Exhibit 10
 
 
 
 
 
 
 
 
Unit Corporation
Stock and Incentive Compensation Plan
 
Amended and Restated May 2, 2012

 
 
 
Table of Contents

 
Page
Article 1. Establishment, Purpose, and Duration
1
1.1
Establishment of this Plan
1
1.2
Purpose of this Plan
1
1.3
Duration of this Plan
1
1.4
Successor Plan
1
     
Article 2. Definitions
1

 
Article 3. Administration
5
3.1
General
5
3.2
Authority of the Committee
5
3.3
Delegation
5

 
Article 4. Shares Subject to this Plan and Maximum Awards
6
4.1
Number of Shares Available for Awards
6
4.2
Adjustments in Authorized Shares
6

 
Article 5. Eligibility and Participation
7
    5.1 Eligibility   7     5.2 Actual Participation  7      
Article 6. Stock Options
7
6.1
Grant of Options
7
6.2
Award Agreement
7
6.3
Option Price
7
6.4
Duration of Options
7
6.5
Exercise of Options
7
6.6
Payment
7
6.7
Restrictions on Share Transferability
8
6.8
Termination of Employment
8
6.9
Nontransferability of Options
8
6.10
Notification of Disqualifying Disposition
8
      Article 7. Stock Appreciation Rights
8
    7.1 Grant of SARs  8     7.2 SAR Agreement  8     7.3 Term of SAR  9     7.4
Exercise of Freestanding SARs  9     7.5 Exercise of Tandem SARs   9     7.6
Payment of SAR Amount  9     7.7 Termination of Employment.  9     7.8
Nontransferability of SARs  9     7.9 Other Restrictions  9      
Article 8. Restricted Stock and Restricted Stock Units
9
     9
8.1
Grant of Restricted Stock or Restricted Stock Units
10
8.2
Restricted Stock or Restricted Stock Unit Agreement
10
8.3
Nontransferability of Restricted Stock and Restricted Stock Units
10
8.4
Other Restrictions
10
8.5
Certificate Legend
10
8.6
Voting Rights
10
8.7
Dividends and Other Distributions
10
8.8
Termination of Employment
11

 
 
 
 

    8.9 Payment In Consideration of Restricted Stock Units 11

 

Article 9. Performance Shares and Performance Units 
11
    9.1 Grant of Performance Shares and Performance Units  11     9.2 Value of
Performance Shares and Performance Units  11     9.3 Earning of Performance
Shares and Performance Units  11     9.4 Form and Timing of Payment of
Performance Shares and Performance Units  11     9.5 Termination of Employment
 11     9.6 Nontransferability of Performance Shares and Performance Units  11  
   
Article 10. Cash-Based Awards and Stock-Based Awards 
12
     12
10.1
Grant of Cash-Based Awards
12
10.2
Value of Cash-Based Awards
12
10.3
Payment in Consideration of Cash-Based Awards
12
10.4
Form and Timing of Payment of Cash-Based Awards
12
10.5
Stock-Based Awards
12
10.6
Termination of Employment
12
10.7
Nontransferability of Cash-Based Awards and Stock-Based Awards
12

 
Article 11. Performance Measures
12

 
Article 12. Beneficiary Designation
14

 
Article 13. Rights of  Participants
14
13.1
Employment
14
13.2
Participation
14
13.3
Rights as a Shareholder
14

 
Article 14. Change of Control 
14
14.1
Accelerated Vesting and Payment
14
14.2
Alternative Awards
15

 
Article 15. Amendment, Modification, Suspension, and Termination  
15
15.1
Amendment, Modification, Suspension, and Termination
15
15.2
Adjustment of Awards on the Occurrence of Certain Unusual or Nonrecurring Events
16
    15.3 Awards Previously Granted 16

                                                                                                                                             
Article 16. Withholding
16

 
Article 17. Successors
16

 
Article 18. General Provisions
16
18.1
Forfeiture Events
16
18.2
Legend
16
18.3
Delivery Of Title
17
    18.4 Investment Representations  17     18.5 Employees Based Outside of The
United States  17     18.6 Uncertificated Shares  17     18.7 Unfunded Plan  17
    18.8 No Fractional Shares  17     18.9 Other Compensation and Benefit Plans
 17     18.10 No Constraint on Corporate Action  18

 
Article 19. Legal Construction  
18
19.1
Gender And Number
18
19.2
Severability
18
    19.3 Requirements of Law  18     19.4 Governing Law  18

 
 
 
                                                                                                                                                                                                                                                                                       
                                                                                                                                           
Unit Corporation
Stock and Incentive Compensation Plan
 
Effective: May 2, 2012
 
 
Article 1.
 
 
Establishment, Purpose, and Duration
 
 
1.1  
Establishment of this Plan.

 
Effective with shareholder approval received May 3, 2006, Unit Corporation, a
Delaware corporation (hereinafter referred to as the "Company"), established an
incentive compensation plan known as the Stock and Incentive Compensation Plan
(hereinafter referred to as the "Plan"), as set forth in this document.
 
The Plan permits the grant of Nonqualified Stock Options, Incentive Stock
Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Shares, Performance Units, Cash-Based Awards, and Stock-Based
Awards.
 
This amended and restated version of the Plan shall become effective, if
approved by the Company’s shareholders, on May 2, 2012 (the "Effective Date")
and shall remain in effect as provided in Section 1.3 of this document.
 
1.2  
Purpose of this Plan.

 
The purpose of this Plan is to promote the success and enhance the value of the
Company and Affiliates by linking the personal interests of the Participants to
those of the Company's shareholders, and by providing Participants with an
incentive for outstanding performance.
 
This Plan is further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of Participants on whose
judgment, interest, and special effort the successful conduct of its operation
largely is dependent.
 
1.3  
Duration of this Plan.

 
This Plan shall commence as of the Effective Date and shall remain in effect,
subject to the right of the Committee or the Board to amend or terminate this
Plan at any time under Article 15, until all Shares subject to this Plan have
been purchased or acquired according to this Plan's provisions.
 
1.4  
Successor Plan.

 
This Plan shall serve as the successor to the Unit Corporation Amended and
Restated Stock Option Plan, the Employee Bonus Plan, and the Non-employee
Directors 2000 Stock Option Plan (the "Predecessor Plans"), and no further
grants shall be made under the Predecessor Plans from and after the Effective
Date of this Plan.
 
 
Article 2.
Definitions
 
Whenever used in this Plan, the following terms shall have the meaning set forth
below, and when the meaning is intended, the initial letter of the word shall be
capitalized.
 
"Affiliate" shall have the meaning given to that term in Rule 12b-2 of the
General Rules and Regulations of the Exchange Act, with reference to the
Company, and shall also include any corporation, partnership, joint venture,
limited liability company, or other entity in which the Company owns, directly
or indirectly, at least fifty percent (50%) of the total combined Voting Power
of such corporation or of the capital interest or profits interest of such
partnership or other entity.
 
"Award" means, individually or collectively, a grant under this Plan of NQSOs,
ISOs, SARs, Restricted Stock, Restricted Stock Units, Performance Shares,
Performance Units, Cash-Based Awards, or Stock-Based Awards, in each case
subject to the terms of this Plan.
 
 
1
 
"Award Agreement" means either (i) a written agreement entered into by the
Company or an Affiliate and a Participant setting forth the terms and provisions
applicable to Awards granted under this Plan; or (ii) a written statement issued
by the Company or an Affiliate to a Participant describing the terms and
provisions of such Award.
 
"Beneficial Owner" or "Beneficial Ownership" shall have the meaning given to
that term in rule 13d-3 of the General Rules and Regulations under the Exchange
Act.
 
"Board" or "Board of Directors" means the Board of Directors of the Company.
 
"Cash-Based Award" means an Award granted under Article 10, the value of which
is denominated in cash as determined by the Committee and which is not any other
form of Award described in this Plan.
 
"Cause" means (i) the willful failure by the Participant to perform
substantially the Participant's duties as an Employee or Non-employee Director
(other than due to physical or mental illness) after reasonable notice to the
Participant of such failure, (ii) the Participant's engaging in serious
misconduct that is injurious to the Company or any Affiliate in any way,
including, but not limited to, by way of damage to their respective reputations
or standings in their respective industries, (iii) the Participant's having been
convicted of, or having entered a plea of nolo contendere to, a crime that
constitutes a felony or (iv) the breach by the Participant of any written
covenant or agreement with the Company or any Affiliate not to disclose or
misuse any information pertaining to, or misuse any property of, the Company or
any Affiliate or not to compete or interfere with the Company or any Affiliate.
 
