ex10_7.htm


    Exhibit
10.7

     

    
      QUICKSILVER
RESOURCES INC.

      AMENDED
AND RESTATED

      EXECUTIVE

      CHANGE
IN CONTROL RETENTION INCENTIVE PLAN

       

      WHEREAS,
Quicksilver Resources Inc., a Delaware corporation (the “Company”) considers it
to be in the best interests of its stockholders to encourage the continued
employment of certain Executives (as defined herein) notwithstanding the
possibility, threat or occurrence of a Change in Control (as defined
herein);

       

      WHEREAS,
the Company believes that the possibility of the occurrence of a Change in
Control may result in the termination by the Executive of the Executive’s
employment by the Company or in the distraction of the Executive from the
performance of his or her duties to the Company, in either case to the detriment
of the Company and its stockholders;

       

      WHEREAS,
the Company recognizes that the Executive could suffer adverse financial and
professional consequences if a Change in Control were to occur;
and

       

      WHEREAS,
the Company has determined that it is advisable to establish a severance benefit
program to protect the Executive if a Change in Control occurs, thereby
encouraging the Executive to remain in the employ of the Company and not to be
distracted from the performance of his or her duties to the Company by the
possibility of a Change in Control.

       

      NOW,
THEREFORE, the Company adopts the Quicksilver Resources Inc. Amended and
Restated Executive Change in Control Retention Incentive Plan, the terms of
which are as follows:

       

      ARTICLE
1

      DEFINITIONS

       

      1.1           “Base
Salary” means the Participant’s annual gross salary before any
deductions, exclusions or any deferrals or contributions under any Company plan
or program, but excluding bonuses, incentive compensation, deferred
compensation, employee benefits, expense reimbursements or any other non-salary
form of compensation being received by a Participant (determined without regard
to any reduction in such Base Salary that occurs after a Change in
Control).

       

      1.2           “Benchmark
Bonus” means the greater of (a) the average of the three annual
bonuses earned by the Participant under the terms of the Company’s annual
incentive plan for the three consecutive fiscal years of the Company immediately
preceding the Change in Control event (or, if the Participant has been employed
for fewer than three fiscal years of the Company, the average of all annual
bonuses earned by the Participant under the terms of the Company’s annual
incentive plan for the fiscal years immediately preceding the Change in Control
event) or (b) the annual bonus that would be payable to the Participant if the
target level of performance was achieved for the fiscal year of the Company in
which the Change in Control event occurs under the terms of the Company’s annual
incentive plan applicable to such Participant. In the event that a Participant
received a bonus in a year in which he was not employed for the entire 12 months
of that year, such bonus will be annualized for purposes of determining the
average as set forth in Article 1.2(a).

       

      1.3           “Benefits”
means the severance benefits a Participant is entitled to receive pursuant to
Article 3 hereof, and any retention bonus a Participant is entitled to receive
pursuant to Article 5 hereof.

       

      1.4           “Board”
means the Board of Directors of the Company or its direct or indirect
parent.

       

      1.5           “Cause”
means (a) the conviction of the Participant for any felony involving dishonesty,
fraud or breach of trust or (b) the willful engagement by the Participant in
gross misconduct in the performance of his or her duties that materially injures
the Company.  For purposes of this Plan, no act or failure to act on
the part of the Participant shall be deemed “willful” if it was due primarily to
an error in judgment or negligence, but shall be deemed “willful” only if done
or omitted to be done by the Executive not in good faith and without reasonable
belief that the Participant’s action or omission was in the best interest of the
Company.  Notwithstanding the foregoing, solely for purposes of this
Plan, the Participant shall not be deemed to have been terminated for “Cause”
hereunder unless and until there shall have been delivered to the Participant a
copy of a resolution duly adopted by the affirmative vote of not less than three
quarters of the Board then in office at a meeting of the Board called and held
for such purpose, after reasonable notice to the Participant and an opportunity
for the Participant, together with the Participant’s counsel (if the Participant
chooses to have counsel present at such meeting), to be heard before the Board,
finding that, in the good faith opinion of the Board, the Participant had
committed an act constituting “Cause” as herein defined and specifying the
particulars thereof in detail.  Nothing herein will limit the right of
the Participant or his beneficiaries to contest the validity or propriety of any
such determination.

       

      1.6           “Change
in Control” means the occurrence of any of the following after the
Effective Date:

       

      (a)           any
individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934 (“Exchange Act”)) is or becomes the
beneficial owner (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 50% or more of the combined voting power of the
then-outstanding Voting Stock of the Company; provided, however, that the
following acquisitions shall not constitute a Change in Control:  (i)
any acquisition of Voting Stock of the Company directly from the Company that is
approved by a majority of the Incumbent Directors; (ii) any acquisition of
Voting Stock of the Company by the Company or any Subsidiary of the Company;
(iii) any acquisition of Voting Stock of the Company by the trustee or other
fiduciary holding securities under any employee benefit plan (or related trust)
sponsored or maintained by the Company or any Subsidiary of the Company; and
(iv) any acquisition of Voting Stock of the Company by Mercury Exploration
Company, Quicksilver Energy, L.P., The Discovery Fund, Pennsylvania Avenue
Limited Partnership, Pennsylvania Management Company, the estate of Frank
Darden, Lucy Darden, Anne Darden Self, Glenn Darden or Thomas Darden, or their
respective successors, assigns, designees, heirs, beneficiaries, trusts, estates
or controlled affiliates;

       

      (b)           a
majority of the Board ceases to be comprised of Incumbent Directors;
or

       

      (c)           the
consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the consolidated assets of the
Company (each, a “Business Combination Transaction”) immediately after which the
Voting Stock of the Company outstanding immediately prior to such Business
Combination Transaction does not continue to represent (either by remaining
outstanding or by being converted into Voting Stock of the entity surviving,
resulting from, or succeeding to all or substantially all of the Company’s
consolidated assets as a result of such Business Combination Transaction or any
parent of such entity), at least 50% of the combined voting power of the
then-outstanding shares of Voting Stock of (i) the entity surviving,
resulting from, or succeeding to all or substantially all of the Company’s
consolidated assets as a result of, such Business Combination Transaction or
(ii) any parent of any such entity (including, without limitation, an
entity which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets either directly or through one or more
subsidiaries).

