Unassociated Document


    
      INCENTIVE
        PLAN

      OF

      CARRIZO
        OIL & GAS, INC.

      


      


      EMPLOYEE
        RESTRICTED STOCK AWARD AGREEMENT

      


      


      THIS
        AGREEMENT ("Agreement") is made as of the 23rd day of January, 2006 (the
        "Grant
        Date"), by and between Carrizo Oil & Gas, Inc., a Texas corporation (the
        "Company"), and Jack L. Bayless (the "Grantee"), who started with the Company
        on
        October 15, 2005 (the “Start Date”).

      


      The
        Company has adopted the Incentive Plan of Carrizo Oil & Gas, Inc. (the
        "Plan"), a copy of which is appended to this Agreement as Exhibit A
        and by
        this reference made a part hereof, for the benefit of eligible employees,
        directors and independent contractors of the Company and its Subsidiaries.
        Capitalized terms used and not otherwise defined herein shall have the meaning
        ascribed thereto in the Plan.

      


      Pursuant
        to the Plan, the Committee, which has generally been assigned responsibility
        for
        administering the Plan, has determined that it would be in the interest of
        the
        Company and its stockholders to grant the restricted stock provided herein
        in
        order to provide Grantee with additional remuneration for services rendered,
        to
        encourage Grantee to remain in the employ of the Company or its Subsidiaries
        and
        to increase Grantee's personal interest in the continued success and progress
        of
        the Company.

      


      The
        Company and Grantee therefore agree as follows:

      


      1. Grant
        of Restricted Stock.
        Subject to the terms and conditions herein, effective as of the Grant Date,
        the
        Company grants to the Grantee 15,000 shares of Common Stock of the Company,
        par
        value $.01 per share (the "Restricted Stock"). The Company will issue to
        the
        Grantee stock certificates evidencing the shares of Restricted Stock, which
        certificates will be registered in the name of the Grantee and will bear
        an
        appropriate legend referring to the terms, conditions, and restrictions
        applicable to the Restricted Stock, substantially in the following
        form:

      


      The
        transferability of this certificate and the shares of Common Stock represented
        hereby are subject to the terms, conditions and restrictions (including
        forfeiture) contained in the Restricted Stock Award Agreement, effective
        as of
January
        23, 2006,
        between Carrizo Oil & Gas, Inc. and the registered owner hereof. Copies of
        such Agreement are on file in the offices of Carrizo Oil & Gas, Inc., 1000
        Louisiana Street, Suite 1500, Houston, Texas 77002.

      


      The
        certificates evidencing the shares of Restricted Stock shall be held in custody
        by the Company or, if specified by
        the Committee, by a third party custodian or trustee, until the restrictions
        on
        such shares shall have lapsed, and, as a condition of this award of Restricted
        Stock, the Company may require that the Grantee deliver a stock power, duly
        endorsed in blank, relating to the shares of Restricted Stock.

       

      
        
           

        

        
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      2. Transfer
        Restrictions.
        Except as expressly provided herein, the shares of Restricted Stock are not
        transferable (voluntarily or involuntarily) other than by will or the laws
        of
        descent and distribution, and may not otherwise
        be assigned, pledged, hypothecated or otherwise disposed of and shall not
        be
        subject to execution, attachment or similar process. Upon any attempt to
        effect
        any such disposition, or upon the levy of any such process, the award provided
        for herein shall immediately become null and void, and the shares of Restricted
        Stock shall be immediately forfeited to the Company.

      


      3. Restrictions.
        Subject to the provisions of paragraph 4 hereof, the restrictions on the
        shares
        of Restricted Stock shall lapse and such shares shall vest in the Grantee
        in
        three installments at the rate of thirty-three and one-third percent (33
        1/3%)
        of the shares of Restricted Stock awarded hereunder (rounded up to the nearest
        whole number) on each of the first, second and third anniversary dates of
        the
        Start Date; provided that the Grantee has been in the continuous employment
        of
        the Company and its Subsidiaries through the applicable date (subject to
        the
        provisions of any applicable written employment agreement between the Grantee
        and the Company or any Subsidiary). A change of employment is continuous
        employment within the meaning of this paragraph 3 provided that, after giving
        effect to such change, the Grantee continues to be an employee of the Company
        or
        any Subsidiary. Shares as to which restrictions shall have lapsed shall no
        longer be deemed Restricted Stock, and the Company shall deliver to the Grantee
        certificates representing such shares as described in paragraph 5
        below.

