As filed with the Securities and Exchange Commission on
January 10, 1994
Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
EL PASO NATURAL GAS COMPANY
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 74-0608280
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
</TABLE>
One Paul Kayser Center
304 Texas Avenue
El Paso, Texas 79901
(Address of principal executive offices, including zip code)
EL PASO NATURAL GAS COMPANY
INCENTIVE COMPENSATION PLAN
(Full title of the plan)
BRITTON WHITE, JR.
Senior Vice President and General Counsel
EL PASO NATURAL GAS COMPANY
One Paul Kayser Center
304 Texas Avenue
El Paso, Texas 79901
(915) 541-2600
(Name, address and telephone number,
including area code, of agent for service)
----------------------
Copy to:
ARNOLD H. TRACY
MUDGE ROSE GUTHRIE ALEXANDER & FERDON
180 Maiden Lane
New York, New York 10038
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Title of Amount to be Proposed Proposed Amount of
securities registered maximum maximum registration
to be offering price aggregate fee
registered per share(1) offering
price(1)
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<S> <C> <C> <C> <C>
Common Stock,
par value $3 100,000 shares $35.50 $3,550,000 $1,224.15
per share
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</TABLE>
(1) Estimated pursuant to Rule 457(c) solely for the purpose of
calculating the amount of the registration fee. The price per
share is estimated based on the average of the high and low trading
prices for El Paso Natural Gas Company's Common Stock on January 4,
1994, as reported by the New York Stock Exchange.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and Exchange
Commission (the "Commission") by El Paso Natural Gas Company (the
"Registrant") pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), are hereby incorporated by reference
in this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the year
ended December 31, 1992, which contains audited financial
statements for the most recent year for which such statements have
been filed;
(b) All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Exchange Act, since the end of the
fiscal year covered by the Annual Report referred to in (a) above;
and
(c) The description of the Registrant's common stock, $3 par
value (the "Common Stock"), contained in the Registration
Statement on Form 8-A (Registration No. 1-2700) filed with the
Commission on February 13, 1992 under Section 12 of the Exchange
Act, including any amendments or reports filed for the purpose of
updating such descriptions.
All documents and reports filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, after the
date hereof and prior to the filing of a post-effective amendment
to the Registration Statement which indicates that the securities
offered hereby have been sold, or which deregisters all such
securities remaining unsold, shall also be deemed to be
incorporated by reference into this Registration Statement and to
be a part hereof commencing on the respective dates on which such
documents are filed.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law provides
that a corporation may indemnify directors and officers as well as
other employees and individuals against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement
in connection with specified actions, suits or proceedings, whether
civil, criminal, administrative or investigative (other than an
action by or in the right of the corporation--a "derivative
action"), if they acted in good faith and in a manner they
reasonably believed to be in or not opposed to the best interests
of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe their conduct was
unlawful. A similar standard is applicable in the case of
derivative actions, except that indemnification only extends to
expenses (including attorneys' fees) incurred in connection with
the defense or settlement of such action, and the statute requires
court approval before there can be any indemnification where the
person seeking indemnification has been found liable to the
corporation. The statute provides that it is not exclusive of
other indemnification that may be granted by a corporation's by-
laws, disinterested director vote, stockholder vote, agreement or
otherwise.
Article X of the By-laws of the Registrant requires
indemnification to the full extent permitted under Delaware law as
from time to time in effect. Subject to any restrictions imposed by
Delaware law, the By-laws provide an unconditional right to
indemnification for all expense, liability and loss (including
attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) actually and reasonably incurred or
suffered by any person in connection with any actual or threatened
proceeding (including, to the extent permitted by law, any
derivative action) by reason of the fact that such person is or was
serving as a director, officer or employee of the Registrant or
that, being or having been such a director or officer or an
employee of the Registrant, such person is or was serving at the
request of the Registrant as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise, including an employee benefit plan. The By-laws also
provide that the Registrant may, by action of its Board of
Directors, provide indemnification to its agents with the same
scope and effect as the foregoing indemnification of directors and
officers.
Section 102(b)(7) of the Delaware General Corporation Law
permits a corporation to provide in its certificate of
incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director, except
for liability for (i) any breach of the director's duty of loyalty
to the corporation or its stockholders, (ii) acts or omissions not
in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) payment of unlawful dividends or unlawful
stock purchases or redemptions, or (iv) any transaction from which
the director derived an improper personal benefit.