       

      For
purposes of this Plan, (i) “Incumbent Directors” means the individuals who, as
of the date hereof, are Directors of the Company and any individual becoming a
Director subsequent to the date hereof whose election, nomination for election
by the Company’s shareholders, or appointment, was approved by a vote of a
majority of the then Incumbent Directors (either by a specific vote or by
approval of the proxy statement of the Company in which such person is named as
a nominee for director, without objection to such nomination) and (ii) “Voting
Stock” means securities entitled to vote generally in the election of
Directors.

       

      1.7           “Code”
means the Internal Revenue Code of 1986, as amended.

       

      1.8           “Company”
means Quicksilver Resources Inc., a Delaware corporation.  The term
“Company” shall also include any Successor, whether the liability of such
Successor under the Plan is established by contract or occurs by operation of
law.

       

      1.9           “Effective
Date” means the date on which the Plan is adopted.

       

      1.10           “Employment
Termination Date” means the date on which the employment relationship
between the Participant and the Company is terminated due to an Involuntary
Termination.

       

      1.11           “ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.

       

      1.12           “Executive”
means an employee of the Company or a Subsidiary whose name appears on Exhibit B
which is attached hereto and made a part hereof for all purposes, as the same
may be amended in the Company’s discretion from time to time (subject to
Article 9).

       

      1.13           “Excise
Tax” means the excise tax imposed by Section 4999 of the Code, together
with any interest or penalties imposed with respect to such tax.

       

      1.14           “Good
Reason Event” means the occurrence of one or more of the following events
or conditions after the occurrence of a Change in Control:

       

      (a)           the
Company removes the Participant from, or fails to re-elect or appoint the
Participant to, any duties or position with the Company that were assigned or
held by the Participant immediately before the occurrence of the Change in
Control, except that a nominal change in the Participant’s title that is merely
descriptive and does not affect rank or status shall not constitute such an
event;

       

      (b)           the
Company or a Subsidiary assigns to the Participant any duties inconsistent with
the Participant’s position (including offices, titles and reporting
requirements), authority, duties or responsibilities with the Company or a
Subsidiary in effect immediately before the occurrence of the Change in
Control;

       

      (c)           the
Company takes any action that results in a material diminution of the
Participant’s position, authority, duties or responsibilities or otherwise takes
any action that materially interferes therewith;

       

      (d)           the
Company reduces the Participant’s Base Salary or the Participant’s incentive
bonus opportunity as in effect immediately prior to such reduction (including a
reduction in the Participant’s incentive bonus target or any other action that
would adversely affect the Participant’s participation in or benefits under the
Company’s incentive bonus plan(s));

       

      (e)           the
Company or a Subsidiary relocates the Participant’s principal workplace to an
area that is located outside of a radius of 50 miles from the location of the
Participant’s principal workplace immediately prior to the Change in Control, or
requires the Participant to perform a majority of his or her duties more than 50
miles from the Participant’s principal work location (determined as of the date
of the Change in Control) for a period of more than 21 consecutive days or for
more than 90 days in any calendar year;

       

      (f)           the
Company or a Subsidiary fails to (i) continue in effect any bonus, incentive,
profit sharing, performance, savings, retirement or pension policy, plan,
program or arrangement (such policies, plans, programs and arrangements
collectively being referred to herein as “Basic
Benefit Plans”),
including, but not limited to, any deferred compensation, supplemental executive
retirement or other retirement income, stock option, stock purchase, stock
appreciation, or similar policy, plan, program or arrangement of the Company or
a Subsidiary, in which the Participant was a participant immediately before the
occurrence of the Change in Control, unless an equitable and reasonably
comparable arrangement (embodied in a substitute or alternative benefit or plan)
shall have been made with respect to such Basic Benefit Plan promptly following
the occurrence of the Change in Control, or (ii) continue the Participant’s
participation in any Basic Benefit Plan (or any substitute or alternative plan)
on substantially the same basis, both in terms of the amount of benefits
provided to the Participant (which are in any event always subject to the terms
of any applicable Basic Benefit Plan) and the level of the Participant’s
participation relative to other participants, as existed immediately before the
occurrence of the Change in Control;

       

      (g)           the
Company or a Subsidiary fails to continue to provide the Participant with
benefits substantially similar to those enjoyed by the Participant under any of
the Company’s
or a Subsidiary’s other benefit plans, policies, programs and arrangements,
including, but not limited to, life insurance, medical, dental, health,
hospital, accident or disability plans, in which the Participant was a
participant immediately before the occurrence of the Change in
Control;

       

      (h)           the
Company takes any action that would directly or indirectly materially reduce any
other non-contractual benefits that were provided to the Participant by the
Company immediately before the occurrence of the Change in Control or deprive
the Participant of any material fringe benefit enjoyed by him or her immediately
before the occurrence of the Change in Control;

       

      (i)           the
Company fails to provide the Participant with the number of paid vacation days
to which he or she was entitled in accordance with the Company’s vacation policy
in effect immediately before the occurrence of the Change in
Control;

       

      (j)           the
Company fails to continue to provide the Participant with office space, related
facilities and support personnel (including, but not limited to, administrative
and secretarial assistance) (i) that are both commensurate with
Participant’s responsibilities to and position with the Company immediately
before the occurrence of the Change in Control and not materially dissimilar to
the office space, related facilities and support personnel provided to employees
of the Company having comparable responsibility to the Participant, or
(ii) that are physically located at the Company’s principal executive
offices;

       

      (k)           the
Company fails to honor any provision of this Plan; or

       

      (l)           the
Company gives effective notice of an election to terminate at the end of the
term (or to not extend the term) of any employment agreement that the
Participant has or may in the future have with the Company or the Successor in
accordance with the terms of any such agreement.