      


      4. Termination
        of Employment; Forfeiture.
        Upon termination of the Grantee's employment with the Company or any subsidiary
        of the Company (or the successor of any such company) for any reason, all
        shares
        of Restricted Stock as to which the restrictions thereon have not previously
        lapsed shall be immediately forfeited to the Company;
        subject,
        however,
        to the provisions of any employment agreement between the Grantee and the
        Company or any Subsidiary.

      


      5. Distribution
        Following Termination of Restrictions.
        Upon the vesting and expiration of the restrictions as to any portion of
        the
        Restricted Stock, the Company will cause a new certificate evidencing such
        number of shares of Common Stock to be delivered to the Grantee, free of
        the
        legend regarding transferability; provided that the Company shall not be
        obligated to issue any fractional shares of Common Stock.

      


      6. Voting
        and Dividend Rights.
        During the period in which the restrictions provided herein are applicable
        to
        the Restricted Stock, the Grantee shall have the right to vote the shares
        of
        Restricted Stock and to receive any cash dividends paid with respect thereto
        unless and until forfeiture thereof. Any dividend or distribution payable
        with
        respect to shares of Restricted Stock that shall be paid or distributed in
        shares of Common Stock shall be subject to the same restrictions provided
        for
        herein, and the shares so paid or distributed shall be deemed Restricted
        Stock
        subject to all terms and conditions herein. Any dividend or distribution
        (other
        than cash or Common Stock) payable or distributable on shares of Restricted
        Stock, unless otherwise determined by the Committee, shall be subject to
        the
        terms and conditions of this Agreement to the same extent and in the same
        manner
        as the Restricted Stock is subject; provided that the Committee may make
        such
        modifications and additions to the terms and conditions (including restrictions
        on transfer and the conditions to the timing and degree of lapse of such
        restrictions) that shall become applicable to such dividend or distribution
        as
        the Committee may provide in its absolute discretion.

       

      
        
           

        

        
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      7. Adjustments.
        As provided in Section 15 of the Plan, certain adjustments may be made to
        the
        Restricted Stock upon the occurrence of events or circumstances described
        in
        Section 15 of the Plan. Without limiting the generality of the foregoing,
        and
except
        as otherwise provided in the Plan, in the event of any merger, consolidation,
        reorganization, recapitalization, reclassification or other capital or corporate
        structure change of the Company, the securities or other consideration
        receivable for or in conversion of or exchange for shares of Restricted Stock
        shall be subject to the terms and conditions of this Agreement to the same
        extent and in the same manner as the Restricted Stock is subject; provided
        that
        the Committee may make such modifications and additions to the terms and
        conditions (including restrictions on transfer and the conditions to the
        timing
        and degree of lapse of such restrictions) that shall become applicable to
        the
        securities or other consideration so receivable as the Committee may provide
        in
        its absolute discretion.

      


      8. Mandatory
        Withholding of Taxes. Grantee
        acknowledges and agrees that the Company shall deduct from the cash or shares
        of
        Common Stock otherwise payable or deliverable hereunder or require payment
        by
        Grantee of an amount of cash and/or number of shares of Common Stock (valued
        at
        their Fair Market Value on the applicable date) that is equal to the amount
        of
        all federal, state and local taxes required to be withheld by the Company
        upon
        such payment or delivery, as determined by the Committee.

      


      9. Restrictions
        Imposed by Law.
        Without limiting the generality of Section 16 of the Plan, the Grantee
        agrees that the Company will not be obligated to deliver any shares of Common
        Stock, if counsel to the Company determines that such delivery would violate
        any
        applicable law or any rule or regulation of any governmental authority or
        any
        rule or regulation of, or agreement of the Company with, any securities exchange
        or association upon which the Common Stock is listed or quoted. The Company
        shall in no event be obligated to take any affirmative action in order to
        cause
        the issuance or delivery of shares of Common Stock to comply with any such
        law,
        rule, regulation or agreement.

      


      10. Notice.
        Unless the Company notifies the Grantee in writing of a different procedure,
        any
        notice or other communication to the Company with respect to this Agreement
        shall be in writing and shall be (a)
        delivered personally to the following address:

      


      


      Carrizo
        Oil & Gas, Inc.

      1000
        Louisiana Street , Suite 1500

      Houston,
        Texas 77002

      


      or
        (b)
        sent by first class mail, postage prepaid and addressed as follows:

      


      Carrizo
        Oil & Gas, Inc.

      1000
        Louisiana Street , Suite 1500

      Houston,
        Texas 77002

      Attention:
        Payroll/Benefits Manager

      


      Any
        notice or other communication to the Grantee with respect to this Agreement
        shall be in writing and shall be delivered personally, or shall be sent by
        first
        class mail, postage prepaid, to Grantee's address as listed in the records
        of
        the Company on the Grant Date, unless the Company has received written
        notification from the Grantee of a change of address.