Article 10 of the Registrant's Restated Certificate of
Incorporation, as amended, provides that to the full extent that
the Delaware General Corporation Law, as it now exists or may
hereafter be amended, permits the limitation or elimination of the
liability of directors, a director of the Registrant shall not be
liable to the Registrant or its stockholders for monetary damages
for breach of fiduciary duty as a director. Any amendment to or
repeal of such Article 10 shall not adversely affect any right or
protection of a director of the Registrant for or with respect to
any acts or omissions of such director occurring prior to such
amendment or repeal.
The Registrant maintains Directors' and Officers' liability
insurance which provides for payments on behalf of the directors
and officers of all losses of such persons (other than matters
uninsurable under the law) arising from claims, including claims
arising under the Securities Act of 1933, as amended (the
"Securities Act"), for acts or omissions by such persons while
acting as directors or officers.
Item 7. Exemption From Registration Claimed.
Not Applicable.
Item 8. Exhibits.
<TABLE>
<CAPTION>
Exhibit
Number Description
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<S> <C>
4.1 Restated Certificate of Incorporation of the Registrant
dated January 22, 1992 (filed as Exhibit 3.A to the Registrant's
Annual Report on Form 10-K for the fiscal year ended December 31,
1992 and incorporated herein by reference)
4.2 El Paso Natural Gas Company Incentive Compensation Plan
5.1 Opinion of Mudge Rose Guthrie Alexander & Ferdon regarding
legality of the Common Stock being registered
5.2 Opinion of Mudge Rose Guthrie Alexander & Ferdon regarding
the Plan's compliance with ERISA
23.1 Consents of Mudge Rose Guthrie Alexander & Ferdon (included
in their opinions filed as Exhibits 5.1 and 5.2)
23.2 Consent of Coopers & Lybrand
24 Power of Attorney (see Signature Page)
</TABLE>
Item 9. Undertakings.
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the
most recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not
apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to Section 13 or Section
15(d) of the Exchange Act that are incorporated by reference in
this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
B. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions of
Item 6, or otherwise, the Registrant has been advised that in the
opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-8 and has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City of El Paso, State of Texas, on January 10, 1994.
EL PASO NATURAL GAS COMPANY
By: /S/ WILLIAM A. WISE
William A. Wise
Chairman of the Board,
President and Chief Executive Officer
POWER OF ATTORNEY
Each person whose individual signature appears below hereby
authorizes H. Brent Austin and Britton White, Jr. and each of them
as attorneys-in-fact, with full power of substitution, to execute
in the name and on behalf of such person, individually and in each
capacity stated below, and to file, any and all amendments to this
Registration Statement, including any and all post-effective
amendments.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the
following persons in the capacities indicated on January 10, 1994.
<TABLE>
<CAPTION>
Signature Title
<S> <C>
/S/ WILLIAM A. WISE Chairman of the Board, President,
William A. Wise Chief Executive Officer and Director
/S/ LUINO DELL'OSSO, JR. Executive Vice President, Chief
Luino Dell'Osso, Jr. Operating Officer and Director
/S/ H. BRENT AUSTIN Senior Vice President and Chief
H. Brent Austin Financial Officer
(Principal Financial Officer)
/S/ THOMAS E. RICKS Vice President and Controller
Thomas E. Ricks (Principal Accounting Officer)
/S/ BYRON ALLUMBAUGH Director
Byron Allumbaugh
/S/ EUGENIO GARZA LAGUERA Director
Eugenio Garza Laguera
/S/ BEN F. LOVE Director
Ben F. Love
/S/ KENNETH L. SMALLEY Director
Kenneth L. Smalley
</TABLE>
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EL PASO NATURAL GAS COMPANY
INCENTIVE COMPENSATION PLAN
Dated as of January 1, 1992
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Table of Contents
SECTION 1 PURPOSES . . . . . . . . . . . . . . . . . . . . . 1
1.1 Purposes . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2 ADMINISTRATION . . . . . . . . . . . . . . . . . . 1
2.1 Administration . . . . . . . . . . . . . . . . . . 1
SECTION 3 PARTICIPANTS . . . . . . . . . . . . . . . . . . . 2
3.1 Participants . . . . . . . . . . . . . . . . . . . 2
SECTION 4 INCENTIVE AWARD POOL . . . . . . . . . . . . . . . 2
4.1 Incentive Award Pool . . . . . . . . . . . . . . . 2
4.2 Company/Subsidiary Performance . . . . . . . . . . 3
