AMENDED AND RESTATED
COFFEYVILLE RESOURCES, LLC
PHANTOM UNIT APPRECIATION PLAN (PLAN II)
 1.
    
    Purpose; Operation. The purpose of the Amended and Restated Coffeyville Resources,
LLC Phantom Unit Appreciation Plan (Plan II) (the Plan) is to provide an incentive to
employees of the Company and its Affiliates who contribute to the Companys success to
increase their efforts on behalf of the Company and to promote the success of the Companys
business. Participants in the Plan have the opportunity to receive cash payments in respect of
Phantom Points they hold in the event of certain distributions pursuant to the Parent II LLC
Agreement to Members (as defined in the Parent II LLC Agreement) in Coffeyville Acquisition
II LLC, an indirect equity owner of the Company. Whether payments will be made will depend on
the amount of net proceeds realized in connection with the event that gives rise to such
distributions. Defined terms are defined in Exhibit A hereto.2.
    
    Administration. The Plan shall be administered by the Committee. The Committee shall
have the authority in its discretion, subject to and not inconsistent with the express
provisions of the Plan, to administer the Plan and to exercise all the powers and authorities
either specifically granted to it under the Plan or necessary or advisable in the
administration of the Plan, including, without limitation:
 
    
    the authority to grant Phantom Points;
    
    to determine the persons to whom and the time or times at which Phantom
Points shall be granted;
    
    to determine the number and type of Phantom Points to be granted and the
terms, conditions and restrictions relating thereto;
    
    to determine whether, to what extent, and under what circumstances Phantom
Points may be settled, cancelled, forfeited, exchanged, or surrendered;
    
    to make adjustments in the terms and conditions applicable to Phantom
Points;
    
    to construe and interpret the Plan and Award Agreements;
    
    to prescribe, amend and rescind rules and regulations relating to the Plan;
    
    to determine the terms and provisions of the Award Agreements;
    
    to determine the Baseline Primary Phantom Percentage, the Total Phantom
Percentages and the Final Phantom Percentages;
    
    to determine the amounts allocable for payment pursuant to this Plan;




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
    
    to assign Phantom Benchmark Amounts; and
    
    to make all other determinations deemed necessary or advisable for the
administration of the Plan.
 All determinations made by the Committee in respect of the Plan shall be final and binding
on all Participants and their beneficiaries. No manager or member of the Company or member
of the Committee shall be liable for any action taken or determination made in good faith
with respect to the Plan or any Phantom Points granted hereunder. The Committee, with the
consent of Parent II LLC, shall make determinations with respect to percentages (including
the Total Phantom Percentages and the Final Phantom Percentages) and cash amounts allocated,
if any, to the Plan with reference to the applicable definitions set forth in Exhibit
A; provided that any and all determinations with respect to applicable
percentages and cash amounts allocated to the Plan shall be made in the Committees
discretion and may vary from such definitions. The Committee may make adjustments in the
operation of provisions of the Plan if the Committee determines in its sole discretion that
such adjustments will further the intent of such provisions.3.
    
    Eligibility. Phantom Points may be granted at any time to directors, employees
(including officers) and service providers of an Employer, in the discretion of the Committee.4.
    
    Phantom Service Points; Payment.
 (a)
    
    Phantom Service Point Pool. A pool of points shall exist consisting of
Phantom Service Points. Phantom Service Points shall represent the right to receive
a cash payment from the Employer within thirty (30) days following the date on which a
distribution is made pursuant to the Parent II LLC Agreement. The pool of Phantom
Service Points shall initially be 10,000,000 but may be increased in the discretion of
the Committee at any time. The total number of Phantom Service Points outstanding
(after taking into account any adjustments made pursuant to Section 7) shall be
referred to as the Total Phantom Service Point Pool.(b)
    
    Phantom Service Percentage. The Phantom Plan Service Percentage for
each Participant shall be the Final Phantom Service Percentage multiplied by the
quotient obtained by dividing (x) the number of Phantom Service Points allocated to
such Participant by (y) 10,000,000, or, if the Total Phantom Service Point Pool is
greater than 10,000,000, the Total Phantom Service Point Pool.(c)
    
    Phantom Service Point Payments. The cash amount payable to a
Participant in respect of his or her Phantom Service Points at any time that a
distribution is made pursuant to the Parent II LLC Agreement in respect of Operating
Units shall be determined by multiplying (x) such Participants Phantom Plan Service
Percentage and (y) the amount of Exit Proceeds. For the avoidance of doubt, the
foregoing is simply a calculation of amount of the cash payment payable to a
Participant holding Phantom Service Points, and in no event shall such
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Participant, in its capacity as such, have any rights to receive a payment or
distribution from Parent II LLC.1
 5.
    