       

      1.15           “Involuntary
Termination” means the termination of a Participant’s employment
relationship with the Company and each Subsidiary (a) by the Company or a
Subsidiary after the occurrence of a Change in Control for any reason other than
Cause, or (b) by the Participant on account of a Good Reason
Event.  For purposes of the Plan, a Participant’s termination will not
be considered to be on account of a Good Reason Event unless the Participant
terminates employment no more than 60 days following such Good Reason
Event.  A Participant shall not be deemed to have incurred an
Involuntary Termination by reason of the transfer of the Participant’s
employment between the Company and any of its Subsidiaries, or among
Subsidiaries.  The Plan Administrator shall determine, in its sole
discretion, whether a Participant’s termination of employment from the Company
or any Subsidiary constitutes an Involuntary Termination.  For
purposes of the Plan, a Participant will not be considered to have terminated
his or her employment relationship unless the termination of employment
qualifies as a Separation from Service.

       

      1.16           “Participant”
means an individual who is an Executive on the date a Change in Control
occurs.  An individual who is classified by the Company as a temporary
employee or an independent contractor on the date of which a Change in Control
occurs is not eligible to participate in the Plan (even if he or she is
subsequently reclassified by the Internal Revenue Service or a court as a common
law employee of the Company and the Company acquiesces to such
reclassification). Notwithstanding the foregoing, in the event that an Executive
has entered into an employment agreement with the Company or a Subsidiary, such
Executive will not be deemed a Participant under this Plan unless such
employment agreement specifically adopts and incorporates this Plan by
reference.

       

      1.17           “Payment”
means any payment, benefit or distribution (or combination thereof) by the
Company or any of its Subsidiaries to or for the benefit of a Participant,
whether paid, payable, distributed, distributable or provided pursuant to the
Plan or otherwise, including any payment, benefit or other right that
constitutes a “parachute payment” within the meaning of Section 280G of the
Code.

       

      1.18           “Person”
means any individual, entity or group that is a “person” within the meaning of
Section 3(a)(9), 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended.

       

      1.19           “Plan”
means the Quicksilver Resources Inc. Amended and Restated Executive Change in
Control Retention Incentive Plan, as set forth herein and as amended from time
to time.

       

      1.20           “Plan
Administrator” means the Company; however, the Company may designate any
Person or a committee to administer the Plan in accordance with the provisions
of Article 8.

       

      1.21           “Release”
means the Release Agreement in substantially the form attached hereto as Exhibit
A and made a part hereof for all purposes.

       

      1.22           “Separation
from Service” means a Participant’s separation from service within the
meaning of Section 409A of the Code; provided, however, that to the extent
permitted by Section 409A of the Code, a Participant will be treated as
incurring a Separation from Service if the reasonably anticipated level of bona
fide services the Participant will perform is permanently decreased to less than
50% of the average level of bona fide services performed by the Participant over
the immediately preceding 12 months.

       

      1.23           “Specified
Employee” means a specified employee within the meaning of Section 409A
of the Code.  A Participant who is identified by the Company as a
Specified Employee at any time during a calendar year will be considered a
Specified Employee for purposes of Article 4 during the 12-month period
that begins on April 1 of the immediately following calendar year, and no
other Participant will be considered a Specified Employee during such 12-month
period.

       

      1.24           “Subsidiary”
means a corporation, partnership, limited liability company or other entity in
which the Company owns directly or indirectly more than 50% of the outstanding
shares of voting stock or other voting interest.

       

      1.25           “Successor”
means a person with or into which the Company shall have been merged or
consolidated or to which the Company shall have transferred all or substantially
all of its assets.

       

      ARTICLE
2

      ELIGIBILITY

       

      (a)           Except
as specified herein, a Participant who incurs an Involuntary Termination within
two years after the occurrence of a Change in Control (including such a
termination on the date of the Change in Control) shall be entitled to the
severance benefits described in Article 3 hereof.

       

      (b)           The
Plan does not provide benefits with respect to any termination of employment
prior to the occurrence of a Change in Control, whether such termination is for
Cause or otherwise.  A Participant will forfeit all Benefits under the
Plan if he or she is discharged by the Company for Cause.

       

      ARTICLE
3

      CHANGE
IN CONTROL BENEFITS

       

      Subject
to Article 4 hereof, the Company shall pay or provide a Participant who has
satisfied the requirements of Article 2 hereof the following
Benefits:

       

      (a)           A
single sum cash payment equal to three times the sum of (i) the
Participant’s Base Salary, plus (ii) the Participant’s Benchmark
Bonus.

       

      (b)           To
the extent permitted by law the Company shall take all actions necessary to
cause the Participant’s account balances under the Company’s 401(k) Plan to
become fully vested and nonforfeitable; provided that such action would not
require the accelerated vesting of any other participant’s account balance in
the Company’s 401(k) Plan.

       

      (c)           To
the extent permitted by Section 409A of the Code, all outstanding stock options,
and restricted share and restricted share unit awards held by the Participant
shall immediately become fully vested.

       

      (d)           The
Company shall take the following actions:

       

      (i)           Throughout
the two years following the Employment Termination Date, the Company shall
maintain in effect and not materially reduce the benefits provided by the
Company’s group medical, dental and vision insurance and group basic life
insurance plans in which the Participant participated immediately prior to the
Employment Termination Date; and

       

      (ii)           the
Company shall arrange for the Participant’s uninterrupted participation
throughout the two-year period commencing on the Participant’s Employment
Termination Date in such group medical, dental and vision insurance and group
basic life insurance plans, provided that if the Participant’s participation
after his or her Employment Termination Date in any such plan is not permitted
by the terms of that plan, then throughout such two-year period, the Company
shall provide the Participant with substantially the same benefits that were
provided to the Participant under such plan immediately before the Employment
Termination Date.  All reimbursements of expenses under the Company’s
medical, dental and vision programs or other reimbursements of expenses shall be
made no later than December 31 of the year following the year in which the
Participant incurs the related expense.  In no event will the amount
of expenses eligible for reimbursement, or in-kind benefits provided, by the
Company in one taxable year affect the amount of expenses eligible for
reimbursement, or in-kind benefits to be provided, in any other taxable
year.  The Participant’s right to reimbursement or in-kind benefits
shall not be subject to liquidation or exchange for another
benefit.