4.3 Maximum Award Percentage . . . . . . . . . . . . . 3
SECTION 5 INDIVIDUAL AWARDS . . . . . . . . . . . . . . . . 4
5.1 Section 16 Executives . . . . . . . . . . . . . . . 4
5.2 Other Participants . . . . . . . . . . . . . . . . 4
5.3 Incentive Award Limits . . . . . . . . . . . . . . 4
5.4 New Employee, or Retirement, Death, Disability or
Termination of Employment . . . . . . . . . . . . . . . . . . 4
SECTION 6 PAYMENT OF INCENTIVE AWARDS . . . . . . . . . . . 4
6.1 Immediate Payment . . . . . . . . . . . . . . . . . 4
6.2 Deferred Payment . . . . . . . . . . . . . . . . . 5
6.3 Special Deferrals . . . . . . . . . . . . . . . . . 5
6.4 Memorandum Account . . . . . . . . . . . . . . . . 6
6.5 Discretionary Investment by Company . . . . . . . . 6
6.6 Payment of Deferred Incentive Award . . . . . . . . 6
6.7 Acceleration of Payment of Deferred Incentive Award 7
6.8 Payment of Burlington Resources Inc. Deferred Incentive
Award . . . . . . . . . . . . . . . . . . . . . . 7
6.9 Payment Upon Change in Control . . . . . . . . . . 7
SECTION 7 GENERAL PROVISIONS . . . . . . . . . . . . . . . . 8
7.1 Issuance of Common Stock . . . . . . . . . . . . . 8
7.2 Unfunded Obligation . . . . . . . . . . . . . . . . 8
7.3 Other Benefits . . . . . . . . . . . . . . . . . . 9
7.4 Annual Salary . . . . . . . . . . . . . . . . . . . 9
7.5 Beneficiary . . . . . . . . . . . . . . . . . . . . 9
7.6 Permanent Disability . . . . . . . . . . . . . . . 9
7.7 Incapacity of Participant or Beneficiary . . . . . 9
7.8 Withholding Taxes . . . . . . . . . . . . . . . . . 10
7.9 Nonassignment . . . . . . . . . . . . . . . . . . . 10
7.10 No Right to Continued Employment . . . . . . . . . 10
7.11 Termination and Amendment . . . . . . . . . . . . . 10
7.12 Stockholder Approval . . . . . . . . . . . . . . . 10
7.13 Applicable Law . . . . . . . . . . . . . . . . . . 11
7.14 Effective Date . . . . . . . . . . . . . . . . . . 11
EL PASO NATURAL GAS COMPANY
INCENTIVE COMPENSATION PLAN
SECTION 1 PURPOSES
1.1 Purposes
The purposes of the El Paso Natural Gas Company Incentive
Compensation Plan (the "Plan") are to encourage outstanding
performances from the executives of El Paso Natural Gas Company
(the "Company") and its subsidiaries, to attract and retain
exceptional executives, and to provide a direct incentive to the
Participants (as defined in Section 3.1) to improve the
profitability of the Company.
SECTION 2 ADMINISTRATION
2.1 Administration
With respect to awards made under the Plan to officers and
directors ("Section 16 Executives") who are subject to Section 16
of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Plan shall be administered by a committee (the "Plan
Administrator") of the Company's Board of Directors (the "Board"),
which shall be constituted at all times so as to meet the
requirements of Rule 16b-3 promulgated under Section 16(b) of the
Exchange Act so long as any of the Company's equity securities are
registered pursuant to Section 12(b) or 12(g) of the Exchange Act.
With respect to all other awards, the Plan shall be administered by
a management committee (the "Management Committee") consisting of
the Chief Executive Officer and such other senior officers as the
Chief Executive Officer shall designate. Subject to the Plan
Administrator, the Management Committee shall interpret the Plan,
prescribe, amend and rescind rules relating to it, select
eligible Participants, grant incentive awards, and take all other
actions necessary for its administration, which actions shall be
final and binding upon all Participants.
It is the intention of the Company that, so long as any of the
Company's equity securities are registered pursuant to Section
12(b) or 12(g) of the Exchange Act, the Plan shall comply in all
respects with Rule 16b-3 promulgated under Section 16(b) of the
Exchange Act and, if any Plan provision is later found not to be in
compliance with such Section, that provision shall be deemed null
and void, and in all events the Plan shall be construed in favor of
its meeting the requirements of Rule 16b-3. Notwithstanding
anything in the Plan to the contrary, the Board, in its absolute
discretion, may bifurcate the Plan so as to restrict, limit or
condition the use of any provision of the Plan to Participants who
are officers and directors subject to Section 16 of the Exchange
Act without so restricting, limiting or conditioning the Plan with
respect to other Participants.
SECTION 3 PARTICIPANTS
3.1 Participants
The Plan Administrator shall determine and designate the
Section 16 Executives and the Management Committee shall designate
all other executives of the Company and its subsidiaries who are
eligible to receive awards under the Plan (the "Participants").
