chk06162009_10114.htm


    

      Exhibit
10.1.14

      CHESAPEAKE
ENERGY CORPORATION

      AMENDED
AND RESTATED LONG TERM INCENTIVE PLAN

       

          1 .  PURPOSE

       

          Section 1.1 Background.  The
original Long Term Incentive Plan was approved by shareholders on June 10, 2005,
and amendments to the Plan were approved by shareholders on June 9, 2006, June
8, 2007, June 6, 2008 and June 12, 2009.

       

          Section
1.2 Purpose.  This Long
Term Incentive Plan is established by Chesapeake Energy Corporation (the
“Company”) to foster and promote the sustained progress, growth and
profitability of the Company by:

       

      (a) Attracting,
retaining and motivating Employees, Non-Employee Directors and
Consultants;

       

      (b) allowing
Employees, Non-Employee Directors and Consultants to acquire a proprietary and
vested interest in the growth and performance of the Company;

       

      (c) providing
incentives and rewards to Employees, Non-Employee Directors and Consultants who
are in a position to contribute materially to the success and long-term
objectives of the Company; and

       

      (d) aligning
the financial interests of Employees, Non-Employee Directors and Consultants
with those of the Company’s shareholders.

       

          Section
1.3 Effective
Date.  The
Plan was effective as of October 1, 2004.  The authority to issue
Awards under the Plan will terminate on September 30, 2014 and the remaining
terms of the Plan will continue in effect thereafter until all matters relating
to the exercise and settlement of Awards and administration of the Plan have
been completed.

       

          2 .  DEFINITIONS

       

          Section
2.1 “Affiliated Entity” means any
partnership or limited liability company in which a majority of voting power
thereof is owned or controlled, directly or indirectly, by the Company or one or
more of its Subsidiaries or Affiliated Entities or a combination
thereof.

       

          Section
2.2 “Appreciation” means, with
respect to a SAR (as hereafter defined), the amount by which the Fair Market
Value of a share of Common Stock on the date of exercise of the SAR exceeds
either (i) the exercise price of the Option to which a tandem SAR relates, in
the case of a tandem SAR, or (ii) the Fair Market Value of a share of Common
Stock on the Date of Grant of the SAR, in the case of a stand-alone
SAR.

       

          Section
2.3 “Award” means, individually
or collectively, any Option, SAR, Performance Share, Restricted Stock, Other
Stock Award  or Cash Award granted under the Plan to an Eligible
Person pursuant to such terms, conditions, restrictions, and/or limitations, if
any, as the applicable Committee may establish by the Award Agreement or
otherwise.

       

          Section
2.4 “Award Agreement” means any
written or electronic instrument that establishes the terms, conditions,
restrictions, and/or limitations applicable to an Award in addition to those
established by this Plan and by the Committee’s exercise of its administrative
powers.

       

          Section
2.5 “Board” means the Board of
Directors of the Company.

       

          Section
2.6 “Cash Award” means a cash
bonus granted by the Committee to a Participant pursuant to Section
8.

       

          Section
2.7 “Change of Control” means the
occurrence of any of the following:

          

      
      

       

      
        	 	    (i)           the
      acquisition by any individual, entity or group (within the meaning of
      Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of
      beneficial ownership (within the meaning of Rule 13d-3 promulgated under
      the Exchange Act) of 30% or more of either (A) the then outstanding shares
      of common stock of the Company (the “Outstanding Company Common Stock”) or
      (B) the combined voting power of the then outstanding voting securities of
      the Company entitled to vote generally in the election of directors (the
      “Outstanding Company Voting Securities”).  For purposes of this
      Section 2.7 the following acquisitions by a Person will not constitute a
      Change of Control: (1) any acquisition directly from the Company; (2) any
      acquisition by the Company; (3) any acquisition by any employee benefit
      plan (or related trust) sponsored or maintained by the Company or any
      corporation controlled by the Company; or (4) any acquisition by any
      corporation pursuant to a transaction which complies with clauses (A), (B)
      and (C) of paragraph (iii) below;
	 	 
	 	    (ii)           the
      individuals who, as of the date hereof, constitute the board of directors
      (the “Incumbent Board”) cease for any reason to constitute at least a
      majority of the board of directors.  Any individual becoming a
      director subsequent to the date hereof whose election, or nomination for
      election by the Company’s shareholders, is approved by a vote of at least
      a majority of the directors then comprising the Incumbent Board will be
      considered a member of the Incumbent Board as of the date hereof, but any
      such individual whose initial assumption of office occurs as a result of
      an actual or threatened election contest with respect to the election or
      removal of directors or other actual or threatened solicitation of proxies
      or consents by or on behalf of a Person other than the Incumbent Board
      will not be deemed a member of the Incumbent Board as of the date
      hereof;
	 	 
