Halliburton Co. Contracts
Sample Business Contracts
Long Term Performance Plan - M.W. Kellogg Co.
LONG TERM
PERFORMANCE PLAN
FOR
SELECTED EMPLOYEES OF
THE M.W. KELLOGG COMPANY
AS AMENDED AND RESTATED
EFFECTIVE SEPTEMBER 1, 1999
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TABLE OF CONTENTS
ARTICLE PAGE
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I - PURPOSE OF PLAN.......................................................1
II - DEFINITIONS OF TERMS USED IN THE PLAN.................................2
2.1 Administrative Committee.......................................2
2.2 Beneficiary....................................................2
2.3 Committee......................................................2
2.4 Company........................................................2
2.5 Crediting Date.................................................2
2.6 DII Compensation Committee.....................................2
2.7 Employer.......................................................2
2.8 Fiscal Year....................................................2
2.9 Halliburton....................................................2
2.10 Net Earnings...................................................2
2.11 Participant....................................................3
2.12 Payment Date...................................................3
2.13 Performance Fund...............................................3
2.14 Performance Account............................................3
2.15 Performance Allocation.........................................3
2.16 Termination for Cause..........................................3
III - PARTICIPATION AND PERFORMANCE ACCOUNT ALLOCATIONS.....................4
3.1 Eligibility....................................................4
3.2 Performance Allocations........................................4
3.3 Interest Credits...............................................4
IV - VESTING AND FORFEITURE................................................4
4.1 Vesting Schedule...............................................4
4.2 Discretionary Vesting..........................................4
4.3 Treatment of Unvested Benefits upon Termination................5
4.4 Forfeiture upon Termination for Cause..........................5
4.5 Forfeiture after Termination...................................5
V - PAYMENT OF BENEFITS ..................................................5
5.1 Amount of Benefits.............................................5
5.2 Form of Benefit Payments.......................................5
5.3 Interest on Installment Payments...............................6
5.4 Beneficiary in the Event of Death..............................6
5.5 Emergency Distribution.........................................6
5.6 Benefits Unfunded..............................................6
(i)
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VI - ADMINISTRATION........................................................7
6.1 Duties.........................................................7
6.2 Finality of Decisions..........................................7
VII - AMENDMENT AND TERMINATION.............................................7
7.1 Amendment and Termination......................................7
VIII - MISCELLANEOUS.........................................................8
8.1 No Employment Rights...........................................8
8.2 Non-Assignability..............................................8
8.3 Law Applicable.................................................9
(ii)
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LONG TERM PERFORMANCE PLAN
FOR SELECTED EMPLOYEES OF
THE M.W. KELLOGG COMPANY
AS AMENDED AND RESTATED
EFFECTIVE SEPTEMBER 1, 1999
WHEREAS, Dresser Industries, Inc. (the "Company") has heretofore adopted
the Long Term Performance Plan For Selected Employees of The M.W. Kellogg
Company (the "Plan") on behalf of The M.W. Kellogg Company; and
WHEREAS, on September 29, 1998 (the "Merger Date"), a wholly owned
subsidiary of Halliburton Company ("Halliburton") was merged with the Company
and, as a consequence of the merger, the Company became a wholly owned
subsidiary of Halliburton; and
WHEREAS, as of the Merger Date, participation in the Plan was frozen so
that only those individuals who were participants in the Plan on the Merger Date
are entitled to participate after the Merger Date; and
WHEREAS, from and after the Crediting Date of the Performance Fund for the
Fiscal Year ending October 31, 1998, no further Performance Allocation shall be
credited to any Participant's Performance Account (capitalized terms used in
this preamble shall have the meanings ascribed below); and
WHEREAS, effective January 1, 1999, The M.W. Kellogg Company was merged
with and into Kellogg Brown & Root, Inc. ("KBR") and, pursuant to such merger,
KBR succeeded to the rights and assumed the continuing obligations of the
Employer (as hereinafter defined) under the Plan; and
WHEREAS, the Company desires to amend and restate the Plan to provide for
changes in the Plan required as a result of the actions set forth in the
foregoing preambles.
NOW, THEREFORE, the Plan document shall be amended and restated, effective
September 1, 1999, as follows:
ARTICLE I
PURPOSE OF PLAN
The Plan is intended to constitute an unfunded deferred compensation
arrangement for a select group of highly compensated or key employees of the
Employer. The Plan compensates Participants for special service to the Employer
and is not intended to constitute a retirement plan. Accordingly, Participants'
benefits hereunder shall not offset employer contributions to any retirement
plan(s), whether qualified or non-qualified.
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ARTICLE II
DEFINITIONS OF TERMS USED IN THE PLAN
Unless the context clearly indicates otherwise, the following words and
phrases have the meanings set forth below:
2.1 Administrative Committee - The committee appointed by the Committee to
which day-to-day administration of the Plan has been delegated.
2.2 Beneficiary - The individual or trust designated by the Participant to
receive the amount, if any, payable under the Plan upon the death of the
Participant.