       

      (e)           Benefits
under the Plan shall not be taken into account as compensation for purposes of
determining contributions or benefits under any other employee benefit plan of
the Company or a Subsidiary.  In addition, Benefits under the Plan
shall be reduced by any severance, termination or similar payments payable to a
Participant pursuant to any employment, change in control, severance or similar
agreement with the Company or a Subsidiary, unless such agreement expressly
provides that a cash severance or retention payment is in addition to the
Benefits under the Plan.

       

      ARTICLE
4

      TIME
OF SEVERANCE PAYMENT

       

      Provided
that the Participant has executed and delivered to the Company the Release and
such Release has become effective and irrevocable in accordance with its terms
prior to the date of payment, the Company shall pay the Participant the cash
severance benefits described in paragraph (a) of Article 3 on the 60th day after the date of
the Participant’s Separation from Service and shall provide the benefits
described in paragraph (d) of Article 3; provided, however, that if the Company
determines in good faith that (a) any payment to the Participant or his estate
or beneficiaries under Article 3 or Article 6 hereof does not qualify for the
“short-term deferral exception” or otherwise would constitute a “deferral of
compensation” under Section 409A of the Code, (b) the Participant is a Specified
Employee, and (c) delay of such payment is required by Section 409A of the Code
and is not already provided for, the payment date shall instead be the earlier
of (x) the first day of the seventh month following the date of the
Participant’s Separation from Service, or (y) the date of the Participant’s
death.  If payment is required to be delayed pursuant to the foregoing
provision, the cash severance payment described in paragraph (a) of
Article 3 shall be increased to include interest payable on such cash
severance payment at the interest rate described below from the date of the
Participant’s Separation from Service to the date of payment.  The
interest rate shall be determined as of the date of the Participant’s Separation
from Service and shall be the rate of interest then most recently published in
The
Wall Street Journal as the “prime rate” at large U.S. money center
banks.

       

      If the
Participant fails to furnish the executed Release, or if the Release furnished
by the Participant has not become effective and irrevocable by the date of
payment, the Participant will not be entitled to the severance benefits
described in paragraphs (a) and (d) of Article 3.

       

      ARTICLE
5

      RETENTION
BONUS

       

      If a
Participant remains employed by the Company or a Subsidiary throughout the
six-month period following a Change in Control, then six months after the date
of the Change in Control the Company shall pay to the Participant, in a single
cash payment, a retention bonus equal to one-half (1/2) of the Participant’s
Base Salary (without regard to whether the Participant is or ever will become
entitled to severance benefits under Article 3 hereof).

       

      ARTICLE
6

      CERTAIN
ADDITIONAL PAYMENTS BY THE COMPANY

       

      6.1           Gross-Up
Payment.  Notwithstanding anything in the Plan to the contrary
and except as set forth below, in the event that it is determined that any
Payment that is paid or payable to or for the benefit of a Participant would be
subject to the Excise Tax, the Participant shall be entitled to receive, and the
Company shall be required to pay, an additional payment (a “280G
Gross-Up Payment”) in an amount such that, after payment by the
Participant of all taxes (and any interest or penalties imposed with respect
thereto), including any income and employment taxes (and any interest and
penalties imposed with respect thereto) and Excise Taxes imposed upon the 280G
Gross-Up Payment, the Participant retains an amount of the 280G Gross-Up Payment
equal to the Excise Tax imposed upon the Payments.  The Company’s
obligation to make 280G Gross-Up Payments under this Article ‎6
shall not be conditioned upon a Participant’s termination of employment and
shall survive and apply after a Participant’s termination of
employment.

       

      6.2           Calculation
of Gross-Up Payment.  Subject to the provisions of Section
‎6.3,
all determinations required to be made under this Article ‎6,
including whether and when a 280G Gross-Up Payment is required, the amount of
any 280G Gross-Up Payment and the assumptions to be utilized in arriving at such
determinations, shall be made in accordance with the terms of this Article ‎6
by a nationally recognized certified public accounting firm that shall be
selected by the Company; provided, however, that in the event of any material
relationship between such accounting firm and a Participant that, in the
reasonable opinion of the Company, could pose a conflict of interest or
otherwise affect the accounting firm’s independent judgment, the Participant
shall select another independent accounting firm acceptable to the Company to
make such determinations with respect to the Participant (the “Accounting
Firm”).  The Accounting Firm shall submit its determination and
detailed supporting calculations to both the Company and the Participant within
15 business days of the receipt of notice from the Participant that there has
been a Payment or such earlier time as is requested by the Participant or the
Company.  For purposes of determining the amount of any 280G Gross-Up
Payment, each Participant shall be deemed to pay Federal income tax at the
highest marginal rate applicable to individuals in the calendar year in which
the 280G Gross-Up Payment is to be made and deemed to pay state and local income
taxes at the highest marginal rates applicable to individuals in the state or
locality of the Participant’s residence or place of employment in the calendar
year in which the 280G Gross-Up Payment is to be made, net of the maximum
reduction in Federal income taxes that can be obtained from deduction of state
and local taxes, taking into account limitations applicable to individuals
subject to Federal income tax at the highest marginal rate.  All fees
and expenses of the Accounting Firm shall be borne solely by the
Company.  Any 280G Gross-Up Payment, as determined pursuant to this
Article ‎6,
shall be paid by the Company to the applicable Participant within five business
days of the receipt of the Accounting Firm’s determination.  If the
Accounting Firm determines that no Excise Tax is payable by the Participant, it
shall so indicate to the Participant in writing.  Any determination by
the Accounting Firm shall be binding upon the Company and the
Participant.  As a result of the uncertainty in the application of the
Excise Tax, it is possible that the amount of the 280G Gross-Up Payment
determined by the Accounting Firm to be due to a Participant, consistent with
the calculations required to be made hereunder, shall be lower than the amount
actually due (an “Underpayment”).  In
the event that the Company exhausts its remedies pursuant to Section ‎6.3
and the Participant thereafter is required to make a payment of any Excise Tax,
the Accounting Firm shall determine the amount of the Underpayment that has
occurred and submit its determination and detailed supporting calculations to
both the Participant and the Company as promptly as possible, and any
Underpayment shall be paid by the Company to the Participant within five
business days of the receipt of the Accounting Firm’s determination and
calculations.