    Phantom Performance Points; Payment.
 (a)
    
    Phantom Performance Point Pool. A pool of points shall exist consisting
of Phantom Performance Points. Phantom Performance Points shall represent the right
to receive a cash payment within thirty (30) days following the date on which a
distribution is made pursuant to the Parent II LLC Agreement in respect of Value Units.
The pool of Phantom Performance Points shall initially be 10,000,000, but may be
increased in the discretion of the Committee at any time. The total number of Phantom
Performance Points outstanding (after taking into account any adjustment made pursuant
to Section 7) shall be referred to as the Total Phantom Performance Point Pool.(b)
    
    Phantom Performance Percentage. The Phantom Plan Performance
Percentage for each Participant shall initially be the Final Phantom Performance
Percentage multiplied by the quotient obtained by dividing (x) the number of Phantom
Performance Points allocated to such Participant by (y) 10,000,000, or, if the Total
Phantom Performance Point Pool is greater than 10,000,000, the Total Phantom
Performance Point Pool, and shall be further subject to reduction pursuant to Section
5(c) below.(c)
    
    Performance Factor; Investment Multiple. As provided in the definition
of Final Phantom Performance Percentage, each Participants Phantom Plan Performance
Percentage reflects the Performance Factor, which operates to adjust Participants
performance percentages based on the performance of the investment in the Parent II LLC
by the Investor Members. For purposes of this Plan:
 (1)
    
    The Performance Factor equals a number
(between zero and one) equal to the quotient obtained by dividing (i)
the excess, if positive, of the Final Investment Multiple (as defined
below) over the Minimum Investment Multiple by (ii) two (2);
provided that if such quotient is greater than one, the
Performance Factor will equal one.(2)
    
    The Final Investment Multiple is computed,
after giving effect to any payments to be made pursuant to this Plan,
by dividing (x) the total fair market value of all net distributions
received, or to be received upon the applicable distribution, by the
Investor Members from the Company in respect of their aggregate
investment in the Company divided by (y) the aggregate of such
investment of the
 
 1
    
    Schedule A provides an illustration of
how a calculation of a Phantom Service Point payment would be made under the
Plan. It is not intended to be an indication of actual payments under the Plan. 3




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Investor Members in the Company (it being understood that all such
amounts are themselves simultaneously being calculated by reference
to amounts that may be payable pursuant to the Plan).
 (d)
    
    Phantom Performance Point Payments. The cash amount payable to a
Participant in respect of his or her Phantom Performance Points at any time that a
distribution is made pursuant to the Parent II LLC Agreement in respect of Value Units
shall be determined by adding (x) the product of (i) such Participants Phantom Plan
Performance Percentage and (ii) the amount of Exit Proceeds plus (y) an additional
amount to provide a catch-up similar to that provided in respect of Value Units
pursuant to Section 9.1(d) of the Parent II LLC Agreement. For the avoidance of doubt,
the foregoing is simply a calculation of the amount of the cash payment payable to a
Participant holding Phantom Performance Points, and in no event shall such Participant,
in its capacity as such, have any rights to receive a payment or distribution from
Parent II LLC.
 6.
    
    Additional Awards; Adjustments.
 (a)
    
    Additional Awards. An Employer may determine that a Participants
performance warrants an award of additional Phantom Points, in which case the Employer
may recommend to the Committee that an additional award be made.(b)
    
    Prior Appreciation Adjustments. Each Participant will be assigned a
Phantom Benchmark Amount, which shall be an amount determined by the Committee with
respect to the Participant each time the Committee awards any Phantom Points to the
Participant and relates to the valuation of Parent II LLC at such time, provided that
with respect to Phantom Points that are forfeited and reallocated pursuant to Section
7, the Committee, in its discretion, may instead assign the Phantom Benchmark Amount
that was in effect for such forfeited Phantom Points immediately prior to such
forfeiture or such other Phantom Benchmark Amount as it may determine in its
discretion. Notwithstanding anything to the contrary set forth in the Plan, for
purposes of the calculations under Section 4(c) and Section 5(d), the Committee shall
make such adjustments to the amounts otherwise determined thereunder to account for the
Phantom Benchmark Amount assigned in respect of a Participants Phantom Points.(c)
    
    In the event of any material acquisition, disposition, merger,
recapitalization, capital contribution or other similar event, the Committee may make
such adjustment(s) to the terms of the Plan or any awards granted under the Plan as the
Committee shall determine appropriate in its sole discretion.
 7.
    
    Termination of Employment. If a Participant ceases to be employed by an Employer
(other than in connection with a transfer to another Employer) prior to an Exit Event, such
Participant shall forfeit all Phantom Points granted to the Participant. For avoidance of
doubt, any forfeited Phantom Service Points and Phantom Performance Points shall be returned
to the Phantom Service Point Pool and Phantom Performance Point Pool, respectively, and the
Committee, in its discretion, may reallocate, by one or more separate grants, such forfeited
Phantom Points to one or more employees who are eligible
to participate in the Plan.
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8.
    