"Change of Control" of the Company shall be deemed to have occurred as of the
first day that any one or more of the following conditions shall have been
satisfied:
 
(a) any individual, entity, or group (a “Person”), including any “person” within
the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act, becomes the
beneficial owner (within the meaning of Rule 13d-3 promulgated under the
Exchange Act), of 20% or more of either (i) the then outstanding shares of
common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the
combined voting power of the then outstanding securities of the Company entitled
to vote generally in the election of Directors (the “Outstanding Company Voting
Securities”); excluding, however, the following: (A) any acquisition directly
from the Company (excluding any acquisition resulting from the exercise of an
exercise, conversion or exchange privilege unless the security being so
exercised, converted or exchanged was acquired directly from the Company); (B)
any acquisition by the Company; (C) any acquisition by an employee benefit plan
(or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company; (D) any acquisition by any corporation pursuant to a
transaction with complies with clauses (i), (ii) and (iii) of subsection (iii)
of this definition; and (E) if the Board of Directors of the Company determines
in good faith that a Person became the beneficial owner of 20% or more of the
Outstanding Company Common Stock inadvertently (including, without limitation,
because (A) such Person was unaware that it beneficially owned a percentage of
Outstanding Company Common Stock that would cause a Change of Control or (B)
such Person was aware of the extent of its beneficial ownership of Outstanding
Company Common Stock but had no actual knowledge of the consequences of such
beneficial ownership under this Plan) and without any intention of changing or
influencing control of the Company, then the beneficial ownership of Outstanding
Company Common Stock by that Person shall not be deemed to be or to have become
a Change of Control for any purposes of this Plan unless and until such Person
shall have failed to divest itself, as soon as practicable (as determined, in
good faith, by the Board of Directors of the Company), of beneficial ownership
of a sufficient number of Outstanding Company Common Stock so that such Person's
beneficial ownership of Outstanding Company Common Stock would no longer
otherwise qualify as a Change of Control.
 
(b) individuals who, as of the date hereof, constitute the Board of Directors
(the “Incumbent Board”) cease for any reason to constitute at least a majority
of such Board; provided that any individual who becomes a Director of the
Company subsequent to the date hereof whose election, or nomination for election
by the Company’s stockholders, was approved by the vote of at least a majority
of the Directors then comprising the Incumbent Board shall be deemed a member of
the Incumbent Board; and provided further, that any individual who was initially
elected as a Director of the Company as a result of an actual or threatened
election contest, as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange act, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person other than the
Board shall not be deemed a member of the Incumbent Board;
 
 
2
 
(c) consummation  of a reorganization, merger, statutory share exchange or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a “Corporate Transaction”); excluding, however, a
Corporate Transaction Pursuant to which (i) all or substantially all of the
individuals or entities who are the beneficial owners, respectively, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities
immediately prior to such Corporate Transaction will beneficially own, directly
or indirectly, more than 70% of, respectively, the outstanding shares of common
stock, and the combined voting power of the outstanding securities of such
corporation entitled to vote generally in the election of Directors, as the case
may be, of the corporation resulting from such Corporate Transaction (including,
without limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company’s assets either directly or
indirectly) in substantially the same proportions relative to each other as
their ownership, immediately prior to such Corporate Transaction, of the
Outstanding Company Common stock and the Outstanding Company Voting Securities,
as the case may be, (ii) no Person (other than: the Company; the corporation
resulting from such Corporate Transaction; and any Person which beneficially
owned, immediately prior to such Corporate Transaction, directly or indirectly,
25% or more of the Outstanding Company Common Stock or the Outstanding Voting
Securities, as the case may be) will beneficially own, directly or indirectly,
25% or more of, respectively, the outstanding shares of common stock of the
corporation resulting from such Corporate Transaction or the combined voting
power of the outstanding securities of such corporation entitled to vote
generally in the election of Directors and (iii) individuals who were members of
the Incumbent Board will constitute a majority of the members of the Board of
Directors of the corporation resulting from such Corporate Transaction; or
 
(d) approval by the stockholders of the Company of a plan of complete
liquidation or dissolution of the Company.
 
"Code" means the U.S. Internal Revenue Code of 1986, as amended from time to
time, or any successor thereto.
 
"Committee" means the Compensation Committee of the Board of Directors, or any
other duly authorized committee of the Board appointed by the Board to
administer this Plan.
 
"Company" means Unit Corporation, a Delaware corporation, and any successor
thereto as provided in Article 18.
 
"Constructively Terminated" means, unless otherwise specified by the Committee
in the Award Agreement, a voluntary termination of employment by an Employee
within ten (10) business days after any of the following actions by the Company,
Affiliate, or person acting on behalf of either:
 
 
(i)  
Requiring the Employee to be based as his/her regular or customary place of
employment or Agency at any office or location more than fifty (50) miles from
the location at which the Employee performed his/her duties immediately before
the Change of Control, or in a state other than the one in which the Employee
performed his/her duties immediately before the Change of Control, in each case
except for travel reasonably required in the performance of the individual's
responsibilities;

 
(ii)  
In the case of an Employee, reducing the Employee's base salary below the rate
in effect at the time of a Change of Control; or

 
(iii)  
In the case of an Employee, failing to pay the Employee's base salary, other
wages, or employment-related benefits as required by law.

 
“Disability” means a termination of a Non-employee Director’s service as a
member of the Board as a result of physical or mental impairment of sufficient
severity such that, in the opinion of a physician selected by the Company, he or
she is unable to continue to serve on the Board.
 
"Employee" means any employee of the Company or an Affiliate.  Directors who are
not otherwise employed by the Company or an Affiliate shall not be considered
Employees under this Plan.  For greater clarity, and without limiting the
generality of the foregoing, individuals described in the first sentence of this
definition who are foreign nationals or are employed outside of the United
States, or both, are Employees and may be granted Awards on the terms and
conditions set forth in this Plan, or on such other terms and conditions as may,
in the judgment of the Committee, be necessary or desirable to further the
purposes of this Plan.
 
 
3
 
"Exchange Act" means the Securities Exchange Act of 1934, as amended from time
to time, or any successor act thereto.
 
"Fair Market Value" or "FMV" means a price that is based on the opening,
closing, actual, high, low, or average selling prices of a Share on the New York
Stock Exchange ("NYSE") or other established stock exchange (or exchanges) on
the applicable date, the preceding trading day, the next succeeding trading day,
or an average of trading days, as determined by the Committee in its
discretion.  Such definition(s) of FMV shall be specified in each Award
Agreement and may differ depending on whether FMV is in reference to the grant,
exercise, vesting, settlement, or payout of an Award.  If, however, the
accounting standards used to account for equity awards granted to Participants
are substantially modified subsequent to the Effective Date of this Plan, the
Committee shall have the ability to determine an Award's FMV based on the
relevant facts and circumstances.  If Shares are not traded on an established
stock exchange, FMV shall be determined by the Committee based on objective
criteria.
 
"Fiscal Year" means the year commencing on January 1 and ending December 31 or
other time period as approved by the Board.
 
"Freestanding SAR" means an SAR that is not a Tandem SAR, as described in
Article 7.
 
"Grant Price" means the price against which the amount payable is determined on
exercise of an SAR.
 
"Incentive Stock Option" or "ISO" means an Option to purchase Shares granted
under Article 6 and that is designated as an Incentive Stock Option and is
intended to meet the requirements of Section 422 of the Code, or any successor
provision.
 
"Insider" shall mean an Employee who is, on the relevant date, subject to the
reporting requirements of Section 16 of the Exchange Act, as determined by the
Board.
 
“Non-employee Director” means a director whose only relationship to the Company
is based on his or her service on the Board, and who is not an Employee.
 
"Nonqualified Stock Option" or "NQSO" means an Option to purchase Shares,
granted under Article 6, which is not intended to be an Incentive Stock Option
or that otherwise does not meet such requirements.
 
"Option" means the conditional right to purchase Shares at a stated Option Price
for a specified period of time in the form of an Incentive Stock Option or a
Nonqualified Stock Option subject to the terms of this Plan.
 