       

      6.3           Notice
of Claims.  A Participant shall notify the Company in writing
of any written claim by the Internal Revenue Service that, if successful, would
require the payment by the Company of a 280G Gross-Up Payment.  Such
notification shall be given as soon as practicable, but no later than 30 days
after the Participant is informed in writing of any claim.  Failure to
give timely notice shall not prejudice any Participant’s right to 280G Gross-Up
Payments and rights of indemnity under this Article ‎6,
unless, and solely to the extent that, the Company has been prejudiced in a
material respect by the failure.  The Participant shall advise the
Company of the nature of any claim and the date on which the claim is requested
to be paid.  No Participant shall pay a claim prior to the expiration
of the 30-day period following the date on which the Participant gives notice to
the Company (or such shorter period ending on the date that any payment of taxes
with respect to the claim is due).  If the Company notifies a
Participant in writing prior to the expiration of such period that the Company
wishes to contest the claim, the Participant shall (a) give the Company any
information reasonably requested by the Company relating to the claim, (b) take
such action in connection with contesting the claim as the Company reasonably
requests in writing from time to time, including accepting legal representation
with respect to the claim by an attorney reasonably selected by the Company, (c)
cooperate with the Company in good faith in order effectively to contest the
claim and (d) permit the Company to participate in any proceedings relating to
the claim; provided, however, that the Company shall bear and pay directly all
costs and expenses (including additional income taxes, interest and penalties)
incurred in connection with the contest, and shall indemnify and hold the
Participant harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest or penalties) imposed as a result of such representation and
payment of costs and expenses.  Without limitation on the foregoing
provisions of this Section ‎6.3,
the Company shall control all proceedings taken in connection with the contest,
and, at its sole discretion, may pursue or forgo any and all administrative
appeals, proceedings, hearings and conferences with the applicable taxing
authority in respect of the claim and may, at its sole discretion, either direct
the Participant to pay the tax claimed and sue for a refund or contest the claim
in any permissible manner, and the Participant agrees to prosecute the contest
to a determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that (x) if the Company directs the Participant to
pay the claim and sue for a refund, the Company shall advance the amount of the
payment to the Participant, on an interest-free basis, and shall indemnify and
hold the Participant harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties) imposed with respect to the advance
or with respect to any imputed income in connection with the advance and (y) if
the contest results in any extension of the statute of limitations relating to
payment of taxes for the taxable year of the Participant with respect to which
the contested amount is claimed to be due, the extension must be limited solely
to the contested amount.  Furthermore, the Company’s control of the
contest shall be limited to issues with respect to which the 280G Gross-Up
Payment would be payable hereunder, and each Participant shall be entitled to
settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

       

      6.4           Refunds.  If,
after the receipt by a Participant of an amount advanced by the Company pursuant
to Section ‎6‎.3,
the Participant becomes entitled to receive any refund with respect to the
related claim, the Participant shall (subject to the Company’s complying with
the requirements of Section ‎6‎.3)
promptly pay to the Company the amount of the refund received (together with any
interest paid or credited thereon after taxes applicable
thereto).  If, after the receipt by a Participant of an amount
advanced by the Company pursuant to Section ‎6.3,
a determination is made that the Participant will not be entitled to any refund
with respect to the claim and the Company does not notify the Participant in
writing of its intent to contest the denial of refund prior to the expiration of
the 30-day period after the determination, then the advance shall be forgiven
and shall not be required to be repaid and the amount of the advance shall
offset, to the extent thereof, the amount of 280G Gross-Up Payment required to
be paid.

       

      6.5           Payment
Deadline.  Notwithstanding any other provision of this Article
‎6
to the contrary, any 280G Gross-Up Payment, Underpayment or other payment or
reimbursement made pursuant to this Article ‎6
shall be paid or reimbursed no later than December 31st of the year following
the year in which the applicable taxes are remitted or, in the case of
reimbursement of expenses incurred due to a tax audit or litigation to which
there is no remittance of taxes, no later than the end of the year following the
year in which the audit is completed or there is a final and nonappealable
settlement or other resolution of the litigation in accordance with Treasury
Regulation Section 1.409A-3(i)(1)(v).

       

      ARTICLE
7

      UNFUNDED
ARRANGEMENT

       

      The plan
is unfunded, and all cash Benefits will be paid, as needed, from the general
assets of the Company.  The Plan is only a general corporate
commitment and each Participant must rely upon the general credit of the Company
for the fulfillment of its obligations hereunder.  Under all
circumstances the rights of Participants to any asset held by the Company will
be no greater than the rights expressed in this Plan.  Nothing
contained in this Plan shall constitute a guarantee by the Company that the
assets of the Company will be sufficient to pay any Benefits under this Plan or
would place the Participant in a secured position ahead of general creditors of
the Company; the Participants are only unsecured creditors of the Company with
respect to their Plan benefits, and the Plan constitutes a mere promise by the
Company to make Benefit payments in the future.  No specific assets of
the Company have been or shall be set aside, or shall in any way be transferred
to a trust or shall be pledged in any way for the performance of the Company’s
obligations under the Plan which would remove such assets from being subject to
the general creditors of the Company.

