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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

                                     Between


                        The Home-Stake Oil & Gas Company

                                       and

                                Robert C. Simpson


                        Effective as of February 5, 1998

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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT


         This Amended and Restated  Employment  Agreement (this  "Agreement") is
amended and restated effective this 5th day of February,  1998, by and among The
Home-Stake  Oil & Gas Company,  an Oklahoma  corporation  (the  "Company"),  and
Robert C. Simpson (the "Executive").

         WITNESSETH:

         WHEREAS, on October 23, 1991, the Company and the Executive executed an
Employment  Agreement (the  "Original  Employment  Agreement"),  effective as of
November 15, 1991; and

         WHEREAS,  the Company and the Executive  desire to change certain terms
and provisions of the Original Employment Agreement and to amend and restate the
same;

         NOW  THEREFORE,  in  consideration  of the  premises and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged,  the parties do hereby amend and restate the  Original  Employment
Agreement to read as follows:

         1.  Introduction.  The  Executive  is  currently  the  Chief  Executive
Officer,  President  and  Treasurer of the Company.  The Company  believes  that
retaining the Executive's services as an employee of the Company and the benefit
of his business  experience are of material  importance.  The Company desires to
encourage the Executive to continue in the employ of the Company for the benefit
of the Company and its  stockholders.  Therefore,  the Company and the Executive
intend by this Agreement to specify the terms and conditions of the  Executive's
employment relationship with the Company.

         2.  Employment.  The  Company  hereby  employs  the  Executive  and the
Executive hereby accepts  employment with the Company upon the terms and subject
to the conditions set forth herein.

         3. Term.  This  Agreement  shall commence on the effective date of this
Agreement and shall continue until terminated.

         4.       Duties and Responsibilities.

                  (a) The Executive  shall serve the Company as Chief  Executive
         Officer,  President  and Treasurer and shall  perform,  faithfully  and
         diligently, the services and functions relating to such offices.



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                  (b)  The  Executive  shall  devote  such of his  entire  time,
         attention,  energies and business efforts to his duties as an executive
         of the  Company  as are  reasonably  necessary  to carry out his duties
         specified in Section 4(a). The Executive  shall not engage in any other
         business  activity  (regardless  of whether such  business  activity is
         pursued for gain, profit or other pecuniary advantage) if such business
         activity would impair the  Executive's  ability to carry out his duties
         hereunder.  This  Section  4(b),  however,  shall not be  construed  to
         prevent the  Executive  from (i)  investing  his  personal  assets as a
         passive investor in such form or manner as will not contravene the best
         interests  of the Company,  (ii)  participating  in various  charitable
         efforts, or (iii) serving as a director or member of a committee of any
         organization when such position has previously been approved in writing
         by the Board of Directors.

         5.       Compensation and other Employee Benefits.

                  As  compensation  for his  services  under  the  terms of this
                  Agreement:

                           (a) the  Executive  shall be paid an annual salary of
                  not less than  $150,000,  payable in accordance  with the then
                  current payroll policies of the Company. Such annual salary is
                  herein referred to as the "Base Salary". The Base Salary shall
                  be reviewed  annually by the Board of  Directors  and shall be
                  subject to  increase  in the sole  discretion  of the Board of
                  Directors.

                           (b)  subject to the right of the  Company to amend or
                  terminate any employee and/or group or executive benefit plan,
                  the  Executive  shall be  entitled  to receive  the  following
                  employee benefits:

                                    (i) The  Executive  shall  have the right to
                           participate in all current or future  employee and/or
                           group benefit plans of the Company that are available
                           to  its  salaried  employees  generally   (including,
                           without limitation,  disability,  accident,  medical,
                           life insurance, parking and hospitalization plans);

                                    (ii) The  Executive  shall have the right to
                           participate in all current executive benefit plans of
                           the  Company,   including  but  not  limited  to  the
                           Company's Key Employee  Incentive  Bonus Plan and The
                           Home-Stake  Oil & Gas Company  Profit  Sharing 401(k)
                           Plan,  all in accordance  with the Company's  regular
                           practices with respect to its executive officers;

