Document:

<PAGE>
Centerpoint Energy Houston Electric, LLC
1111 Louisiana
Houston, TX  77002

                                                                 EXHIBIT 4(j)(9)
================================================================================

                    CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC

                                       TO

                               JPMORGAN CHASE BANK
                                     Trustee

                                   ----------

                          EIGHTH SUPPLEMENTAL INDENTURE

                          Dated as of October 10, 2002

                                   ----------

                  Supplementing the General Mortgage Indenture
                          Dated as of October 10, 2002

         THIS INSTRUMENT GRANTS A SECURITY INTEREST BY A PUBLIC UTILITY

           THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS

          This instrument is being filed pursuant to Chapter 35 of the
                        Texas Business and Commerce Code

================================================================================

<PAGE>

EIGHTH SUPPLEMENTAL INDENTURE, dated as of October 10, 2002, between CENTERPOINT
ENERGY HOUSTON ELECTRIC, LLC, a limited liability company organized and existing
under the laws of the State of Texas (herein called the "Company"), having its
principal office at 1111 Louisiana, Houston, Texas 77002, and JPMORGAN CHASE
BANK, a banking corporation duly organized and existing under the laws of the
State of New York, as Trustee (herein called the "Trustee"), the office of the
Trustee at which on the date hereof its corporate trust business is administered
being 600 Travis Street, Suite 1150 Houston, Texas 77002.

                             RECITALS OF THE COMPANY

WHEREAS, the Company has heretofore executed and delivered to the Trustee a
General Mortgage Indenture dated as of October 10, 2002 (the "Indenture")
providing for the issuance by the Company from time to time of its bonds, notes
or other evidence of indebtedness to be issued in one or more series (in the
Indenture and herein called the "Securities") and to provide security for the
payment of the principal of and premium, if any, and interest, if any, on the
Securities; and

WHEREAS, the Company, in the exercise of the power and authority conferred upon
and reserved to it under the provisions of the Indenture and pursuant to
appropriate resolutions of the Manager, has duly determined to make, execute and
deliver to the Trustee this Eighth Supplemental Indenture to the Indenture as
permitted by Sections 201, 301 and 1401 of the Indenture in order to establish
the form or terms of, and to provide for the creation and issuance of, the
Securities specified in clause (8) of the definition of the "Initial Series"
under the Indenture in an initial aggregate principal amount of $100,000,000
(such series being hereinafter and in the Indenture referred to as the "Initial
Series (8)"); and

WHEREAS, all things necessary to make the Securities of the Initial Series (8),
when executed by the Company and authenticated and delivered by the Trustee or
any Authenticating Agent and issued upon the terms and subject to the conditions
hereinafter and in the Indenture set forth against payment therefor the valid,
binding and legal obligations of the Company and to make this Eighth
Supplemental Indenture a valid, binding and legal agreement of the Company, have
been done;

NOW, THEREFORE, THIS EIGHTH SUPPLEMENTAL INDENTURE WITNESSETH that, in order to
establish the terms of a series of Securities, and for and in consideration of
the premises and of the covenants contained in the Indenture and in this Eighth
Supplemental Indenture and for other good and valuable consideration the receipt
and sufficiency of which are hereby acknowledged, it is mutually covenanted and
agreed as follows:

<PAGE>

                                   ARTICLE ONE

                        DEFINITIONS AND OTHER PROVISIONS
                             OF GENERAL APPLICATION

         Section 101. Definitions. Each capitalized term that is used herein and
is defined in the Indenture shall have the meaning specified in the Indenture
unless such term is otherwise defined herein.

                                   ARTICLE TWO

                       TITLE, FORM AND TERMS OF THE BONDS

         Section 201. Title of the Bonds. This Eighth Supplemental Indenture
hereby creates a series of Securities designated as the "General Mortgage Bonds,
Series H, due June 1, 2026" of the Company (collectively referred to herein as
the "Bonds"). For purposes of the Indenture, the Bonds shall constitute a single
series of Securities and may be issued in an unlimited principal aggregate
amount, although the initial issuance of the Bonds shall be in the principal
amount of $100,000,000.

         Section 202. Form and Terms of the Bonds. The form and terms of the
Bonds will be set forth in an Officer's Certificate delivered by the Company to
the Trustee pursuant to the authority granted by this Eighth Supplemental
Indenture in accordance with Sections 201 and 301 of the Indenture.

         Section 203. Treatment of Proceeds of Title Insurance Policy. Any
moneys received by the Trustee as proceeds of any title insurance policy on
Mortgaged Property of the Company shall be subject to and treated in accordance
with the provisions of Section 607(2) of the Indenture (other than the last
paragraph thereof).

                                  ARTICLE THREE

                            MISCELLANEOUS PROVISIONS

The Trustee makes no undertaking or representations in respect of, and shall not
be responsible in any manner whatsoever for and in respect of, the validity or
sufficiency of this Eighth Supplemental Indenture or the proper authorization or
the due execution hereof by the Company or for or in respect of the recitals and
statements contained herein, all of which recitals and statements are made
solely by the Company.

Except as expressly amended and supplemented hereby, the Indenture shall
continue in full force and effect in accordance with the provisions thereof and
the Indenture is in all respects hereby ratified and confirmed. This Eighth
Supplemental Indenture and all of its provisions shall be deemed a part of the
Indenture in the manner and to the extent herein and therein provided.

<PAGE>

This Eighth Supplemental Indenture shall be governed by, and construed in
accordance with, the law of the State of New York.

This Eighth Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument.

<PAGE>

                  IN WITNESS WHEREOF, the parties hereto have caused this Eighth
Supplemental Indenture to be duly executed as of the day and year first above
written.

                                    CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC

                                    By: /s/ Marc Kilbride
                                       -----------------------------------------
                                         Name:  Marc Kilbride
                                         Title:

                                    JPMORGAN CHASE BANK, as Trustee

                                    By: /s/ Rhonda L. Parman
                                       -----------------------------------------
                                         Name:  Rhonda L. Parman
                                         Title: Vice President and Trust Officer

                                 ACKNOWLEDGMENT

STATE OF TEXAS             )
                           )       ss
COUNTY OF HARRIS           )

                  On the 10th day of October 2002, before me personally came
Marc Kilbride, to me known, who, being by me duly sworn, did depose and say that
he resides in Harris County, Texas; that he is the Vice President and Treasurer
of CenterPoint Energy, Houston Electric, LLC, a Texas limited liability company,
the limited liability company described in and which executed the foregoing
instrument; and that he signed his name thereto by authority of the sole manager
of said limited liability company.

                                  /s/ Mary Etta Gaut
                                  ----------------------------------------------
                                  Notary Public

Seal of Notary Public

<PAGE>

                                 ACKNOWLEDGMENT

STATE OF TEXAS             )
                           )       ss
COUNTY OF HARRIS           )

                  On the 10th day of October 2002, before me personally came
Rhonda L. Parman, to me known, who, being by me duly sworn, did depose and say
that she resides in Houston, Texas; that she is Vice President and Trust Officer
of JPMorgan Chase Bank, a banking corporation organized under the state of New
York, the ___________________ described in and which executed the foregoing
instrument; and that she signed her name thereto by authority of the board of
directors of corporation.

                                  /s/ Treva Bushnell
                                  ----------------------------------------------
                                  Notary Public

Seal of Notary Public<PAGE>
                                                                    EXHIBIT 10.1

                               APACHE CORPORATION

                               401(k) SAVINGS PLAN

<PAGE>

                                TABLE OF CONTENTS

<Table>
<Caption>
                                                                                                               PAGE
                                                                                                               ----
<S>                                                                                                            <C>
ARTICLE I         Definitions.....................................................................................1
        1.1       Account Owner...................................................................................1
        1.2       Accounts........................................................................................1
        1.3       Affiliated Entity...............................................................................1
        1.4       Alternate Payee.................................................................................2
        1.5       Annual Addition.................................................................................2
        1.6       Catch-Up Contributions..........................................................................2
        1.7       Code............................................................................................2
        1.8       Committee.......................................................................................2
        1.9       Company.........................................................................................2
        1.10      Company Contributions...........................................................................2
        1.11      Company Discretionary Contributions.............................................................2
        1.12      Company Matching Contributions..................................................................2
        1.13      Company Stock...................................................................................2
        1.14      Compensation....................................................................................3
        1.15      Covered Employee................................................................................4
        1.16      Determination Date..............................................................................5
        1.17      Disability......................................................................................5
        1.18      Domestic Relations Order........................................................................5
        1.19      Employee........................................................................................5
        1.20      Employment Commencement Date....................................................................5
        1.21      ERISA...........................................................................................5
        1.22      Five-Percent Owner..............................................................................5
        1.23      401(k) Contributions............................................................................6
        1.24      Former Amoco Employee...........................................................................6
        1.25      Highly Compensated Employee.....................................................................6
        1.26      Hour of Service.................................................................................6
        1.27      Key Employee....................................................................................6
        1.28      Lapse in Apache Employment......................................................................6
        1.29      Limitation Year.................................................................................6
        1.30      Non-Highly Compensated Employee.................................................................6
        1.31      Non-Key Employee................................................................................6
        1.32      Normal Retirement Age...........................................................................6
        1.33      Participant.....................................................................................7
        1.34      Participant Before-Tax Contributions............................................................7
        1.35      Period of Service...............................................................................7
        1.36      Plan Year.......................................................................................7
        1.37      Qualified Domestic Relations Order ('QDRO').....................................................7
        1.38      Qualified Matching Contributions ('QMACs')......................................................7
        1.39      Qualified Non-Elective Contributions ('QNECs')..................................................7
        1.40      Reemployment Commencement Date..................................................................7
        1.41      Required Beginning Date.........................................................................7
        1.42      Rollover Contribution...........................................................................8
        1.43      Spouse..........................................................................................8
        1.44      Termination from Service Date...................................................................8
        1.45      Valuation Date..................................................................................9
        1.46      Year of Service.................................................................................9
ARTICLE II        Participation...................................................................................9
        2.1       Participation - Required Service................................................................9
        2.2       Reemployment....................................................................................9
        2.3       Enrollment Procedure...........................................................................10
</Table>

                                        i
<PAGE>

<Table>
<S>                                                                                                            <C>
ARTICLE III       Contributions..................................................................................10
        3.1       Company Contributions..........................................................................10
        3.2       Participant Contributions......................................................................12
        3.3       Return of Contributions........................................................................14
        3.4       Limitation on Annual Additions.................................................................14
        3.5       Contribution Limits for Highly Compensated Employees (ADP Test)................................16
        3.6       Contribution Limits for Highly Compensated Employees (ACP Test)................................17
        3.7       QNECs..........................................................................................19
        3.8       QMACs..........................................................................................20
ARTICLE IV        Interests in the Trust Fund....................................................................20
        4.1       Participants' Accounts.........................................................................20
        4.2       Valuation of Trust Fund........................................................................21
        4.3       Allocation of Increase or Decrease in Net Worth................................................21
ARTICLE V         Amount of Benefits.............................................................................22
        5.1       Vesting Schedule...............................................................................22
        5.2       Forfeitures....................................................................................23
        5.3       Restoration of Forfeitures.....................................................................23
        5.4       Method of Forfeiture Restoration...............................................................24
        5.5       Allocation of Forfeitures......................................................................24
        5.6       Credits for Pre-Lapse Service..................................................................24
        5.7       Transfers - Portability........................................................................24
        5.8       Reemployment - Separate Account................................................................25
ARTICLE VI        Distribution of Benefits.......................................................................25
        6.1       Beneficiaries..................................................................................25
        6.2       Consent........................................................................................26
        6.3       Distributable Amount...........................................................................26
        6.4       Manner of Distribution.........................................................................26
        6.5       Time of Distribution...........................................................................27
        6.6       Direct Rollover Election.......................................................................28
ARTICLE VII       Withdrawals and Loans..........................................................................29
        7.1       In-Service Withdrawals.........................................................................29
        7.2       Loans..........................................................................................30
ARTICLE VIII      Allocation of Responsibilities - Named Fiduciaries.............................................32
        8.1       No Joint Fiduciary Responsibilities............................................................32
        8.2       The Company....................................................................................32
        8.3       The Trustee....................................................................................32
        8.4       The Committee - Plan Administrator.............................................................32
        8.5       Committee to Construe Plan.....................................................................33
        8.6       Organization of Committee......................................................................33
        8.7       Interested Committee Members...................................................................33
        8.8       Agent for Process..............................................................................33
        8.9       Indemnification of Committee Members...........................................................33
        8.10      Conclusiveness of Action.......................................................................33
        8.11      Payment of Expenses............................................................................33
ARTICLE IX        Trust Agreement - Investments..................................................................34
        9.1       Trust Agreement................................................................................34
        9.2       Expenses of Trust..............................................................................34
        9.3       Investments....................................................................................34
ARTICLE X         Termination and Amendment......................................................................35
        10.1      Termination of Plan or Discontinuance of Contributions.........................................35
        10.2      Allocations upon Termination or Discontinuance of Company Contributions........................35
        10.3      Procedure Upon Termination of Plan or Discontinuance of Contributions..........................35
        10.4      Amendment by Apache............................................................................36
ARTICLE XI        Plan Adoption by Affiliated Entities...........................................................36
        11.1      Adoption of Plan...............................................................................36
        11.2      Agent of Affiliated Entity.....................................................................36
</Table>

                                       ii
<PAGE>

<Table>
<S>                                                                                                            <C>
        11.3      Disaffiliation and Withdrawal from Plan........................................................36
        11.4      Effect of Disaffiliation or Withdrawal.........................................................37
        11.5      Distribution Upon Disaffiliation or Withdrawal.................................................37
ARTICLE XII       Top-Heavy Provisions...........................................................................38
        12.1      Application of Top-Heavy Provisions............................................................38
        12.2      Determination of Top-Heavy Status..............................................................38
        12.3      Special Vesting Rule...........................................................................38
        12.4      Special Minimum Contribution...................................................................39
        12.5      Change in Top-Heavy Status.....................................................................39
ARTICLE XIII      Miscellaneous..................................................................................39
        13.1      RIGHT TO DISMISS EMPLOYEES - NO EMPLOYMENT CONTRACT............................................39
        13.2      Claims Procedure...............................................................................39
        13.3      Source of Benefits.............................................................................40
        13.4      Exclusive Benefit of Employees.................................................................40
        13.5      Forms of Notices...............................................................................40
        13.6      Failure of Any Other Entity to Qualify.........................................................40
        13.7      Notice of Adoption of the Plan.................................................................40
        13.8      Plan Merger....................................................................................40
        13.9      Inalienability of Benefits - Domestic Relations Orders.........................................41
        13.10     Payments Due Minors or Incapacitated Individuals...............................................43
        13.11     Uniformity of Application......................................................................43
        13.12     Disposition of Unclaimed Payments..............................................................44
        13.13     Applicable Law.................................................................................44
ARTICLE XIV       Matters Affecting Company Stock................................................................44
        14.1      Voting, Etc....................................................................................44
        14.2      Notices........................................................................................44
        14.3      Retention/Sale of Company Stock and Other Securities...........................................44
        14.4      Tender Offers..................................................................................45
        14.5      Stock Rights...................................................................................45
        14.6      Other Rights Appurtenant to the Company Stock..................................................46
        14.7      Information to Trustee.........................................................................46
        14.8      Information to Account Owners..................................................................46
        14.9      Expenses.......................................................................................47
        14.10     Former Account Owners..........................................................................47
        14.11     No Recommendations.............................................................................47
        14.12     Trustee to Follow Instructions.................................................................47
        14.13     Confidentiality................................................................................48
        14.14     Investment of Proceeds.........................................................................48
        14.15     Independent Fiduciary..........................................................................49
        14.16     Method of Communications.......................................................................49
ARTICLE XV        Uniformed Services Employment and Reemployment Rights Act of 1994..............................49
        15.1      General........................................................................................49
        15.2      While a Serviceman.............................................................................49
        15.3      Failure to Return..............................................................................50
        15.4      Return From Uniformed Service..................................................................51
</Table>

Appendix A -- Participating Companies
Appendix B -- Hadson Energy Resources Company
Appendix C - Corporate Transactions
Appendix D --DEKALB Energy Company / Apache Canada Ltd.