       

      ARTICLE
8

      ADMINISTRATION
OF THE PLAN

       

      The Plan
Administrator shall have the full power and authority to administer the Plan,
carry out its terms and conditions and effectuate its purposes.  The
Plan Administrator shall be the “named fiduciary,” as such term is defined in
ERISA, of the Plan, with responsibility for administration of the
Plan.

       

      The Plan
Administrator shall serve without compensation for its services as
such.  However, all reasonable expenses of the Plan Administrator
shall be paid or reimbursed by the Company upon proper
documentation.  The Plan Administrator shall be indemnified by the
Company against personal liability for actions taken in good faith in the
discharge of duties as the Plan Administrator.

       

      The Plan
Administrator shall keep all individual and group records relating to
participants and former participants and all other records necessary for the
proper operation of the Plan.  Such records shall be made available to
the Company and to each Participant for examination during business hours except
that a Participant shall examine only such records as pertain exclusively to the
examining Participant and to the Plan.  The Plan Administrator shall
prepare and shall file as required by law or regulation all reports, forms,
documents and other items required by ERISA, and every other relevant statute,
each as amended, and all regulations thereunder (except that the Company, as
payor of the Benefits, shall prepare and distribute to the proper recipients all
forms relating to withholding of income or wage taxes, Social Security taxes,
and other amounts which may be similarly reportable).

       

      ARTICLE
9

      AMENDMENT
OR TERMINATION

       

      The Board
reserves the right to amend or terminate the Plan at any time and in any manner
without the consent of any affected individual, provided that any amendment or
termination will not adversely affect the Benefits payable to a Participant
whose Employment Termination Date occurred prior to the date of such amendment
or termination.  The right to amend the Plan includes the right to
change the individuals who are eligible to participate in the Plan from time to
time.  Notwithstanding the foregoing, for a period of two years
following a Change in Control, the Plan may not be terminated, or amended in any
manner adverse to any eligible Participant without the written consent of each
affected Participant.

       

      ARTICLE
10

      CLAIMS
PROCEDURES

       

      10.1           Claim
for Benefits.  When a Benefit is due, a Claimant may submit a
claim for Benefits to the office designated by the Plan Administrator to receive
claims.  For purposes of this Article, “Claimant” means a Participant
or an authorized representative of a Participant who makes a claim for Benefits
under the Plan.

       

      10.2           Deadline
for Notifications of Claim Determinations.  If a Claimant’s
claim for Benefits under the Plan is denied in whole or in part, the Plan
Administrator will provide to the Claimant a written notice of the claim
decision within 90 days of receipt of the claim.  This 90-day period
may be extended one time by the Plan Administrator for up to 90 days, provided
that the Plan Administrator notifies the Claimant, prior to the expiration of
such 90-day period, of the circumstances requiring the extension of time and the
date by which the Plan Administrator expects to render a
decision.  Claims not acted upon within the time prescribed herein
shall be deemed denied for purposes of proceeding to the review
stage.

       

      10.3           Contents
of Notices of Claims Denials.  When a claim is denied (an
adverse determination) in full or in part, the Plan Administrator will provide
the Claimant a written or electronic notification of the denial within the time
frame specified in Section 9.1.  This notice will:

       

      (a)           explain
the specific reasons for the adverse determination;

       

      (b)           reference
the specific Plan provisions on which the adverse determination is
based;

       

      (c)           provide
a description of any additional material or information necessary for the
Claimant to complete the claim and an explanation of why such material or
information is necessary; and

       

      (d)           provide
a description of the Plan’s review procedures and the time limits applicable to
such procedures, including a statement of the Claimant’s right to bring a civil
action under Section 502(a) of ERISA following an adverse claims determination
on review.

       

      10.4           Appeals
of Denied Claims.  The Claimant will have 60 days after
receiving the notice that the Claimant’s claim is denied to appeal the adverse
determination in writing to the Plan Administrator. The Claimant may submit
written comments, documents, records, and other information relevant to the
claim, and such information will be taken into account during the review,
without regard to whether it was submitted or considered in the initial claim
determination.  In addition, the Claimant will be provided, upon
request and free of charge, reasonable access to and copies of all documents,
records, and other information relevant to the claim.

       

      If no
appeal of the adverse determination is made in writing to the Plan Administrator
within 60 days after the Claimant’s receipt of the notice of denial, the denial
of the claim is final.

       

      10.5           Deadlines
for Notifications of Appeals Determinations.  The Administrator
will notify the Claimant of its determination on review of an adverse claim
determination within a reasonable period of time, but not later than 60 days
from receipt of a request for review of the adverse
determination.  This 60-day period may be extended one time by the
Plan Administrator for up to 60 days, provided that the Plan Administrator
notifies the Claimant, prior to the expiration of such 60-day period, of the
circumstances requiring the extension of time and the date by which the Plan
Administrator expects to render a decision.

       

      10.6           Contents
of Notices of Final Claims Determinations.  Notice of the
Plan’s claims decision will be given in writing or electronically.  If
the Claimant’s claim is denied in whole or in part the notification will
include:

       

      (a)           the
specific reasons for the denial;

       

      (b)           reference
to the specific Plan provisions on which the decision was based;

       

      (c)           a
statement of the Claimant’s right to receive, upon request and free of charge,
reasonable access to and copies of all documents, records, and other information
relevant to the claim; and

       

      (d)           a
statement of the Claimant’s right to bring a civil action in court under section
502(a) of ERISA.

       

      ARTICLE
11

      MISCELLANEOUS

       

      11.1           Tax
Withholding.  The Company will calculate the deductions from
the amount of the benefit paid under the Plan for any taxes required to be
withheld by federal, state or local government and shall cause them to be
withheld.