                                    (iii) The  Executive  shall be  entitled  to
                           reimbursement   from  the  Company   for   reasonable
                           out-of-pocket  expenses incurred by him in the course
                           of the performance of his duties hereunder;



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                                    (iv) In order to promote  the  interests  of
                           the  Company,  the  Executive  shall be  entitled  to
                           reimbursement  from the Company for all monthly  dues
                           incurred by him in connection  with his membership in
                           Southern Hills Country Club;

                                    (v) The  Executive  shall  have the right to
                           participate  in  any  Company  oil,  gas  or  mineral
                           property acquisition in accordance with the Company's
                           policy  as it may exist  from time to time  regarding
                           employee participation in such acquisitions;

                                    (vi) The Executive shall be entitled to such
                           vacation, holidays and other paid or unpaid leaves of
                           absence as are consistent  with the Company's  normal
                           policies or as are otherwise approved by the Board of
                           Directors; and

                                    (vii) The Executive shall be entitled to the
                           use  of  an  automobile   with  the  costs   thereof,
                           including   acquisition   cost  of  up  to   $30,000,
                           insurance,  license  tag and  maintenance  (excluding
                           gas) to be borne by the  Company.  In the  event  the
                           Executive's employment with the Company is terminated
                           for any  reason,  he shall have the right to purchase
                           the  Company  automobile  he is  then  using  for the
                           lesser of its then book value after  depreciation  as
                           shown on the books and  records of the Company or its
                           fair market value.

         6.       Termination of Employment.

                  (a) Due Cause.  Nothing  herein shall prevent the Company from
         terminating the Executive for "Due Cause" (as hereinafter  defined), in
         which event the Executive  shall be entitled to receive his Base Salary
         on a pro rata  basis to the date of  termination.  In the event of such
         termination for Due Cause,  all other rights and benefits the Executive
         may have under the employee and/or group or executive benefit plans and
         programs of the Company,  generally,  shall be determined in accordance
         with the terms and conditions of such plans and programs. The term "Due
         Cause" shall mean (i) the Executive  has  committed a willful  criminal
         act,  such as  embezzlement,  against the Company  intending  to enrich
         himself at the expense of the Company,  (ii) the  Executive has engaged
         in conduct that has caused serious  injury,  monetary or otherwise,  to
         the  Company as  evidenced  by a binding and final  judgment,  order or
         decree of a court or administrative agency of competent jurisdiction in
         effect after exhaustion of all rights of appeal of the action,  suit or
         proceeding,  (iii) the Executive, in carrying out his duties hereunder,
         has been  guilty of gross  neglect or gross  misconduct,  resulting  in
         either  case in material  harm to the  Company,  or (iv) the  Executive
         fails to carry out his duties in gross  dereliction  of duty and, after
         receiving  notice  to such  effect  from the  Board of  Directors,  the
         Executive fails to cure the existing problem within 30 days.



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                  (b) Death.  In the event of the death of the  Executive,  this
         Agreement [other than this Section 6(b)] shall terminate on the date of
         death and the  estate of the  Executive  shall be  entitled  to (i) the
         Executive's  Base Salary through the end of the month in which he died,
         (ii) a cash payment equal to the pro rata portion  (calculated  through
         the end of the month in which he died) of the annual bonus, if any, due
         the  Executive  in  respect  of the  calendar  year in which  his death
         occurs, and (iii) a continuation, for one year, of the Executive's most
         recent Base Salary.  In the event of such termination due to death, all
         other rights and benefits the  Executive (or his estate) may have under
         the employee  and/or group or executive  benefit  plans and programs of
         the Company,  generally,  as permitted by law,  shall be  determined in
         accordance with the terms and conditions of such plans and programs.

                  (c)      Disability.