	 	    (iii)           the
      consummation of a reorganization, merger, consolidation or sale or other
      disposition of all or substantially all of the assets of the Company (a
      “Business Combination”), unless following such Business Combination: (A)
      all or substantially all of the individuals and entities who were the
      beneficial owners, respectively, of the Outstanding Company Common Stock
      and Outstanding Company Voting Securities immediately prior to such
      Business Combination beneficially own, directly or indirectly, more than
      60% of, respectively, the then outstanding shares of common stock and the
      combined voting power of the then outstanding voting securities entitled
      to vote generally in the election of directors, as the case may be, of the
      corporation resulting from such Business Combination (including, without
      limitation, a corporation which as a result of such transaction owns the
      Company or all or substantially all of the Company’s assets either
      directly or through one or more subsidiaries) in substantially the same
      proportions as their ownership, immediately prior to such Business
      Combination of the Outstanding Company Common Stock and Outstanding
      Company Voting Securities, as the case may be, (B) no Person (excluding
      any corporation resulting from such Business Combination or any employee
      benefit plan (or related trust) of the Company or such corporation
      resulting from such Business Combination) beneficially owns, directly or
      indirectly, 30% or more of, respectively, the then outstanding shares of
      common stock of the corporation resulting from such Business Combination
      or the combined voting power of the then outstanding voting securities of
      such corporation except to the extent that such ownership existed prior to
      the Business Combination and (C) at least a majority of the members of the
      board of directors of the corporation resulting from such Business
      Combination were members of the Incumbent Board at the time of the
      execution of the initial agreement, or of the action of the Board,
      providing for such Business Combination; or
	 	 
	 	    (iv)           the
      approval by the shareholders of the Company of a complete liquidation or
      dissolution of the Company.
	 	 
	 	For Executive
      Officers, a Change of Control means the occurrence of any of the foregoing
      events; provided, however, if a change of control is defined in any
      Executive Officer’s employment agreement with the Company, a Change of
      Control with respect to any Award granted to such Executive Officer under
      the Plan shall mean any of the events described in the definition of
      change of control in such Executive Officer’s employment agreement in
      force at the time of determination.


      

       

          Section
2.8 “Code” means the Internal
Revenue Code of 1986, as amended.  Reference in the Plan to any
Section of the Code shall be deemed to include any amendments or successor
provisions to such Section and any regulations under such Section.

       

          Section
2.9 “Committee” means the
Compensation Committee of the Board (or any successor committee) or any other
committee designated by the Board.

       

          Section
2.10 “Common Stock” means the
common stock, par value $.01 per share, of the Company and, after substitution,
such other stock as shall be substituted therefor as provided in Section 3.3(b)
of the Plan.

       

          Section
2.11  “Consultant” means any
person who is engaged by the Company, a Subsidiary or an Affiliated Entity to
render consulting or advisory services.

       

          Section
2.12 “Date of Grant” means the
date on which the grant of an Award is made by the Committee.

       

          Section
2.13 “Disability” has the meaning
set forth in Section 409(A)(a)(2)(C) of the Code.

       

          Section
2.14 “Eligible Person” means any
Employee, Non-Employee Director, or Consultant.

       

          Section
2.15 “Employee” means any employee
of the Company, a Subsidiary or an Affiliated Entity or any person to whom an
offer of employment with the Company, a Subsidiary or an Affiliated Entity is
extended, as determined by the Committee.

       

          Section
2.16  “Exchange Act” means
the Securities Exchange Act of 1934, as amended.

       

          Section
2.17 “Executive Officer
Participants” means Participants who are subject to the provisions of
Section 16 of the Exchange Act with respect to the Common Stock.

       

          Section
2.18 “Fair Market Value” means, as
of any day, the closing price of the Common Stock on such day (or on the next
preceding business day, if such day is not a business day or if no trading
occurred on such day) as reported on the New York Stock Exchange or on such
other securities exchange or reporting system as may be designated by the
Committee.  In the event that the price of a share of Common Stock
shall not be so reported, the Fair Market Value of a share of Common Stock shall
be determined by the Committee in its absolute discretion.

       

          Section
2.19 “Incentive Stock Option”
means an Option within the meaning of Section 422 of the Code.

       

          Section
2.20 “Non-Executive Officer
Participants” means Participants who are not subject to the provisions of
Section 16 of the Exchange Act.

       

          Section
2.21  “Non-Employee Director” shall
have the meaning set forth in Rule 16b-3, or any successor rule, promulgated
under Section 16 of the Exchange Act.

       

          Section
2.22 “Nonqualified Stock Option”
means an Option to purchase shares of Common Stock which is not an Incentive
Stock Option within the meaning of Section 422(b) of the Code.

       

          Section
2.23 “Option” means an Incentive
Stock Option or Nonqualified Stock Option.

       

          Section
2.24 “Other Stock Award” means any
right granted to a Participant by the Committee under Section 7 of the
Plan.

       

          Section
2.25 “Participant” means an
Eligible Person to whom an Award has been granted by the Committee under the
Plan.

       

          Section
2.26 “Performance Award” means any
award of Performance Shares granted by the Committee under Section 6 of the
Plan.

       

          Section
2.27 “Performance Measures” means
the Company’s achievement of target levels of earnings per share, share price,
net income, cash flows, reserve additions or replacements, production volume,
finding costs, operating costs, overhead or other costs, drilling results,
acquisitions and divestitures, risk management activities, return on equity,
total or comparative shareholder return, a combination of or interrelationship
among any of the foregoing, or other criteria, as determined by the
Committee.