2.3 Committee - The Compensation Committee of the Board of Directors of
Halliburton which has been charged with overseeing the administration of the
Plan since the Fiscal Year ended October 31, 1998. The Committee has delegated
day-to-day administration of the Plan to the Administrative Committee.
2.4 Company - Dresser Industries, Inc. and its successors in interest.
2.5 Crediting Date - January 15th next following the end of any Fiscal
Year.
2.6 DII Compensation Committee - The committee charged with administration
of the Plan prior to the Fiscal Year ended October 31, 1998.
2.7 Employer - Since January 1, 1999, Kellogg Brown & Root, Inc. (successor
to The M.W. Kellogg Company), a wholly-owned subsidiary of the Company.
2.8 Fiscal Year - The year ending October 31.
2.9 Halliburton - Halliburton Company, the ultimate parent company of the
Company and the Employer.
2.10 Net Earnings - For any Fiscal Year through the Fiscal Year ending
October 31, 1998, the Employer's annual operating earnings, less interest, taxes
and goodwill amortization, all as determined by the DII Compensation Committee
in its sole discretion.
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2.11 Participant - Any key employee of the Employer who has been designated
by the Committee as eligible to participate in the Plan, and who has been
assigned a percentage of the Performance Fund. Notwithstanding the foregoing,
effective September 29, 1998, participation in the Plan was frozen and only
those individuals who were Participants as of or prior to September 29, 1998,
are entitled to participate in the Plan after such date.
2.12 Payment Date - With respect to payment in lump sum or the initial
annual installment, as applicable, as soon as practicable after the Crediting
Date next following the end of the calendar year in which termination of a
Participant's employment occurred. Subsequent annual installments shall be paid
as soon as practicable following the Crediting Date for each of the nine
succeeding years.
2.13 Performance Fund - An amount equal to a percent of the Net Earnings,
as determined by the DII Compensation Committee, for any Fiscal Year through the
Fiscal Year ending October 31, 1998.
2.14 Performance Account - The account established on the books of the
Company for a Participant.
2.15 Performance Allocation - The amount of a Participant's portion of the
Performance Fund for any Fiscal Year through the Fiscal Year ending October 31,
1998, based on his assigned percentage of the Performance Fund, credited at the
Crediting Date.
2.16 Termination for Cause - Termination of a Participant's employment by
the Employer as a result of the Participant's (i) gross negligence or willful
misconduct in the performance of his duties, (ii) conviction of a felony or
(iii) a material violation of Halliburton's Code of Business Conduct.
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ARTICLE III
PARTICIPATION AND PERFORMANCE ACCOUNT ALLOCATIONS
3.1 Eligibility. Any key employee of the Employer who, on or before
September 29, 1998, was designated by the DII Compensation Committee as eligible
to participate in the Plan and assigned a percentage of the Performance Fund for
any Fiscal Year shall be a Participant.
3.2 Performance Allocations. Every year at the Crediting Date the
Participant's Performance Allocation will be credited to his Performance
Account; provided, however, that no Performance Allocation shall be credited
after the Performance Allocation for the Fiscal Year ending October 31, 1998.
3.3 Interest Credits. Interest on the outstanding balance of each
Participant's Performance Account shall be credited annually on the Crediting
Date at a rate equal to the opening yield of five-year U.S. Treasury Securities
as quoted by Merrill Lynch, Pierce, Fenner & Smith on such date or, if such date
is not a business day, the immediately preceding business day.
ARTICLE IV
VESTING AND FORFEITURE
4.1 Vesting Schedule. Each year's Performance Allocation is vested
separately. The Performance Allocation for any Fiscal Year is considered
one-third vested at the Crediting Date and is vested an additional one-third for
each of the next two years, at which time the Performance Allocation for such
Fiscal Year is fully vested.
4.2 Discretionary Vesting. The Committee (with respect to Participants
within its purview) or the Administrative Committee (with respect to all other
Participants) may, in the sole discretion of the applicable committee, fully
vest all years' Performance Allocations for terminations due to death,
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disability, retirement, or terminations other than Terminations for Cause or
voluntary resignations.
4.3 Treatment of Unvested Benefits upon Termination. Except as provided in
Section 4.2, the unvested portion of a Participant's Performance Account shall
continue to vest in accordance with the vesting schedule upon termination of
such Participant's employment due to death, disability or retirement. The
unvested portion of a Participant's Performance Account shall be forfeited upon
a Participant's voluntary resignation.
4.4 Forfeiture upon Termination for Cause. Termination for Cause shall
result in immediate forfeiture of a Participant's vested and unvested
Performance Account balance(s).
4.5 Forfeiture after Termination. Any outstanding Performance Account
balance may, in the sole discretion of the Committee, be forfeited if, at any
time within two years after a Participant's termination of employment, the
Participant takes or allows some act or omission contrary to the interests of
the Employer or Halliburton.
ARTICLE V
PAYMENT OF BENEFITS
5.1 Amount of Benefits. The amount of benefits payable hereunder shall be
equal to the vested portion of a Participant's Performance Account (including
accrued interest thereon), determined as of the Crediting Date immediately
following the termination date.