                           (1)  For  purposes  of this  Agreement,  "Disability"
                  shall mean the  inability or  incapacity  of the Executive for
                  six months to perform the duties and responsibilities  related
                  to the job or position  with the Company  described in Section
                  4(a), and "the date on which the Disability occurs" shall mean
                  the first day following such six month period.  Such inability
                  or  incapacity   shall  be   documented   to  the   reasonable
                  satisfaction   of  the  Board  of  Directors  by   appropriate
                  correspondence   from   registered    physicians    reasonably
                  satisfactory to the Board of Directors.

                           (2) In the event the Executive  suffers a Disability,
                  this  Agreement  (other than this  Section 6(c) and Sections 7
                  and 8) shall  terminate  on the date on which  the  Disability
                  occurs and the  Executive  shall be  entitled  to (i) his Base
                  Salary through the end of the month in which his employment is
                  terminated due to the Disability, (ii) a cash payment equal to
                  the pro rata portion  (calculated through the end of the month
                  in which his  employment is terminated  due to  Disability) of
                  the annual bonus,  if any, due the Executive in respect of the
                  calendar  year in which  his  Disability  occurs,  and (iii) a
                  continuation,  for one year,  of the  Executive's  most recent
                  Base Salary.

                  (d)  Voluntary  Termination.  The  Executive  may  voluntarily
         terminate his employment  under this Agreement at any time by providing
         at least 90 days' prior written  notice to the Company.  In such event,
         the  Executive  shall be entitled to receive his Base Salary  until the
         date his  employment  terminates  and all other rights and benefits the
         Executive may have under the employee and/or group or executive benefit
         plans and programs of the Company,  generally,  shall be  determined in
         accordance with the terms and conditions of such plans and programs.





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                  (e)      Constructive Termination.

                           (1) If the Company (i)  terminates  the employment of
                  the  Executive  other  than  for Due  Cause  or  because  of a
                  Disability,  (ii) materially changes the Executive's function,
                  duties,  or  responsibilities,  which  change  would cause the
                  Executive's  position  with  the  Company  to  become  of less
                  dignity, responsibility, importance or scope than the position
                  and responsibilities  held by the Executive  immediately prior
                  to such change,  (iii) decreases the  Executive's  Base Salary
                  below the level  provided  for by the terms of Section 5(a) or
                  reduces the employee  benefits and perquisites below the level
                  provided  for by the terms of Section  5(b)  (other  than as a
                  result of any amendment or termination of any employee  and/or
                  group  or  executive   benefit   plan,   which   amendment  or
                  termination  is applicable to all  executives of the Company),
                  or (iv) fails  prior to the  effectiveness  of any  succession
                  (whether   direct   or   indirect,   by   purchase,    merger,
                  consolidation  or  otherwise) to cause any successor to all or
                  substantially all of the business and/or assets of the Company
                  to expressly assume and agree to perform this Agreement in the
                  same manner and to the same  extent that the Company  would be
                  required  to perform if no such  succession  had taken  place,
                  then any such action by the  Company,  unless  consented to in
                  writing by the Executive, shall be deemed to be a constructive
                  termination  by  the  Company  of the  Executive's  employment
                  ("Constructive Termination").

                           (2) In the event of a Constructive Termination,  this
                  Agreement  (other than this Section 6(e) and Sections 7 and 8)
                  shall  terminate on the date of  Constructive  Termination and
                  the Executive shall be entitled to (i) his Base Salary through
                  the end of the  month in which  the  Constructive  Termination
                  occurs,  (ii) an amount  equal to twice the  Executive's  most
                  recent Base  Salary,  and (iii) an amount  equal to the sum of
                  the annual  bonuses  paid the  Executive  in each of the three
                  calendar  years  prior  to the  calendar  year  in  which  the
                  Constructive Termination occurs divided by three.