                                       iii
<PAGE>

                               APACHE CORPORATION
                               401(k) SAVINGS PLAN

                                    PREAMBLE

Apache Corporation, a Delaware corporation ("Apache"), maintains this profit
sharing plan (the "Plan"), which is intended to be qualified under Code section
401(a), and which contains a cash or deferred arrangement that is intended to be
qualified under Code section 401(k).

The Plan is hereby amended and restated as set forth below, effective August 1,
2002, except for those provisions that have their own specific effective dates.
This restatement reflects the terms of the Plan that were the subject of the
July 22, 2002 favorable determination letter from the Internal Revenue Service,
except that obsolete provisions have been eliminated.

Any Participant (as defined herein) in the Plan who is credited with at least
one Hour of Service (as defined herein) after July 31, 2002 shall be subject to
the provisions of this Plan as so amended and restated. Service shall be
credited according to the terms of the Plan that are in effect at the time the
service is rendered. Any Participant in the Plan who is not credited with an
Hour of Service after August 1, 2002 shall continue to be governed by the
provisions of the Plan as in effect immediately prior to August 1, 2002.
However, any Account Owner (as defined herein) on or after August 1, 2002 shall
be subject to the rules of this amended and restated Plan with regard to his
status as an Account Owner and with regard to the rules regarding Account
ownership (such as receiving investment earnings, giving investment directions,
and receiving distributions).

Each Appendix to this Plan is a part of the Plan document. It is intended that
an Appendix will be used to (1) describe which business entities are actively
participating in the Plan, (2) describe any special participation, eligibility,
vesting, or other provisions that apply to the employees of a business entity,
(3) describe any special provisions that apply to Participants affected by a
designated corporation transaction, and (4) describe any special distribution
rules that apply to directly transferred benefits from other plans.

ARTICLE I
DEFINITIONS

The following words and phrases shall have the meaning set forth below:

1.1      Account Owner. "Account Owner" means a Participant who has an Account
         balance, an Alternate Payee who has an Account balance, or a
         beneficiary who has obtained an interest in the Account(s) of the
         previous Account Owner because of the previous Account Owner's death.

1.2      Accounts. "Accounts" means the various Participant accounts established
         pursuant to section 4.1.

1.3      Affiliated Entity. "Affiliated Entity" means:

         (a)      For all purposes of the Plan except those listed in subsection
                  (b), the term "Affiliated Entity" means any legal entity that
                  is treated as a single employer with Apache pursuant to Code
                  section 414(b), 414(c), 414(m), or 414(o).

         (b)      For purposes of determining Annual Additions under section
                  1.5, limiting Annual Additions to a Participant's Account(s)
                  under section 3.4, and construing the defined terms as they
                  are used in sections 1.5 and 3.4 (such as " Compensation" and
                  "Employee"), the term "Affiliated Entity" means any legal
                  entity that is treated as a single employer with Apache
                  pursuant to Code section 414(m) or 414(o), and any legal
                  entity that would be an Affiliated Entity pursuant to Code
                  section 414(b) or 414(c) if the phrase "more than 50%" were
                  substituted for the phrase "at least 80%" each place it occurs
                  in Code section 1563(a)(1).

                                       1
<PAGE>

1.4      Alternate Payee. "Alternate Payee" means a Participant's Spouse, former
         spouse, child, or other dependent who is recognized by a QDRO as having
         a right to receive all, or a portion of, the benefits payable under
         this Plan with respect to such Participant.

1.5      Annual Addition. "Annual Addition" means the allocations to a
         Participant's Account(s) for any Limitation Year, as described in
         detail below.

         (a)      Annual Additions shall include: (i) Company Contributions
                  (except as provided in paragraphs (b)(iii) and (b)(v)) to this
                  Plan and Company contributions to any other defined
                  contribution plan maintained by the Company or any Affiliated
                  Entity, including Company Matching Contributions forfeited to
                  satisfy the ACP test of section 3.6, (ii) after-tax
                  contributions to any other defined contribution plan
                  maintained by the Company or an Affiliated Entity; (iii)
                  401(k) Contributions to this Plan and similar contributions to
                  any other defined contribution plan maintained by the Company
                  or an Affiliated Entity, including any such contributions
                  distributed to satisfy the ADP test of section 3.5; (iv)
                  forfeitures allocated to a Participant's Account(s) in this
                  Plan and any other defined contribution plan maintained by the
                  Company or any Affiliated Entity (except as provided in
                  paragraphs (b)(iii) and (b)(v) below); (v) all amounts paid or
                  accrued to a welfare benefit fund as defined in Code section
                  419(e) and allocated to the separate account (under the
                  welfare benefit fund) of a Key Employee to provide
                  post-retirement medical benefits; and (vi) contributions
                  allocated on the Participant's behalf to any individual
                  medical account as defined in Code section 415(l)(2).

         (b)      Annual Additions shall not include: (i) Rollover Contributions
                  to any defined contribution plan maintained by the Company or
                  an Affiliated Entity; (ii) repayments of loans made to a
                  Participant from a qualified plan maintained by the Company or
                  any Affiliated Entity; (iii) repayments of forfeitures for
                  rehired Participants, as described in Code sections
                  411(a)(7)(B) and 411(a)(3)(D); (iv) direct transfers of
                  employee contributions from one qualified plan to any
                  qualified defined contribution plan maintained by the Company
                  or any Affiliated Entity; (v) repayments of forfeitures of
                  missing individuals pursuant to section 13.12; or (vi) salary
                  deferrals within the meaning of Code sections 414(u)(2)(C) or
                  414(v)(6)(B).

1.6      Catch-Up Contributions. "Catch-Up Contributions" means those
         contributions made to the Plan by the Company, at the election of the
         Participant pursuant to subsection 3.2(b) that meet the requirements of
         Code section 414(v).

1.7      Code. "Code" means the Internal Revenue Code of 1986, as amended from
         time to time, and the regulations and rulings in effect thereunder from
         time to time.

1.8      Committee. "Committee" means the administrative committee provided for
         in section 8.4.

1.9      Company. "Company" means Apache, any successor thereto, and any
         Affiliated Entity that adopts the Plan pursuant to Article XI. Each
         Company is listed in Appendix A.

1.10     Company Contributions. "Company Contributions" means all contributions
         to the Plan made by the Company pursuant to section 3.1 for the Plan
         Year.

1.11     Company Discretionary Contributions. "Company Discretionary
         Contributions" means all contributions to the Plan made by the Company
         pursuant to subsection 3.1(a) for the Plan Year.

1.12     Company Matching Contributions. "Company Matching Contributions" means
         all contributions to the Plan made by the Company pursuant to
         subsection 3.1(b) for the Plan Year.

1.13     Company Stock. "Company Stock" means shares of the $1.25 par value
         common stock of Apache.

                                       2
<PAGE>

1.14     Compensation. "Compensation" means:

         (a)      Code Section 415 Compensation. For purposes of determining the
                  limitation on Annual Additions under section 3.4 and the
                  minimum contribution under section 12.4 when the Plan is
                  top-heavy, Compensation shall mean those amounts reported as
                  "wages, tips, other compensation" on Form W-2 by the Company
                  or an Affiliated Entity and elective contributions that are
                  not includable in the Employee's income pursuant to Code
                  sections 125, 132(f)(4), 402(e)(3), 402(h), 403(b), 408(p),
                  414(u)(2)(C), 414(v)(6)(B), or 457. For purposes of section
                  3.4, Compensation shall be measured over a Limitation Year.
                  For purposes of section 12.4, Compensation shall be measured
                  over a Plan Year.

         (b)      Code Section 414(q) Compensation. For purposes of identifying
                  Highly Compensated Employees and Key Employees, Compensation
                  shall mean those amounts reported as "wages, tips, other
                  compensation" on Form W-2 by the Company or an Affiliated
                  Entity, and elective contributions that are not includable in
                  the Employee's income pursuant to Code sections 125,
                  132(f)(4), 402(e)(3), 402(h), 403(b), 408(p), 414(u)(2)(C),
                  414(v)(6)(B), or 457. Compensation shall be measured over a
                  Plan Year. Compensation shall include only amounts paid to the
                  Employee, and shall not include any additional amounts accrued
                  by the Employee.

         (c)      Code Section 414(s) Compensation. For purposes of the ADP and
                  ACP tests under sections 3.5 and 3.6, and for purposes of
                  allocating QNECs under subsection 3.7(c), Compensation shall
                  mean any definition of compensation for a Plan Year, as
                  selected by the Committee, that satisfies the requirements of
                  Code section 414(s) and the regulations promulgated
                  thereunder. The definition of Compensation used in one Plan
                  Year may differ from the definition used in another Plan Year.

         (d)      Benefit Compensation. For purposes of determining and
                  allocating Company Discretionary Contributions under
                  subsection 3.1(a), Compensation shall generally mean regular
                  compensation paid by the Company.

                  (i)      Specifically, Compensation shall include:

                           (A)      Regular salary or wages,

                           (B)      Overtime pay,

                           (C)      The regular annual bonus (unless all or a
                                    portion is excluded by the Committee before
                                    the regular annual bonus is paid) and any
                                    other bonus designated by the Committee,

                           (D)      Salary reductions pursuant to this Plan,

                           (E)      Salary reductions that are excludable from
                                    an Employee's gross income pursuant to Code
                                    section 125 or 132(f)(4), and

                           (F)      Amounts contributed as salary deferrals to
                                    the Company's Nonqualified
                                    Retirement/Savings Plan.

                  (ii)     Compensation shall exclude:

                           (A)      Commissions,

                           (B)      Severance pay,

                           (C)      Moving expenses,

                           (D)      Any gross-up of moving expenses to account
                                    for increased income or employment taxes,

                                       3
<PAGE>

                           (E)      Foreign service premiums paid as an
                                    inducement to work outside of the United
                                    States,

                           (F)      Credits or benefits under this Plan (except
                                    as provided in subparagraph (i)(D)) and
                                    credits or benefits under the Apache
                                    Corporation Money Purchase Retirement Plan,

                           (G)      Other contingent compensation,

                           (H)      Any amount relating to the granting of a
                                    stock option by the Company or an Affiliated
                                    Entity, the exercise of such a stock option,
                                    or the sale or deemed sale of any shares
                                    thereby acquired,

                           (I)      Contributions to any other fringe benefit
                                    plan (including, but not limited to,
                                    overriding royalty payments or any other
                                    exploration-related payments),

                           (J)      Any bonus other than (1) a regular annual
                                    bonus not otherwise excluded by the
                                    Committee and (2) a bonus specifically
                                    included as Compensation by the Committee,
                                    in each case pursuant to subparagraph
                                    (i)(C), and

                           (K)      Except as provided under subparagraph
                                    (i)(F), any benefit accrued under, or any
                                    payment from, any nonqualified plan of
                                    deferred compensation.

                  (iii)    Compensation shall be measured over that portion of a
                           Plan Year while the Employee is a Covered Employee.
                           Compensation shall include only amounts paid to the
                           Employee during the Plan Year, and shall not include
                           any amounts accrued by but not paid to the Employee
                           during the Plan Year.

         (e)      Deferral Compensation. For purposes of determining Participant
                  Before-Tax Contributions under section 3.2 and for purposes of
                  determining and allocating Company Matching Contributions
                  under subsection 3.1(b), Compensation shall mean Compensation
                  as defined in subsection (d), with the following
                  modifications. Compensation shall be measured over each pay
                  period after the Employee has satisfied the eligibility
                  requirements of subsection 2.1(a). Compensation shall include
                  only amounts paid while the Employee is a Covered Employee.

         (f)      Limit on Compensation. For purposes of calculating the minimum
                  contribution required in top-heavy years under subsection (a),
                  for all purposes of subsections (c) and (d), and for purposes
                  of determining the maximum allocation of Company Matching
                  Contributions under subsection (e), the Compensation taken
                  into account for the Plan Year shall not exceed the dollar
                  limit specified in Code section 401(a)(17) in effect for the
                  Plan Year.

1.15     Covered Employee. "Covered Employee" means any Employee of the Company,
         with the following exceptions.

         (a)      Any individual directly employed by an entity other than the
                  Company shall not be a Covered Employee, even if such
                  individual is considered a common-law employee of the Company
                  or is treated as an employee of the Company pursuant to Code
                  section 414(n).

         (b)      An Employee shall not be a Covered Employee unless he or she
                  is either based in the U.S. or on the U.S. payroll.

         (c)      An Employee included in a unit of Employees covered by a
                  collective bargaining agreement shall not be a Covered
                  Employee unless the collective bargaining agreement
                  specifically provides for such Employee's participation in the
                  Plan.

         (d)      An Employee whose job is classified as "temporary" shall be a
                  Covered Employee only after he or she has worked for the
                  Company and Affiliated Entities for six consecutive months.

                                       4
<PAGE>

         (e)      An Employee shall not be a Covered Employee while he or she is
                  classified as an "intern," a "consultant," or an "independent
                  contractor." An Employee may be classified as an "intern" only
                  if he or she is currently enrolled (or the Company expects him
                  or her to be enrolled within the next 12 months) in a high
                  school, college, or university. An Employee may be classified
                  as an intern even if he or she does not receive academic
                  course credit from his or her school for this employment with
                  the Company.