Participants, in general, will be limited to those executives who
because of their management or staff positions have the principal
responsibility for the management, direction and success of the
Company as a whole or a particular business unit thereof. Directors
of the Company who are full-time executives of the Company shall be
eligible to participate in the Plan. Any Participant in the
Burlington Resources Inc. Incentive Compensation Plan (the "BR
Plan") on the day immediately preceding the effective date of this
Plan, who is an employee of the Company, shall become a Participant
of this Plan on the effective date and shall immediately cease
participation in the BR Plan.
SECTION 4 INCENTIVE AWARD POOL
4.1 Incentive Award Pool
A memorandum account (the "Incentive Award Pool") shall be
established for the Company and each participating subsidiary for
purposes of determining the amount of money which shall be
available for incentive awards for each year. The Incentive Award
Pool of an employer (the Company or a participating subsidiary) for
each year shall be an amount equal to the sum total of the
aggregate maximum incentive awards available for its Participants
for that year. Each Participant's maximum incentive award for a
particular year (the "Maximum Incentive Award") shall equal the
Participant's annual salary multiplied by the Maximum Award
Percentage (as defined in Section 4.3), which amount is then
multiplied by the Performance Standard Percentage (as defined in
Section 4.2) of the Participant's employer for that year; provided,
however, that for Participants in grade F and above who are
employed by a participating subsidiary, the Maximum Incentive Award
shall be the sum of (a) the Participant's annual salary multiplied
by the Participant's Maximum Award Percentage, which amount is then
multiplied by one-half of the subsidiary's Performance Standard
Percentage for the year, plus (b) the Participant's annual salary
multiplied by the Participant's Maximum Award Percentage, which
amount is then multiplied by one-half of the Company's Performance
Standard Percentage for the year.
4.2 Company/Subsidiary Performance
At the beginning of each year, the Plan Administrator shall
approve strategic and financial objectives for the Company and for
the participating subsidiaries for the year. At the end of the
year, the Plan Administrator shall assess the Company or
subsidiary's performance in relation to those objectives for
purposes of establishing the size of the Incentive Award Pool in
accordance with the following table of Performance Categories and
Standard Percentages:
<TABLE>
<CAPTION>
Company or Subsidiary Performance
Performance Category Standard Performance
<S> <C>
I. Performance for the year was 100%
outstanding and exceeded
objectives.
II. Performance for the year met 75%
or exceeded objectives or was
excellent in view of prevailing
conditions.
III. Performance for the year 50%
generally met objectives or was
very acceptable in view of
prevailing conditions.
IV. Performance for the year 0 to 25%
did not meet objectives and was
generally below acceptable levels.
</TABLE>
4.3 Maximum Award Percentage
Each participating employer (the Company or a subsidiary) shall
establish the salary grades of its Participants. The Plan
Administrator shall assign a percentage of annual salary (the
"Maximum Award Percentage") for each of the Section 16 Executives
and the Management Committee and assign the Maximum Award
Percentages applicable to all other Participants. The Maximum
Award Percentages of the Participants shall be used to calculate
the Incentive Award Pools, as set forth in Section 4.1. The
Maximum Award Percentage shall not exceed one hundred percent
(100%) for any Participant.
SECTION 5 INDIVIDUAL AWARDS
5.1 Section 16 Executives
The Plan Administrator shall annually grant the incentive award
for the Section 16 Executives. In evaluating the Section 16
Executives, the Plan Administrator shall consider the corporate
objectives of the Company and the Section 16 Executives'
responsibilities and accomplishments, and such other factors as it
deems appropriate.
5.2 Other Participants
The Management Committee shall annually grant the incentive
awards to the Participants other than the Section 16 Executives in
accordance with their individual performances. In evaluating a
Participant, the Management Committee shall consider the corporate
objectives of the Participant's employer, the Participant's
responsibilities and accomplishments, and such other factors as it
deems appropriate.
5.3 Incentive Award Limits
The aggregate individual incentive awards for an employer's
Participants may not exceed that employer's Incentive Award Pool.
A Participant's performance must be satisfactory, regardless of
Company or subsidiary performance, before the Participant may be
granted an incentive award.
5.4 New Employee, or Retirement, Death, Disability or Termination
of Employment
The Plan Administrator or the Management Committee, as
applicable and in its discretion, may grant all or such portion of
an incentive award for the year as it deems advisable to a
Participant (or the Participant's Beneficiary (as defined in
Section 7.5) in the case of the Participant's death) who is
employed or who is promoted to an executive grade during the year,
or whose employment is terminated because of the Participant's
retirement, death, permanent disability, resignation or discharge.