"Option Price" means the price at which a Share may be purchased by a
Participant under an Option, as determined by the Committee.
 
"Participant" means an Employee or Non-employee Director who has been selected
to receive an Award, or who has an outstanding Award granted under this Plan.
 
"Performance-Based Compensation" means compensation under an Award that is
granted in order to provide remuneration solely on account of the attainment of
one or more Performance Goals under circumstances that satisfy the requirements
of Section 162(m) of the Code.
 
"Performance Goal" means a performance criterion selected by the Committee for a
given Award for purposes of Article 11 based on one or more of the Performance
Measures.
 
"Performance Measures" means measures as described in Article 11, the attainment
of one or more of which shall, as determined by the Committee, determine the
vesting, payability, or value of an Award to an Insider that are designated to
qualify as Performance-Based Compensation.
 
"Performance Period" means the period of time during which the assigned
performance criteria must be met in order to determine the degree of payout
and/or vesting with respect to an Award.
 
"Performance Share" means an Award granted under Article 9 and subject to the
terms of this Plan, denominated in Shares, the value of which at the time it is
payable is determined as a function of the extent to which corresponding
performance criteria have been achieved.
 
"Performance Unit" means an Award granted under Article 9 and subject to the
terms of this Plan, denominated in units, the value of which at the time it is
payable is determined as a function of the extent to which corresponding
performance criteria have been achieved.
 
 
4
 
"Period Of Restriction" means the period when an Award of Restricted Stock or
Restricted Stock Unit is subject to forfeiture based on the passage of time, the
achievement of performance criteria, and/or on the occurrence of other events as
determined by the Committee, in its discretion.
 
"Person" shall have the meaning ascribed to such term in Section 3(a)(9) of the
Exchange Act and used in Sections 13(d) and 14(d) thereof, including a "group"
as defined in Section 13(d) thereof; provided, however, that "Person" shall not
include (i) the Company or any Affiliate or (ii) any employee benefit plan
(including an employee stock ownership plan) sponsored by the Company or any
Affiliate.
 
"Restricted Stock" means an Award of Shares subject to a Period of Restriction,
granted under Article 8 and subject to the terms of this Plan.
 
"Restricted Stock Unit" means an Award denominated in units subject to a Period
of Restriction, granted under Article 8 herein and subject to the terms of this
Plan.
 
“Retirement” means the termination of a Non-employee Director’s service as a
member of the Board at the end of any full term to which he or she was elected
or appointed.
 
"Shares" means the shares of common stock of the Company, $0.20 par value per
Share.
 
"Stock Appreciation Right" or "SAR" means the conditional right to receive the
difference between the FMV of a Share on the date of exercise over the Grant
Price, under the terms of Article 7 and subject to the terms of this Plan.
 
"Stock-Based Award" means an equity-based or equity-related Award granted under
Article 10 and subject to the terms of this Plan, and not otherwise described by
the terms of this Plan.
 
"Tandem SAR" means an SAR that the Committee specifies is granted in connection
with a related Option under Article 7 and subject to the terms of this Plan, the
exercise of which shall require forfeiture of the right to purchase a Share
under the related Option (and when a Share is purchased under the Option, the
Tandem SAR shall similarly be cancelled).  Regardless of whether an Option is
granted coincident with an SAR, an SAR is not a Tandem SAR unless so specified
by the Committee at time of grant.
 
"Voting Power" shall mean that number of Voting Securities as shall enable the
holders thereof to cast all the votes which could be cast in an annual election
of directors of a company.
 
"Voting Securities" shall mean all securities entitling the holders thereof to
vote in an annual election of directors of a company.
 
 
Article 3.
Administration
 
3.1  
General.

 
The Committee shall be responsible for administering this Plan.  The Committee
may employ attorneys, consultants, accountants, agents, and other individuals,
any of whom may be an Employee, and the Committee, the Company, and its officers
and Directors shall be entitled to rely on the advice, opinions, or valuations
of any such persons.  All actions taken and all interpretations and
determinations made by the Committee shall be final, conclusive, and binding on
the Participants, the Company, and all other interested parties.
 
3.2  
Authority of the Committee.

 
The Committee shall have full and exclusive discretionary power to interpret the
terms and the intent of this Plan and any Award Agreement or other agreement
ancillary to or in connection with this Plan, to determine eligibility for
Awards, and to adopt such rules, regulations, and guidelines for administering
this Plan as the Committee may deem necessary or proper.  Such authority shall
include, but not be limited to, selecting Award recipients, establishing all
Award terms and conditions and, subject to Article 15, adopting modifications
and amendments, or subplans to this Plan (as described in Section 18.5) or any
Award Agreement, including, without limitation, any that are necessary or
appropriate to comply with the laws or compensation practices of the countries
and other jurisdictions in which the Company and Affiliates operate.
 
3.3  
Delegation.

 
The Committee may delegate to one or more of its members or to one or more
officers of the Company or its Affiliates, any of its duties or powers as it may
deem advisable; provided, however, that the Committee may not delegate any of
its non-administrative powers with respect to Awards intended to be
Performance-Based Compensation; and provided further, that the member(s) or
officer(s) shall report periodically to the Committee regarding the nature and
scope of the Awards granted under the authority delegated under this Section
3.3. Subject to
 
 
5
 
the terms of the previous sentence, the Committee may delegate to any
individual(s) such administrative duties or powers as it may deem advisable
 
 
Article 4.
Shares Subject to this Plan and Maximum Awards
 
4.1  
Number of Shares Available for Awards.

 
Subject to adjustment as provided in Section 4.2, the number of Shares hereby
reserved for issuance to Participants under this Plan shall be Three Million
Three Hundred Thousand (3,300,000) (such total number of Shares, including such
adjustment and remaining Shares, the "Total Share Authorization").  The maximum
aggregate number of Shares that may be granted in the form of Nonqualified Stock
Options shall be equal to the Total Authorization.  The maximum aggregate number
of Shares that may be granted in the form of Incentive Stock Options shall be
Two Million (2,000,000).
 
For greater clarity, any Awards that are not settled in Shares shall not reduce
any of these reserves.  Any Shares related to Awards which (i) terminate by
expiration, forfeiture, cancellation, or otherwise without the issuance of such
Shares, (ii) are settled in cash either in lieu of Shares or otherwise, or (iii)
are exchanged with the Committee's permission for Awards not involving Shares,
shall be available again for grant under this Plan.  Moreover, if the Option
Price of any Option granted under this Plan or the tax withholding requirements
with respect to any Award granted under this Plan are satisfied by tendering
Shares to the Company (by either actual delivery or by attestation), or if an
SAR is exercised, only the number of Shares issued, net of the Shares tendered,
if any, will be deemed delivered for purposes of determining the maximum number
of Shares available for issuance under this Plan.  The maximum number of Shares
available for issuance under this Plan shall not be reduced to reflect any
dividends or dividend equivalents that are reinvested into additional Shares or
credited as additional Restricted Stock, Restricted Stock Units, Performance
Shares, or Stock-Based Awards.  The Shares available for issuance under this
Plan may be authorized and unissued Shares or treasury Shares.
 
Unless and until the Committee determines that an Award to an Insider shall not
be designed to qualify as Performance-Based Compensation, the following limits
("Award Limits") shall apply to grants of Awards to Insiders under this Plan:
 
(a) OPTIONS AND SARS:  The maximum aggregate number of Shares that may be
granted in the form of Options or Stock Appreciation Rights, under any Award
granted in any one Fiscal Year to any one Participant, shall be 250,000.
 
(b) RESTRICTED STOCK/RESTRICTED STOCK UNITS:  The maximum aggregate grant with
respect to Awards of Restricted Stock/Restricted Stock Units granted in any one
Fiscal Year to any one Participant shall be 125,000.
 
(c) PERFORMANCE SHARES/PERFORMANCE UNITS:  The maximum aggregate Award of
Performance Shares or Performance Units that a Participant may receive in any
one Fiscal Year shall be 125,000 Shares, or equal to the value of 125,000 Shares
determined as of the date of vesting or payout, as applicable.
 
(d) CASH-BASED AWARDS:  The maximum aggregate amount awarded or credited with
respect to Cash-Based Awards to any one Participant in any one Fiscal Year may
not exceed $1,500,000 determined as of the date of vesting or payout, as
applicable.
 