       

          Section
2.28 “Performance Share” means the
Common Stock subject to a Performance Award granted under Section 6 of the Plan,
which may be delivered to the Participant upon the achievement of such
performance goals during the Performance Period as specified by the
Committee.

       

          Section
2.29 “Plan" means the Chesapeake
Energy Corporation Long Term Incentive Plan.

       

          Section
2.30 “Restricted Stock” means the
Common Stock issued under Section 5 which is subject to any restrictions that
the Committee, in its discretion, may impose.

       

          Section
2.31  “SAR” means a Stock
Appreciation Right.

       

          Section
2.32 “Shareholder Approval” means
approval by the holders of a majority of the outstanding shares of Common Stock,
present or represented and entitled to vote at a meeting called for such
purposes.

       

          Section
2.33 “Stock Appreciation Right”
means a right, granted under Section 4, to an amount in Common Stock
equal to any increase in the Fair Market Value of the Common Stock between the
date on which the Stock Appreciation Right is granted and the date on which the
right is exercised.

       

          Section
2.34 “Subsidiary” shall have the
same meaning set forth in Section 424(f) of the Code.

       

      


       

      


       

          3 .  ADMINISTRATION

       

          Section
3.1 Administration
of the Plan; the Committee.  The
Compensation Committee shall have overall authority to administer the
Plan.  The Board may designate another committee or committees to
administer the Plan with respect to Non-Executive Officer Participants, subject
to any terms or conditions established by the Committee.  Hereafter,
“Committee” shall mean the Compensation Committee, except when used in reference
to Awards granted to Non-Executive Officer Participants, “Committee” shall mean
any applicable committee designated by the Board.

       

          Unless
otherwise provided in the bylaws of the Company or resolutions adopted from time
to time by the Board establishing the Committee, the Board may from time to time
remove members from, or add members to, the Committee.  Vacancies on
the Committee, however caused, shall be filled by the Board.  The
Committee shall hold meetings at such times and places as it may
determine.  A majority of the Committee shall constitute a quorum, and
the acts of a majority of the members present at any meeting at which a quorum
is present shall be the valid acts of the Committee.  Any action which
may be taken at a meeting of the Committee may be taken without a meeting if all
the members of the Committee consent to the action in writing. Although the
Committee is generally responsible for the administration of the Plan, the Board
in its sole discretion may take any action under the Plan that would otherwise
be the responsibility of the Committee, except as such action pertains to the
administration of Awards to Non-Employee Directors.

      


       

      Subject
to the provisions of the Plan, the Committee shall have the authority
to:

       

      (a) Select
the Eligible Persons to participate in the Plan.

       

      (b) Determine
the time or times when Awards will be granted.

       

      (c) Determine
the form of Award, the number of shares of Common Stock subject to any Award,
all the terms, conditions (including performance requirements), restrictions
and/or limitations, if any, of an Award, including the time and conditions of
exercise or vesting, and the terms of any Award Agreement, which may include the
waiver or amendment of prior terms and conditions or acceleration of the vesting
or exercise of an Award under certain circumstances determined by the Committee
(subject to Section 10.2 of the Plan).  However, nothing in this
Section 3.1 shall be construed to permit the repricing of any outstanding Award
in violation of Section 4.3.

       

      (d) Determine
whether Awards will be granted singly or in combination.

       

      (e) Determine
whether, to what extent and under what circumstances Awards may be settled in
cash or Common Stock.

       

      (f) Determine
whether any conditions applicable to an Award have been met and whether an Award
will be paid at the end of a Performance Period.

       

      (g) Employ
attorneys, consultants, accountants and other advisors as deemed necessary or
appropriate by the Committee.

       

      (h) Take any
and all other action it deems necessary or advisable for the proper operation or
administration of the Plan.

       

          Section
3.2 Committee
to Make Rules and Interpret Plan.  The
Committee in its sole discretion shall have the authority, subject to the
provisions of the Plan, to establish, adopt, or revise such rules and
regulations and to make all such determinations relating to the Plan as it may
deem necessary or advisable for the administration of the Plan. The Committee’s
interpretation of the Plan or any Awards granted pursuant hereto and all
decisions and determinations by the Committee with respect to the Plan shall be
final, binding, and conclusive on all parties, unless otherwise determined by
the Board.

       

          Section
3.3 Shares
Subject to the Plan.  Subject
to adjustment as provided in paragraph (b) below and subject to Section 3.4, the
aggregate number of shares of Common Stock which are available for Awards under
the Plan will not exceed thirty-one million, five hundred thousand (31,500,000)
shares.  Any of the authorized shares of Common Stock may be used for
any of the types of Awards described in the Plan, except that no more than
3,000,000 shares of Common Stock may be issued pursuant to Incentive Stock
Options.  Common Stock delivered pursuant to an Award under the Plan
may consist, in whole or in part, of authorized and unissued shares or treasury
shares.  The Committee, in its sole discretion, shall determine the
manner in which fractional shares arising under this Plan are
treated.  Additional restrictions or adjustments with respect to
shares subject to the Plan are as follows:

       

      (a) Subject
to (b) below, the aggregate number of shares of Common Stock pursuant to Options
and SARs granted to any Employee or Non-Employee Director in any calendar year
under this Plan may not exceed 10% of the shares subject to the Plan and the
aggregate number of shares of Common Stock pursuant to Restricted Stock,
Performance Awards and Other Stock Awards granted to any Employee or
Non-Employee Director in any calendar year may not exceed 10% of the shares
subject to the Plan.