SECTION 6 PAYMENT OF INCENTIVE AWARDS
6.1 Immediate Payment
Each Participant who has elected to receive his or her incentive
award for the year currently shall be paid not later than the month
following the month in which the award is made as follows:
(a) in cash or
(b) at the election of the Participant, in shares of
common stock of the Company, par value $3 per share (the "Common
Stock"), having a value equal to the portion of the incentive award
which the Participant has elected to receive in stock; provided,
that if required by Rule 16b-3 promulgated under Section 16(b) of
the Exchange Act, any election made by an officer or director
subject to Section 16 of the Exchange Act to receive all or a
portion of an incentive award in Common Stock shall be made six
months and one day prior to the date of the grant of the incentive
award.
For purposes of this Plan, the value of a share of Common
Stock shall be the mean between the highest and lowest quoted
selling prices at which the Common Stock was sold on the date of
the grant of the incentive award as reported in the NYSE Composite
Transactions by The Wall Street Journal on such date or, if no
Common Stock was traded on such date, on the next preceding date on
which the Common Stock was so traded. The value of any fractional
share shall be paid in cash.
6.2 Deferred Payment
Prior to the end of the year, each Participant may elect to
have the payment of all or a portion of his or her incentive award
for the year deferred until the Participant's retirement, death,
permanent disability, resignation or termination of employment,
subject to a $1,000 minimum. The election shall be irrevocable and
shall be made on a form prescribed by the Management Committee. Any
election made under the BR Plan shall continue to be effective for
Participants in the BR Plan who become Participants in this Plan on
its effective date. The election shall apply only to that year. If
a Participant has not made an election, any incentive award granted
to the Participant for that year shall be paid pursuant to Section
6.1(a).
6.3 Special Deferrals
The Management Committee may, in its discretion, approve
deferred payments ("Special Deferrals") as follows. Prior to the
end of the year, each Participant may elect to have the payment of
all or a portion of his or her incentive award for the year
deferred until a date specified by the Management Committee. The
Special Deferral shall be subject to a $1,000 minimum. The election
shall be irrevocable and shall be made on a form subscribed by the
Management Committee. The Special Deferral election shall apply
only to the incentive award for that year. If a Participant has not
made an election, any incentive award granted to the Participant
for that year shall be paid pursuant to Section 6.1(a) or 6.2.
6.4 Memorandum Account
The Company shall establish a ledger account (the "Memorandum
Account") for each Participant who has elected to defer the payment
of his or her incentive award for the purpose of reflecting the
Company's obligation to pay the deferred incentive award as
provided in Section 6.6. Interest shall accrue on the deferred
incentive award to the date of distribution and shall be credited
to the Memorandum Account at the end of each calendar quarter or
such other periods as may be determined by the Management
Committee. The Management Committee shall determine the rate of
interest periodically and in so doing may take into account the
earnings, losses, appreciation or depreciation attributable to any
discretionary investment made pursuant to Section 6.5.
6.5 Discretionary Investment by Company
The deferred incentive awards to be paid to the Participants
are an unfunded obligation of the Company. The Management
Committee may annually direct that an amount equal to the deferred
incentive awards for that year shall be invested by the Company as
the Management Committee, in its sole discretion, shall determine.
The Management Committee may, in its sole discretion, determine
that all or a portion of an amount equal to the deferred incentive
awards shall be paid into one or more grantor trusts to be
established by the Company of which it shall be the beneficiary,
and to the assets of which it shall become entitled as and to the
extent that Participants receive benefits under the Plan. The
Management Committee may designate an investment advisor to direct
investments and reinvestments of the funds.
6.6 Payment of Deferred Incentive Award
Upon the retirement, death, permanent disability, Special
Deferral payment date, resignation or termination of employment of
a Participant who has elected to defer an incentive award in a
prior year, the Company shall pay to such Participant (or the
Participant's Beneficiary in the case of his or her death) an
amount equal to the balance of the Participant's Memorandum
Account, plus interest (as determined by the Management Committee
pursuant to Section 6.4) on the outstanding account balance to the
date of distribution and subject to approval of the Management
Committee, as follows:
(a) a lump sum cash payment or
(b) in periodic installments over a period of years to
be determined by the Management Committee, in its discretion.
Payment of deferred incentive awards shall commence or be made
in the month following the Participant's retirement, death,
permanent disability, resignation, termination of employment or
Special Deferral payment date.