                           (3) Any amount  payable to the Executive  pursuant to
                  section  6(e)(2)(i) above shall be paid on the last day of the
                  month  in  which  the  Constructive  Termination  occurs.  Any
                  amounts   payable  to  the  Executive   pursuant  to  Sections
                  6(e)(2)(ii)  or  6(e)(2)(iii)  above shall be paid in one cash
                  payment  within  30 days  after the  Constructive  Termination
                  occurs.

                  (f)      Termination from Change in Control.

                           (1) In the event  any of the  following  occurs  with
                  respect  to the  Company:  (i)  any  individual,  corporation,
                  partnership,  group,  association or other entity or "person",
                  as such term is  defined in  Section  14(d) of the  Securities
                  Exchange Act of 1934 (the "Exchange  Act"),  is or becomes the
                  "beneficial owner" (as defined


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                  in Rule 13d-3 of the General Rules and  Regulations  under the
                  Exchange  Act),   directly  or   indirectly,   of  outstanding
                  securities  of the Company  having fifty percent (50%) or more
                  of the  voting  power  of all  classes  of  securities  of the
                  Company  having the right to vote at elections  of  directors,
                  (ii) the  membership  of the Board of Directors of the Company
                  is changed as a result of a contested  election for  Directors
                  so that the nominees for Directors in such election designated
                  by the  then  existing  Board  of  Directors  of  the  Company
                  together  with the members of the existing  Board of Directors
                  previously  proposed by Management but not up for  re-election
                  fail to  constitute a majority of the persons  comprising  the
                  Board of Directors  following such election,  or (iii) merger,
                  liquidation,  dissolution,  consolidation,  reorganization  or
                  reverse  stock  split (as a result of any of which  there is a
                  material change in the control of the Company),  then any such
                  event  shall be  deemed to be a "Change  in  Control."  In the
                  event a  Constructive  Termination  occurs  during  or after a
                  Change in  Control,  a  "Termination  from  Change in Control"
                  shall be deemed to have occurred.

                           (2) In the  event of a  Termination  from  Change  in
                  Control,  then,  in lieu of the  amount  provided  in  Section
                  6(e)(2)(ii)  above,  the  Executive  shall be  entitled  to an
                  amount equal to three times the  Executive's  most recent Base
                  Salary.  Such amount shall be paid in one cash payment  within
                  30 days after the  Termination  from  Change in Control  shall
                  have occurred.

         7.  Effect  of Death  after  Disability,  Constructive  Termination  or
Termination  from Change in Control.  In the event of the death of the Executive
following Disability,  Constructive  Termination,  or Termination from Change in
Control,  any amounts owed pursuant to Sections 6(c)(2),  6(e)(2) and 6(f)(2) to
the Executive prior to his death shall continue to be owing and shall be paid to
the estate of the Executive.

         8.  Continuation of Rights under Plans. In the event of the Executive's
Disability,  all rights and benefits the  Executive  may have under the employee
and/or group or executive benefit plans and programs of the Company,  generally,
as  permitted  by law,  shall be  determined  in  accordance  with the terms and
conditions  of such plans and  programs  as though the  Executive  were still an
employee of the Company until the end of the period of  continuation of the Base
Salary.

         9. Notices.  All notices,  requests,  demands and other  communications
given  under or by reason of this  Agreement  shall be in  writing  and shall be
deemed sufficiently given if delivered in person, sent by certified mail (return
receipt  requested),  postage prepaid,  or delivered by a recognized  commercial
courier to the  following  addresses  (or to such  other  address as a party may
specify by notice pursuant to this provision):




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                  (a)      To the Company:

                           The Home-Stake Oil & Gas Company
                           15 East 5th Street, Suite 2800
                           Tulsa, Oklahoma 74103

                                Attention:    Mr. Chris K. Corcoran
                                              Executive Vice President

                  (b)      To the Executive:

                           Robert C. Simpson
                           4717 S. Wheeling Ave.
                           Tulsa, Oklahoma 74105

         10.  Controlling  Law  and  Performability.  The  execution,  validity,
interpretation  and  performance  of this  Agreement  shall be  governed  by and
construed in accordance with the laws of the State of Oklahoma.