         (f)      An individual who is employed pursuant to a written agreement
                  with an agency or other third party for a specific job
                  assignment or project shall not be a Covered Employee.

1.16     Determination Date. "Determination Date" means, with respect to each
         Plan Year, the last day of the preceding Plan Year; provided however,
         that in the case of the first Plan Year of the Plan, the Determination
         Date shall be the last day of the first Plan Year.

1.17     Disability. "Disability" means a disability due to sickness or injury
         which renders an Employee incapable of performing any services for the
         Company or an Affiliated Entity for which the Employee is qualified by
         education, training, or experience. Evidence of disability satisfactory
         to Apache shall be required.

1.18     Domestic Relations Order. "Domestic Relations Order" means any
         judgment, decree, or order (including approval of a property settlement
         agreement) issued by a court of competent jurisdiction that relates to
         the provisions of child support, alimony or maintenance payments, or
         marital property rights to a Spouse, former spouse, child, or other
         dependent of the Participant and is made pursuant to a state domestic
         relations law (including a community property law).

1.19     Employee. "Employee" means each individual who performs services for
         the Company or an Affiliated Entity and whose wages are subject to
         withholding by the Company or an Affiliated Entity. The term "Employee"
         shall include only individuals currently performing services for the
         Company or an Affiliated Entity, and shall exclude former Employees who
         are still being paid by the Company or an Affiliated Entity (whether
         through the payroll system, through overriding royalty payments,
         through exploration-related payments, or otherwise). The term
         "Employee" shall also include any individual who provides services to
         the Company or an Affiliated Entity pursuant to an agreement between
         the Company or an Affiliated Entity and a third party that employs the
         individual, but only if the individual has performed such services for
         the Company or an Affiliated Entity on a substantially full-time basis
         for at least one year and only if the services are performed under the
         primary direction or control by the Company or an Affiliated Entity;
         provided, however, that if the individuals included as Employees
         pursuant to the first part of this sentence constitute 20% or less of
         the Non-Highly Compensated Employees of the Company and Affiliated
         Entities, then any such individuals who are covered by a qualified plan
         that is a money purchase pension plan that provides a nonintegrated
         employer contribution rate for each participant of at least 10% of
         compensation, that provides for full and immediate vesting, and that
         provides immediate participation for each employee of the third party
         (other than those who perform substantially all of their services for
         the third party and other than those whose compensation from the third
         party during each of the four preceding plan years was less than $1000)
         shall not be considered an Employee.

1.20     Employment Commencement Date. "Employment Commencement Date" means the
         date on which an Employee first performs an Hour of Service.

1.21     ERISA. "ERISA" means the Employee Retirement Income Security Act of
         1974, as amended, and the regulations and rulings in effect thereunder
         from time to time.

1.22     Five-Percent Owner. "Five-Percent Owner" means:

         (a)      With respect to a corporation, any individual who owns (either
                  directly or indirectly according to the rules of Code section
                  318) more than 5% of the value of the outstanding stock of the
                  corporation or stock processing more than 5% of the total
                  combined voting power of all stock of the corporation.

                                       5
<PAGE>

         (b)      With respect to a non-corporate entity, any individual who
                  owns (either directly or indirectly according to rules similar
                  to those of Code section 318) more than 5% of the capital or
                  profits interest in the entity.

         (c)      An individual shall be a Five-Percent Owner for a particular
                  year if such individual is a Five-Percent Owner at any time
                  during such year.

1.23     401(k) Contributions. "401(k) Contributions" means those contributions
         made to the Plan by the Company, at the election of the Participant
         pursuant to subsection 3.2(a), that are excludable from the
         Participant's gross income under Code sections 401(k) and 402(e)(3).

1.24     Former Amoco Employee. "Former Amoco Employee" means an Employee who
         was formerly employed by Amoco Production Company or its subsidiaries
         and who became an Employee of the Company pursuant to the provisions of
         that certain Stock Purchase Agreement effective June 30, 1991, between
         Amoco Production Company, Apache, and others.

1.25     Highly Compensated Employee. "Highly Compensated Employee" means, for
         each Plan Year, an Employee who (a) was in the "top-paid group" during
         the immediately preceding Plan Year and had Compensation of $80,000 (as
         adjusted by the Secretary of the Treasury) or more during the
         immediately preceding Plan Year, or (b) is a Five-Percent Owner during
         the current Plan Year, or (c) was a Five-Percent Owner during the
         immediately preceding Plan Year. The term "top-paid group" means the
         top 20% of Employees when ranked on the basis of Compensation paid
         during the year. In determining the number of Employees in the top-paid
         group, the Committee may elect to exclude Employees with less than six
         (or some smaller number of) months of service at the end of the year,
         Employees who normally work less than 17 1/2 (or some fewer number of)
         hours per week, Employees who normally work less than six (or some
         fewer number of) months during any year, Employees younger than 21 (or
         some younger age) on the last day of the year, and Employees who are
         nonresident aliens who receive no earned income (within the meaning of
         Code section 911(d)(2)) from Apache or an Affiliated Entity that
         constitutes income from sources within the United States (within the
         meaning of Code section 861(a)(3)). Furthermore, an Employee who is a
         nonresident alien who receives no earned income (within the meaning of
         Code section 911(d)(2)) from Apache or an Affiliated Entity that
         constitutes income from sources within the United States (within the
         meaning of Code section 861(a)(3)) during the year shall not be in the
         top-paid group for that year.

1.26     Hour of Service. "Hour of Service" means each hour for which an
         Employee is paid or entitled to payment by the Company or an Affiliated
         Entity for the performance of duties for the Company or an Affiliated
         Entity during the applicable computation period. Hours of Service shall
         be credited to the Employee for the computation period or periods in
         which the duties are performed, regardless of when the Employee is paid
         for those duties.

1.27     Key Employee. "Key Employee" means an individual described in Code
         section 416(i)(1) and the regulations promulgated thereunder.

1.28     Lapse in Apache Employment. "Lapse in Apache Employment" means the
         period commencing on the Termination from Service Date and ending on
         the Reemployment Commencement Date. A Participant shall incur a
         one-year Lapse in Apache Employment if the Participant does not perform
         an Hour of Service in the 12-month period beginning on any anniversary
         of his or her Termination from Service Date.

1.29     Limitation Year. "Limitation Year" means the calendar year.

1.30     Non-Highly Compensated Employee. "Non-Highly Compensated Employee"
         means an Employee who is not a Highly Compensated Employee.

1.31     Non-Key Employee. "Non-Key Employee" means an Employee who is not a Key
         Employee.

1.32     Normal Retirement Age. "Normal Retirement Age" means age 65.

                                       6
<PAGE>

1.33     Participant. "Participant" means any individual with an Account balance
         under the Plan except beneficiaries and Alternate Payees. The term
         "Participant" shall also include any Covered Employee who has satisfied
         the eligibility requirements of section 2.1, but who does not yet have
         an account balance.

1.34     Participant Before-Tax Contributions. "Participant Before-Tax
         Contributions" means 401(k) Contributions and Catch-Up Contributions.

1.35     Period of Service. "Period of Service" means a period commencing on an
         Employee's Employment Commencement Date or Reemployment Commencement
         Date, whichever is applicable, and ending on his or her Termination
         from Service Date. A Period of Service shall also include the period
         between an Employee's Termination from Service Date and his or her
         Reemployment Commencement Date if the Employee does not incur a
         one-year Lapse in Apache Employment between such dates; however, the
         period between the first and second anniversaries of an Employee's
         absence from work because of parental leave (as explained in paragraph
         1.44(b)(i)) shall not be included in the Employee's Period of Service.
         A Period of Service for a Former Amoco Employee shall also include any
         periods of employment with Amoco Production Company or its
         subsidiaries. Periods of Service shall not include any period following
         a Participant's Termination from Service Date solely because of a
         severance payment of payments made to an individual with respect to his
         or her termination of employment. See the definition of "Employee" for
         a description of when a leased employee (within the meaning of Code
         section 414(n)) is treated as an Employee. In addition, for purposes of
         calculating an Employee's Period of Service once an individual has
         become an Employee, the individual shall be treated as an Employee for
         any prior period during which the individual would have been a leased
         employee (within the meaning of Code section 414(n)) but for the fact
         that his or her services were not on a substantially full-time basis or
         were for less than a year.

1.36     Plan Year. "Plan Year" means the 12-month period on which the records
         of the Plan are kept, which shall be the calendar year.

1.37     Qualified Domestic Relations Order ('QDRO'). "Qualified Domestic
         Relations Order ('QDRO')" means a Domestic Relations Order that creates
         or recognizes the existence of an Alternate Payee's right to, or
         assigns to an Alternate Payee the right to, receive all or a portion of
         the benefits payable with respect to a Participant under the Plan and
         with respect to which the requirements of Code section 414(p) and ERISA
         section 206(d)(3) are met.

1.38     Qualified Matching Contributions ('QMACs'). "Qualified Matching
         Contributions ('QMACs')" means that portion of Company Matching
         Contributions so designated by the Company, or any portion of the
         forfeitures designated as QMACs under section 5.5, that satisfy the
         requirements of section 3.8.

1.39     Qualified Non-Elective Contributions ('QNECs'). "Qualified Non-Elective
         Contributions ('QNECs')" means any contribution to the Plan made by the
         Company, or any portion of the forfeitures designated as QNECs under
         section 5.5, that satisfies the requirements of section 3.7.

1.40     Reemployment Commencement Date. "Reemployment Commencement Date" means
         the first date following a Lapse in Apache Employment on which the
         Employee performs an Hour of Service.

1.41     Required Beginning Date. "Required Beginning Date" means:

         (a)      Excepted as provided in subsections (b), (c), and (d),
                  Required Beginning Date means April 1 of the calendar year
                  following the later of (i) the calendar year in which the
                  Participant attains age 70 1/2, or (ii) the calendar year in
                  which the Participant terminates employment with Apache and
                  all Affiliated Entities.

         (b)      For a Participant who is both an Employee and a Five-Percent
                  Owner of Apache or an Affiliated Entity, the term "Required
                  Beginning Date" means April 1 of the calendar year following
                  the calendar year in which the Five-Percent Owner attains age
                  70 1/2. If an Employee older than 70 1/2 becomes a
                  Five-Percent

                                       7
<PAGE>

                  Owner, his or her Required Beginning Date shall be April 1 of
                  the calendar year following the calendar year in which he or
                  she becomes a Five-Percent Owner.

         (c)      Before January 1, 1997, an Employee who was not a Five-Percent
                  Owner may have had a Required Beginning Date. Beginning
                  January 1, 1997, such an Employee shall be treated as if he or
                  she has not yet had a Required Beginning Date, with the result
                  that his or her minimum required distributions under
                  subsection 6.5(c) will be zero until his or her new Required
                  Beginning Date. His or her new Required Beginning Date shall
                  be determined pursuant to subsections (a) and (b).

         (d)      If a Participant is rehired after his or her Required
                  Beginning Date, and he or she is not a Five-Percent Owner, he
                  or she shall be treated upon rehire as if he or she has not
                  yet had a Required Beginning Date, with the result that his or
                  her minimum required distributions under subsection 6.5(c)
                  will be zero until his or her new Required Beginning Date. His
                  or her new Required Beginning Date shall be determined
                  pursuant to subsections (a) and (b).

1.42     Rollover Contribution. "Rollover Contribution" means the following.

         (a)      Direct Transfers. A Rollover Contribution includes a direct
                  transfer to a defined contribution plan by a Covered Employee
                  of an eligible rollover distribution from:

                  (i)      a qualified plan described in Code section 401(a)
                           (including after-tax contributions),

                  (ii)     a qualified annuity plan described in Code section
                           403(a) (including after-tax contributions),

                  (iii)    an annuity contract described in Code section 403(b)
                           (including after-tax contributions), or

                  (iv)     an eligible plan under Code section 457(b) that is
                           maintained by an eligible employer described in Code
                           section 457(e)(1)(A) (which generally includes state
                           or local governments).

         (b)      Regular Rollovers. A Rollover Contribution includes a
                  contribution to a defined contribution plan by a Covered
                  Employee of an eligible rollover distribution from:

                  (i)      a qualified plan described in Code section 401(a)
                           (excluding after-tax contributions),

                  (ii)     a qualified annuity plan described in Code section
                           403(a) (excluding after-tax contributions),

                  (iii)    an annuity contract described in Code section 403(b)
                           (excluding after-tax contributions), or

                  (iv)     an eligible plan under Code section 457(b) that is
                           maintained by an eligible employer described in Code
                           section 457(e)(1)(A) (which generally includes state
                           and local governments).

         (c)      Rollovers from IRAs. A Rollover Contribution includes a
                  contribution to a defined contribution plan by a Covered
                  Employee of the portion of a distribution from an individual
                  retirement account or annuity described in Code section 408(a)
                  or 408(b) that is eligible to be rolled over and that would
                  otherwise be included in the Covered Employee's gross income.

1.43     Spouse. "Spouse" means the individual of the opposite sex to whom a
         Participant is lawfully married according to the laws of the state of
         the Participant's domicile.

1.44     Termination from Service Date. "Termination from Service Date" means
         the earlier of the following dates:

         (a)      The last day an Employee performs services for the Company or
                  an Affiliated Entity if the Employee quits (except as provided
                  in paragraph (b)(iii)), is discharged, retires, or dies; or

                                       8
<PAGE>

         (b)      The first anniversary of the day a former Employee is absent
                  from the Company or Affiliated Entity for any reason other
                  than resignation, discharge, retirement, or death (such as
                  vacation, holiday, sickness, disability, leave of absence, or
                  temporary lay-off), with the following exceptions:

                  (i)      If the former Employee is absent from the Company or
                           Affiliated Entity because of parental leave (which
                           includes only the pregnancy of the former Employee,
                           the birth of the former Employee's child, the
                           placement of a child with the former Employee in
                           connection with adoption of such child by the former
                           Employee, or the caring for such child immediately
                           following birth or placement) on the first
                           anniversary of the day the former Employee was first
                           absent, the Termination from Service Date shall be
                           the second anniversary of the day he or she was first
                           absent.

                  (ii)     If the former Employee is absent from the Company or
                           Affiliated Entity for more than one year because of
                           an approved leave of absence (either with or without
                           pay) for any reason (including, but not limited to,
                           jury duty) and the former Employee returns to work at
                           or prior to the expiration of his or her leave of
                           absence, no Termination from Service Date shall
                           occur.

                  (iii)    If a former Employee is absent from the Company or an
                           Affiliated Entity because of a Disability incurred
                           while employed by the Company or an Affiliated
                           Entity, a Termination from Service Date shall not
                           occur until the later of the first anniversary of his
                           or her absence or the date he or she recovers from
                           the Disability, regardless of whether the former
                           Employee quits during the Disability.