    General Provisions.
 (a)
    
    Nontransferability. Unless otherwise provided in an Award Agreement,
Phantom Points shall not be transferable by a Participant under any circumstances,
except by will or the laws of descent and distribution.(b)
    
    No Right to Continued Employment, etc. Nothing in the Plan or in any
Award Agreement entered into pursuant the Plan shall confer upon any Participant the
right to continue in the employ of or to be entitled to any remuneration or benefits
not set forth in the Plan or such Award Agreement, or to interfere with or limit in any
way the right of an Employer to terminate such Participants employment.(c)
    
    Taxes. The Company or any Affiliate is authorized to withhold from any
payment relating to Phantom Points under the Plan amounts of withholding and other
taxes due to enable the Company and Participants to satisfy obligations for the payment
of withholding taxes and other tax obligations.(d)
    
    Excise Tax. To the extent that, (i) in the Committees determination,
payment to a Participant in respect of his or her Phantom Points would constitute
parachute payments (within the meaning of Section 280G of the Code), and if (ii) such
payment would (together with any other payment to which the Participant is or may be
entitled that would constitute a parachute payment), if reduced by all federal,
state, and local taxes applicable thereto, including the excise tax imposed under
Section 4999 of the Code, be less than the amount the Participant would receive, after
all taxes, if the Participant received aggregate payments in respect of his or her
Phantom Points (and such other payments) equal (as valued under Section 280G of the
Code) to only three times the Participants base amount (within the meaning of
Section 280G of the Code), less $1.00, then (iii) such payments hereunder shall be
reduced to such extent to avoid the application of such excise tax; provided that the
Company shall use its reasonable best efforts to obtain shareholder approval of the
payments in a manner intended to satisfy requirements of the shareholder approval
exception to Section 280G of the Code and the regulations promulgated thereunder, such
that payments may be made to the Participant in respect of his or her Phantom Points
without the application of the excise tax.(e)
    
    Amendment and Termination. The Plan shall take effect on the date of
its adoption by the manager of the Company (the Manager). The Manager may at any
time and from time to time alter, amend, suspend, or terminate the Plan in whole or in
part, including, but not limited to, amending the Plan and awards to alter the
structure of the Plan if the Manager determines the Plan is not meeting its objectives.(f)
    
    No Rights to Awards; No Stockholder or Member Rights. No Participant
shall have any claim to be granted any Phantom Points under the Plan, and there is no
obligation for uniformity of treatment of Participants. A Participant or a
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transferee of Phantom Points shall have no rights as a stockholder or member of the
Company or any Affiliate.(g)
    
    Unfunded Status of Awards. The Plan is intended to constitute an
unfunded plan for incentive compensation. With respect to any payments not yet made
to a Participant pursuant to an Award, nothing contained in the Plan or any Phantom
Points shall give any such Participant any rights that are greater than those of a
general creditor of the Company.(h)
    
    Governing Law. The Plan and all determinations made and actions taken
pursuant hereto shall be governed by the laws of the State of Delaware without giving
effect to the conflict of laws principles thereof.(i)
    
    Beneficiary. Upon the death of a Participant, all of his of her rights
under the Plan shall inure to his or her designated beneficiary or, if no beneficiary
has been designated, to his or her estate.(j)
    
    No Guarantee or Assurances. There can be no guarantee that any
distributions in respect of Operating Units or Value Units will occur under the Parent
II LLC Agreement or that any payment to any Participant will result under the Plan.(k)
    
    Expiration of Plan. Unless otherwise determined by the Manager, the
Plan shall expire on July 25, 2015 and all outstanding Phantom Points shall then expire
and be forfeited with no consideration paid in respect of such forfeiture.
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EXHIBIT A
 Plan Definitions
    provided Schedule 1
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x y
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SCHEDULE 1
 Baseline Primary Phantom Percentage
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SCHEDULE A
 Example
 
 Formula : Phantom Plan Service Percentage * Exit Proceeds
 Variables :
 Phantom Plan Service Percentage: Final Phantom Service Percentage * (Phantom Service Points Issued
to Participant / Total Phantom Service Point Pool)
 Final Phantom Service Percentage:
 Total Phantom Service Percentage:
 Baseline Primary Phantom Percentage:
 Phantom Service Points Issued to Participant:
 Total Phantom Service Point Pool:
 Exit Proceeds:
 Calculation :
 Phantom Plan Service Percentage:
    
    (0.333 * 0.0391) * (500,000 / 10,000,000)
0.0130203 * 0.05 = 0.000651015
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