Plan provisions on which the denial is based;
(iii) a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation of why such material or information is necessary; and
(iv) an explanation of the procedure for review of the denied or partially denied claim set forth below, including the claimant’s right to bring a civil
2
action under ERISA Section 502(a) following an adverse benefit determination on review.
(d) Review of Denial. Upon denial of a claim, in whole or in part, the Claimant or his duly authorized representative will have the right to submit a written request to the Plan Administrator for a full and fair review of the denied claim by filing a written notice of appeal with the Plan Administrator within 60 days of the receipt by the Claimant of written notice of the denial of the claim. A Claimant or the Claimant’s authorized representative will have, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the Claimant’s claim for Benefits and may submit issues and comments in writing. The review will take into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.
If the Claimant fails to file a request for review within 60 days of the denial notification, the claim will be deemed abandoned and the Claimant precluded from reasserting it. If the Claimant does file a request for review, his request must include a description of the issues and evidence he deems relevant. Failure to raise issues or present evidence on review will preclude those issues or evidence from being presented in any subsequent proceeding or judicial review of the claim.
(e) Decision Upon Review. The Plan Administrator will provide a prompt written decision on review to the Claimant. If the claim is denied on review, the decision shall set forth:
(i) the specific reason or reasons for the adverse determination;
(ii) specific reference to pertinent Plan provisions on which the adverse determination is based;
(iii) a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the Claimant’s claim for Benefits; and
(iv) a statement describing any voluntary appeal procedures offered by the Plan and the Claimant’s right to obtain the information about such procedures, as well as a statement of the Claimant’s right to bring an action under ERISA Section 502(a).
A decision will be rendered no more than 60 days after the Plan Administrator’s receipt of the request for review, except that such period may be extended for an additional 60 days if the Plan Administrator determines that special circumstances (such as for a hearing) require such extension. If an extension of time is required, written notice of the extension will be furnished to the Claimant before the end of the initial 60-day period.
To the extent of his responsibility to review the denial of benefit claims, the Plan Administrator will have full authority to interpret and apply in his discretion the provisions of the Plan. The decision of the Plan Administrator will be final and binding upon any and all
3
Claimants, including, but not limited to, the Participant and any other individual making a claim through him.
(f) Other Procedures. Notwithstanding the foregoing, the Plan Administrator may, in his discretion, adopt different procedures for different claims without being bound by past actions. Any procedures adopted, however, shall be designed to afford a Claimant a full and fair review of his claim and shall comply with applicable regulations under ERISA.
(g) Finality of Determinations; Exhaustion of Remedies. To the extent permitted by law, decisions reached under the claims procedures set forth in this Article VIII shall be final and binding on all parties. No legal action for Benefits under the Plan shall be brought unless and until the Claimant has exhausted his remedies under this Section. In any such legal action, the Claimant may only present evidence and theories which the Claimant presented during the claims procedure. Any claims which the Claimant does not in good faith pursue through the review stage of the procedure shall be treated as having been irrevocably waived. Judicial review of a Claimant’s denied claim shall be limited to a determination of whether the denial was an abuse of discretion based on the evidence and theories the Claimant presented during the claims procedure. Any suit or legal action initiated by a Claimant under the Plan must be brought by the Claimant no later than one year following a final decision on the claim for Benefits by the Plan Administrator. The one-year limitation on suits for Benefits will apply in any forum where a Claimant initiates such suit or legal action.
(h) Effect of Plan Administrator Action. The Plan shall be interpreted by the Plan Administrator in accordance with the terms of the Plan and their intended meanings. However, the Plan Administrator shall have the discretion to make any findings of fact needed in the administration of the Plan, and shall have the discretion to interpret or construe ambiguous, unclear or implied (but omitted) terms in any fashion they deem to be appropriate in their sole judgment. The validity of any such finding of fact, interpretation, construction or decision shall not be given de novo review if challenged in court, by arbitration or in any other forum, and shall be upheld unless clearly arbitrary or capricious. To the extent the Plan Administrator has been granted discretionary authority under the Plan, the Plan Administrator’s prior exercise of such authority shall not obligate him to exercise his authority in a like fashion thereafter. If, due to errors in drafting, any Plan provision does not accurately reflect its intended meaning, as demonstrated by consistent interpretations or other evidence of intent, or as determined by the Plan Administrator in his sole and exclusive judgment, the provision shall be considered ambiguous and shall be interpreted by the Plan Administrator in a fashion consistent with its intent, as determined by the Plan Administrator in his sole discretion. The Plan Administrator may amend the Plan retroactively to cure any such ambiguity. This Section 8.1(h)
may not be invoked by any person to require the Plan to be interpreted in a manner which is inconsistent with its interpretation by the Plan Administrator. All actions taken and all determinations made in good faith by the Plan Administrator shall be final and binding upon all persons claiming any interest in or under the Plan.
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The final sentence of Section 10.5 is deleted and replaced with the following:
If any provision herein would result in taxable income to the Eligible Employee under Code Section 409A, such provision will be amended to avoid any such taxation in such manner as the Plan Administrator determines, with the advice of legal counsel, and as permitted under Code Section 409A.