1.45     Valuation Date. "Valuation Date" means the last day of each Plan Year
         and any other dates as specified in section 4.2 as of which the assets
         of the Trust Fund are valued at fair market value and as of which the
         increase or decrease in the net worth of the Trust Fund is allocated
         among the Participants' Accounts.

1.46     Year of Service. "Year of Service" means all of a Participant's Periods
         of Service, expressed in years, and rounded down to the next whole
         number.

ARTICLE II
PARTICIPATION

2.1      Participation - Required Service.

         (a)      Participant Before-Tax Contributions. A Covered Employee shall
                  be eligible to begin to make Participant Before-Tax
                  Contributions as of the first day of the first pay period of
                  the month that begins after the day the Employee becomes a
                  Covered Employee.

         (b)      Company Discretionary Contributions. Each Covered Employee
                  shall be eligible to participate in the Plan with respect to
                  the Company Discretionary Contribution provided by subsection
                  3.1(a) on the day the Employee first becomes a Covered
                  Employee.

2.2      Reemployment.

         (a)      Termination without Vesting. If a Participant terminates
                  employment before having any vested interest in his or her
                  Company Contributions Account under section 5.1 and is
                  thereafter reemployed by the Company or an Affiliated Entity,
                  (i) the Employee shall be treated as a new Employee for
                  participation purposes if the Employee incurred a one-year
                  Lapse in Apache Employment before rehire, and (ii) if the
                  Employee did not incur a one-year Lapse in Apache Employment
                  before rehire, the Employee shall be eligible to again
                  participate in the Plan under section 2.1 as if he or she has
                  been employed by the Company, but not as a Covered Employee,
                  during the break in employment.

         (b)      Termination with Vesting. If the case of any Participant who
                  terminates employment with a vested interest in his or her
                  Company Contributions Account under section 5.1, (i) he or she
                  shall become eligible to receive Company Discretionary
                  Contributions as of the later of his or her Reemployment

                                       9
<PAGE>

                  Commencement Date or the date he or she again becomes a
                  Covered Employee, and (ii) he or she shall be eligible to make
                  Participant Before-Tax Contributions as of the first day of
                  the first pay period following the later of his or her
                  Reemployment Commencement Date or the date he or she again
                  became a Covered Employee.

2.3      Enrollment Procedure.

         Notwithstanding sections 2.1 and 2.2, a Covered Employee shall not be
         eligible to participate in the Plan until after completing the
         enrollment procedures specified by the Committee. Such enrollment
         procedures may, for example, require the Covered Employee to complete
         and sign an enrollment form or to complete a voice-response telephone
         enrollment. The Covered Employee shall provide the initial investment
         direction, the address and date of birth of the Employee, and the name,
         address, and date of birth of each beneficiary of the Employee, the
         initial rate of the Participant Before-Tax Contributions, and any other
         information requested by the Committee. An election to make Participant
         Before-Tax Contributions shall not be effective until after the Covered
         Employee has properly completed the enrollment procedures. The
         Committee may require that the enrollment procedure be completed a
         certain number of days prior to the date that a Covered Employee
         actually begins to participate.

ARTICLE III
CONTRIBUTIONS

The only contributions that can be made to the Plan are Company Contributions
pursuant to section 3.1, Participant Before-Tax Contributions and Rollover
Contributions pursuant to section 3.2, contributions pursuant to subsection
5.3(b), and loan repayments.

3.1      Company Contributions.

         (a)      Company Discretionary Contributions. For each Plan Year, the
                  Company shall contribute to the Trust Fund such amount of
                  Company Discretionary Contributions that the Company, in its
                  sole discretion, determines to contribute. The Company may
                  elect to treat any portion of forfeitures occurring during the
                  Plan Year as Company Discretionary Contributions, pursuant to
                  section 5.5. Company Discretionary Contributions shall be
                  allocated to each "eligible Participant" in proportion to the
                  eligible Participant's Compensation. For purposes of this
                  subsection, an "eligible Participant" is a Participant who
                  received credit for one Hour of Service as a Covered Employee
                  during the Plan Year and who was employed by the Company or an
                  Affiliated Entity on the last day of the Plan Year. Company
                  Discretionary Contributions shall be allocated to Company
                  Contributions Accounts, except for those Company Discretionary
                  Contributions that are designated as QNECs pursuant to
                  subsection 3.7(b), which shall be allocated to Participant
                  Before-Tax Contributions Accounts.

         (b)      Company Matching Contributions.

                  (i)      Standard Match. As of the last day of the Plan Year,
                           the Committee shall make the final allocation of
                           Company Matching Contributions (including such
                           forfeitures occurring during the Plan Year that are
                           treated as Company Matching Contributions pursuant to
                           section 5.5) to each Participant who made Participant
                           Before-Tax Contributions during the Plan Year as
                           follows. Each Participant's allocation shall be equal
                           to his Participant Before-Tax Contributions for the
                           Plan Year, up to a maximum allocation of 6% of his
                           Compensation. The Committee may make interim
                           allocations of Company Matching Contributions during
                           the Plan Year, reflecting the allocation earned thus
                           far in the Plan Year.

                  (ii)     Additional Match. If the nondiscrimination tests
                           described in sections 3.5 and 3.6 are not satisfied
                           for a Plan Year, the Company may elect to contribute
                           an additional amount, or it may elect to use any
                           forfeitures occurring during the Plan Year, as an
                           extra Company Matching Contribution for the Plan
                           Year. The extra Company Matching Contribution may be
                           designated as a QMAC pursuant to section 3.8. The
                           extra Company Matching Contribution shall be
                           allocated to all "eligible

                                       10
<PAGE>

                           Participants" in proportion to the Company Matching
                           Contribution allocated to such eligible Participants
                           during the Plan Year under paragraph (i). For
                           purposes of this paragraph only, an "eligible
                           Participant" is any Non-Highly Compensated Employee
                           who is a Covered Employee on the last day of the Plan
                           Year.

                  (iii)    Coordination With Code Section 401(a)(17). Company
                           Matching Contributions in a Plan Year shall accrue
                           only on Participant Before-Tax Contributions up to 6%
                           of the Code section 401(a)(17) limit for that Plan
                           Year. Any Company Matching Contributions allocated
                           during the Plan Year in which they were accrued shall
                           be allocated on a temporary basis only; the
                           allocation shall become final after the Committee
                           verifies that the allocation complies with the terms
                           of the Plan, including the limits of Code section
                           401(a)(17). Any reduction in the allocation to comply
                           with Code section 401(a)(17), adjusted to reflect
                           investment experience, shall be used to pay those
                           expenses of the Plan that are properly payable from
                           the Trust Fund or to reduce future Company
                           Contributions to the Plan.

                  (iv)     Accounts. Company Matching Contributions shall be
                           allocated to Company Contributions Accounts, except
                           for those Company Matching Contributions that are
                           designated as QMACs under section 3.8, which shall be
                           allocated to Participant Before-Tax Contributions
                           Accounts.

         (c)      Miscellaneous Contributions.

                  (i)      The Company may make additional contributions to the
                           Plan to restore amounts forfeited from the Company
                           Contributions Accounts of certain rehired
                           Participants, pursuant to section 5.4. This
                           additional contribution shall be required only when
                           the forfeitures occurring during the Plan Year are
                           insufficient to restore such forfeited amounts, as
                           described in section 5.5. This contribution shall be
                           allocated to the Participant's Company Contributions
                           Account.

                  (ii)     The Company may make additional contributions to the
                           Plan to satisfy the minimum contribution required by
                           section 12.4. The Company may elect to use any
                           portion of forfeitures occurring during the Plan Year
                           for this purpose, pursuant to section 5.5.

                  (iii)    The Company may make additional contributions to the
                           Plan to restore the forfeited benefit of any missing
                           individual, pursuant to section 13.12. This
                           additional contribution shall be required only when
                           the forfeitures occurring during the Plan Year are
                           insufficient to restore such forfeited amounts, as
                           described in section 5.5.

                  (iv)     The Company may make QNECs to the Plan to enable the
                           Plan to satisfy the ADP and ACP tests of sections 3.5
                           and 3.6. The Company may elect to treat any portion
                           of forfeitures occurring during the Plan Year as
                           QNECs, pursuant to section 5.5. QNECs shall be
                           allocated to Participant Before-Tax Contribution
                           Accounts.

                  (v)      The Company may make additional contributions to the
                           Plan to provide make-up contributions for returning
                           servicemen, pursuant to section 15.4.

         (d)      Contributions Contingent on Deductibility. The Company
                  Contributions for a Plan Year (excluding forfeitures and
                  contributions pursuant to paragraph 3.1(c)(v) shall not exceed
                  the amount allowable as a deduction for Apache's taxable year
                  ending with or within the Plan Year pursuant to Code section
                  404. The amount allowable as a deduction under Code section
                  404 shall include carry forwards of unused deductions for
                  prior years. If the Code section 404 deduction limit would be
                  exceeded for any Plan Year, the Plan contributions shall be
                  reduced, in the following order, until the Plan contributions
                  equal the Code section 404 deduction limit: first, the Company
                  Matching Contributions for those Highly Compensated Employees
                  who are eligible to participate in the Company's Nonqualified

                                       11
<PAGE>

                  Retirement/Savings Plan; second, all but $1 of the Company
                  Discretionary Contributions for those Highly Compensated
                  Employees who are eligible to participate in the Company's
                  Nonqualified Retirement/Savings Plan; third, any remaining
                  Company Matching Contribution; fourth, any remaining Company
                  Discretionary Contributions. Company Contributions other than
                  QNECs, QMACs, and contributions pursuant to paragraph
                  3.1(c)(iv) shall be paid to the Trustee no later than the due
                  date (including any extensions) for filing the Company's
                  federal income tax return for such year; QNECs and QMACs shall
                  be paid to the Trustee no later than 12 months after the close
                  of the Plan Year; and contributions subject to paragraph
                  3.1(c)(iv) shall be paid to the Trustee as specified in
                  section 15.4. Company Contributions may be made without regard
                  to current or accumulated earnings and profits; nevertheless,
                  this Plan is intended to qualify as a "profit sharing plan" as
                  defined in Code section 401(a). The appropriate contribution
                  of the Company to the Trust Fund may be paid by the Company in
                  the form of Company Stock, cash, other assets of any
                  character, or in any combination of the foregoing, as
                  determined by the Company.

3.2      Participant Contributions.

         (a)      401(k) Contributions.

                  (i)      General Rules. A Participant may elect to defer the
                           receipt of a portion of his or her Compensation
                           during the Plan Year and contribute such amounts to
                           the Plan as 401(k) Contributions. The Committee shall
                           determine the maximum 401(k) Contributions that a
                           Participant may make and shall establish other
                           administrative rules governing the 401(k)
                           Contributions; for example, the Committee may require
                           401(k) Contributions to be made in whole percentages
                           of Compensation, the Committee may allow different
                           contribution percentages from bonuses than are
                           allowed from regular pay, and the Committee may limit
                           401(k) Contributions (for the year or for the pay
                           period or for a bonus) to a percentage of
                           Compensation (for the year or for the pay period or
                           for the bonus). The Company shall pay the amount
                           deducted from the Participant's Compensation to the
                           Trustee promptly after the deduction is made. 401(k)
                           Contributions shall be allocated to Participant
                           Before-Tax Contributions Accounts.

                  (ii)     Limitations on 401(k) Contributions.

                           (A)      Limit for Apache Plans. The sum of 401(k)
                                    Contributions to this Plan and elective
                                    deferrals (as defined in Code section
                                    402(g)(3)) to any other plan maintained by
                                    the Company or an Affiliated Entity shall
                                    not exceed the dollar limit in effect under
                                    Code section 402(g)(1) in any calendar year.
                                    The Company shall inform the Committee if
                                    such limit has been exceeded, and the excess
                                    amount allocated to this Plan. The excess
                                    amount allocated to this Plan shall be
                                    reduced by any 401(k) Contributions returned
                                    pursuant to any other provision of this
                                    Article. Any remaining excess amount shall
                                    be recharacterized as a Catch-Up
                                    Contribution to the extent possible, and any
                                    remaining excess amount shall be returned to
                                    the Participant as soon as administratively
                                    possible, and in no event later than April
                                    15 of the calendar year after the calendar
                                    year in which the excess occurred. Company
                                    Matching Contributions attributable to
                                    amounts returned under this subparagraph
                                    shall be forfeited. Unmatched 401(k)
                                    Contributions shall be returned first. The
                                    amount returned, recharacterized, or
                                    forfeited shall be adjusted to reflect the
                                    net increase or decrease in the net worth of
                                    the Participant's Account attributable
                                    thereto for the Plan Year. The Committee may
                                    use any reasonable method to allocate this
                                    adjustment.

                           (B)      Participant Limit. If the sum of the 401(k)
                                    Contributions to this Plan and elective
                                    deferrals (as defined in Code section
                                    402(g)(3)) to any other plan exceed the
                                    dollar limit in effect under Code section
                                    402(g)(1) in a calendar year, and the
                                    Participant is an Employee on the last day
                                    of the Plan Year and informs the Committee
                                    of the amount of the excess allocated to
                                    this Plan, then that amount will be reduced
                                    by any 401(k) Contributions for that
                                    calendar year that were returned pursuant to
                                    any other provision in this Article. Any
                                    remaining excess amount shall be
                                    recharacterized as a Catch-Up Contribution
                                    to the extent possible, and any remaining
                                    excess amount shall be returned to the
                                    Participant as soon as administratively
                                    possible, and in no event later than April
                                    15 of the calendar year after the calendar
                                    year in which the excess occurred. Company
                                    Matching Contributions attributable to
                                    amounts returned under this

                                       12
<PAGE>

                                    subparagraph shall be forfeited. Unmatched
                                    401(k) Contributions shall be returned
                                    first. The amount returned, recharacterized,
                                    or forfeited shall be adjusted to reflect
                                    the net increase or decrease in the net
                                    worth of the Participant's Account
                                    attributable thereto for the Plan Year. The
                                    Committee may use any reasonable method to
                                    allocate this adjustment.

         (b)      Catch-Up Contributions.

                  (i)      General Rules. A Participant whose 49th birthday
                           occurred before the first day of the Plan Year may
                           elect to defer the receipt of a portion of his or her
                           Compensation during the Plan Year and contribute such
                           amounts to the Plan as Catch-Up Contributions. The
                           Company shall pay the amount deducted from the
                           Participant's Compensation to the Trustee promptly
                           after the deduction is made. The Committee shall
                           determine after the end of each calendar year which
                           Participant Before-Tax Contributions were Catch-Up
                           Contributions and which were 401(k) Contributions.
                           See sections 3.5 and 3.6 for instances in which
                           Participant Before-Tax Contributions that would
                           normally be characterized as 401(k) Contributions are
                           in fact characterized as Catch-Up Contributions.
                           Catch-Up Contributions shall be allocated to
                           Participant Before-Tax Contributions Accounts.