6.7 Acceleration of Payment of Deferred Incentive Award
The Management Committee, in its discretion, may accelerate
the payment of the unpaid balance of a Participant's Memorandum
Account in the event of the Participant's death, permanent
disability or termination of employment, or upon its determination
that the Participant (or the Participant's Beneficiary in the case
of the Participant's death) has incurred a severe financial
hardship. The Management Committee in making its determination may
consider such factors and require such information as it deems
appropriate.
6.8 Payment of Burlington Resources Inc. Deferred Incentive Award
Incentive awards which were deferred by a Participant under
the BR Plan, together with interest accrued thereon, shall be paid
by the Company in accordance with the terms of this Plan and in
lieu of payment by Burlington Resources Inc. ("BR").
6.9 Payment Upon Change in Control
Notwithstanding any other provision of this Plan, in the event
of a Change in Control of the Company, the maximum bonus amount
attributable to the year in which the Change in Control occurs
shall become fully vested and distributable within 30 days after
the date of the Change in Control.
For purposes of this Plan a "Change in Control" shall be
deemed to occur:
(a) if any person (as such term is used in Sections
13(d) and 14(d)(2) of the Exchange Act), except BR, is or becomes
the "beneficial owner" (as defined in Rule 13d-3 of the Exchange
Act), directly or indirectly, of securities of the Company
representing twenty percent (20%) or more of the combined voting
power of the Company's then outstanding securities;
(b) upon the first purchase of the Common Stock
pursuant to a tender or exchange offer (other than a tender or
exchange offer made by the Company);
(c) upon the approval by the Company's stockholders of
a merger or consolidation, a sale or disposition of all or
substantially all the Company's assets or a plan of liquidation or
dissolution of the Company; or
(d) if, during any period of two (2) consecutive years,
individuals who at the beginning of such period constitute the
Board cease for any reason to constitute at least a majority
thereof, unless the election or nomination for the election by the
Company's stockholders of each new director was approved by a vote
of at least two-thirds (2/3) of the directors then still in office
who were directors at the beginning of the period. Notwithstanding
the above, any distribution of Common Stock solely to BR
stockholders, and any change in the constitution of the Board
occurring in connection therewith, shall not be deemed a Change in
Control. For purposes of this Section 6.9, the term "the Company"
shall include BR until such time as BR distributes all the
outstanding Common Stock owned by it to the stockholders of BR.
SECTION 7 GENERAL PROVISIONS
7.1 Issuance of Common Stock
The shares of Common Stock to be issued pursuant to this Plan
may be from shares held in the Company's treasury or out of the
authorized but unissued shares of the Company. The Company,
however, shall not be required to issue any certificate for shares
of Common Stock prior to:
(a) obtaining any approval or ruling from the
Securities and Exchange Commission or other governmental agencies
which the Company, in its sole discretion, deems necessary or
advisable;
(b) the listing of the shares on any stock exchange on
which the Common Stock may then be listed; or
(c) the completion of any registration or other
qualification of such shares under any federal or state laws,
rulings or regulations of any governmental body which the Company,
in its sole discretion, determines to be necessary or advisable.
7.2 Unfunded Obligation
The incentive awards to be paid to Participants pursuant to
this Plan are an unfunded obligation of the Company. The
Management Committee, in its sole discretion, may direct the
Company to share with its subsidiaries the costs of a portion of
the incentive awards paid to Participants who are executives of
those companies. The Company is not required to segregate any
monies from its general funds, to create any trusts or to make any
special deposits with respect to this obligation. Title to and
beneficial ownership of any investments which the Company may make
to fulfill this obligation shall at all times remain in the
Company. Any investments and the creation or maintenance of any
Memorandum Accounts shall not create or constitute a trust or a
fiduciary relationship between the Plan Administrator, the
Management Committee or the Company and a Participant, or otherwise
create any vested interest in any Participant or his or her
Beneficiary or his or her creditors in any assets of the Company
whatsoever. The Participants shall have no claim against the
Company for any changes in the value of any assets which may be
invested or reinvested by the Company with respect to this Plan.
7.3 Other Benefits
Incentive awards shall not be considered as part of a
Participant's salary or used for the calculation of any other pay,
allowance, pension or other benefit unless otherwise permitted by
other benefit plans provided by the Company or its subsidiaries, or
required by law or by contractual obligations of the Company or its
subsidiaries.
7.4 Annual Salary
The term "annual salary" shall mean the Participant's annual
salary being paid at the end of the year, exclusive of bonuses or
other forms of cash incentive compensation for the year.