       

      (b) In the
event that the shares of Common Stock, as presently constituted, shall be
changed into or exchanged for a different number or kind or shares of stock or
other securities of the Company or of another corporation (whether by reason of
merger, consolidation, recapitalization, reclassification, stock split,
combination of shares or other corporate event of similar nature), or if the
number of such shares of Common Stock shall be increased through the payment of
a stock dividend, then there shall be substituted for or added to each share
available under and subject to the Plan as provided herein, the number and kind
of shares of stock or other securities into which each outstanding share of
Common Stock shall be so changed or for which each such share shall be exchanged
or to which each such share shall be entitled, as the case may be, to reflect
any increase or decrease in the number of, or change in the kind or value of,
issued shares of Common Stock to preclude, to the extent practicable, the
enlargement or dilution of rights under such Awards.  In the event
there shall be any other change in the number or kind of the outstanding shares
of Common Stock, or any stock or other securities into which the Common Stock
shall have been changed or for which it shall have been exchanged, then if the
Committee shall, in its sole discretion, determine that such change equitably
requires an adjustment in the shares available under and subject to the Plan, or
in any Award theretofore granted or which may be granted under the Plan, such
adjustments shall be made in accordance with such determination.

       

      No fractional shares of Common Stock or
units of other securities shall be issued pursuant to any such adjustment, and
any fractions resulting from any such adjustment shall be eliminated in each
case by rounding downward to the nearest whole share.

       

          Section
3.4 Share
Counting.  The
following shares of Common Stock related to Awards will be available for
issuance again under the Plan:

       

      (a) Common
Stock related to Awards paid in cash;

       

      (b) Common
Stock related to Awards that expire, are forfeited or cancelled or terminate for
any other reason without the delivery of the Common Stock;

       

      (c) Common
Stock equal in number to the shares of Common Stock surrendered in payment of
the exercise price of an Option; and

       

      (d) Common
Stock tendered or withheld in order to satisfy withholding tax
obligations.

       

          4 .  STOCK
OPTIONS AND STOCK APPRECIATION RIGHTS

       

          Section
4.1 Grant
of Options and SARs.  The Committee
may, from time to time, subject to the provisions of the Plan and such other
terms and conditions as it may determine, grant Nonqualified Stock Options and
Stock Appreciation Rights (SARs) to Eligible Persons and Incentive Stock Options
to Employees.  SARs may be granted either alone or in tandem with
concurrently or previously issued Options.  Each grant of an Option or
SAR shall be evidenced by an Award Agreement executed by the Company and the
Participant, and shall contain such terms and conditions and be in such form as
the Committee may from time to time approve, subject to the requirements of
Section 4.2.

       

          Section
4.2 Conditions
of Options and SARs.  Each
Option and SAR so granted shall be subject to the following
conditions:

       

      (a) Exercise Price.  As
limited by Section 4.2(e) below, the Award Agreement for each Option and SAR
shall state the exercise price set by the Committee on the Date of
Grant.  No Option or SAR shall be granted at an exercise price which
is less than the Fair Market Value of the Common Stock on the Date of
Grant.

       

      (b) Exercise of Options and
SARs.  Options and SARs granted under the Plan shall be
exercisable, in whole or in such installments and at such times, and shall
expire at such time, as shall be provided by the Committee in the Award
Agreement.  An SAR issued in tandem with an Option is only exercisable
to the extent the related Option is exercisable and is subject to the conditions
applicable to such Option.  When a tandem SAR is exercised, the Option
to which it relates shall cease to be exercisable to the extent of the number of
shares with respect to which the tandem SAR is exercised.  Similarly
when the Option is exercised, the tandem SARs relating to the shares covered by
such Option exercise shall terminate.

       

      (c) Form of
Payment.  The payment of the exercise price of an Option by the
Participant shall be made in cash, shares of Common Stock, a combination thereof
or in such other manner as the Committee may specify in the applicable Award
Agreement.  The payment of the Appreciation associated with the
exercise of a SAR shall be made by the Company in shares of Common
Stock.

       

      (d) Term of Option or
SAR.  The term of an Option or SAR shall be determined by the
Committee and specified in the applicable Award Agreement, except that no Option
or SAR shall be exercisable after the expiration of ten years from the Date of
Grant.