                  (ii)     Limitations on Catch-Up Contributions.

                           (A)      Limit for Apache Plans. The sum of Catch-Up
                                    Contributions to this Plan and similar
                                    deferrals under Code section 414(v) to any
                                    other plan maintained by the Company or an
                                    Affiliated Entity shall not exceed the
                                    dollar limit in effect under Code section
                                    414(v)(2) in any calendar year. The Company
                                    shall inform the Committee if such limit has
                                    been exceeded, and the excess amount
                                    allocated to this Plan. The excess amount
                                    allocated to this Plan shall be reduced by
                                    any amounts returned pursuant to any other
                                    provision of this Article. Any remaining
                                    excess amount shall be returned to the
                                    Participant as soon as administratively
                                    possible, and in no event later than April
                                    15 of the calendar year after the calendar
                                    year in which the excess occurred. Company
                                    Matching Contributions attributable to
                                    amounts returned under this subparagraph
                                    shall be forfeited. Unmatched Catch-Up
                                    Contributions shall be returned first. The
                                    amount returned or forfeited shall be
                                    adjusted to reflect the net increase or
                                    decrease in the net worth of the
                                    Participant's Account attributable thereto
                                    for the Plan Year. The Committee may use any
                                    reasonable method to allocate this
                                    adjustment.

                           (B)      Participant Limit. If the sum of the
                                    Catch-Up Contributions to this Plan and
                                    similar deferrals under Code section 414(v)
                                    to any other plan exceed the dollar limit in
                                    effect under Code section 414(v)(2) in a
                                    calendar year, and the Participant is an
                                    Employee on the last day of the Plan Year
                                    and informs the Committee of the amount of
                                    the excess allocated to this Plan, then that
                                    amount will be reduced by any Catch-Up
                                    Contributions for that calendar year that
                                    were returned pursuant to any other
                                    provision in this Article and any remaining
                                    excess amount shall be returned to the
                                    Participant as soon as administratively
                                    possible, and in no event later than April
                                    15 of the calendar year after the calendar
                                    year in which the excess occurred. Company
                                    Matching Contributions attributable to
                                    amounts returned under this subparagraph
                                    shall be forfeited. Unmatched Catch-Up
                                    Contributions shall be returned first. The
                                    amount returned or forfeited shall be
                                    adjusted to reflect the net increase or
                                    decrease in the net worth of the
                                    Participant's Account attributable thereto
                                    for the Plan Year. The Committee may use any
                                    reasonable method to allocate this
                                    adjustment.

         (c)      Procedures. Participant Before-Tax Contributions shall be made
                  according to rules prescribed by the Committee, and may only
                  be made after the Company has received authorization from a
                  Participant to deduct such contributions from his or her
                  Compensation. Such authorization shall remain in effect until
                  revoked or changed by the Participant. If an Employee makes a
                  hardship withdrawal from his Before-Tax Account under section
                  7.1 after 2001, his contribution rate shall be immediately
                  reduced to 0%, and shall remain at 0% for at least 6 months.
                  To be effective, any authorization, change of authorization,
                  or notice of revocation must be filed with the Committee
                  according to such restrictions and requirements as the
                  Committee prescribes. The Committee shall establish procedures
                  from time to time for

                                       13
<PAGE>

                  Participants to change their contribution elections, which
                  procedures shall be communicated to Participants. The
                  Committee may establish different procedures for Participant
                  Before-Tax Contributions from different types of Compensation,
                  such as bonuses. The Committee's procedures for Catch-Up
                  Contributions shall allow all Participants who can make
                  Catch-Up Contributions the effective opportunity to make the
                  same dollar amount of Catch-Up Contributions for the calendar
                  year.

         (d)      Rollovers. The Plan may accept any Rollover Contribution from
                  a Covered Employee, with the following limitations. The
                  Committee shall decide from time to time which types of
                  Rollover Contributions the Plan will accept, and the
                  conditions under which the Plan will accept them. The Plan
                  shall not accept any Rollover Contribution to the extent that
                  it is a direct transfer of an amount that would, if not rolled
                  over, be excluded from the Covered Employee's gross income
                  (i.e., the Plan won't accept rollovers of after-tax
                  contributions). If the Plan accepts a contribution and
                  subsequently determines that the contribution did not qualify
                  as a Rollover Contribution, the Plan shall distribute such
                  contribution, as well as the net increase or decrease in the
                  net value of the Trust Fund attributable to the contribution,
                  to the Covered Employee as soon as administratively
                  practicable. Rollover Contributions shall be allocated to
                  Rollover Accounts.

3.3      Return of Contributions.

         (a)      Upon the request of the Company, the Trustee shall return to
                  the Company, any Company Contribution made under a mistake of
                  fact. The amount that shall be returned shall not exceed the
                  excess of the amount contributed (reduced to reflect any
                  decrease in the net worth of the appropriate Accounts
                  attributable thereto) over the amount that would have been
                  contributed without the mistake of fact. Appropriate
                  reductions shall be made in the Accounts of Participants to
                  reflect the return of any contributions previously credited to
                  such Accounts. If the Company so requests, any contribution
                  made under a mistake of fact shall be returned to the Company
                  within one year after the date of payment.

         (b)      Upon the request of the Company, the Trustee shall return to
                  the Company, any Company Contribution or 401(k) Contribution
                  that is not deductible under Code section 404. The Company
                  shall pay any returned 401(k) Contribution to the appropriate
                  Participant or the Company's Nonqualified Retirement/Savings
                  Plan, as appropriate, as soon as administratively practicable,
                  subject to any withholding. All contributions under the Plan
                  are expressly conditioned upon their deductibility for federal
                  income tax purposes. The amount that shall be returned shall
                  be the excess of the amount contributed (reduced to reflect
                  any decrease in the net worth of the appropriate Accounts
                  attributable thereto) over the amount that would have been
                  contributed if there had not been a mistake in determining the
                  deduction. Appropriate reductions shall be made in the
                  Accounts of Participants to reflect the return of any
                  contributions previously credited to such Accounts. Any
                  contribution conditioned on its deductibility shall be
                  returned within one year after it is disallowed as a
                  deduction.

         (c)      A contribution shall be returned under this section only to
                  the extent that its return will not reduce the Account(s) of a
                  Participant to an amount less than the balance that would have
                  been credited to the Participant's Account(s) had the
                  contribution not been made.

3.4      Limitation on Annual Additions.

         (a)      Limit. The Annual Additions to a Participant's Account(s) in
                  this Plan and to his or her accounts in any other defined
                  contribution plans maintained by the Company or an Affiliated
                  Entity for any Limitation Year shall not exceed in the
                  aggregate the lesser of (i) $40,000 (as adjusted by the
                  Secretary of the Treasury), or (ii) 100% of the Participant's
                  Compensation. The limit in paragraph (ii) shall not apply to
                  any contribution for medical benefits (within the meaning of
                  Code section 419A(f)(2)) after separation from service that is
                  treated as an Annual Addition.

                                       14
<PAGE>

         (b)      Corrective Mechanism.

                  (i)      Reduction in Annual Additions. A Participant's Annual
                           Additions shall be reduced, to the extent necessary
                           to satisfy the foregoing limits, if the Annual
                           Additions arose as a result of a reasonable error in
                           estimating Compensation, as a result of the
                           allocation of forfeitures, or as a result of other
                           facts and circumstances as provided in the
                           regulations under Code section 415.

                  (ii)     Order of Reduction, Multiple Plans. Apache also
                           maintains the Apache Corporation Money Purchase
                           Retirement Plan, a money purchase pension plan. On
                           January 1, 1997, Apache owned more than 50% of
                           Producers Energy Marketing LLC ("ProEnergy"). As long
                           as Apache's ownership of ProEnergy remains above 50%,
                           the annual additions to any qualified defined
                           contribution plan maintained by ProEnergy will be
                           considered Annual Additions subject to the limitation
                           in subsection (a). The Participant's Annual Additions
                           shall be reduced, to the extent necessary, in the
                           following order. First, to the extent that the Annual
                           Additions in a single plan exceed the limits of
                           subsection (a), the Annual Additions in that plan
                           shall be reduced, in the order specified in that
                           plan, to the extent necessary to satisfy the limits
                           of subsection (a). Then, if the Participant has
                           Annual Additions in more than one plan and in the
                           aggregate they exceed the limits of subsection (a),
                           the Annual Additions will be reduced as follows.

                           (A)      If the Participant was eligible to
                                    participate in the Non-Qualified
                                    Retirement/Savings Plan of Apache
                                    Corporation on the last day of the Plan Year
                                    in which the excess Annual Addition
                                    occurred, the Annual Additions will be
                                    reduced in the following order: the Annual
                                    Additions to the Apache Corporation Money
                                    Purchase Pension Plan; then the Annual
                                    Additions to ProEnergy's plans, in the order
                                    specified in those plans; then the Annual
                                    Additions to this Plan.

                           (B)      If the Participant was not eligible to
                                    participate in the Non-Qualified
                                    Retirement/Savings Plan of Apache
                                    Corporation on the last day of the Plan Year
                                    in which the excess Annual Addition
                                    occurred, the Annual Additions will be
                                    reduced in the following order: the Annual
                                    Additions to this Plan; then the Annual
                                    Additions to ProEnergy's plans, in the order
                                    specified in those plans; then the Annual
                                    Additions to the Apache Corporation Money
                                    Purchase Retirement Plan.

                  (iii)    Order of Reduction, This Plan. If the Participant was
                           eligible to participate in the Non-Qualified
                           Retirement/Savings Plan of Apache Corporation on the
                           last day of the Plan Year in which the excess Annual
                           Addition occurred, the Annual Additions to this Plan
                           shall be reduced in the following order: Company
                           Discretionary Contributions; Company Matching
                           Contributions; then 401(k) Contributions. If the
                           Participant was not eligible to participate in the
                           Non-Qualified Retirement/Savings Plan of Apache
                           Corporation on the last day of the Plan Year in which
                           the excess Annual Addition occurred, the Annual
                           Additions to this Plan shall be reduced in the
                           following order: unmatched 401(k) Contributions; then
                           matched 401(k) Contributions and the corresponding
                           Company Matching Contributions; then Company
                           Discretionary Contributions.

                  (iv)     Disposition of Excess Annual Additions. The Plan
                           shall pay any reduction in 401(k) Contributions
                           (adjusted to reflect any investment earnings, but not
                           any investment losses, thereon) to the Participant as
                           soon as administratively practicable, subject to any
                           withholding. Any reduction of Company Contributions
                           shall be placed in a suspense account in the Trust
                           Fund and used to reduce future Company Contributions
                           to the Plan. The following rules shall apply to such
                           suspense account: (A) no further Company
                           Contributions may be made if the allocation thereof
                           would be precluded by Code section 415; (B) any
                           increase or decrease in the net value of the Trust
                           Fund attributable to the suspense account shall not
                           be allocated to the suspense account, but shall be
                           allocated to the Accounts; and (C) all amounts held
                           in the suspense account shall be allocated as of each
                           succeeding allocation date on which forfeitures may
                           be allocated pursuant to section 5.5 (and may be
                           allocated more frequently if the Committee so
                           directs), until the suspense account is exhausted.

                                       15
<PAGE>

3.5      Contribution Limits for Highly Compensated Employees (ADP Test).

         (a)      Limits on Contributions. Notwithstanding any provision in this
                  Plan to the contrary, the actual deferral percentage ("ADP")
                  test of Code section 401(k)(3) shall be satisfied. Code
                  section 401(k) and the regulations issued thereunder are
                  hereby incorporated by reference to the extent permitted by
                  such regulations. In performing the ADP test for a Plan Year,
                  the Plan will use that Plan Year's data for the Non-Highly
                  Compensated Employees.

         (b)      Permissible Variations of the ADP Test. To the extent
                  permitted by the regulations under Code sections 401(m) and
                  401(k), 401(k) Contributions, QMACs, and QNECs may be used to
                  satisfy the ACP test of section 3.6 if they are not used to
                  satisfy the ADP test. The Committee may elect to exclude from
                  the ADP test those Non-Highly Compensated Employees who, at
                  the end of the Plan Year, had not attained age 21 and/or whose
                  Period of Service was for less than one year.

         (c)      Advanced Limitation on 401(k) Contributions or Company
                  Matching Contributions. The Committee may limit the 401(k)
                  Contributions of any Highly Compensated Employee (or any
                  Employee expected to be a Highly Compensated Employee) at any
                  time during the Plan Year (with the result that his or her
                  share of Company Matching Contributions may be limited). This
                  limitation may be made, if practicable, whenever the Committee
                  believes that the limits of this section or sections 3.4 or
                  3.6 will not be satisfied for the Plan Year.

         (d)      Corrections to Satisfy Test. If the ADP test is not satisfied
                  for the Plan Year, the Committee shall decide which one or
                  more of the following methods shall be employed to satisfy the
                  ADP test. All corrections shall be accomplished if possible
                  before March 15 of the following Plan Year, and in no event
                  later than 12 months after the close of the Plan Year.

                  (i)      The Committee may recommend to the Company and the
                           Company may make QNECs to the Plan, pursuant to
                           subsection 3.7(c).

                  (ii)     The Committee may recommend to the Company and the
                           Company may designate some or all of the Company
                           Discretionary Contributions allocated to Non-Highly
                           Compensated Employees as QNECs, pursuant to
                           subsection 3.7(b).

                  (iii)    The Committee may recommend to the Company and the
                           Company may designate any Company Matching
                           Contributions to the Plan as QMACs, pursuant to
                           section 3.8.

                  (iv)     401(k) Contributions of Highly Compensated Employees
                           may be recharacterized as Catch-Up Contributions or
                           returned to the Highly Compensated Employee, without
                           the consent of either the Highly Compensated Employee
                           or his or her Spouse, subject to the rules of
                           subsection (f).

         (e)      Order of Correction. The method described in subsection (c)
                  shall be employed first, during the Plan Year. If that method
                  is not used during the Plan Year, or if the net effect of such
                  method was insufficient for the ADP test to be satisfied, the
                  Company has the discretion to use any one or more of the
                  methods described in paragraphs (d)(i), (d)(ii), and (d)(iii).
                  If the Company does not choose to make the corrections
                  described in paragraphs (d)(i), (d)(ii), and (d)(iii), or if
                  such corrections are insufficient to satisfy the ADP test,
                  then the correction method described in paragraph (d)(iv)
                  shall be used.