7.5 Beneficiary
The term "Beneficiary" shall mean the person or persons to
whom payments are to be paid pursuant to the terms of the Plan in
the event of the Participant's death. The designation shall be on
a form provided by the Management Committee, executed by the
Participant and delivered to the Committee. A Participant may
change his or her beneficiary designation at any time. A
designation by a Participant under the BR Plan shall remain in
effect under this Plan unless it is revoked or changed under this
Plan. If no beneficiary is designated, the designation is
ineffective, or in the event the Beneficiary dies before the
balance of the Memorandum Account is paid, the balance shall be
paid to the Participant's spouse or, if there is no surviving
spouse, to his or her lineal descendants, pro rata, or, if there is
no surviving spouse or lineal descendants, to the Participant's
estate (unless the Management Committee for a given year has
designated investment in an annuity, in which case the payment
options selected by the Participant with respect thereto shall
govern).
7.6 Permanent Disability
A Participant shall be deemed to have become "permanently
disabled" for purposes of this Plan if the Management Committee
finds, upon the basis of medical evidence satisfactory to it, that
the Participant is totally disabled, whether due to physical or
mental condition, so as to be prevented from engaging in further
employment by the Company or any of its subsidiaries and that such
disability will be permanent and continuous during the remainder of
his or her life.
7.7 Incapacity of Participant or Beneficiary
If the Management Committee finds that any Participant or
Beneficiary to whom a payment is payable under the Plan is unable
to care for the Participant's affairs because of illness or
accident or is under a legal disability, any payment due (unless a
prior claim therefore shall have been made by a duly appointed
legal representative), at the discretion of the Committee, may be
paid to the spouse, child, parent or brother or sister of such
Participant or Beneficiary or to any person who the Committee has
determined has incurred expense for such Participant or
Beneficiary. Any such payment shall be a complete discharge of the
obligations of the Company under the provisions of the Plan.
7.8 Withholding Taxes
Appropriate payroll taxes shall be withheld from payments made
to Participants pursuant to this Plan, whether such payments are
made in cash or Common Stock.
7.9 Nonassignment
The right of a Participant or Beneficiary to the payment of
any incentive awards under the Plan may not be assigned,
transferred, pledged or encumbered nor shall such right or other
interests be subject to attachment, garnishment, execution or other
legal process.
7.10 No Right to Continued Employment
Nothing in the Plan shall be construed to confer upon any
Participant any right to continued employment with the Company or
a subsidiary, nor interfere in any way with the right of the
Company or a subsidiary to terminate the employment of such
Participant at any time without assigning any reason therefor.
7.11 Termination and Amendment
The Board and the Plan Administrator may from time to time
amend, suspend or terminate the Plan, in whole or in part,
including, but not limited to, any amendment necessary to insure
that the Company may obtain any regulatory approval referred to in
Section 7.1, and if the Plan is suspended or terminated, the Board
of Directors and the Plan Administrator may reinstate any or all of
its provisions. The Management Committee may amend the Plan
provided that it may not suspend or terminate the Plan,
substantially increase the administrative cost of the Plan or
increase the obligations of the Company, or expend the
classification of employees who are eligible to participate in the
Plan. No amendment, suspension or termination may impair the right
of a Participant or his or her designated Beneficiary to receive
the deferred compensation benefit accrued prior to the effective
date of such amendment, suspension or termination.
7.12 Stockholder Approval
The Board, the Plan Administrator and the Management Committee
may not amend the Plan without the approval of the stockholders of
the Company to
(a) materially increase the number of shares that may
be issued under the Plan;
(b) materially modify the requirements as to
eligibility for participation in the Plan; or
(c) otherwise materially increase the benefits accruing
to the Participants under the Plan.
7.13 Applicable Law
The Plan shall be construed and governed in accordance with
the laws of the State of Texas.
7.14 Effective Date
The Plan shall be dated as of January 1, 1992 and shall be
effective upon the date of adoption by the Board, provided that the
Plan is approved by the Company's stockholders at or prior to the
Company's 1993 Annual Meeting of Stockholders.
Exhibit 5.1
Mudge Rose Guthrie Alexander & Ferdon
180 Maiden Lane
New York, New York 10038
January 7, 1994
El Paso Natural Gas Company
One Paul Kayser Center
304 Texas Avenue
El Paso, Texas 79901
El Paso Natural Gas Company
Incentive Compensation Plan
100,000 Shares of Common Stock,
$ 3.00 Par Value
Dear Sirs:
We are acting as special counsel to El Paso Natural Gas
Company, a Delaware Corporation (the "Company"), in connection with
the preparation and filing with the Securities and Exchange
Commission of a Registration Statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, as
amended (the "Act"), with respect to the Company's Incentive
Compensation Plan (the "Plan"). The Registration Statement covers
100,000 shares of Common Stock, $3 par value, of the Company (the
"Shares").