       

      (e) Special Restrictions Relating to
Incentive Stock Options.  Options issued in the form of
Incentive Stock Options shall only be granted to Employees of the Company or a
Subsidiary and not to Employees of an Affiliated Entity unless such entity is
classified as a “disregarded entity” of the Company or the applicable Subsidiary
under the Code.  In addition to being subject to all applicable terms,
conditions, restrictions and/or limitations established by the Committee,
Options issued in the form of Incentive Stock Options shall comply with the
requirements of Section 422 of the Code (or any successor Section thereto),
including, without limitation, the requirement that the exercise price of an
Incentive Stock Option not be less than 100% of the Fair Market Value of the
Common Stock on the Date of Grant, the requirement that each Incentive Stock
Option, unless sooner exercised, terminated or canceled, expire no later than
ten years from its Date of Grant, and the requirement that the aggregate Fair
Market Value (determined on the Date of Grant) of the Common Stock with respect
to which Incentive Stock Options are exercisable for the first time by a
Participant during any calendar year (under this Plan or any other plan of the
Company or any Subsidiary) not exceed $100,000.  Incentive Stock
Options which are in excess of the applicable $100,000 limitation will be
automatically recharacterized as Nonqualified Stock Options.  No
Incentive Stock Options shall be granted to any Employee if, immediately before
the grant of an Incentive Stock Option, such Employee owns more than 10% of the
total combined voting power of all classes of stock of the Company or its
Subsidiaries (as determined in accordance with the stock attribution rules
contained in Sections 422 and 424(d) of the Code) unless  the exercise
price is at least 110% of the Fair Market Value of the Common Stock subject to
the Incentive Stock Option, and such Incentive Stock Option by its terms is
exercisable no more than five years from the date such Incentive Stock Option is
granted.

       

      (f) Shareholder
Rights.  No Participant shall have any rights as a shareholder
with respect to any share of Common Stock subject to an Option or SAR prior to
the purchase or receipt of such share of Common Stock by exercise of the Option
or SAR.  In addition, no Option or SAR granted under the Plan shall
include any dividend equivalents.

       

          Section
4.3 No
Repricing.  Except for adjustments made pursuant to Section
3.3(b), in no event will the Committee, without first obtaining Shareholder
Approval, (i) decrease the exercise price of an Option or SAR after the Date of
Grant; (ii) accept for surrender to the Company any outstanding Option or SAR
granted under the Plan as consideration for the grant of a new Option or SAR
with a lower exercise price; or (iii) repurchase from Participants any
outstanding Options or SARs that have an exercise price per share higher than
the then current Fair Market Value of a Share.

       

          5 .  RESTRICTED
STOCK AWARDS

       

          Section
5.1 Grant
of Restricted Stock.  The
Committee may, from time to time, subject to the provisions of the Plan and such
other terms and conditions as it may determine, grant Restricted Stock to any
Eligible Person.  Restricted Stock shall be awarded in such number,
for such purchase price (if any) and at such times during the term of the Plan
as the Committee shall determine.  Each grant of Restricted Stock
shall be evidenced by an Award Agreement executed by the Company and the
Participant, and shall contain such terms and conditions and be in such form as
the Committee may from time to time approve, subject to the requirements of
Section 5.2.  Restricted Stock issued pursuant to a Restricted Stock
Award may be evidenced in such manner as the Committee deems appropriate,
including, without limitation, a book-entry registration or issuance of a stock
certificate or certificates into escrow until the restrictions associated with
such Award are satisfied.

       

          Section
5.2 Conditions
of Restricted Stock Awards.  The
grant of Restricted Stock shall be subject to the following:

       

      (a) Restriction
Period.  Each Restricted Stock Award shall require the holder
to remain in the employment or otherwise be classified as an Eligible Person (or
in the case of a Non-Employee Director, remain a director or consultant or be
classified as another category of Eligible Person) of the Company, a Subsidiary,
or an Affiliated Entity for a prescribed period (the “Restriction
Period”).  The Committee shall determine the Restriction Period or
Periods that shall apply to the shares of Common Stock covered by each Award or
portion thereof.  In addition to any time vesting conditions
determined by the Committee, Restricted Stock may be subject to the achievement
by the Company of specified Performance Measures or other individual criteria as
determined by the Committee.  At the end of the Restriction Period,
assuming the fulfillment of any other specified vesting conditions, the
restrictions imposed by the Committee shall lapse with respect to the shares of
Common Stock covered by the Award or portion thereof.

       

      (b) Code Section
162(m).  If the Committee intends for a Restricted Stock Award
to be granted and administered in a manner designed to preserve the
deductibility of the resulting compensation in accordance with Section 162(m) of
the Code, then Performance Measures applicable to such Award shall be
established in writing by the Committee no later than the earlier of (i) 90 days
after the commencement of the relevant Performance Period and (ii) the date as
of which 25% of the Performance Period has elapsed.  The Committee’s
discretion to modify or waive the Performance Measures related to the vesting of
the Award may be restricted in order to comply with Section 162(m).

       

      (c) Forfeiture.  Except
as otherwise determined by the Committee, upon termination of service or
employment during the Restriction Period, all shares of Restricted Stock still
subject to forfeiture shall be forfeited by the Participant and any purchase
price paid by the Participant shall be returned to such
Participant.

       

      (d) Shareholder
Rights.  During any Restriction Period, the Committee may, in
its discretion, grant to or withhold from the holder of Restricted Stock all or
any of the rights of a shareholder with respect to the shares, including, but
not by way of limitation, the right to vote such shares or to receive
dividends.  If any dividends or other distributions are paid in shares
of Common Stock and distributed to the holder of Restricted Stock, all such
shares shall be subject to the same restrictions on transferability as the
shares of Common Stock subject to the Award with respect to which they were
paid.