         (f)      Calculating the Amounts Returned or Recharacterized. If the
                  ADP test is not satisfied, and 401(k) Contributions are
                  returned or recharacterized pursuant to paragraph (d)(iv)
                  above, the Committee shall determine the amount to be returned
                  or recharacterized pursuant to paragraph (i) below, and shall
                  then allocate that amount among the Highly Compensated
                  Employees pursuant to paragraph (ii) below in the order
                  specified in paragraph (iii) below. The amount actually
                  recharacterized or returned to each Highly Compensated
                  Employee shall be adjusted to reflect as nearly as possible
                  the actual investment gains or losses thereon for the Plan
                  Year, determined pursuant to Article IV, but shall not be
                  adjusted to reflect any subsequent gains or losses.

                                       16
<PAGE>

                  (i)      Calculation of Amount of Excess Contributions. The
                           amount of 401(k) Contributions to be recharacterized
                           or returned to the group of Highly Compensated
                           Employees as a whole (the "excess contributions")
                           shall be equal to the hypothetical reduction in the
                           401(k) Contributions that are subject to the ADP test
                           pursuant to subsection (b) (the "relevant 401(k)
                           Contributions") that would be made under the
                           following procedure. The Highly Compensated
                           Employee(s) with the highest "actual deferral ratio"
                           has an amount hypothetically reduced until his or her
                           actual deferral ratio is reduced to the actual
                           deferral ratio of the Highly Compensated Employee
                           with the next highest actual deferral ratio; this
                           process is repeated to the extent necessary for the
                           ADP test to be satisfied. The term "actual deferral
                           ratio" is a fraction, the denominator of which is
                           equal to the Participant's Compensation, and the
                           numerator of which is equal to (A)+(B)+(C)-(D)-(E),
                           where

                           (A)      is equal to the Participant's 401(k)
                                    Contributions for the Plan Year.

                           (B)      is equal to that portion of the
                                    Participant's QNECs and QMACs that are
                                    allocated to the Participant as of any date
                                    within the Plan Year, but only to the extent
                                    that the Committee elects to include them in
                                    the ADP test.

                           (C)      is equal to zero for a Non-Highly
                                    Compensated Employee, and, for each Highly
                                    Compensated Employee who participates in a
                                    cash or deferred arrangement sponsored by
                                    the Company or an Affiliated Entity that is
                                    permitted to be aggregated with this Plan,
                                    is equal to the contributions to the other
                                    plan that are subject to that plan's ADP
                                    test.

                           (D)      is equal to any of the amounts in (A) that
                                    are used in the ACP test pursuant to
                                    subsection (b).

                           (E)      is equal to any of the amounts in (A) or (B)
                                    or (C) that have been removed from the
                                    Participant's Accounts pursuant to any other
                                    corrective mechanisms described in this
                                    Article.

                  (ii)     Allocation of Excess Contributions. The excess
                           contributions shall be allocated among the Highly
                           Compensated Employees as follows. The Highly
                           Compensated Employee(s) with the largest relevant
                           401(k) Contributions shall have an amount
                           recharacterized or returned until his or her
                           remaining relevant 401(k) Contributions are equal to
                           those of the Highly Compensated Employee with the
                           next largest relevant 401(k) Contributions. This
                           process is repeated until the excess contributions
                           have been completely recharacterized or returned to
                           the Highly Compensated Employees.

                  (iii)    Ordering. For each Highly Compensated Employee
                           allocated an excess contribution, the Plan shall take
                           the following steps, in the following order.

                           (A)      Recharacterize matched 401(k) Contributions
                                    as Catch-Up Contributions to the extent
                                    possible.

                           (B)      Recharacterize unmatched 401(k)
                                    Contributions as Catch-Up Contributions to
                                    the extent possible.

                           (C)      Return unmatched 401(k) Contributions.

                           (D)      Return matched 401(k) Contributions and
                                    forfeit the corresponding Company Matching
                                    Contribution (unless it was returned to the
                                    Participant pursuant to paragraph
                                    3.6(c)(iv)).

3.6      Contribution Limits for Highly Compensated Employees (ACP Test).

         (a)      Limits on Contributions. Notwithstanding any provision in this
                  Plan to the contrary, the actual contribution percentage
                  ("ACP") test of Code section 401(m)(2) shall be satisfied.
                  Code section 401(m) and the regulations issued thereunder are
                  hereby incorporated by reference to the extent permitted by

                                       17
<PAGE>

                  such regulations. In performing the ACP test for a Plan Year,
                  the Plan will use that Plan Year's data for the Non-Highly
                  Compensated Employees.

         (b)      Permissible Variations of the ACP Test. To the extent
                  permitted by the regulations under Code sections 401(m) and
                  401(k), 401(k) Contributions, QMACs, and QNECs may be used to
                  satisfy this test if not used to satisfy the ADP test of
                  section 3.5. The Committee may elect to exclude from the ACP
                  test those Non-Highly Compensated Employees who, at the end of
                  the Plan Year, had not attained age 21 and/or whose Period of
                  Service was for less than one year.

         (c)      Corrections to Satisfy Test. If the ACP test is not satisfied,
                  the Committee shall decide which one or more of the following
                  methods shall be employed to satisfy the ACP test. All
                  corrections shall be accomplished if possible before March 15
                  of the following Plan Year, and in no event later than 12
                  months after the close of the Plan Year.

                  (i)      The Committee may recommend to the Company and the
                           Company may make QNECs to the Plan, pursuant to
                           subsection 3.7(c).

                  (ii)     The Committee may recommend to the Company and the
                           Company may designate any portion of its Company
                           Discretionary Contribution as a QNEC, pursuant to
                           subsection 3.7(b).

                  (iii)    The Committee may recommend to the Company and the
                           Company may make extra Company Matching Contributions
                           to the Plan, pursuant to paragraph 3.1(b)(ii).

                  (iv)     The non-vested Company Matching Contributions
                           allocated to Highly Compensated Employees as of any
                           date during the Plan Year may be forfeited as of the
                           last day of the Plan Year, and the vested Company
                           Matching Contributions allocated to any Highly
                           Compensated Employee for the Plan Year may be paid to
                           such Highly Compensated Employee, without the consent
                           of either the Highly Compensated Employee or his or
                           her Spouse, subject to the rules of subsection (e).

                  (v)      Those 401(k) Contributions that are taken into
                           account for this ACP test for any Highly Compensated
                           Employee may be returned to such Highly Compensated
                           Employee, without the consent of either the Highly
                           Compensated Employee or his or her Spouse, subject to
                           the rules of subsection (e).

         (d)      Order of Correction. The method described in subsection 3.5(c)
                  shall be employed first, during the Plan Year. If that method
                  is not used during the Plan Year, or if the net effect of such
                  method was insufficient for the ACP test to be satisfied, the
                  Company has the discretion to use any one or more of the
                  methods described in paragraphs (c)(i), (c)(ii), and (c)(iii).
                  If the Company does not choose to make the corrections
                  described in paragraphs (c)(i), (c)(ii), and (c)(iii), or if
                  such corrections are insufficient to satisfy the ACP test,
                  then the correction methods described in paragraphs (c)(iv)
                  and (c)(v) shall be used, as described in subsection (e).

         (e)      Calculating the Corrective Reduction in Participants'
                  Accounts. If the ACP test is not satisfied, and the correction
                  methods described in paragraphs (c)(iv) and (c)(v) are to be
                  used, the Committee shall determine the amount of the
                  correction pursuant to paragraph (i) below, and shall then
                  allocate that amount among the Highly Compensated Employees
                  pursuant to paragraph (ii) below in the order specified in
                  paragraph (iii). The amount of the correction shall be
                  adjusted to reflect as nearly as possible the actual
                  investment gains or losses thereon for the Plan Year,
                  determined pursuant to Article IV, but shall not be adjusted
                  to reflect any subsequent gains or losses.

         (f)      Calculation of Amount of Excess Aggregate Contributions. The
                  term "aggregate contributions" means those 401(k)
                  Contributions and Company Matching Contributions that are
                  taken into account for the ACP test pursuant to subsection
                  (b). The amount of the excess aggregate contributions shall be
                  equal to the hypothetical reduction in the aggregate
                  contributions that would be made under the following
                  procedure. The Highly Compensated Employee(s) with the highest
                  "actual contribution ratio" has his or

                                       18
<PAGE>

                  her aggregate contributions hypothetically reduced until his
                  or her actual contribution ratio is lowered to the actual
                  contribution ratio of the Highly Compensated Employee with the
                  next highest actual contribution ratio; this process is
                  repeated to the extent necessary for the ACP test to be
                  satisfied. The term "actual contribution ratio" is a fraction,
                  the denominator of which is equal to the Participant's
                  Compensation, and the numerator of which is equal to
                  (A)+(B)+(C)+(D)-(E), where

                           (A) is equal to the Participant's Company Matching
                           Contributions for the Plan Year.

                           (B) is equal to the Participant's 401(k)
                           Contributions that are used in the ACP test pursuant
                           to subsection (b).

                           (C) is equal to that portion of the Participant's
                           QNECs and QMACs that are allocated to the Participant
                           as of any date within the Plan Year, but only to the
                           extent that the Committee elects to include them in
                           the ACP test.

                           (D) is equal to zero for a Non-Highly Compensated
                           Employee, and, for each Highly Compensated Employee
                           who participates in a cash or deferred arrangement
                           sponsored by the Company or an Affiliated Entity that
                           is permitted to be aggregated with this Plan, is
                           equal to the contributions to the other plan that are
                           subject to that plan's ACP test.

                           (E) is equal to any of the amounts in (A) or (B) or
                           (C) or (D) that have been removed from the
                           Participant's Accounts pursuant to any other
                           corrective mechanisms described in this Article.

                  (i)      Allocation of Excess Aggregate Contributions. The
                           excess aggregate contributions shall be allocated
                           among the Highly Compensated Employees as follows.
                           The Highly Compensated Employee(s) with the largest
                           aggregate contributions shall have his or her
                           aggregate contributions reduced until his or her
                           remaining aggregate contributions are equal to those
                           of the Highly Compensated Employee with the next
                           largest aggregate contributions. This process is
                           repeated until the excess aggregate contributions
                           have been eliminated.

                  (ii)     Ordering. For each Highly Compensated Employee
                           allocated an excess aggregate contribution, the Plan
                           shall take the following steps, in the following
                           order.

                           (A)      Recharacterize matched 401(k) Contributions
                                    as Catch-Up Contributions to the extent
                                    possible.

                           (B)      Recharacterize unmatched 401(k)
                                    Contributions as Catch-Up Contributions to
                                    the extent possible.

                           (C)      Return unmatched 401(k) Contributions.

                           (D)      Pay the vested Company matching Contribution
                                    for the Plan Year to the Participant.

                           (E)      Return matched 401(k) Contributions and
                                    forfeit the corresponding Company Matching
                                    Contribution (unless it was returned to the
                                    Participant pursuant to paragraph
                                    3.6(c)(iv)).

                           (F)      Forfeit the unvested Company Matching
                                    Contribution for the Plan Year.

3.7      QNECs.

         (a)      QNECs shall be paid to the Plan no later than 12 months after
                  the close of the Plan Year to which they relate.

         (b)      The Company may designate as a QNEC all or any portion of the
                  Company Discretionary Contribution that is allocated to
                  Non-Highly Compensated Employees.

                                       19
<PAGE>

         (c)      The Company may make a contribution to the Plan, in addition
                  to the Company Discretionary Contribution, that the Company
                  designates as a QNEC. This subsection applies to such
                  contributions. As of the last day of each Plan Year, the
                  Committee shall allocate such QNECs for such Plan Year
                  (including such forfeitures occurring during such Plan Year
                  that are treated as QNECs pursuant to section 5.5). These
                  amounts shall be allocated to the Participant Before-Tax
                  Contributions Accounts of those Non-Highly Compensated
                  Employees who were Covered Employees on the last day of the
                  Plan Year, as follows:

                  (i)      QNECs shall be allocated to the Participant
                           Before-Tax Contributions Account of the Non-Highly
                           Compensated Employee(s) with the least Compensation,
                           until either the QNECs are exhausted or the limit of
                           section 3.4 is reached for such Non-Highly
                           Compensated Employee(s).

                  (ii)     Any remaining QNECs shall be allocated to the
                           Participant Before-Tax Contributions Account of the
                           Non-Highly Compensated Employee(s) with the next
                           lowest Compensation, until either the QNECs are
                           exhausted or the limit of section 3.4 is reached for
                           such Non-Highly Compensated Employee(s).

                  (iii)    The procedure in paragraph (ii) shall be repeated
                           until all QNECs have been allocated.

         (d)      All QNECs shall be treated in the same manner as a Company
                  Discretionary Contribution for purposes of section 12.4.

3.8      QMACs.

         The Company may designate all or any portion of any Non-Highly
         Compensated Employee's allocation of Company Matching Contributions as
         a QMAC. Such designation shall be made before such contributions are
         made to the Trust Fund. If the Company inadvertently designates any
         Highly Compensated Employee's allocation as a QMAC, the designation
         shall be ineffective. QMACs shall be paid to the Plan no later than 12
         months after the close of the Plan Year to which they relate.

ARTICLE IV
INTERESTS IN THE TRUST FUND

4.1      Participants' Accounts.

         The Committee shall establish and maintain separate Accounts in the
         name of each Participant, but the maintenance of such Accounts shall
         not require any segregation of assets of the Trust Fund. Each Account
         shall contain the contributions specified below and the increase or
         decrease in the net worth of the Trust Fund attributable to such
         contributions.

         (a)      Participant Before-Tax Contributions Account. A Participant
                  Before-Tax Contributions Account shall be established for each
                  Participant who makes Participant Before-Tax Contributions, or
                  who receives an allocation of QNECs or QMACs. The Committee
                  may elect to establish subaccounts for the different types of
                  contributions allocated to this Account.

         (b)      Company Contributions Account. A Company Contributions Account
                  shall be established for each Participant who receives an
                  allocation of Company Discretionary Contributions that are not
                  designated as QNECs or an allocation of Company Matching
                  Contributions that are not designated as QMACs. The Committee
                  may elect to establish subaccounts for the different types of
                  contributions allocated to this Account.

         (c)      Rollover Account. A Rollover Account shall be established for
                  each Participant who makes a Rollover Contribution to the Plan
                  pursuant to subsection 3.2(d).