       

      11.2           Plan
Not an Employment Contract.  The adoption and maintenance of
the Plan is not a contract between the Company and its employees which gives any
employee the right to be retained in its employment.  Likewise, it is
not intended to interfere with the rights of the Company to discharge any
employee at any time or to interfere with the employee’s right to terminate his
or her employment at any time.

       

      11.3           Alienation
Prohibited.  No benefits hereunder shall be subject to
anticipation or assignment by a Participant, to attachment by, interference
with, or control of any creditor of a Participant, or to being taken or reached
by any legal or equitable process in satisfaction of any debt or liability of a
Participant prior to its actual receipt by the Participant.  Any
attempted conveyance, transfer, assignment, mortgage, pledge, or encumbrance of
the benefits hereunder prior to payment thereof shall be void.

       

      11.4           Gender
and Number.  If the context requires it, words of one gender
when used in the Plan shall include the other genders, and words used in the
singular or plural shall include the other.

       

      11.5           Severability. If
any provision of the Plan is determined to be invalid or unenforceable, that
determination shall not affect the validity or enforceability of any other
provision.

       

      11.6           Successors.  The
Company shall not, directly or indirectly, consolidate with, merge into or sell
or otherwise transfer all or substantially all of its assets to, any person, or
permit any person to consolidate with or merge into the Company, unless
immediately after such consolidation, merger, sale or transfer, the Successor
shall have assumed in writing the Company’s obligations under the
Plan.

       

      11.7           Assignment;
Binding Effect.  This Plan shall be binding upon any
Successor.  The Company shall not assign any of its obligations under
the Plan unless (a) such assignment is to a Successor, and (b) the requirements
of Section 11.6 are fulfilled.

       

      11.8           Compliance
with Section 409A of the Code.  To the extent applicable, it is
intended that the Plan and any Benefits payable hereunder are exempt from
Section 409A of the Code or are structured in a manner that would not cause a
Participant to be subject to taxes and interest pursuant to Section 409A of the
Code.  The Plan shall be construed and interpreted in a manner
consistent with such intent.

       

      11.9           Governing
Law.  The provisions of the Plan shall be construed,
administered, and governed under the laws of the State of Texas and, to the
extent applicable, by the laws of the United States.

       

       

      
        
          	 	QUICKSILVER
      RESOURCES INC.	 
	 	 	 	 
	 	By:	/s/
      Thomas F. Darden	 
	 	 	Title:
      Chairman of the Board	 
	 	 	 	 


        

      

       

       

      
        
           

        

        
           

          
            
 

        

        
           

        

      

      Exhibit A

       

      
        QUICKSILVER
RESOURCES INC.

        AMENDED
AND RESTATED

        EXECUTIVE

        CHANGE
IN CONTROL RETENTION INCENTIVE PLAN

         

      

      RELEASE
AGREEMENT

       

      This
RELEASE
is executed by  (the “Employee”) in consideration of the severance
benefits provided under the Quicksilver Resources Inc. Amended and Restated
Executive Change in Control Retention Incentive Plan (the “Plan”), and as a
condition to the receipt of such benefits.  For purposes of this
Release, the term “Company” means Quicksilver Resources Inc. and any Successor
(as defined in the Plan).

       

      NOW
THEREFORE, the Employee provides the following
release:

       

      1.           Release
by Employee. I,
_____, on behalf of myself and my heirs and assigns, in consideration of the
Company’s payment of the severance benefits in the amount of $_____________
(less any amounts that the Company is required to withhold under applicable
laws) and the welfare benefits described in Section 3(d) of the Plan to be
furnished to me pursuant to the Plan, the sufficiency of which is hereby
acknowledged, and as a material inducement to the Company to enter into this
Release hereby release and forever discharge the Company, and its directors,
officers, shareholders, partners, representatives, agents, employees,
predecessors, successors, affiliates, divisions, subsidiaries and related
entities and their respective directors, officers, shareholders, agents,
representatives and employees, from all claims of any nature whatsoever waivable
by applicable law, from the beginning of time to the date of the execution of
this Release, known or unknown, suspected or unsuspected, including but not
limited to all claims arising out of, based upon, or relating to my employment
with the Company, or compensation for that employment.  I understand
that the consideration provided for in the Plan exceeds anything of value to
which I am already entitled without the Plan.

       

      Without
limiting the generality of the foregoing, I understand and agree that this
Release includes, but is not limited to, claims based on or relating
to:  (a) any express or implied employment contract; (b) wrongful
discharge; (c) termination in breach of public policy; (d) age discrimination
under the Age Discrimination in Employment Act of 1967, as amended;
(e) claims of discrimination, harassment or retaliation under Title VII of
the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act,
or any other law which prohibits discrimination based on race, color, age,
ancestry, national origin, sex, sexual orientation, religion, mental or physical
disabilities, or marital status; (f) any other federal, state or local laws or
regulations prohibiting employment discrimination; (g) personal injury,
defamation, assault, battery, invasion of privacy, fraud, intentional or
negligent misrepresentation of fact, intentional or negligent infliction of
emotional distress, or false imprisonment; (h) claims for additional wages,
compensation, severance pay or bonuses; and (i) claims for attorneys’ fees or
costs.

       

      I
UNDERSTAND THAT THIS RELEASE COVERS BOTH CLAIMS THAT I KNOW ABOUT AND THOSE THAT
I MAY NOT KNOW ABOUT.

       

      2.           Additional
Issues Associated with Scope of Release.  I understand that I
am only waiving those claims that I have as of the date I sign this Release, and
not any claims that might arise in the future.  I also understand that
this Release does not release or discharge claims that are not waivable by
applicable law.  Also excluded from the scope of this Release are any
rights I have to any vested benefits under the Company’s benefit plans,
including but not limited to the Quicksilver Resources Inc. 401(k)
Plan.  Further, nothing in this Release prohibits me from filing a
charge with the EEOC or participating in an investigation or proceeding of the
EEOC.  However, I am waiving the right to any personal monetary
recovery or other personal relief should the EEOC or any other agency pursue
alleged charges in part or entirely on my behalf.