       

      (e) Minimum Vesting
Condition.  The minimum Restriction Period applicable to any
Restricted Stock that is not subject to performance criteria restricting the
vesting of the Award shall be three years from the Date of Grant (subject to the
provisions of Section 10.2).

       

          6 .  PERFORMANCE
AWARDS

       

          Section
6.1 Grant of Performance
Shares.  The Committee may, from time to time, subject to the
provisions of the Plan and such other terms and conditions as it may determine,
grant Performance Shares to any Eligible Person.  Performance Shares
shall be awarded in such number and at such times during the term of the Plan as
the Committee shall determine.  Each Performance Award shall be
evidenced by an Award Agreement executed by the Company and the Participant, and
shall contain such terms and conditions and be in such form as the Committee may
from time to time approve, subject to the requirements of Section
6.2.

       

          Section
6.2 Conditions of Performance
Awards.  The grant of Performance Shares shall be subject to
the following:

       

      (a) Performance
Period.  Performance Shares will be subject to the achievement
of one or more performance goals by the Company or the Participant individually,
measured for a prescribed period (the “Performance Period”), as specified by the
Committee, such Performance Period to be not less than one year in
duration.  Such performance goals may be based upon the Company’s
achievement of Performance Measures or other individual criteria.

       

      (b) Code Section
162(m).  If the Committee intends for a Performance Award to be
granted and administered in a manner designed to preserve the deductibility of
the resulting compensation in accordance with Section 162(m) of the Code, then
the Performance Measures applicable to such Award shall be established in
writing by the Committee no later than the earlier of (i) 90 days after the
commencement of the relevant Performance Period and (ii) the date as of which
25% of the Performance Period has elapsed.  The Committee’s discretion
to modify or waive the Performance Measures to the vesting of the Award may be
restricted in order to comply with Section 162(m).

       

      (c) Payment Respecting Performance
Shares.  Performance Shares shall be earned to the extent that
their terms and conditions are met, as certified by the
Committee.  The form and timing of payment for Performance Shares
earned shall be determined by the Committee and specified in the Award
Agreement; however, in no event shall the payment for Performance Shares earned
be made on a date that is later than 60 days after the vesting of such
Performance Shares.

       

      (d) Termination of
Employment.  The Committee, in its sole discretion, may (i)
permit a Participant who ceases to be an Eligible Person before the end of any
Performance Period, or the personal representative of a deceased Participant, to
continue to be subject to a Performance Award relative to the current
Performance Period until such Awards are forfeited or earned pursuant to their
terms and conditions or (ii) authorize the payment to such Participant, or the
personal representative of a deceased Participant, of the Performance Shares
which would have been paid to the Participant had the Participant remained an
Eligible Person to the end of the Performance Period.  In the absence
of such permission by the Committee, any unvested Performance Shares shall be
forfeited when a Participant ceases to be an Eligible Person.

       

          7 .  OTHER
STOCK AWARDS

      


          Section 7.1 Grant of Other Stock
Awards.  The Committee may, from time to time, subject to the
provisions of the Plan and such other terms and conditions as it may determine,
specify the terms and provisions of other forms of equity-based or
equity-related awards not described above which the Committee determines to be
consistent with the purpose of the Plan and the interests of the Company, which
awards may provide for cash payments based in whole or in part on the value or
future value of Common Stock, for the acquisition or future acquisition of
Common Stock, or any combination thereof.  Each Other Stock Award
shall be evidenced by an Award Agreement executed by the Company and the
Participant, and shall contain such terms and conditions and be in such form as
the Committee may from time to time approve, subject to the requirements of
Section 7.2.

       

          Section 7.2 Minimum Vesting Condition.
Other Stock Awards subject to performance criteria shall not vest in less than
one year and Other Stock Awards which are subject to time vesting shall not vest
in less than three years.

       

          8 .  CASH AWARDS

      


                The
Committee may, from time to time, subject to the provisions of the Plan and such
other terms and conditions as it may determine, grant to an Eligible Person a
Cash Award (including without limitation, discretionary Awards, Awards based on
objective performance criteria or Awards based on subjective performance
criteria).  Cash Awards shall be awarded in such amount and at such
times during the term of the Plan as the Committee shall determine, provided
however that the total amount of all Cash Awards made under the Plan, in the
aggregate, will not exceed $10 million.  Each Cash Award shall be
evidenced by an Award Agreement executed by the Company and the Participant, and
shall contain such terms and conditions and be in such form as the Committee may
from time to time approve.

       

          9 .  FUNDAMENTAL
TRANSACTION; CHANGE OF CONTROL

      


          Section
9.1 Fundamental
Transaction.  If the Company merges with another entity in a
transaction in which the Company is not the surviving entity or if, as a result
of a merger, other business combination or any other transaction or event, other
securities are substituted for the Common Stock or the Common Stock may no
longer be issued (each, a “Fundamental Transaction”), then notwithstanding any
other provisions of the Plan, (i) all outstanding Options and SARs shall be
fully exercisable and any unexercised Options and SARs shall terminate upon the
closing of the Fundamental Transaction, (ii) restrictions on outstanding
Restricted Stock, Other Stock Awards and Cash Awards shall lapse; and (iii) each
outstanding Performance Award shall be deemed to have achieved a level of
performance that would cause all of the Performance Shares to become
payable.

