FAIR MARKET VALUE DETERMINED IN
GOOD FAITH BY THE ADMINISTRATOR AND SUCH DETERMINATION SHALL BE CONCLUSIVE AND
BINDING ON ALL PERSONS.
2.20
"INCUMBENT DIRECTORS" MEANS INDIVIDUALS WHO, ON
THE EFFECTIVE DATE, CONSTITUTE THE BOARD, PROVIDED THAT ANY INDIVIDUAL BECOMING
A DIRECTOR SUBSEQUENT TO THE EFFECTIVE DATE WHOSE ELECTION OR NOMINATION FOR
ELECTION TO THE BOARD WAS APPROVED BY A VOTE OF AT LEAST TWO-THIRDS OF THE
INCUMBENT DIRECTORS THEN ON THE BOARD (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) SHALL BE AN INCUMBENT
DIRECTOR.
NO INDIVIDUAL INITIALLY ELECTED OR NOMINATED AS A DIRECTOR AS A
RESULT OF AN ACTUAL OR THREATENED ELECTION CONTEST WITH RESPECT TO DIRECTORS OR
AS A RESULT OF ANY OTHER ACTUAL OR THREATENED SOLICITATION OF PROXIES BY OR ON
BEHALF OF ANY PERSON OTHER THAN THE BOARD SHALL BE AN INCUMBENT DIRECTOR.
2.21
"NON-EMPLOYEE DIRECTOR" MEANS A DIRECTOR WHO IS A
"NON-EMPLOYEE DIRECTOR" WITHIN THE MEANING OF RULE 16B-3.
2.22
"OFFICER" MEANS A PERSON WHO IS AN OFFICER OF THE
COMPANY WITHIN THE MEANING OF SECTION 16 OF THE EXCHANGE ACT AND THE RULES AND
REGULATIONS PROMULGATED THEREUNDER.
2.23
"PARTICIPANT" MEANS A PERSON TO WHOM AN AWARD IS
GRANTED PURSUANT TO THE PLAN OR, IF APPLICABLE, SUCH OTHER PERSON WHO HOLDS AN
OUTSTANDING AWARD.
2.24
"PLAN" MEANS THIS KEY ENERGY SERVICES, INC. 2006
PHANTOM SHARES PLAN.
2.25
"RESTRICTED PERIOD" HAS THE MEANING SET FORTH IN
SECTION 7.1(A).
2.26
"PHANTOM SHARE" MEANS A NOTATIONAL UNIT WITH THE
VALUE OF ONE SHARE OF COMMON STOCK ON ANY GIVEN DATE AND ANY OTHER SECURITIES
INTO WHICH SUCH SHARE IS CHANGED OR FOR WHICH SUCH SHARE IS EXCHANGED ("SHARE").
2.27
"RULE 16B-3" MEANS RULE 16B-3 PROMULGATED UNDER
THE EXCHANGE ACT OR ANY SUCCESSOR TO RULE 16B-3, AS IN EFFECT FROM TIME TO TIME.
4
3.
ADMINISTRATION.
3.1
ADMINISTRATION BY BOARD.
THE PLAN SHALL BE
ADMINISTERED BY THE BOARD UNLESS AND UNTIL THE BOARD DELEGATES ADMINISTRATION TO
A COMMITTEE, AS PROVIDED IN SECTION 3.5.
3.2
POWERS OF ADMINISTRATOR.
THE ADMINISTRATOR
SHALL HAVE THE POWER AND AUTHORITY TO SELECT AND GRANT TO PARTICIPANTS AWARDS
PURSUANT TO THE TERMS OF THE PLAN.
3.3
SPECIFIC POWERS.
IN PARTICULAR, THE
ADMINISTRATOR SHALL HAVE THE AUTHORITY: (A) TO CONSTRUE AND INTERPRET THE PLAN
AND APPLY ITS PROVISIONS; (B) TO PROMULGATE, AMEND, AND RESCIND RULES AND
REGULATIONS RELATING TO THE ADMINISTRATION OF THE PLAN; (C) TO AUTHORIZE ANY
PERSON TO EXECUTE, ON BEHALF OF THE COMPANY, ANY INSTRUMENT REQUIRED TO CARRY
OUT THE PURPOSES OF THE PLAN; (D) TO DELEGATE ITS AUTHORITY TO ONE OR MORE
OFFICERS OF THE COMPANY WITH RESPECT TO AWARDS THAT DO NOT INVOLVE "INSIDERS"
WITHIN THE MEANING OF SECTION 16 OF THE EXCHANGE ACT; (E) TO DETERMINE WHEN
AWARDS ARE TO BE GRANTED UNDER THE PLAN AND THE APPLICABLE DATE OF GRANT;
(F) FROM TIME TO TIME TO SELECT, SUBJECT TO THE LIMITATIONS SET FORTH IN THIS