As special counsel to the Company, we have examined the
Registration Statement and such corporate records and other
documents and instruments and have made such investigations of law,
as we have considered necessary or appropriate for the purpose of
rendering this opinion.
Based upon and subject to the foregoing we are of the
opinion that:
(1) The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State
of Delaware.
(2) The Shares issuable pursuant to the Plan have been
duly authorized and reserved for issuance and, when the
certificates for the Shares have been duly executed by the Company,
countersigned by a transfer agent, duly registered by a registrar
for the Shares and issued in accordance with the terms of the Plan,
the Shares will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement. By giving the foregoing
consent, we do not admit that we are within the category of persons
whose consent is required under Section 7 of the Act.
Very truly yours,
/S/ MUDGE ROSE GUTHRIE ALEXANDER & FERDON
Exhibit 5.2
Mudge Rose Guthrie Alexander & Ferdon
180 Maiden Lane
New York, New York 10038
January 5, 1994
El Paso Natural Gas Company
One Paul Kayser Center
304 Texas Avenue
El Paso, Texas 79901
El Paso Natural Gas Company
Incentive Compensation Plan
100,000 Shares of Common Stock,
$3.00 Par Value
Dear Sirs:
We are acting as special counsel to El Paso Natural Gas
Company, a Delaware corporation (the "Company"), in connection with
the preparation and filing with the Securities and Exchange
Commission of a Registration Statement on Form S-8 (the
"Registration Statement") under the Securities Act of 1933, as
amended (the "Act"), with respect to the Company's Incentive
Compensation Plan (the "Plan"). The Registration Statement covers
100,000 shares of Common Stock, $3 par value, of the Company. You
have requested that we provide you with our opinion regarding the
compliance of the Plan with the requirements of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA").
In rendering this opinion, we have reviewed the Plan as
adopted effective January 1, 1992, which you have represented to us
to be the full and complete Plan in effect on the date hereof. We
have also reviewed such other records and documents and obtained
such verifications and confirmations of fact as we have deemed
necessary for the purposes of this opinion. We have relied upon the
representations and warranties contained in such documents and upon
such verifications and confirmations, and, as to all matters of
fact covered by such documents, we have relied, without independent
investigation or verification, on such documents. In such
examination we have assumed the genuineness of all signatures and
the authenticity, accuracy and completeness of all documents
submitted to us as originals and the conformity with the originals
and accuracy and completeness of all documents submitted to us as
copies. We have assumed the due authorization, execution,
acknowledgment and delivery of the Plan and of all documents which
are a prerequisite to the effectiveness of the Plan.
We have also assumed that the Plan is and will be
operated in accordance with the terms thereof and in accordance
with the requirements of ERISA and published regulations and
interpretations thereof as they apply to the interpretation and
operation of the Plan. We have assumed that all reporting and
disclosure requirements applicable to the Plan have been met and
will continue to be met in a timely manner. We are not, and have
not been, responsible for the day-to-day administration and
operation of the Plan nor have we reviewed for the purpose of this
opinion any trust or trusts which may have been established with
respect to the Plan.
Based on the foregoing, we are of the opinion that, as of
the date hereof, the provisions of the written documents
constituting the Plan meet all material applicable requirements of
ERISA. This opinion is limited to matters governed by ERISA as they
exist on the date hereof, and we express no opinion as to the
effect of any other federal laws or as to the effect of the laws of
any state.
This opinion is being offered solely for your benefit and
is not to be quoted in whole or in part or otherwise referred to,
nor is it to be filed with any governmental agency or other person,
without our prior written consent. We hereby consent to the filing
of this opinion as an exhibit to the Registration Statement. By
giving the foregoing consent, we do not admit that we are within
the category of persons whose consent is required under Section 7
of the Act.
Very truly yours,
/S/ MUDGE ROSE GUTHRIE ALEXANDER & FERDON
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this El Paso
Natural Gas Company registration statement on Form S-8, relating
to the El Paso Natural Gas Company Incentive Compensation Plan, of
our report dated January 29, 1993, on our audits of the
consolidated financial statements and the related consolidated
financial statement schedules of El Paso Natural Gas Company at
December 31, 1992 and 1991, and for the years ended December 31,
1992, 1991 and 1990, which are included in the El Paso Natural Gas
Company Annual Report on Form 10-K.
/S/ COOPERS & LYBRAND
El Paso, Texas
January 10, 1994