         11.  Arbitration.  Any  dispute  or  controversy  arising  under  or in
connection  with  this  Agreement  shall be  settled  by  arbitration  in Tulsa,
Oklahoma.  In the proceeding,  the Executive  shall select one  arbitrator,  the
Company shall select one  arbitrator  and the two  arbitrators so selected shall
select a third  arbitrator.  The decision of a majority of the arbitrators shall
be binding on the Executive and the Company.  Should one party fail to select an
arbitrator  within five days after notice of the appointment of an arbitrator by
the other party or should the two arbitrators  selected by the Executive and the
Company  fail to  select an  arbitrator  within  ten days  after the date of the
appointment of the last of such two  arbitrators,  any person sitting as a Judge
of the United States District Court for the Northern District of Oklahoma,  upon
application of the Executive or the Company, shall appoint an arbitrator to fill
such space with the same force and  effect as though  such  arbitrator  had been
appointed  in  accordance  with the  second  sentence  of this  Section  11. Any
arbitration  proceeding  pursuant  to this  Section  11  shall be  conducted  in
accordance with the rules of the American Arbitration Association.  Judgment may
be entered on the arbitrators' award in any court having jurisdiction.

         12. Expenses.  The Company shall pay or reimburse the Executive (or his
estate,  as the case may be) for all costs and expenses  (including  arbitration
and court costs and attorneys fees) incurred by the Executive as a result of any
successful  claim,  action or  proceeding  arising  out of, or  challenging  the
validity,  advisability  or  enforceability  of, this Agreement or any provision
hereof.

         13. Entire Agreement and Amendments. This Agreement contains the entire
agreement of the  Executive  and the Company  relating to the matters  contained
herein and supersedes all prior agreements and understandings,  oral or written,
between the Executive and the Company with


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respect to the subject matter  hereof.  This Agreement may be changed only by an
agreement in writing signed by the party against whom enforcement of any waiver,
change, modification, extension or discharge is sought.

         14.  Separability.  If any  provision of this  Agreement is rendered or
declared  illegal or  unenforceable  by reason of any  existing or  subsequently
enacted legislation or by the decision of any arbitrator or by decree of a court
of last resort,  the Executive and the Company shall promptly meet and negotiate
substitute provisions for those rendered or declared illegal or unenforceable to
preserve the original  intent of this Agreement to the extent legally  possible,
but all other  provisions  of this  Agreement  shall  remain  in full  force and
effect.

         15.  Effect of  Agreement.  This  Agreement  shall be binding  upon the
Executive and his heirs,  executors,  administrators,  legal representatives and
assigns and upon the Company and its respective successors and assigns.  Failure
of the Company prior to the  effectiveness of any succession  (whether direct or
indirect, by purchase,  assignment, merger, consolidation or otherwise) to cause
any successor to all or  substantially  all of the business and/or assets of the
Company to  expressly  assume and agree to perform  this  Agreement  in the same
manner and to the same extent  that the Company  would be required to perform if
no such  succession  had taken  place,  shall  entitle the  Executive to certain
compensation from the Company as set forth in Section 6 of this Agreement.

         16. Waiver of Breach. The waiver by either party to this Agreement of a
breach of any  provision of this  Agreement by the other party shall not operate
or be construed as a waiver by such party of any subsequent breach by such other
party.

         IN WITNESS  WHEREOF,  the  Executive and the Company have executed this
Agreement on the date first above written.

"EXECUTIVE"                                "COMPANY"

                                           THE HOME-STAKE OIL & GAS COMPANY


/s/ Robert C. Simpson                      By /s/ Chris K. Corcoran
----------------------------                 --------------------------------
Robert C. Simpson                            Chris K. Corcoran
                                             Executive Vice President



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