       

          Section 9.2 Change of
Control.  Notwithstanding any other provisions of the Plan to
the contrary, upon the occurrence of a Change of Control, (i) all outstanding
Options and SARs shall be fully exercisable and any unexercised Options and SARs
shall terminate upon the closing of the Change of Control, (ii) restrictions on
outstanding Restricted Stock, Other Stock Awards and Cash Awards shall lapse;
and (iii) each outstanding Performance Award shall be deemed to have achieved a
level of performance that would cause all of the Performance Shares to become
payable.

       

          10 .  GENERAL

       

          Section
10.1 Amendment
or Termination of Plan.  The
Board may suspend or terminate the Plan at any time.  In addition, the
Board may, from time to time, amend the Plan in any manner, but may not adopt
any amendment without Shareholder Approval if (i) such approval is necessary or
desirable to qualify or comply with any tax or regulatory requirement for which
or with which the Board deems it necessary or desirable to qualify or comply, or
(ii) in the opinion of counsel to the Company, Shareholder Approval is required
by any federal or state laws or regulations or the rules of any stock exchange
on which the common stock may be listed.

       

          Section
10.2 Acceleration
of Awards on Disability, Death, Retirement or Involuntary
Termination.  With
respect to (i) a Participant who ceases to be an Eligible Person due to a
Disability, (ii) the personal representative of a deceased Participant, or
(iii) any other Participant who ceases to be an Eligible Person due to the
Participant’s retirement or involuntary termination (as defined by the
Committee), the Committee, in its sole discretion, may permit the purchase of
all or any part of the shares subject to any unvested Option or waive the
vesting requirements of any Award on the date the Participant ceases to be an
Eligible Person due to a Disability, death, retirement or involuntary
termination.  With respect to Options which have already vested at
such date or the vesting of which is accelerated by the Committee in accordance
with the foregoing provision, the Participant or the personal representative of
a deceased Participant shall have the right to exercise such vested Options
within such period(s) as the Committee shall determine. The purchase
of all or any part of the shares subject to any unvested Option or the waiver
the vesting requirements of any Award on the date the Participant ceases to be
an Eligible Person due to an involuntary termination pursuant to this Section
10.2 will be limited to 5% of the aggregate number of shares of Common Stock
which are available for Awards under the Plan pursuant to Section 3.3 of the
Plan. 

       

          Withholding
Taxes.  A
Participant must pay in cash to the Company the amount of taxes required to be
withheld by law upon the exercise of an Option.  Required withholding
taxes associated with Restricted Stock, Performance Shares, Cash or Other Stock
Awards must also be paid in cash unless the Committee requires a Participant to
pay the amount of taxes required by law to be withheld from such Awards by
directing the Company to withhold from any Award the number of shares of Common
Stock having a Fair Market Value on the date of vesting equal to the amount of
required withholding taxes.

       

          Section
10.3 Code Section 83(b)
Elections.  The Company, its Subsidiaries and Affiliated
Entities have no responsibility for a Participant’s election, attempt to elect
or failure to elect to include the value of an Award subject to Section 83 in
the Participant’s gross income for the year of grant pursuant to Section 83(b)
of the Code.  Any Participant who makes an election pursuant to
Section 83(b) will promptly provide the Committee with a copy of the election
form.

       

          Section
10.4 Code Section
162(m).  It is the intent of the Company that the Plan comply
in all respects with Section 162(m) of the Code and that any ambiguities or
inconsistencies in construction of the Plan be interpreted to give effect to
such intention.

       

          Section
10.5 Code Section
409A.  It is the intent of the Company that no Award under the
Plan be subject to Section 409A of the Code.  The Committee shall
design and administer the Awards under the Plan so that they are not subject to
Section 409A of the Code.

       

          Section
10.6 Certain
Additional Payments by the Company.  The
Committee may, in its sole discretion, provide in any Award Agreement for
certain payments by the Company in the event that acceleration of vesting of any
Award under the Plan is subject to the excise tax imposed by Section 4999 of the
Code or any interest or penalties with respect to such excise tax (such excise
tax, interest and penalties, collectively, the “Excise Tax”).  An
Award Agreement may provide that the Participant shall be entitled to receive a
payment (a “Gross-Up Payment”) in an amount such that after payment by the
Participant of all taxes (including any interest or penalties imposed with
respect to such taxes), including any Excise Tax imposed upon the Gross-Up
Payment, the Participant retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon such acceleration of vesting of any Award.

       

          Section
10.7 Non-Transferability.  Subject
to other provisions of the Plan and any applicable Award Agreement, Awards are
not transferable other than by will or the laws of descent and
distribution.  Any attempted sale, transfer, assignment, pledge,
hypothecation or other disposition of, or the levy of execution, attachment or
similar process upon, any Award contrary to the provisions hereof shall be void
and ineffective, shall give no right to any purported transferee, any may, at
the sole discretion of the Committee, result in forfeiture of the Award involved
in such attempt.  The Committee shall impose such other restrictions
and conditions on any shares of Common Stock covered by an Award as it may deem
advisable including, without limitation, restrictions under applicable Federal
or state securities laws, and may legend the certificates representing the
shares of Common Stock subject to the Award to give appropriate notice of such
restrictions.  Notwithstanding the foregoing, an Award held by a
Non-Employee Director may be transferable under certain circumstances as
specified by the Committee in the Award Agreement.