(e) STOCK AWARDS:  The maximum aggregate grant with respect to Awards of
Stock-Based Awards in any one Fiscal Year to any one Participant shall be
125,000.
 
4.2  
Adjustments in Authorized Shares.

 
In the event of any corporate event or transaction (including, but not limited
to, a change in the Shares of the Company or the capitalization of the Company)
such as a merger, consolidation, reorganization, recapitalization, separation,
stock dividend, extraordinary dividend, stock split, reverse stock split, split
up, spin-off, or other distribution of stock or property of the Company,
combination of securities, exchange of securities, dividend in kind, or other
like change in capital structure or distribution (other than normal cash
dividends) to shareholders of the Company, or any similar corporate event or
transaction, the Committee, in its sole discretion, in order to prevent dilution
or enlargement of Participants' rights under this Plan, may substitute or
adjust, as applicable, the number and kind of Shares that may be issued under
this Plan, the number and kind of Shares subject to outstanding Awards, the
Option Price or Grant Price applicable to outstanding Awards, the Award Limits,
the limit on issuing Awards other than Options granted with an Option Price
equal to at least the FMV of a Share on the date of grant or Stock Appreciation
Rights with a Grant Price equal to at least the FMV of a Share on the date of
grant, and any
 
 
6
 
other value determinations applicable to outstanding Awards or to this Plan
provided that any such substitution or adjustment is made in accordance with
Section 424(h) of the Code.
 
The Committee, in its sole discretion, may also make appropriate adjustments in
the terms of any Awards under this Plan to reflect, or related to, such changes
or distributions and may modify any other terms of outstanding Awards, including
modifications of performance criteria and changes in the length of Performance
Periods.  The determination of the Committee as to the foregoing adjustments, if
any, shall be conclusive and binding on Participants under this Plan.
 
Subject to the provisions of Article 14 and any applicable law or regulatory
requirement, without affecting the number of Shares reserved or available under
this Plan, the Committee may authorize the issuance, assumption, substitution,
or conversion of Awards under this Plan in connection with any such corporate
event or transaction on such terms and conditions as it may deem
appropriate.  Additionally, the Committee may amend this Plan, or adopt
supplements to this Plan, in such manner as it deems appropriate to provide for
such issuance, assumption, substitution, or conversion as provided in the
previous sentence.
 
 
Article 5.
Eligibility and Participation
 
5.1  
Eligibility.

 
Individuals eligible to participate in this Plan include all Employees and
Non-employee Directors.
 
5.2  
Actual Participation.

 
Subject to the provisions of this Plan, the Committee may from time to time,
select from all eligible Employees and Non-employee Directors, those to whom
Awards shall be granted and shall determine in its discretion, the nature,
terms, and amount of each Award.
 
 
Article 6.
Stock Options
 
6.1  
Grant of Options.

 
Subject to the terms and provisions of this Plan, Options may be granted to
Participants in such number, and on such terms, and at any time and from time to
time as shall be determined by the Committee in its discretion.  Despite the
foregoing, no ISOs may be granted to any Non-employee Director and no ISO may be
granted more than ten (10) years after  the Effective Date.
 
6.2  
Award Agreement.

 
Each Option grant shall be evidenced by an Award Agreement that shall specify
the Option Price, the duration of the Option, the number of Shares to which the
Option pertains, the conditions on which an Option shall become vested and
exercisable, and any such other provisions as the Committee shall
determine.  The Award Agreement also shall specify whether the Option is
intended to be an ISO or a NQSO.
 
6.3  
Option Price.

 
The Option Price for each grant of an Option under this Plan shall be determined
by the Committee and shall be specified in the Award Agreement but in no event
shall the Option Price be less than the FMV of the Shares on the date of grant.
 
6.4  
Duration of Options.

 
Each Option granted to a Participant shall expire at such time as the Committee
shall determine at the time of grant; provided, however, no Option shall be
exercisable later than the tenth (10th) anniversary date of its grant.  Despite
the forgoing, for Options granted to Participants employed outside the United
States and who are third country nationals, the Committee has the authority to
grant Options that have a term greater that ten (10) years.
 
6.5  
Exercise of Options.

 
Options granted under this Article 6 shall be exercisable at such times and on
the occurrence of such events, and be subject to such restrictions and
conditions, as the Committee shall in each instance approve, which need not be
the same for each grant or for each Participant.
 
6.6  
Payment.

 
Options granted under this Article 6 shall be exercised by the delivery of a
notice of exercise to the Company or an agent designated by the Company in a
form specified or accepted by the Committee, or by
 
 
7
 
complying with any alternative procedures which may be authorized by the
Committee, setting forth the number of Shares with respect to which the Option
is to be exercised, accompanied by full payment for the Shares.
 
The Option Price on exercise of any Option shall be payable to the Company in
full either: (a) in cash or its equivalent; (b) by tendering (either by actual
delivery or attestation) previously acquired Shares having an aggregate FMV at
the time of exercise equal to the total Option Price; (c) by a combination of
(a) and (b); or (d) any other method approved or accepted by the Committee in
its sole discretion subject to such rules and regulations as the Committee may
establish.
 
Subject to Section 6.7 and any governing rules or regulations, as soon as
practicable after receipt of a notification of exercise and full payment, the
Committee shall cause to be delivered to the Participant Share certificates or
evidence of book entry Shares in an appropriate amount based on the number of
Shares purchased under the Option(s).  Unless otherwise determined or accepted
by the Committee, all payments in cash shall be paid in United States dollars.
 
6.7  
Restrictions on Share Transferability.

 
The Committee may impose such restrictions on any Shares acquired under the
exercise of an Option granted under this Plan as it may deem advisable,
including, without limitation, requiring the Participant to hold the Shares
acquired under exercise for a specified period of time, or restrictions under
applicable laws or under the requirements of any stock exchange or market on
which such Shares are listed and/or traded.
 
6.8  
Termination of Employment or Board Service.

 
Each Participant's Award Agreement shall set forth the extent to which the
Participant shall have the right to exercise the Option following termination of
the Participant's employment or service as a Non-Employee Director with the
Company or an Affiliate.  Such provisions shall be determined in the sole
discretion of the Committee, shall be included in the Award Agreement entered
into with each Participant, need not be uniform among all Options issued under
this Article 6, and may reflect distinctions based on the reasons for
termination.
 
6.9  
Nontransferability of Options.

 
(a) INCENTIVE STOCK OPTIONS.  No ISO granted under this Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution.  Further, all ISOs
granted to a Participant under this Article 6 shall be exercisable during his or
her lifetime only by such Participant.
 
(b) NONQUALIFIED STOCK OPTIONS.  Except as otherwise provided in a Participant's
Award Agreement at the time of grant, or thereafter by the Committee, NQSO
granted under this Article 6 may not be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution.  Further, except as otherwise provided in a
Participant's Award Agreement at the time of grant or thereafter by the
Committee, all NQSOs granted to a Participant under this Article 6 shall be
exercisable during the Participant's lifetime only by such Participant.
 
6.10  
Notification of Disqualifying Disposition.

 
The Participant will notify the Company on the disposition of Shares issued
under the exercise of an ISO.  The Company will use such information to
determine whether a disqualifying disposition as described in Section 421(b) of
the Code has occurred.
 
 
Article 7.
Stock Appreciation Rights
 
7.1  
Grant of SARs.

 
Subject to the terms and conditions of this Plan, SARs may be granted to
Participants at any time and from time to time and on such terms as shall be
determined by the Committee in its discretion.  The Committee may grant
Freestanding SARs, Tandem SARs, or any combination of these forms of SARs.
 
The SAR Grant Price for each grant of a Freestanding SAR shall be determined by
the Committee and shall be specified in the Award Agreement but in no event
shall the Grant Price be less than FMV of the Shares on the date of grant  The
Grant Price of Tandem SARs shall be equal to the Option Price of the related
Option.
 
 
7.2  
SAR Agreement.

 
Each SAR Award shall be evidenced by an Award Agreement that shall specify the
Grant Price, the term of the SAR, and any such other provisions as the Committee
shall determine.
 
 
8
 
7.3  
Term of SAR.

 
The term of an SAR granted under this Plan shall be determined by the Committee,
in its sole discretion, and except as determined otherwise by the Committee and
specified in the SAR Award Agreement, no SAR shall be exercisable later than the
tenth (10th) anniversary date of its grant.  Despite the forgoing, for SARs
granted to Participants employed outside the United States and who are third
country nationals, the Committee has the authority to grant Options that have a
term greater that ten (10) years.
 