                                       20
<PAGE>

4.2      Valuation of Trust Fund.

         (a)      General. The Trustee shall value the assets of the Trust Fund
                  at least annually as of the last day of the Plan Year, and as
                  of any other dates determined by the Committee, at their
                  current fair market value and determine the net worth of the
                  Trust Fund. In addition, the Committee may direct the Trustee
                  to have a special valuation of the assets of the Trust Fund
                  when the Committee determines, in its sole discretion, that
                  such valuation is necessary or appropriate or in the event of
                  unusual market fluctuations of such assets. Such special
                  valuation shall not include any contributions made by
                  Participants since the preceding Valuation Date, any Company
                  Contributions for the current Plan Year, or any unallocated
                  forfeitures. The Trustee shall allocate the expenses of the
                  Trust Fund occurring since the preceding Valuation Date,
                  pursuant to section 9.2, and then determine the increase or
                  decrease in the net worth of the Trust Fund that has occurred
                  since the preceding Valuation Date. The Trustee shall
                  determine the share of the increase of decrease that is
                  attributable to the non-separately accounted for portion of
                  the Trust Fund and to any amount separately accounted for, as
                  described in subsections (b) and (c).

         (b)      Mandatory Separate Accounting. The Trustee shall separately
                  account for (i) any individually directed investments
                  permitted under section 9.3, and (ii) amounts subject to a
                  Domestic Relations Order, to provide a more equitable
                  allocation of any increase or decrease in the net worth of the
                  Accounts.

         (c)      Permissible Separate Accounting. The Trustee may separately
                  account for the following amounts to provide a more equitable
                  allocation of any increase or decrease in the net worth of the
                  Trust Fund:

                  (i)      the distributable amount of a Participant, pursuant
                           to section 6.6, including any amount distributable to
                           an Alternate Payee or to a beneficiary of a deceased
                           Participant; and

                  (ii)     Company Matching Contributions made since the
                           preceding Valuation Date;

                  (iii)    Participant Before-Tax Contributions that were
                           received by the Trustee since the preceding Valuation
                           Date;

                  (iv)     Company Matching Contributions and 401(k)
                           Contributions of Highly Compensated Employees that
                           may need to be distributed or forfeited to satisfy
                           the ADP and ACP tests of sections 3.5 or 3.6;

                  (v)      Rollovers that were received by the Trustee since the
                           preceding Valuation Date;

                  (vi)     Any other amounts for which separate accounting will
                           provide a more equitable allocation of the increase
                           or decrease in the net worth of the Trust Fund.

4.3      Allocation of Increase or Decrease in Net Worth.

         (a)      The Committee shall, as of each Valuation Date, allocate the
                  increase or decrease in the net worth of the Trust Fund that
                  has occurred since the preceding Valuation Date between the
                  non-separately accounted for portion of the Trust Fund and the
                  amounts separately accounted for that are identified in
                  subsections 4.2(b) and 4.2(c).

         (b)      The increase or decrease attributable to the non-separately
                  accounted for portion of the Trust Fund shall be allocated
                  among the appropriate Accounts in the ratio that the dollar
                  value of each such Account bore to the aggregate dollar value
                  of all such Accounts on the preceding Valuation Date after all
                  allocations and credits made as of such date had been
                  completed.

         (c)      After the allocation in subsection (b) is completed, the
                  Committee shall allocate any amounts separately accounted for
                  (including the increase or decrease in the net worth of the
                  Trust Fund attributable to such amounts) to the appropriate
                  Account(s) if such separate accounting is no longer necessary.

                                       21
<PAGE>

ARTICLE V
AMOUNT OF BENEFITS

5.1      Vesting Schedule.

         A Participant shall have a fully vested and nonforfeitable interest in
         all his or her Account(s) upon his or her Normal Retirement Age if he
         or she is an Employee on such date, upon his or her death while an
         Employee or while on an approved leave of absence from the Company or
         an Affiliated Entity, or upon his or her termination of employment with
         the Company or an Affiliated Entity because of a Disability. In all
         other instances a Participant's vested interest shall be calculated
         according to the following rules.

         (a)      Participant Before-Tax Contributions Account and Rollover
                  Account. A Participant shall be fully vested at all times in
                  his or her Participant Before-Tax Contributions Account and
                  his or her Rollover Account.

         (b)      Company Contributions Account. A Participant shall become
                  fully vested in his or her Company Contributions Account in
                  accordance with the following schedule:

<Table>
<Caption>
    Completed Years of Service           Vesting Percentage
    --------------------------           ------------------
<S>                                      <C>
            Less than 1                          0%
                 1                              20%
                 2                              40%
                 3                              60%
                 4                              80%
             5 or more                         100%
</Table>

         (c)      Special Vesting Rule. All Participants in the Plan who were
                  Employees of the Company on July 1, 1992 became 100% vested
                  with respect to all Company Matching Contributions and Company
                  Discretionary Contributions, together with any earnings
                  attributable thereto, made as of any date prior to July 2,
                  1992. If a Participant was not previously 100% vested, then
                  the amount that became 100% vested pursuant to this subsection
                  was allocated to a special Company Contributions Account; a
                  new Company Contributions Account was established for all
                  Company Matching Contributions not designated as QMACs and
                  Company Discretionary Contributions made on behalf of the
                  Participant as of any date subsequent to July 1, 1992.
                  Whenever any Participant becomes 100% vested in the two
                  separate Company Contributions Accounts, those Accounts shall
                  be merged into one Company Contributions Account.

         (d)      Partial Termination. A partial termination of the Plan
                  occurred as a result of the relocation of Apache's
                  headquarters from Denver, Colorado to Houston, Texas. As a
                  result, notwithstanding subsection (b), the Company
                  Contributions Accounts off all Denver-based Participants who
                  were laid off or who voluntarily severed their employment with
                  the Company after August 5, 1991, in connection with the
                  corporate relocation, are 100% vested.

         (e)      Change of Control. The Company Contributions Accounts of all
                  Participants shall be fully vested as of the effective date of
                  a "change in control." For purposes of this subsection, a
                  "change of control" shall mean the event occurring when a
                  person, partnership, or corporation, together with all
                  persons, partnerships, or corporations acting in concert with
                  each person, partnership, or corporation, or any or all of
                  them, acquires more than 20% of Apache's outstanding voting
                  securities; provided that a change of control shall not occur
                  if such persons, partnerships, or corporations acquiring more
                  than 20% of Apache's voting securities is solicited to do so
                  by Apache's board of directors, upon its own initiative, and
                  such persons, partnerships, or corporations have not
                  previously proposed to acquire more than 20% of Apache's
                  voting securities in an unsolicited offer made either to
                  Apache's board of directors or directly to the stockholders of
                  Apache.

                                       22
<PAGE>

5.2      Forfeitures.

         (a)      Notwithstanding the vesting rules of section 5.1, Annual
                  Additions to a Participant's Accounts and any increase or
                  decrease in the net worth of the Participant's Accounts
                  attributable to such Annual Additions may be reduced to
                  satisfy the limits described in section 3.4. Any reduction
                  shall be allocated as specified in section 3.4.

         (b)      Notwithstanding the vesting rules of section 5.1, Company
                  Matching Contributions and any increase or decrease in the net
                  worth of the Account(s) attributable to such contributions may
                  be forfeited as of the last day of the Plan Year if the 401(k)
                  Contribution that they matched was returned under paragraph
                  3.2(a)(ii) or subsection 3.5(d) or 3.6(c). Any such forfeiture
                  shall be allocated as specified in section 5.5.

         (c)      Notwithstanding the vesting rules of section 5.1, a missing
                  individual's vested Accounts may be forfeited as of the last
                  day of any Plan Year, as provided in section 13.12. Any such
                  forfeiture shall be allocated as specified in section 5.5.

         (d)      A Participant's non-vested interest in his or her Company
                  Contributions Account shall be forfeited at the end of the
                  Plan Year in which the Participant terminates employment. Any
                  such forfeiture shall be allocated as specified in section
                  5.5.

         (e)      Notwithstanding the vesting rules of section 5.1, Company
                  Matching Contributions that would violate Code section
                  401(a)(17), and any increase or decrease in the net worth of
                  the Account(s) attributable to such contributions, may be
                  forfeited as specified in subsection 3.1(b). Any such
                  reduction shall be allocated as specified in subsection
                  3.1(b).

5.3      Restoration of Forfeitures.

         (a)      The forfeiture of a missing individual's Account(s), as
                  described in section 13.12, shall be restored to such
                  individual if the individual makes a claim for such amount.

         (b)      If a Participant is rehired before incurring five-consecutive
                  one-year Lapses in Apache Employment, and the Participant has
                  received a distribution of his or her entire vested interest
                  in his or her Company Contributions Account (with the result
                  that the Participant forfeited his or her non-vested interest
                  in such Account), then the exact amount of the forfeiture
                  shall be restored to the Participant's Account. All the
                  rights, benefits, and features available to the Participant
                  when the forfeiture occurred shall be available with respect
                  to the restored forfeiture.

         (c)      If a Participant who is rehired before incurring five
                  consecutive one-year Lapses in Apache Employment has his or
                  her Accounts restored as above provided, and again terminates
                  employment prior to becoming fully vested in his or her
                  Company Contributions Account, the vested portion of his or
                  her Company Contributions Account shall be determined by
                  applying the vested percentage determined under section 5.1 to
                  the sum of (A) and (B), then subtracting (B) from such sum,
                  where: (A) is the value of the Participant's Company
                  Contributions Account as of the Valuation Date immediately
                  following his or her most recent termination of employment;
                  and (B) is the amount previously distributed to the
                  Participant on account of the prior termination of employment.

         (d)      If a Participant is rehired after having incurred five
                  consecutive one-year Lapses in Apache Employment, then no
                  amount forfeited from his or her Company Contributions Account
                  shall be restored to that Account.

                                       23
<PAGE>

5.4      Method of Forfeiture Restoration.

         Forfeitures that are restored pursuant to section 5.3 shall be
         accomplished by an allocation of the forfeitures occurring during the
         Plan Year, pursuant to section 5.5, or if such forfeitures are
         insufficient, by a special Company Contribution, pursuant to paragraph
         3.1(c)(i).

5.5      Allocation of Forfeitures.

         (a)      During the Plan Year. The forfeitures that occur during a Plan
                  Year shall be used during the Plan Year for the following: to
                  restore the forfeited portions of the Company Contributions
                  Accounts of reemployed Participants described in section 5.3;
                  to pay those expenses of the Plan that are properly payable
                  from the Trust Fund and that are not paid by the Company or
                  charged to Accounts; to reduce the Company Matching
                  Contributions under paragraph 3.1(b)(i) for the Plan Year, to
                  the extent that the Company has not already made such
                  contributions; to reduce any other Company Contributions for
                  the Plan Year, but only to the extent that the Company decides
                  to make such contributions.

         (b)      Forfeitures Remaining After the Plan Year End. If any
                  forfeitures remain after the end of a Plan Year, they shall be
                  used during the following Plan Year for the following: to
                  restore the forfeited portions of the Company Contributions
                  Accounts of reemployed Participants described in section 5.3;
                  to pay those expenses of the Plan that are properly payable
                  from the Trust Fund and that are not paid by the Company or
                  charged to Accounts; to reduce the Company Matching
                  Contributions under paragraph 3.1(b)(i) for the Plan Year, to
                  the extent that the Company has not already made such
                  contributions; to reduce the Company Matching Contributions
                  under paragraph 3.1(b)(i) for such following Plan Year, to the
                  extent the Company has not already made such contributions; to
                  reduce any other Company Contributions for the Plan Year, but
                  only to the extent that the Company decides to make such
                  contributions; and to reduce any other Company Contributions
                  for such following Plan Year, but only to the extent that the
                  Company decides to make such contributions. Apache shall
                  decide, on behalf of each employer, the amount and type(s) of
                  Company Contributions the forfeitures shall reduce. Any
                  forfeitures that remain at the end of such following Plan Year
                  shall be allocated as a Company Discretionary Contribution for
                  such following Plan Year.

5.6      Credits for Pre-Lapse Service.

         (a)      Company Contributions Made After Reemployment.

                  (i)      A Participant who is vested in any portion of his or
                           her Company Contributions Account, who incurs a
                           one-year Lapse in Apache Employment, and who is
                           thereafter reemployed, shall receive credit for
                           vesting purposes for Years of Service prior to a
                           one-year Lapse in Apache Employment upon completing a
                           Year of Service after such one-year Lapse in Apache
                           Employment.

                  (ii)     A Participant who is not vested in any portion of his
                           or her Company Contributions Account, who incurs a
                           one-year Lapse in Apache Employment, and who is
                           thereafter reemployed, shall receive credit for
                           vesting purposes for Years of Service prior to a
                           one-year Lapse in Apache Employment only if (A) the
                           Participant completes a Year of Service after such
                           Lapse in Apache Employment, and (B) the number of
                           consecutive one-year Lapses in Apache Employment is
                           less than the greater of five or the aggregate number
                           of Years of Service before such lapse.

         (b)      Company Contributions Made Prior to Termination. Years of
                  Service after a Participant has incurred five consecutive
                  one-year Lapses in Apache Employment shall be disregarded in
                  determining the vested percentage in a Participant's Company
                  Contributions Account at the time of the lapse.

5.7      Transfers - Portability.

         If any other employer adopts this or a similar profit sharing plan and
         enters into a reciprocal agreement with the Company that provides that
         (a) the transfer of a Participant from such employer to the Company (or
         vice

                                       24
<PAGE>

         versa) shall not be deemed a termination of employment for purposes of
         the plans, and (b) service with either or both employers shall be
         credited for purposes of vesting under both plans, then the transferred
         Participant's Account shall be unaffected by the transfer, except, if
         deemed advisable by the Committee, it may be transferred to the trustee
         of the other plan.

5.8      Reemployment - Separate Account.

         A rehired Participant shall have two Company Contribution Accounts, an
         "old" Company Contributions Account for the contributions from his or
         her earlier episode of employment, and a "new" Company Contributions
         Account for his or her later episode of employment. The vested
         percentage applicable to such Accounts shall be determined pursuant to
         sections 5.1 and 5.6, unless an amount was distributed from the old
         Company Contributions Account before the Participant was rehired, in
         which case the vested percentage of the old Company Contributions
         Account, after any forfeiture has been restored to it, shall be
         determined pursuant to subsection 5.3(c). If a Participant becomes
         fully vested in both the old and the new Company Contributions
         Accounts, they shall be merged into one Company Contributions Account.

ARTICLE VI
DISTRIBUTION OF BENEFITS

6.1      Beneficiaries.

         (a)      Designating Beneficiaries. Each Account Owner shall file with
                  the Committee a designation of the beneficiaries and
                  contingent beneficiaries to whom the distributable amount
                  (determined pursuant to section 6.2) shall be paid in the
                  event of the Account Owner's death. In the absence of an
                  effective beneficiary designation as to any portion of the
                  distributable amount after a Participant dies, such amount
                  shall be paid to the Participant's surviving Spouse, or, if
                  none, to his or her estate. In the absence of an effective
                  beneficiary designation as to any portion of the distributable
                  amount after any non-Participant Account Owner dies, such
                  amount shall be paid to the Account Owner's estate. The
                  Account Owner may change a beneficiary designation at any time
                  and without the consent of any previously designated
                  beneficiary.