       

          Section
10.8 Non-Uniform
Determinations.  The Committee’s determinations under the Plan,
including without limitation, (i) the determination of the Eligible Persons to
receive Awards, (ii) the form, amount and timing of such Awards, (iii) the terms
and provisions of such Awards, (iv) minimum employment or service periods, and
(v) agreements evidencing the same, need not be uniform and, subject to any
restrictions set forth in the Plan, may be made by the Committee selectively
among Participants who receive, or who are eligible to receive, Awards under the
Plan, whether or not such Participants are similarly situated.

       

          Section
10.9 Leaves of Absence,
Suspensions.  The Committee shall be entitled to make such
rules, regulations and determinations as it deems appropriate under the Plan in
respect of any suspension of employment or leave of absence from the Company
granted to a Participant whether such suspension or leave is paid or unpaid and
whether due to a Disability or otherwise.  Without limiting the
generality of the foregoing, the Committee shall be entitled to determine (i)
whether or not any such suspension or leave of absence shall be treated as if
the Participant ceased to be an employee of the Company and (ii) the impact, if
any, of any such suspension or leave of absence on Awards under the
Plan.

       

          Section
10.10 Participant
Misconduct.  Notwithstanding anything in the Plan to the
contrary, the Committee shall have the authority under the Plan to determine
that in the event of serious misconduct by the Participant (including violations
of employment agreements, confidentiality or other proprietary matters) or any
activity of a Participant in competition with the business of the Company or any
Subsidiary or Affiliated Entity, any outstanding Award granted to such
Participant may be cancelled, in whole or in part, whether or not
vested.  The determination of whether a Participant has engaged in a
serious breach of conduct or any activity in competition with the business of
the Company or any Subsidiary or Affiliated Entity shall be determined by the
Committee in good faith and in its sole discretion.  This Section
10.11 shall have no effect and be deleted from the Plan following a Change of
Control.

       

          Section
10.11 Regulatory
Approval and Listings.  The
Company shall use its best efforts to file with the Securities and Exchange
Commission as soon as practicable following the date this Plan is effective, and
keep continuously effective and usable, a Registration Statement on Form S-8
with respect to shares of Common Stock subject to Awards
hereunder.  Notwithstanding anything contained in this Plan to the
contrary, the Company shall have no obligation to issue or deliver certificates
representing shares of Common Stock evidencing Awards prior to:

       

      (a) the
obtaining of any approval from, or satisfaction of any waiting period or other
condition imposed by, any governmental agency which the Committee shall, in its
sole discretion, determine to be necessary or advisable;

       

      (b) the
listing of such shares on any exchange on which the Common Stock may be listed;
and

       

      (c) the
completion of any registration or other qualification of such shares under any
state or federal law or regulation of any governmental body which the Committee
shall, in its sole discretion, determine to be necessary or
advisable.

       

          Section
10.12 Right
to Continued Employment or Board Membership.  Participation
in the Plan shall not give any Participant any right to remain in the employ of
the Company, a Subsidiary or an Affiliated Entity or any right to remain on the
Board of the Company.  Further, the adoption of this Plan shall not be
deemed to give any Employee, Non-Employee Director or Consultant or any other
individual any right to be granted an Award.

       

          Section
10.13 Other Compensation
Programs.  The existence and terms of the Plan shall not limit
the authority of the Board in compensating Employees and Non-Employee Directors
in such other forms and amounts, including compensation pursuant to any other
plans as may be currently in effect or adopted in the future, as it may
determine from time to time.

       

          Section
10.14 Reliance
on Reports.  Each
member of the Committee and each member of the Board shall be fully justified in
relying or acting in good faith upon any report made by the independent public
accountants of the Company and its Subsidiaries and upon any other information
furnished in connection with the Plan by any person or persons other than the
Committee or Board member.  In no event shall any person who is or
shall have been a member of the Committee or the Board be liable for any
determination made or other action taken or any omission to act in reliance upon
any such report or information, including the furnishing of information, or
failure to act, if in good faith.

       

          Section
10.15 Construction.  The
titles and headings of the sections in the Plan are for the convenience of
reference only, and in the event of any conflict, the text of the Plan, rather
than such titles or headings, shall control.

       

          Section
10.16 Governing
Law, Severability.  The
Plan shall be governed by and construed in accordance with the laws of the State
of Oklahoma except as superseded by applicable federal law.  If any
provision of the Plan is held unlawful or otherwise invalid or unenforceable in
whole or in part, the unlawfulness, invalidity or unenforceability will not
affect any other parts of the Plan, which will remain in full force and
effect.

       

          Section
10.17 Supersession.  Upon
receipt of Shareholder Approval pursuant to Section 1.4, this Plan supersedes
and replaces in all respects the Initial Plan and any Award Agreement issued
pursuant to the Plan after the effective date of this Plan will be governed by
the terms of this Plan and not by the Initial Plan or any other plans or
agreements, oral or otherwise.