5.2 Form of Benefit Payments. Each Participant will make an election as to
whether he wants to receive payment in ten equal annual installments or in a
lump sum. This election can be changed at any time at least one year prior to
the Payment Date, or the initial Payment Date in the case of installment
payments.
Upon the death of the Participant or former Participant, either before or
after his termination of employment, any unpaid balance in his Performance
Account shall, be paid to his Beneficiary in a lump sum or ten equal annual
installments per the Participant's election, which must be made one year prior
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to the Payment Date, or the initial Payment Date in the case of installment
payments.
5.3 Interest on Installment Payments. If payment is made in installments,
the unpaid balance of a Participant's Performance Account as determined
immediately prior to the Crediting Date for any installment payment shall be
credited with interest in the manner provided in Section 3.3 and such interest
amount shall be paid in conjunction with such installment payment.
5.4 Beneficiary in the Event of Death. The designation of Beneficiary under
the Plan shall be made on a form specified by the Administrative Committee and
may be changed from time to time in the manner prescribed by the Administrative
Committee.
5.5 Emergency Distribution. All or any portion of the vested amount of a
Participant's Performance Account may be paid to him, upon appropriate
application and in the sole discretion of the Committee, in the event of unusual
financial hardship due to: (i) illness or disability of the Participant or
member of his family; (ii) educational expenses of the Participant or his
dependent; (iii) purchase by the Participant of a primary residence; or (iv) any
other hardship of similar nature and importance as may be determined to be valid
and worthy by the Committee. The Participant's application must set forth in
writing the reasons for the requested distribution and the amount requested. The
Committee shall have the discretion to deny any such request in its entirety or
to approve distribution of the entire amount requested or any lesser amount as
it may deem appropriate.
5.6 Benefits Unfunded. Benefits payable under the Plan shall not be funded
in any manner.
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ARTICLE VI
ADMINISTRATION
6.1 Duties of Committee. Prior to the Fiscal Year ending October 31, 1998,
the Plan was administered by the DII Compensation Committee and, accordingly,
such committee made all determinations with respect to the calculation of the
Performance Fund amount for all Fiscal Years through the Fiscal Year ending
October 31, 1998. From and after such Fiscal Year, the Committee shall oversee
administration of the Plan in accordance with its terms and purposes and shall
have the sole discretionary duty and authority to interpret the provisions of
the Plan. The Administrative Committee shall determine the amount and manner of
payment of the benefits due each Participant or his Beneficiary and shall cause
such benefits to be paid accordingly. In addition, the Administrative Committee
shall have the authority set forth in Section 4.2 and responsibility for the
day-to-day administration of the Plan, together with such other duties and
authority as may be delegated by the Committee.
6.2 Finality of Decisions. The decisions made and actions taken by the DII
Compensation Committee (including all prior determinations concerning Net
Earnings and Performance Fund amounts), the Committee and/or the Administrative
Committee in the administration of the Plan shall be final and conclusive on all
persons, and the members of such committees shall not be subject to individual
liability with respect to the Plan.
ARTICLE VII
AMENDMENT AND TERMINATION
7.1 Amendment and Termination. While the Company intends to maintain the
Plan for as long as any Participant continues in the employment of the Employer,
the Company reserves the right to amend and/or terminate it at any time for
whatever reasons it may deem appropriate; provided, however, that no such
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amendment or termination shall reduce any benefits accrued under the terms of
the Plan prior to the date of such Plan termination or amendment.
ARTICLE VIII
MISCELLANEOUS
8.1 No Employment Rights. Nothing contained in the Plan shall be construed
as a contract of employment between the Employer, the Company or any other
Halliburton subsidiary and any employee, or as a right of any employee to be
continued in employment or as a limitation of the right of the Employer, the
Company or any other Halliburton subsidiary to discharge any employee with or
without cause.
8.2 Non-Assignability. No Participant shall have any right to commute,
encumber, pledge, transfer or otherwise dispose of or alienate any present or
future right or expectancy which he may have at any time to receive payments of
any allocations made to such Participant, all such allocations being expressly
hereby made non-assignable and non-transferable; provided, however, that nothing
in this Section 8.2 shall prevent transfer (A) by will, (B) by the applicable
laws of descent and distribution or (C) pursuant to an order that satisfies the
requirements for a "qualified domestic relations order" as such term is defined
in section 206(d)(3)(B) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA") and section 414(p)(1)(A) of the Internal Revenue Code of
1986, as amended (the "Code"), including an order that requires distributions to
an alternate payee prior to a Participant's "earliest retirement age" as such
term is defined in section 206(d)(3)(E)(ii) of ERISA and section 414(p)(4)(B) of
the Code. Attempts to transfer or assign by a Participant (other than in
accordance with the preceding sentence) shall, in the sole discretion of the
Administrative Committee after consideration of such facts as it deems
pertinent, be grounds for terminating any rights of such Participant to any
amounts allocated to but not previously paid over to such Participant.
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8.3 Law Applicable. The Plan shall be governed by the laws of Texas.
DRESSER INDUSTRIES, INC.
By /s/ D. C. Vaughan
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