7.4  
Exercise of Freestanding SARs.

 
Freestanding SARs may be exercised on whatever terms and conditions the
Committee, in its sole discretion, imposes.
 
7.5  
Exercise of Tandem SARs.

 
Tandem SARs may be exercised for all or part of the Shares subject to the
related Option on the surrender of the right to exercise the equivalent portion
of the related Option.  A Tandem SAR may be exercised only with respect to the
Shares for which its related Option is then exercisable.
 
Despite any other provision of this Plan to the contrary, with respect to a
Tandem SAR granted in connection with an ISO: (a) the Tandem SAR will expire no
later than the expiration of the underlying ISO; (b) the value of the payout
with respect to the Tandem SAR may be for no more than one hundred percent
(100%) of the difference between the Option Price of the underlying ISO and the
FMV of the Shares subject to the underlying ISO at the time the Tandem SAR is
exercised; and (c) the Tandem SAR may be exercised only when the FMV of the
Shares subject to the ISO exceeds the Option Price of the ISO.
 
7.6  
Payment of SAR Amount.

 
On the exercise of an SAR, a Participant shall be entitled to receive payment
from the Company in an amount determined by multiplying:
 
(a) The difference between the FMV of a Share on the date of exercise over the
Grant Price; by
 
(b) The number of Shares with respect to which the SAR is exercised.
 
At the discretion of the Committee, the payment on SAR exercise may be in cash,
Shares of equivalent value (based on the FMV on the date of exercise of the SAR,
as defined in the Award Agreement or otherwise defined by the Committee
thereafter), in some combination thereof, or in any other form approved by the
Committee at its sole discretion.  The Committee's determination regarding the
form of SAR payout shall be set forth or reserved for later determination in the
Award Agreement pertaining to the grant of the SAR.
 
7.7  
Termination of Employment or Board Service.

 
Each Award Agreement shall set forth the extent to which the Participant shall
have the right to exercise the SAR following termination of the Participant's
employment or service as a Non-employee Director with the Company or an
Affiliate.  Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into with
Participants, need not be uniform among all SARs issued under this Plan, and may
reflect distinctions based on the reasons for termination.
 
7.8  
Nontransferability of SARs.

 
Except as otherwise provided in a Participant's Award Agreement at the time of
grant or thereafter by the Committee, an SAR granted under this Plan may not be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution.  Further, except
as otherwise provided in a Participant's Award Agreement at the time of grant or
thereafter by the Committee, all SARs granted to a Participant under this Plan
shall be exercisable during his or her lifetime only by such Participant.
 
7.9  
Other Restrictions.

 
Without limiting the generality of any other provision of this Plan, the
Committee may impose such other conditions and/or restrictions on any Shares
received on exercise of an SAR granted under this Plan as it may deem
advisable.  This includes, but is not limited to, requiring the Participant to
hold the Shares received on exercise of an SAR for a specified period of time.
 
 
Article 8.
Restricted Stock and Restricted Stock Units
 
8.1  
Grant of Restricted Stock or Restricted Stock Units.

 
Subject to the terms and provisions of this Plan, the Committee, at any time and
from time to time, may grant Shares of Restricted Stock and/or Restricted Stock
Units to Participants in such amounts and on such terms as the Committee shall
determine.
 
 
9
 
8.2  
Restricted Stock or Restricted Stock Unit Agreement.

 
Each Restricted Stock and/or Restricted Stock Unit grant shall be evidenced by
an Award Agreement that shall specify the Period(s) of Restriction, the number
of Shares of Restricted Stock or the number of Restricted Stock Units granted,
and any such other provisions as the Committee shall determine.
 
8.3  
Nontransferability of Restricted Stock and Restricted Stock Units.

 
Except as otherwise provided in this Plan or the Award Agreement, the Shares of
Restricted Stock and/or Restricted Stock Units granted may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Period of Restriction specified in the Award Agreement
(and in the case of Restricted Stock Units until the date of delivery or other
payment), or on earlier satisfaction of any other conditions, as specified by
the Committee in its sole discretion and set forth in the Award Agreement at the
time of grant or thereafter by the Committee. All rights with respect to the
Restricted Stock and/or Restricted Stock Units granted to a Participant under
this Plan shall be available during his or her lifetime only to such
Participant, except as otherwise provided in the Award Agreement at the time of
grant or thereafter by the Committee.
 
8.4  
Other Restrictions.

 
The Committee shall impose, in the Award Agreement at the time of grant or
anytime thereafter, such other conditions and/or restrictions on any Shares of
Restricted Stock or Restricted Stock Units granted under this Plan as it may
deem advisable including, without limitation, a requirement that Participants
pay a stipulated purchase price for each Share of Restricted Stock or each
Restricted Stock Unit, restrictions based on the achievement of specific
performance criteria, time-based restrictions on vesting following the
attainment of the performance criteria, time-based restrictions, restrictions
under applicable laws or under the requirements of any stock exchange or market
on which such Shares are listed or traded, or holding requirements or sale
restrictions placed on the Shares by the Company on vesting of such Restricted
Stock or Restricted Stock Units.
 
To the extent deemed appropriate by the Committee and subject to Section 18.6,
the Company may retain the certificates representing Shares of Restricted Stock,
or Shares and delivered in consideration of Restricted Stock Units, in the
Company's possession until such time as all conditions and/or restrictions
applicable to such Shares have been satisfied or lapse.
 
Except as otherwise provided in this Article 8, Shares of Restricted Stock
covered by each Restricted Stock Award shall become freely transferable by the
Participant after all conditions and restrictions applicable to such Shares have
been satisfied or lapse, and Restricted Stock Units shall be paid in cash,
Shares, or a combination of cash and Shares as the Committee, in its sole
discretion shall determine.
 
8.5  
Certificate Legend.

 
In addition to any legends placed on certificates under Section 8.4, each
certificate representing Shares of Restricted Stock granted under this Plan may
bear a legend such as the following:
 
The sale or other transfer of the Shares of stock represented by this
certificate, whether voluntary, involuntary, or by operation of law, is subject
to certain restrictions on transfer as set forth in the Unit Corporation Stock
and Incentive Compensation Plan, and in the associated Award Agreement.  A copy
of this Plan and such Award Agreement may be obtained from Unit Corporation.
 
8.6  
Voting Rights.

 
To the extent provided by the Committee in the Award Agreement, Participants
holding Shares of Restricted Stock may be granted the right to exercise full
voting rights with respect to those Shares during the Period of Restriction.  A
Participant shall have no voting rights with respect to any Restricted Stock
Units granted hereunder.
 
8.7  
Dividends and Other Distributions.

 
During the Period of Restriction, Participants holding Shares of Restricted
Stock or Restricted Stock Units may, if the Committee so determines and provides
in the Participant’s Award Agreement, be credited with dividends paid with
respect to the underlying Shares or dividend equivalents while they are so held
in a manner determined by the Committee in its sole discretion.  The Committee
may apply any restrictions to the dividends or dividend equivalents that the
Committee deems appropriate.  The Committee, in its sole discretion, may
determine the form of payment of dividends or dividend equivalents, including
cash, Shares, Restricted Stock, or Restricted Stock Units.
 
 
10
 
8.8  
Termination of Employment or Board Service.

 
Each Award Agreement shall set forth the extent to which the Participant shall
have the right to retain Restricted Stock and/or Restricted Stock Units
following termination of the Participant's employment or service as a
Non-employee Director with the Company or an Affiliate.  These provisions shall
be determined in the sole discretion of the Committee, shall be included in the
Award Agreement entered into with each Participant, need not be uniform among
all Shares of Restricted Stock or Restricted Stock Units issued under this Plan,
and may reflect distinctions based on the reasons for termination.
 
8.9  
Payment In Consideration of Restricted Stock Units.

 
When and if Restricted Stock Units become payable, a Participant having received
the grant of such units shall be entitled to receive payment from the Company in
cash, Shares of equivalent value (based on the FMV, as defined in the Award
Agreement at the time of grant or thereafter by the Committee), in some
combination thereof, or in any other form determined by the Committee at its
sole discretion.  The Committee's determination regarding the form of payout
shall be set forth or reserved for later determination in the Award Agreement
pertaining to the grant of the Restricted Stock Unit.
 