       

      3.           No
Knowledge of Legal Violations. I
further assert that during my employment with the Company and activities
regarding any company or organization affiliated with the Company, that I have
no information or knowledge of any legal irregularity, violation, or alleged
violation of any law, regulation, statute, or ordinance of any kind resulting
from the operations of the Company, or any other company or organization
affiliated with the Company.  I have never reported any such
irregularity or violation to any superior with respect to the Company or any
company or organization affiliated with the Company.

       

      4.           Advisement
to Consult with an Attorney and Forty-five (45) Day Review
Period.  I acknowledge that I am hereby advised in writing to
consult with an attorney prior to executing this Release to discuss the contents
of this document and its meaning.  I understand that I have forty-five
(45) days after receiving this Release to consider this waiver and release of my
rights.  I understand the terms and conditions of this Release in
full, agree to abide by this, and knowingly and voluntarily execute it without
hidden reservations.

       

      5.           Seven
(7) Day Revocation Period. I
understand that I will have seven (7) days after I sign this Release during
which I can revoke my signature and cancel my acceptance of the benefits under
the Plan for any reason, and that this Release shall not become effective or
enforceable until after this revocation period has expired.  I
understand that I may revoke or rescind this Release by providing written notice
of revocation to the Company’s General Counsel,  [name, address, fax
number], within the 7-day revocation period.  I understand that I will
not be entitled to any severance benefits under the Plan until the end of the
7-day revocation period.

       

      6.           Receipt
of Disclosures.  I acknowledge that I have received the
Disclosures that are attached to this Release as Exhibit 1.

       

      7.           Governing
Law.  The provisions of the Plan and this Release shall be
construed, administered and governed under the laws of the State of Texas and,
to the extent applicable, the laws of the United States.

       

      [8.           Continuing
Obligations After Separation from Employment.  I
agree that before and after my separation from employment, I will continue to
abide by any Company policies and procedures relating to confidentiality,
inventions, non-disclosure and/or other employment obligations that survive the
termination of my employment.  I agree that I will continue to be
bound by all post-employment obligations as required by the Company’s policies
and procedures or as required in any other written agreement between myself and
the Company.  I agree that the Plan and this Release do not affect or
diminish in any manner any of my post-employment obligations to the Company,
including, but not limited to, those specifically described within this
Release.]1

       

      [9.           Entire
Agreement. I
understand that the Plan and this Release contain the entire agreement and
understanding between me and the Company regarding my employment and separation
from that employment and that no other covenants or promises have been made
except those contained in the Plan and this Release.  The Plan and
this document supersede all other agreements and arrangements between the
Company and me, whether written or oral.]2

       

      10.           Attorneys’
Fees. I
further agree I am fully responsible for any attorneys’ fees incurred by me in
consulting with an attorney of my choice in connection with my review or
execution of this document.

       

      11.           Severability. I
agree that should any court or arbitrator determine that any clause, sentence,
provision, paragraph, or part of this Release is illegal, invalid, or
unenforceable, that court’s or arbitrator’s determination shall not affect,
impair, or invalidate the remainder of the Release, and the remainder of the
Release will remain in full force and effect.

       

      12.           Headings. I
understand that all headings used in this Release are intended for convenience
and reference only and do not in any manner amplify, limit, modify or amend the
Release.  A court or arbitrator shall not use any headings in the
construction or interpretation of any section of the Release.

      
         

        EXECUTED
in multiple originals this     day of ____,
________.

         

        
          
            	 	Signature of
      Employee	 
	 	 	 
	 	 	 
	 	WITNESS 	 


          

        

         

        NON-REVOCATION
STATEMENT

         

        I, _______________, acknowledge that at least seven (7)
days have expired since the execution of the Release Agreement by me on the
_____ day of _____, _____, and I knowingly and voluntarily elect not to revoke
this waiver and release of my rights under the Age Discrimination in Employment
Act, as amended, 29 U.S.C. § 621 et
seq.

         

        EXECUTED
in multiple originals this  day of ____, ________.

         

        
          
            
              	 	Signature of
      Employee	 
	 	 	 


            

          

           

          
            
 

        

      

      
        1
Note:  This provision should refer to any post-employment obligations
by specific policy name or agreement name, where applicable.  Seek
guidance from legal department.

      

        

        2
Note:  Before using this form, managers must first consider whether
any of the individuals who are asked to sign this agreement have any other
contracts or written agreements with the Company.  In such a case, it
is imperative that you seek guidance from the legal
department.

         

      

      
        
          
             

          

          
             

            
              
 

          

          
             

          

        

        Exhibit 1

         

      

      45-DAY
WAIVER

       

      DISCLOSURES

       

      Covered
Class of Employees, Eligibility and Time
Limits.

       

      The
individuals selected to participate in the Plan are those employees of
___________ (Company) who incur Involuntary Terminations as defined in the
Quicksilver Resources Inc. Amended and Restated Executive Change in Control
Retention Incentive Plan (the “Plan”).  This program will end on the
date of _________.

       

      Eligible
Employees.

       

      The
following is a list of the job titles and ages of all employees who are
eligible to
participate in the Plan:

       


       

      
        	 	
                Job
      Title

              	 	
                Age

              	 
	 	
                Hourly

              	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 


      

       

      Employees
Not Eligible.

       

      The
following is a list of the ages of employees who are not eligible to participate
in the Plan:

       

      
         

        
          	 	
                  Job
      Title

                	 	
                  Age

                	 
	 	
                  Hourly

                	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 


        

         

      

      
        
           

        

        
           

          
            
 

        

        
           

        

      

      Exhibit B

       

      
        QUICKSILVER
RESOURCES INC.

        AMENDED
AND RESTATED

        EXECUTIVE

        CHANGE
IN CONTROL RETENTION INCENTIVE PLAN

      

       

      List
of Executives of Quicksilver Resources Inc.