As expressly amended hereby, the Plan is ratified and confirmed in all respects and shall remain in full force and effect.
IN WITNESS WHEREOF, the undersigned, being a duly authorized officer of the Company, has approved, ratified and executed this Amendment on this ____ day of ______________, 2008.
ANADARKO PETROLEUM CORPORATION
By: _______________________________
Name: ____________________________
Title: _____________________________
1
SECOND AMENDMENT TO THE
ANADARKO PETROLEUM CORPORATION SEVERANCE PLAN AND
SUMMARY PLAN DESCRIPTION
THIS SECOND AMENDMENT (“AMENDMENT”) is made effective as of January 1, 2009 (the “Effective Date”), by Anadarko Petroleum Corporation, a Delaware corporation (the “Plan Sponsor”), and amends the Anadarko Petroleum Corporation Severance Plan and Summary Plan Description as amended and restated effective as of September 1, 2007 (the “Plan”) in order to update certain administration and amendment provisions of the Plan.
Article II is amended by adding a new Section 2.8A to read as follows:
2.8A Committee. The Anadarko Petroleum Corporation Health and Welfare Benefits Administrative Committee, which is a committee of Employees appointed by the Senior Vice President Responsible for Human Resources (“SVP-HR”) to act as named fiduciary and Plan Administrator of the Plan.
Section 2.19 is amended by deleting such section in its entirety and replacing it with the following new Section 2.19 to read as follows:
2.19 Plan Administrator. The Committee, which is appointed by the SVP-HR to act as Plan Administrator of the Plan. References herein to the Committee or Plan Administrator shall include, when appropriate, any Employee or other person or entity who has been delegated the appropriate authority by the Committee as Plan Administrator in accordance with Section 7.4.
Section 5.1 is amended by deleting such section in its entirety and replacing it with the following new Section 5.1 to read as follows:
5.1 Amendment of the Plan. The Plan Sponsor, in its complete discretion, may amend the Plan at any time without advance notice by a written instrument, effective as of the date specified therein, that is (a) authorized or ratified by action of the Board (or committee of the Board designated for such purpose), and (b) identified as an amendment or restatement of the Plan. No Eligible Employee has any vested interest in, or any other rights to receive, any Benefits under the Plan unless and until actually paid to him or on his behalf.
Notwithstanding the foregoing, (a) the Chief Financial Officer of the Plan Sponsor (the “CFO”) and the Chief Executive Officer of the Plan Sponsor acting jointly, or (b) the CFO and the General Counsel of the Plan Sponsor acting jointly, will each have the power to approve, adopt, and execute any amendment to the Plan that (i) is required to comply with changes in applicable law or (ii) does not increase the cost of the Plan by more than five percent (5%) per year as determined in good faith and with the certification of an actuary if necessary.
2
Section 5.2 is amended by deleting such section in its entirety and replacing it with the
following new Section 5.2 to read as follows:
5.2 Termination of the Plan. The Plan Sponsor, in its complete discretion, may terminate the Plan for any reason, in whole or in part, without advance notice by adoption of a written instrument to such effect that is approved or ratified by the Board (or committee of the Board designated for such purpose). No Benefits hereunder shall be vested until actually paid to, or on behalf of, the Eligible Employee.
Article VII is amended to add a new Section 7.1 and renumber the remainder of Article VII accordingly, with such new Section 7.1 to read as follows:
7.1 Committee. The Committee shall be the Plan Administrator. Subject to Section 7.4, the day-to-day administration of the Plan shall be the responsibility of the Committee. The Committee shall consist of at least five members, as appointed from time to time by the Plan Sponsor by action of the Senior Vice President responsible for Human Resources of the Plan Sponsor (the “SVP-HR”). The members of the Committee shall serve at the discretion of the SVP-HR without additional compensation, but may be reimbursed for proper expenditures incurred during the course of performance of duties hereunder in accordance with applicable law.
Appendix A is amended by deleting (2) and (7) and replacing them with a new (2) and (7) to read as follows:
(2) Plan Sponsor:
Anadarko Petroleum Corporation Attn: Benefits Department – Human Resources 1201 Lake Robbins Drive The Woodlands, Texas 77380 (832) 636-1000
Plan Administrator:
Anadarko Petroleum Corporation Health and Welfare Benefits Administrative Committee Attn: Benefits Department – Human Resources 1201 Lake Robbins Drive The Woodlands, Texas 77380 (832) 636-1000 (ask for “Benefits Department – Human Resources”)
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(7) Agent for Service of Legal Process:
Anadarko Petroleum Corporation Health and Welfare Benefits Administrative Committee Anadarko Petroleum Corporation Severance Plan Anadarko Petroleum Corporation c/o CT Corporation System 350 N. St. Paul Street Dallas, TX 75201
As expressly amended hereby, the Plan is ratified and confirmed in all respects and shall remain in full force and effect.
IN WITNESS WHEREOF, the Plan Sponsor has caused this Second Amendment to be adopted and executed by its duly authorized officer on this ______ day of___________, 2009.
ANADARKO PETROLEUM CORPORATION
By: _______________________________
Name: ____________________________
Title: _____________________________
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