 
Article 9.
Performance Shares and Performance Units
 
9.1  
Grant of Performance Shares and Performance Units.

 
Subject to the terms and provisions of this Plan, the Committee, at any time and
from time to time, may grant Performance Shares and/or Performance Units to
Participants in such amounts and on such terms as the Committee shall determine.
 
9.2  
Value of Performance Shares and Performance Units.

 
Each Performance Share shall have an initial value equal to the FMV of a Share
on the date of grant.  Each Performance Unit shall have an initial value that is
established by the Committee at the time of grant which shall in no event be
less than the FMV of a Share.  The Committee shall set performance criteria for
a Performance Period in its discretion which, depending on the extent to which
they are met, will determine, in the manner determined by the Committee and
documented in the Award Agreement the value and/or number of each Performance
Share or Performance Unit that will be paid to the Participant.
 
9.3  
Earning of Performance Shares and Performance Units.

 
Subject to the terms of this Plan, after the applicable Performance Period has
ended, the holder of Performance Shares/Performance Units shall be entitled to
receive payout on the value and number of Performance Shares/Performance Units
determined as a function of the extent to which the corresponding performance
criteria have been achieved.  Despite the foregoing, the Company has the ability
to require the Participant to hold the Shares received under such Award for a
specified period of time.
 
9.4  
Form and Timing of Payment of Performance Shares and Performance Units.

 
Payment of earned Performance Shares/Performance Units shall be as determined by
the Committee and as evidenced in the Award Agreement.  Subject to the terms of
this Plan, the Committee, in its sole discretion, may pay earned Performance
Shares/Performance Units in the form of cash or in Shares (or in a combination
thereof) equal to the value of the earned Performance Shares/Performance Units
at the close of the applicable Performance Period.  Any Shares may be granted
subject to any restrictions deemed appropriate by the Committee.  The
determination of the Committee with respect to the form of payout of such Awards
shall be set forth in the Award Agreement pertaining to the grant of the Award
or reserved for later determination.
 
9.5  
Termination of Employment or Board Service.

 
Each Award Agreement shall set forth the extent to which the Participant shall
have the right to retain Performance Shares/Performance Units following
termination of the Participant's employment or service as a Non-employee
Director with the Company or an Affiliate.  Such provisions shall be determined
in the sole discretion of the Committee, shall be included in the Award
Agreement entered into with each Participant, need not be uniform among all
Awards of Performance Shares/Performance Units issued under this Plan, and may
reflect distinctions based on the reasons for termination.
 
9.6  
Nontransferability of Performance Shares and Performance Units.

 
Except as otherwise provided in a Participant's Award Agreement at the time of
grant or thereafter by the Committee, Performance Shares/Performance Units may
not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution.
 
 
11
 
Article 10.
Cash-Based Awards and Stock-Based Awards
 
 
10.1  
Grant of Cash-Based Awards.

 
Subject to the terms and provisions of this Plan, the Committee, at any time and
from time and time, may grant Cash-Based Awards to Participants in such amounts
and on such terms as the Committee may determine.
 
10.2  
Value of Cash-Based Awards.

 
Each Cash-Based Award shall have a value as may be determined by the
Committee.  For each Cash-Based Award, the Committee may establish performance
criteria in its discretion.  If the Committee exercises its discretion to
establish such performance criteria, the number and/or value of Cash-Based
Awards that will be paid out to the Participant will be determined, in the
manner determined by the Committee, the extent to which the performance criteria
are met.
 
10.3  
Payment in Consideration of Cash-Based Awards.

 
Subject to the terms of this Plan, the holder of a Cash-Based Award shall be
entitled to receive payout on the value of Cash-Based Award determined as a
function of the extent to which the corresponding performance criteria, if any,
have been achieved.
 
10.4  
Form and Timing of Payment of Cash-Based Awards.

 
Payment of earned Cash-Based Awards shall be as determined by the Committee and
evidenced in the Award Agreement.  Subject to the terms of this Plan, the
Committee, in its sole discretion, may pay earned Cash-Based Awards in the form
of cash or in Shares (or in a combination thereof) that have an aggregate FMV
equal to the value of the earned Cash-Based Awards (the applicable date
regarding which aggregate FMV shall be determined by the Committee).  Such
Shares may be granted subject to any restrictions deemed appropriate by the
Committee.  The determination of the Committee with respect to the form of
payout of such Awards shall be set forth in the Award Agreement pertaining to
the grant of the Award.
 
10.5  
Stock-Based Awards.

 
The Committee may grant other types of equity-based or equity-related Awards not
otherwise described by the terms of this Plan (including the grant or offer for
sale of unrestricted Shares) in such amounts and subject to such terms and
conditions including, but not limited to being subject to performance criteria,
or in satisfaction of such obligations, as the Committee shall determine.  Such
Awards may entail the transfer of actual Shares to Participants, or payment in
cash or otherwise of amounts based on the value of Shares and may include,
without limitation, Awards designed to comply with or take advantage of the
applicable local laws of jurisdictions other than the United States.
 
10.6  
Termination of Employment or Board Service.

 
Each Award Agreement shall set forth the extent to which the Participant shall
have the right to receive Cash-Based Awards and Stock-Based Awards following
termination of the Participant's employment or service as a Non-employee
Director with the Company or an Affiliate.  Such provisions shall be determined
in the sole discretion of the Committee, shall be included in the applicable
Award Agreement, need not be uniform among all Awards of Cash-Based Awards and
Stock-Based Awards issued under this Plan, and may reflect distinctions based on
the reasons for termination.
 
10.7  
Nontransferability of Cash-Based Awards and Stock-Based Awards.

 
Except as otherwise provided in a Participant's Award Agreement at the time of
grant or thereafter by the Committee, Cash-Based Awards and Stock-Based Awards
may not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution.
 
 
Article 11.
Performance Measures
 
Despite any other terms of this Plan, the vesting, payment, or value (as
determined by the Committee) of each Award other than an Option or SAR that, at
the time of grant, the Committee intends to be Performance-Based Compensation to
an Insider shall be determined by the attainment of one or more Performance
Goals as determined by the Committee in conformity with Section 162(m) of the
Code.  The Committee shall specify in writing, by resolution or otherwise, the
Participants eligible to receive such an Award (which may be expressed in terms
of a class of individuals) and the Performance Goal(s) applicable to such Awards
within ninety (90) days after the commencement of the period to which the
Performance Goal(s) relate(s) or such earlier time as required to comply with
Section 162(m) of the Code.  No such Award shall be payable unless the Committee
certifies in writing, by resolution or otherwise, that the Performance
 
 
12
 
Goal(s) applicable to the Award were satisfied.  In no case may the Committee
increase the value of an Award of Performance-Based Compensation above the
maximum value determined under the performance formula by the attainment of the
applicable Performance Goal(s), but the Committee may retain the discretion to
reduce the value below such maximum.
 
Unless and until the Committee proposes for shareholder vote and the
shareholders approve a change in the general Performance Measures set forth in
this Article 11, the Performance Goal(s) on which the payment or vesting of an
Award to an Insider that is intended to qualify as Performance-Based
Compensation shall be limited to the following Performance Measures:
 
(a) Net earnings or net income (before or after taxes);
 
(b) Earnings per share;
 
(c) Net operating profit;
 
(d) Operating earnings;
 
(e) Operating earnings per share;
 
(f) Return measures (including, but not limited to, return on assets, capital,
equity, or sales);
 
(g) Cash flow (including, but not limited to, operating cash flow, free cash
flow, and cash flow return on capital);
 
(h) Earnings before or after taxes, interest, depreciation, and/or amortization
and including/excluding capital gains and losses;
 
(i) Gross or operating margins;
 
(j) Share price (including, but not limited to, growth measures and total
shareholder return);
 
(k) Margins;
 
(l) Operating efficiency;
 
(m) Customer satisfaction;
 
(n) Employee satisfaction;
 
(o) Working capital targets;
 
(p) Revenue growth;
 
(q) Growth of Assets; and
 
(r)  Safety.
 
Any Performance Measure (s) may be used to measure the performance of the
Company as a whole or any business unit of the Company or any combination
thereof, as the Committee may deem appropriate, or any of the above Performance
Measures as compared to the performance of a group of comparator companies, or
published or special index that the Committee, in its sole discretion, deems
appropriate.  In the Award Agreement, the Committee also has the authority to
provide for accelerated vesting of any Award based on the achievement of
Performance Goal(s).
 