      


      
        
           

        

        
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      11. Amendment.
        Notwithstanding any other provisions hereof, this Agreement may be supplemented
        or amended from time to time as approved by the Committee as contemplated
        by
        Section 6 of the Plan. Without limiting the generality of the foregoing,
        without
        the consent of the Grantee,

      


      (a) this
        Agreement may be amended or supplemented (i) to cure any ambiguity or to
        correct
        or supplement any provision herein which may be defective or inconsistent
        with
        any other provision herein, or (ii) to add to the covenants and agreements
        of
        the Company for the benefit of Grantee or surrender any right or power reserved
        to or conferred upon the Company in this Agreement, subject,
        however,
        to any required approval of the Company's stockholders and, provided,
        in each case, that such changes or corrections shall not adversely affect
        the
        rights of Grantee with respect to the Award evidenced hereby without the
        Grantee’s consent, or (iii) to make such other changes as the Company, upon
        advice of counsel, determines are necessary or advisable because of the adoption
        or promulgation of, or change in or of the interpretation of, any law or
        governmental rule or regulation, including any applicable federal or state
        securities laws; and

      


      (b) subject
        to Section 6 of the Plan and any required approval of the Company's
        stockholders, the Award evidenced by this Agreement may be canceled by the
        Committee and a new Award made in substitution therefor, provided
        that the Award so substituted shall satisfy all of the requirements of the
        Plan
        as of the date such new Award is made and no such action shall adversely
        affect
        the Restricted Stock to the extent then vested without the Grantee’s
        consent.

      


      12. Grantee
        Employment.
        Nothing contained in this Agreement, and no action of the Company or the
        Committee with respect hereto, shall confer or be construed to confer on
        the
        Grantee any right to continue in the employ of the Company or any of its
        Subsidiaries or interfere in any way with the right of the Company or any
        employing Subsidiary to terminate the Grantee's employment at any time, with
        or
        without cause; subject,
        however,
        to the provisions of any employment agreement between the Grantee and the
        Company or any Subsidiary.

      


      13. Governing
        Law.
        This Agreement shall be governed by, and construed in accordance with, the
        internal laws of the State of Texas.

      


      14. Construction.
        References in this Agreement to "this Agreement" and the words "herein,"
        "hereof," "hereunder" and similar terms include all Exhibits and Schedules
        appended hereto, including the Plan. This Agreement is entered into, and
        the
        Award evidenced hereby is granted, pursuant to the Plan and shall be governed
        by
        and construed in accordance with the Plan and the administrative interpretations
        adopted by the Committee thereunder. All decisions of the Committee upon
        questions regarding the Plan or this Agreement shall be conclusive. Unless
        otherwise expressly stated herein, in the event of any inconsistency between
        the
        terms of the Plan and this Agreement, the terms of the Plan shall control.
        The
        headings of the paragraphs of this Agreement have been included for convenience
        of reference only, are not to be considered a part hereof and shall in no
        way
        modify or restrict any of the terms or provisions hereof.

       

      
        
           

        

        
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      15. Duplicate
        Originals.
        The Company and the Grantee may sign any number of copies of this Agreement.
        Each signed copy shall be an original, but all of them together represent
        the
        same agreement.

      


      16. Rules
        by Committee.
        The rights of the Grantee and obligations of the Company hereunder shall
        be
        subject to such reasonable rules and regulations as the Committee may adopt
        from
        time to time hereafter.

      


      17. Entire
        Agreement.
        Subject to the provisions of any applicable written employment agreement
        between
        the Grantee and the Company or any Subsidiary, Grantee and the Company hereby
        declare and represent that no promise or agreement not herein expressed has
        been
        made and that this Agreement contains the entire agreement between the parties
        hereto with respect to the Restricted Stock and replaces and makes null and
        void
        any prior agreements, oral or written, between Grantee and the Company regarding
        the Restricted Stock.

      


      18. Grantee
        Acceptance.
        Grantee shall signify acceptance of the terms and conditions of this Agreement
        by signing in the space provided at the end hereof and returning a signed
        copy
        to the Company.

      


      


      ATTEST:      Carrizo
        Oil & Gas, Inc.

      


      


      


      /s/
        Paul F. Boling     By:/s/
        S.P. Johnson IV   

      Secretary       Name:
        S.P. Johnson IV

      Title:
        President

      


      

        ACCEPTED:

        


        


        


        /s/
          Jack L. Bayless

        Jack
          L. Bayless

         

        
          
             

          

          
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