The Committee may provide in any Award Agreement that any evaluation of
attainment of a Performance Goal may include or exclude any of the following
events that occurs during the relevant period: (a) asset write-downs; (b)
litigation or claim judgments or settlements; (c) the effect of changes in tax
laws, accounting principles, or other laws or provisions affecting reported
results; (d) any reorganization and restructuring programs; (e) extraordinary
nonrecurring items as described in Accounting Principles Board Opinion No. 30
and/or in management's discussion and analysis of financial condition and
results of operations appearing in the Company's annual report to shareholders
for the applicable year; (f) acquisitions or divestitures; and (g) foreign
exchange gains and losses. To the extent such inclusions or exclusions affect
Awards to Insiders, they shall be prescribed in a form that meets the
requirements of Section 162(m) of the Code for deductibility for federal income
tax purposes.
 
In the event that applicable tax and/or securities laws change to permit
Committee discretion to alter the governing Performance Measures without
obtaining shareholder approval of such changes, the Committee shall have sole
discretion to make such changes without obtaining shareholder approval.  In
addition, in the event that the Committee
 
 
13
 
determines that it is advisable to grant Awards to Insiders that shall not
qualify as Performance-Based Compensation, the Committee may make such grants
without satisfying the requirements of Code Section 162(m).
 
 
Article 12.
Beneficiary Designation
 
A Participant's "beneficiary" is the person or persons entitled to receive
payments or other benefits or exercise rights that are available under this Plan
in the event of the Participant's death.  A Participant may designate a
beneficiary or change a previous beneficiary designation at such times
prescribed by the Committee by using forms and following procedures approved or
accepted by the Committee for that purpose.  If no beneficiary designated by the
Participant is eligible to receive payments or other benefits or exercise rights
that are available under this Plan at the Participant's death the beneficiary
shall be the Participant's estate.
 
Despite the above, the Committee may in its discretion, after notifying the
affected Participants, modify the foregoing requirements, institute additional
requirements for beneficiary designations, or suspend the existing beneficiary
designations of living Participants or the process of determining beneficiaries
under this Article 12, or both, in favor of another method of determining
beneficiaries.
 
 
Article 13.
Rights of Participants
 
13.1  
Employment.

 
Nothing in this Plan or an Award Agreement shall interfere with or limit in any
way the right of the Company or an Affiliate to terminate any Participant's
employment or other service relationship at any time, nor confer on any
Participant any right to continue in the capacity in which he or she is employed
or otherwise serves the Company or an Affiliate.
 
Neither an Award nor any benefits arising under this Plan shall constitute part
of an employment contract with the Company or an Affiliate and, accordingly,
subject to the terms of this Plan, this Plan may be terminated or modified at
any time in the sole and exclusive discretion of the Committee without giving
rise to liability on the part of the Company or an Affiliate for severance
payments or otherwise except as provided in this Plan.
 
For purposes of this Plan, unless otherwise provided by the Committee, transfer
of employment of a Participant between the Company and an Affiliate or among
Affiliates, shall not be deemed a termination of employment. The Committee may
stipulate in a Participant's Award Agreement or otherwise the conditions under
which a transfer of employment or services to an entity that is spun-off from
the Company or an Affiliate, if any, shall not be deemed a termination of
employment or services for purposes of an Award.
 
13.2  
Participation.

 
No Employee or Non-employee Director shall have the right to be selected to
receive an Award. No Employee or Non-employee Director, having been selected to
receive an Award, shall have the right to be selected to receive a future Award
or (if selected to receive such a future Award) the right to receive such a
future Award on terms and conditions identical or in proportion in any way to
any prior Award.
 
13.3  
Rights as a Shareholder.

 
Except to the extent otherwise provided in an Award Agreement, a Participant
shall have none of the rights of a shareholder with respect to Shares covered by
any Award until the Participant becomes the record holder of such Shares.
 
 
Article 14.
Change of Control
 
14.1  
Accelerated Vesting and Payment.

 
Subject to the provisions of Section 14.2 or as otherwise provided in the Award
Agreement, in the event of a Change of Control, unless otherwise specifically
prohibited under law or by the rules and regulations of a national security
exchange:
 
(a) Any and all Options and SARs granted under this Plan shall become
immediately exercisable; additionally, if a Participant's employment or service
as a Non-employee Director is involuntarily terminated by the Company for any
reason except Cause within twelve (12) months following such Change of Control,
the Participant shall
 
 
14
 
have until the earlier of (i) twelve (12) months following such termination date
, or (ii) the term of the Option or SAR, to exercise such Options or SARs;
 
(b) Any Period of Restriction and other restrictions imposed on Restricted Stock
or Restricted Stock Units shall lapse, and Restricted Stock Units shall be
immediately payable;
 
(c) The target payout opportunities attainable under all outstanding Awards of
performance-based Restricted Stock, performance-based Restricted Stock Units,
Performance Units, and Performance Shares (including but not limited to Awards
intended to be Performance-Based Compensation) shall be deemed to have been
fully earned based on targeted performance being attained as of the effective
date of the Change of Control and performance-based Restricted Stock Units and
Performance Units shall be immediately payable:
 
(i)  
The vesting of all Awards denominated in Shares shall be accelerated as of the
effective date of the Change of Control, and shall be paid out to Participants
within thirty (30) days following the effective date of the Change of Control;
and

 
(ii)  
Awards denominated in cash shall be paid to Participants in cash within thirty
(30) days following the effective date of the Change of Control;

 
(d) On a Change of Control, unless otherwise specifically provided in a written
agreement entered into between the Participant and the Company or an Affiliate,
the Committee shall immediately vest and pay out all Cash-Based Awards and Other
Stock-Based Awards as determined by the Committee; and
 
(e) Notwithstanding anything in this Section 14.1 to the contrary, if any Award
constitutes nonqualified deferred compensation within the meaning of Section
409A of the Code, such Award shall be immediately payable only if such Change of
Control also constitutes a “change in control event” within the meaning of
Section 409A of the Code, and shall otherwise be payable on the earliest
possible date otherwise permissible under the terms of such Award.
 
14.2  
Alternative Awards.

 
Despite Section 14.1, no cancellation, acceleration of vesting, lapsing of
restrictions, payment of Award, cash settlement or other payment shall occur
with respect to any Award if the Committee reasonably determines, before the
occurrence of a Change of Control, in good faith and, to the extent applicable,
in accordance with Section 409A of the Code, that such Award shall be honored or
assumed, or new rights substituted therefor (such honored, assumed or
substituted Award hereinafter called an "Alternative Award") by any successor as
described in Article 17; provided that any such Alternative Award must:
 
(a) Be based on stock which is traded on an established U.S. securities market,
or that the Committee reasonably believes will be so traded within sixty (60)
days after the Change of Control;
 
(b) Provide such Participant with rights and entitlements substantially
equivalent to or better than the rights, terms and conditions applicable under
such Award, including, but not limited to, an identical or better exercise or
vesting schedule and identical or better timing and methods of payment;
 
(c) Have substantially equivalent economic value to such Award (determined at
the time of the Change of Control); and
 
(d) Have terms and conditions which provide that in the event that the
Participant's employment or service as a Non-employee Director is involuntarily
terminated or Constructively Terminated, any conditions on a Participant's
rights under, or any restrictions on transfer or exercisability applicable to,
each such Alternative Award shall be waived or shall lapse, as the case may be.
 
 
Article 15.
Amendment, Modification, Suspension, and Termination
 
15.1  
Amendment, Modification, Suspension, and Termination.

 
The Committee or Board may, at any time and from time to time, alter, amend,
modify, suspend, or terminate this Plan in whole or in part; provided however,
that:
 
(a)  Except in connection with a corporate transaction involving the Company
(including, without limitation, any stock dividend, stock split, extraordinary
cash dividend, recapitalization, reorganization, merger, consolidation,
split-up, spin-off, combination, or exchange of shares), the terms of
outstanding Awards may not be amended to
 
 
15
 
reduce the exercise price of outstanding Options or SARs or cancel outstanding
Options or SARs in exchange for cash, other awards or Options or SARs without
stockholder approval.
 
(b) To the extent necessary under any applicable law, regulation or exchange
requirement, no amendment shall be effective unless approved by the shareholders
of the Company in accordance with applicable law, regulation, or exchange
requirement.
 
15.2  
Adjustment of Awards on the Occurrence of Certain Unusual or Nonrecurring
Events.

 
The Committee may make adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or nonrecurring events
(including, without limitation, the events described in Section 4.2 hereof)
affecting the Company or the financial statements of the Company or of changes
in applicable laws, regulations, or accounting principles, whenever the
Committee determines that such adjustments are appropriate in order to prevent
unintended dilution or enlargement of the benefits or potential benefits
intended to be made available under this Plan. The determination of the
Committee as to the foregoing adjustments, if any, shall be conclusive and
binding on Participants under this Plan. To the extent such adjustment affects
Awards to Insiders intended to be Performance-Based Compensation, they shall be
prescribed in a form that meets the requirements of Section 162(m) of the Code
for deductibility for federal income tax purposes.
 
15.3  
Awards Previously Granted.

 
Despite any other provision of this Plan to the contrary, no termination,
amendment, suspension, or modification of this Plan shall adversely affect in
any material way any Award previously granted under this Plan, without the
written consent of the Participant holding such Award.
 
 
Article 16.
Withholding
 
The Company or any Affiliate shall have the power and the right to deduct or
withhold, or require a Participant to remit to the Company or any Affiliate, an
amount sufficient to satisfy federal, state, and local taxes, domestic or
foreign (including the Participant's FICA obligation), required by law or
regulation to be withheld with respect to any taxable event arising or as a
result of this Plan. The Committee may provide for Participants to satisfy
withholding requirements by having the Company withhold Shares or the
Participant making such other arrangements, in either case on such conditions as
the Committee specifies.
 
 
Article 17.
Successors
 
Any obligations of the Company or an Affiliate under this Plan with respect to
Awards granted under this Plan, shall be binding on any successor to the Company
or Affiliate, respectively, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation, or otherwise, of
all or substantially all of the business and/or assets of the Company or
Affiliate, as applicable.
 
 
Article 18.
General Provisions
 
18.1  
Forfeiture Events.

 
Without limiting in any way the generality of the Committee's power to specify
any terms and conditions of an Award consistent with law, and for greater
clarity, the Committee may specify in an Award Agreement that the Participant's
rights, payments, and benefits with respect to an Award shall be subject to
reduction, cancellation, forfeiture, or recoupment on the occurrence of certain
specified events, in addition to any otherwise applicable vesting or performance
conditions of an Award. Such events shall include, but shall not be limited to,
failure to accept the terms of the Award Agreement, termination of employment or
board service under certain or all circumstances, violation of material Company
and Affiliate policies, breach of noncompetition, confidentiality,
nonsolicitation, noninterference, corporate property protection, or other
agreement that may apply to the Participant, or other conduct by the Participant
that is detrimental to the business or reputation of the Company and Affiliates.
 
18.2  
Legend.

 
The certificates for Shares may include any legend that the Committee deems
appropriate to reflect any restrictions on transfer of such Shares.
 
 
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18.3  
Delivery Of Title.

 
The Company shall have no obligation to issue or deliver evidence of title for
Shares issued under this Plan before:
 
(a) Obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and
 
(b) Completion of any registration or other qualification of the Shares under
any applicable national or foreign law or ruling of any governmental body that
the Company determines to be necessary or advisable.
 
18.4  
Investment Representations.

 
The Committee may require each Participant receiving Shares under an Award under
this Plan to represent and warrant in writing that the Participant is acquiring
the Shares for investment and without any present intention to sell or
distribute such Shares.
 
18.5  
Employees or Non-employee Directors Based Outside of The United States.

 
Without limiting in any way the generality of the Committee's powers under this
Plan, including but not limited to the power to specify any terms and conditions
of an Award consistent with law, in order to comply with the laws in other
countries in which the Company or an Affiliate operates or has Employees or
Non-employee Directors, the Committee, in its sole discretion, shall have the
power and authority, notwithstanding any provision of this Plan to the contrary,
to:
 
(a) Determine which Affiliates shall be covered by this Plan;
 
(b) Determine which Employees or Non-employee Directors outside the United
States are eligible to participate in this Plan;
 
(c) Modify the terms and conditions of any Award granted to Employees or
Non-employee Directors outside the United States to comply with applicable
foreign laws;
 
(d) Establish subplans and modify exercise procedures and other terms and
procedures, to the extent such actions may be necessary or advisable. Any
subplans and modifications to Plan terms and procedures established under this
Section 18.5 by the Committee shall be attached to this Plan document as
appendices; and
 
(e) Take any action, before or after an Award is made, that it deems advisable
to obtain approval or comply with any necessary local government regulatory
exemptions or approvals.
 
Despite the above, the Committee may not take any actions under this Plan and no
Awards shall be granted that would violate the Exchange Act, the Code, any
securities law, or governing statute or any other applicable law.
 
18.6  
Uncertificated Shares.

 
To the extent that this Plan provides for issuance of certificates to reflect
the transfer of Shares, the transfer of such Shares may be effected on a
noncertificated basis to the extent not prohibited by applicable law or the
rules of any stock exchange.
 
18.7  
Unfunded Plan.

 
Participants shall have no right, title, or interest whatsoever in or to any
investments that the Company or an Affiliate may make to aid it in meeting its
obligations under this Plan. Nothing contained in this Plan, and no action taken
under its provisions, shall create or be construed to create a trust of any
kind, or a fiduciary relationship between the Company or an Affiliate and any
Participant, beneficiary, legal representative, or any other person. Awards
shall be general, unsecured obligations of the Company, except that if an
Affiliate signs an Award Agreement instead of the Company the Award shall be a
general, unsecured obligation of the Affiliate and not any obligation of the
Company. To the extent that any individual acquires a right to receive payments
from the Company or an Affiliate, such right shall be no greater than the right
of an unsecured general creditor of the Company or Affiliate, as applicable. All
payments to be made under this Plan shall be paid from the general funds of the
Company or Affiliate, as applicable, and no special or separate fund shall be
established and no segregation of assets shall be made to assure payment of such
amounts except as expressly set forth in this Plan. This Plan is not intended to
be subject to ERISA.
 
18.8  
No Fractional Shares.

 
No fractional Shares shall be issued or delivered under this Plan or any Award
Agreement. In such an instance, unless the Committee determines otherwise,
fractional Shares and any rights thereto shall be forfeited or otherwise
eliminated.
 
18.9  
Other Compensation and Benefit Plans.

 
Nothing in this Plan shall be construed to limit the right of the Company or an
Affiliate to establish other compensation or benefit plans, programs, policies,
or arrangements. Except as may be otherwise specifically stated in any other
benefit plan, policy, program, or arrangement, no Award shall be
 
 
17
 
treated as compensation for purposes of calculating a Participant's rights under
any such other plan, policy, program, or arrangement.
 
18.10  
No Constraint on Corporate Action.

 
Nothing in this Plan shall be construed (i) to limit, impair or otherwise affect
the Company's or an Affiliate's right or power to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer
all or any part of its business or assets, or (ii) to limit the right or power
of the Company or an Affiliate to take any action which such entity deems to be
necessary or appropriate.
 
 
Article 19.
Legal Construction
 
19.1  
Gender And Number.

 
Except where otherwise indicated by the context, any masculine term used herein
also shall include the feminine, the plural shall include the singular, and the
singular shall include the plural.
 
19.2  
Severability.

 
In the event any provision of this Plan shall be held illegal or invalid for any
reason, the illegality or invalidity shall not affect the remaining parts of
this Plan, and this Plan shall be construed and enforced as if the illegal or
invalid provision had not been included.
 
19.3  
Requirements of Law.

 
The granting of Awards and the issuance of Shares under this Plan shall be
subject to all applicable laws, rules, and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may be required.
The Company or an Affiliate shall receive the consideration required by law for
the issuance of Awards under this Plan.
 
The inability of the Company or an Affiliate to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
or the Affiliate's counsel to be necessary to the lawful issuance and sale of
any Shares under this Plan, shall relieve the Company or Affiliate of any
liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.
 
19.4  
Governing Law.

 
This Plan and each Award Agreement shall be governed by the laws of the State of
Oklahoma, excluding any conflicts or choice of law rule or principle that might
otherwise refer construction or interpretation of this Plan to the substantive
law of another jurisdiction.
 
 
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