         (b)      Special Rule for Married Participants. If the Account Owner is
                  a married Participant, his or her Spouse shall be the sole
                  beneficiary unless the Spouse has consented to the designation
                  of a different beneficiary. To be effective, the Spouse's
                  consent must be in writing, witnessed by a notary public, and
                  filed with the Committee. Any spousal consent shall be
                  effective only as to the Spouse who signed the consent.

         (c)      Special Rule for Divorces. If an Account Owner has designated
                  his or her spouse as a primary or contingent beneficiary, and
                  the Account Owner and spouse later divorce (or their marriage
                  is annulled), then the former spouse will be treated as having
                  pre-deceased the Account Owner for purposes of interpreting a
                  beneficiary designation form completed prior to the divorce or
                  annulment. This subsection 6.1(c) will apply only if the
                  Committee is informed of the divorce or annulment before
                  payment to the former spouse is authorized.

         (d)      Disclaimers. Any individual or legal entity who is a
                  beneficiary may disclaim all or any portion of his or her
                  interest in the Plan, provided that the disclaimer satisfies
                  the requirements of Code section 2518(b) and applicable state
                  law. The legal guardian of a minor or legally incompetent
                  person may disclaim for such person. The personal
                  representative (or the individual or legal entity acting in
                  the capacity of the personal representative according to
                  applicable state law) may disclaim on behalf of a beneficiary
                  who has died. The amount disclaimed shall be distributed as if
                  the disclaimant had predeceased the individual whose death
                  caused the disclaimant to become a beneficiary.

                                       25
<PAGE>

6.2      Consent.

         (a)      General. Except for distributions identified in subsection
                  (b), distributions may be made only after the appropriate
                  consent has been obtained under this subsection. Distributions
                  to a Participant or to a beneficiary (other than a beneficiary
                  of a deceased Alternate Payee) shall be made only with the
                  Participant's or beneficiary's consent to the time of
                  distribution. Distributions to an Alternate Payee or his or
                  her beneficiary shall be made as specified in the QDRO and in
                  accordance with section 13.9. To be effective, the consent
                  must be filed with the Committee according to the procedures
                  adopted by the Committee, within 90 days before the
                  distribution is to commence. A consent once given shall be
                  irrevocable after distribution has been processed.

         (b)      Exceptions to General Rule. Consent is not required for the
                  following distributions:

                  (i)      Corrective distributions under Article III that are
                           returned to the Participant because the contribution
                           is not deductible by the Company or because the
                           contribution would exceed the limits of Code sections
                           401(a)(17), 415(c)(1), 402(g), 401(k)(3), 401(m)(2),
                           401(m)(9), or any other limitation of the Code;

                  (ii)     Distributions that are required to comply with Code
                           section 401(a)(9);

                  (iii)    Immediate cashouts of less than $5,000, as described
                           in subsection 6.5(d) or paragraphs 6.5(e)(i) or
                           13.9(f)(ii);

                  (iv)     Distributions pursuant to Code section 401(a)(14);

                  (v)      Distributions of invalid rollovers pursuant to
                           subsection 3.2(b); and

                  (vi)     Distributions that must occur by a deadline specified
                           in the Plan.

6.3      Distributable Amount.

         The distributable amount of an Account Owner's Account(s) is the vested
         portion of the Account(s) (as determined by Article V) as of the
         Valuation Date coincident with or next preceding the date distribution
         is made, reduced by (a) any amount that is payable to an Alternate
         Payee pursuant to section 13.9, (b) any amount withdrawn pursuant to
         section 7.1 since such Valuation Date, and (c) the outstanding balance
         of any loan under section 7.2. Furthermore, the Committee shall
         temporarily suspend or limit distributions (by reducing the
         distributable amount), as explained in section 13.9, when the Committee
         is informed that a Domestic Relations Order affecting the Participant's
         Accounts is or may be in the process of becoming QDRO. The
         distributable amount shall also be zero (except to the extent necessary
         to comply with Code section 401(a)(9)) while the Committee has
         suspended withdrawals because it believes that the Plan may have a
         cause of action against the Participant, as explained in subsection
         13.9(h).

6.4      Manner of Distribution.

         (a)      General. The distributable amount shall be paid in a single
                  payment, except as otherwise provided in the remainder of this
                  section. Distributions shall be in the form of cash except to
                  the extent that an Account is invested in a fund containing
                  primarily Company Stock, the distributee may elect to receive
                  a distribution of whole shares of Company Stock. Fractional
                  shares of Company Stock shall be converted to and paid in
                  cash.

         (b)      Partial Withdrawals and Installments. Withdrawals are
                  available to Employees as specified in section 7.1 and to
                  those Employees over 70 1/2 who are Five-Percent Owners, as
                  described in paragraph 6.5(c)(ii). Annual installments are
                  available to beneficiaries as described in subsection 6.5(e).

                                       26
<PAGE>

         (c)      Grandfather Rules. Installments were a distribution option
                  under the Plan until June 30, 2001. Annuities were a
                  distribution option for some amounts that were transferred to
                  this Plan before June 30, 2001. Any Account Owner who could
                  receive a distribution before July 1, 2001 and who elected
                  before July 1, 2001 to receive the distribution in the form of
                  installments or an annuity shall receive the benefit so
                  elected. An Account Owner who elected installments may elect
                  to accelerate any or all remaining installment payments.

6.5      Time of Distribution.

         (a)      Earliest Date of Distribution. Unless an earlier distribution
                  is permitted by subsection (b) or required by subsection (c),
                  the earliest date that a Participant may elect to receive a
                  distribution is as follows.

         (b)      Termination of Employment or Disability. A Participant may
                  elect to receive a distribution as soon as practicable after
                  he or she terminates employment or incurs a Disability.

         (c)      During Employment. A Participant may not obtain a distribution
                  while employed by the Company or an Affiliated Entity, except
                  as provided in section 7.1 (relating to in-service
                  withdrawals) and except as provided in paragraph 6.5(c)(ii)
                  (relating to the minimum distributions required on and after a
                  Five-Percent Owner's Required Beginning Date).

         (d)      Compliance With Code Section 401(a)(14). Notwithstanding
                  subsection (a), unless a Participant elects otherwise, his or
                  her distribution shall commence no later than 60 days after
                  the close of the latest of: (i) the Plan Year in which the
                  Participant attains Normal Retirement Age; (ii) the Plan Year
                  in which occurs the tenth anniversary of the year in which the
                  Participant commenced participation in the Plan; and (iii) the
                  Plan Year in which the Participant terminates employment with
                  the Company and Affiliated Entities. If a Participant does not
                  affirmatively elect a distribution, he or she shall be deemed
                  to have elected to defer the distribution to a date later than
                  that specified in the preceding sentence.

         (e)      Latest Date of Distribution.

                  (i)      Former Employees. A Participant who is not an
                           Employee shall receive a single payment of his
                           distributable amount by his Required Beginning Date.
                           If a Five-Percent Owner terminates employment after
                           his or her Required Beginning Date, the Plan shall
                           distribute the entire distributable amount to him or
                           her as soon as administratively practicable after the
                           termination of employment.

                  (ii)     Current Employees. An Employee who is not a
                           Five-Percent Owner is not required to receive any
                           distributions under this subsection. An Employee who
                           is a Five-Percent Owner shall receive annual
                           distributions of at least the minimum amount required
                           to be distributed pursuant to Code section 401(a)(9).
                           A Five-Percent Owner may request that his or her
                           first minimum required distribution be distributed in
                           the calendar year preceding his or her Required
                           Beginning Date; the Committee shall comply with this
                           request if administrating practicable to do so.

         (f)      Small Amounts. If the aggregate value of the nonforfeitable
                  portion of a Participant's Accounts other than his Rollover
                  Account is $5,000 or less on any date after the Participant
                  ceases to be an Employee, then the Participant shall receive a
                  single payment of the distributable amount as soon as
                  practicable, provided that the aggregate value is $5,000 or
                  less when the distribution is processed. The Committee may
                  elect to check the value of the Participant's Accounts on an
                  occasional (rather than a daily) basis, to determine whether
                  to apply the provisions of this subsection.

         (g)      Distribution Upon Participant's Death.

                  (i)      Small Accounts. If the aggregate cash value of the
                           nonforfeitable portion of a Participant's Accounts is
                           $5,000 or less at any time after the Participant's
                           death and before any beneficiary elects to receive a
                           distribution under this subsection, then the
                           beneficiary or beneficiaries shall each

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<PAGE>

                           receive a single payment of their share of each one's
                           distributable amount as soon as administratively
                           practicable, provided that the aggregate value is
                           $5,000 or less when the distribution is processed.
                           The Committee may elect to check the value of the
                           Participant's Accounts on an occasional (rather than
                           a daily) basis, to determine whether to apply the
                           provisions of this paragraph.

                  (ii)     Larger Accounts. If paragraph (i) does not apply,
                           then each beneficiary may elect to have his or her
                           distributable amount distributed in a single payment
                           or in annual installments at any time after the
                           Participant's death, within the following guidelines.
                           No distribution shall be processed until the
                           beneficiary's identity as a beneficiary is
                           established. The entire distributable amount shall be
                           distributed by the last day of the calendar year
                           containing the fifth anniversary of the Participant's
                           death. A beneficiary who has elected installments may
                           elect to accelerate any or all remaining payments. If
                           the Participant was a Five-Percent Owner who began to
                           receive the minimum required distributions under
                           paragraph (c)(ii), the distribution to each
                           beneficiary must be made at least as rapidly as
                           required by the method used to calculate the minimum
                           required distributions that was in effect when the
                           Five-Percent Owner died.

         (h)      Alternate Payee. Distributions to an Alternate Payee shall be
                  made in accordance with the provisions of the QDRO and
                  pursuant to subsection 13.9.

         (i)      242(b) Elections. Notwithstanding the foregoing, distribution
                  of a Participant's Account(s), including the Account(s) of a
                  Participant who is a Key Employee in a top-heavy plan, may be
                  made in accordance with all of the following rules (regardless
                  of when such distribution commences):

                  (i)      The distribution must be one that would not have
                           disqualified the Plan under Code section 401(a)(9)
                           prior to its amendment by the Tax Equity and Fiscal
                           Responsibility Act of 1982.

                  (ii)     The distribution must be in accordance with a method
                           of distribution designated by the Participant whose
                           interest in the Plan is being distributed, or if the
                           Participant is deceased, by the designated
                           beneficiary of such Participant.

                  (iii)    The designation must have been in writing, signed by
                           the Participant or designated beneficiary, and made
                           before January 1, 1984.

                  (iv)     The Participant must have accrued a benefit under the
                           Plan as of December 31, 1983.

6.6      Direct Rollover Election.

         (a)      General Rule. A Participant, an Alternate Payee who is the
                  Spouse or former Spouse of the Participant, or a surviving
                  Spouse of a deceased Participant (collectively, the
                  "distributee") may direct the Trustee to pay all or any
                  portion of his "eligible rollover distribution" to an
                  "eligible retirement plan" in a "direct rollover." This direct
                  rollover option is not available to other Account Owners
                  (non-Spouse beneficiaries and Alternate Payees who are not the
                  Spouse or former Spouse of the Participant). Within a
                  reasonable period of time before an eligible rollover
                  distribution, the Committee shall inform the distributee of
                  this direct rollover option, the appropriate withholding
                  rules, other rollover options, the options regarding income
                  taxation, and any other information required by Code section
                  402(f). The distributee may waive the usual 30-day waiting
                  period before receiving a distribution, and elect to receive
                  his distribution as soon as administratively practicable after
                  completing and filing his distribution election.

         (b)      Definition of Eligible Rollover Distribution. An eligible
                  rollover distribution is any distribution or in-service
                  withdrawal other than (i) distributions required under Code
                  section 401(a)(9), (ii) distributions of amounts that have
                  already been subject to federal income tax (such as defaulted
                  loans or after-tax voluntary contributions), other than a
                  direct transfer to (A) another retirement plan that meets the
                  requirements of Code sections 401(a) or 403(a), or (B) an
                  individual retirement account or annuity

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<PAGE>

                  described in Code section 408(a) or 408(b), (iii) installment
                  payments in a series of substantially equal payments made at
                  least annually and (A) made over a specified period of ten or
                  more years, (B) made for the life or life expectancy of the
                  distributee, or (C) made for the joint life or joint life
                  expectancy of the distributee and his designated beneficiary,
                  (iv) a distribution to satisfy the limits of Code section 415
                  or 402(g), (v) a deemed distribution of a defaulted loan from
                  this Plan, to the extent provided in the regulations, (vi) a
                  distribution to satisfy the ADP or ACP tests, (vii) any other
                  actual or deemed distribution specified in the regulations
                  issued under Code section 402(c), or (viii) any hardship
                  withdrawal by an Employee.

         (c)      Definition of Eligible Retirement Plan. An eligible retirement
                  plan is an individual retirement account or annuity described
                  in Code section 408(a) or 408(b), an annuity plan described in
                  Code section 403(a), an annuity contract described in Code
                  section 403(b), an eligible plan under Code section 457(b)
                  that is maintained by an eligible employer described in Code
                  section 457(e)(1)(A) (which generally includes state and local
                  governments), or the qualified trust of a defined contribution
                  plan described in Code section 401(a), that accepts eligible
                  rollover distributions.

         (d)      Definition of Direct Rollover. A direct rollover is a payment
                  by the Trustee to the eligible retirement plan specified by
                  the distributee.

ARTICLE VII
WITHDRAWALS AND LOANS

7.1      In-Service Withdrawals.

         An Employee may withdraw amounts from his or her Account(s) only as
         provided in this section. An Employee may make withdrawals as follows.

         (a)      Withdrawals for Employees Age 59 1/2 or Older. An Employee who
                  has attained age 59 1/2 may at any time thereafter withdraw
                  any portion of his or her Participant Before-Tax Contributions
                  Account and any vested portion of his or her Company
                  Contributions Account. The minimum withdrawal is $1,000 or the
                  vested Account balance, whichever is less. Only two
                  withdrawals are permitted during each Plan Year under this
                  subsection. If the Employee is not fully vested in his or her
                  Company Contributions Account at the time of a withdrawal
                  under this subsection, the rules of subsection 5.3(c) shall be
                  applied when determining the vested portion of the Company
                  Contributions Account at any time thereafter.

         (b)      Rollover Account. An Employee may withdraw all or any portion
                  of his Rollover Account at any time. The minimum withdrawal is
                  $1,000 or the Rollover Account balance, whichever is less.
                  Only two withdrawals from the Rollover Account are permitted
                  during each Plan Year.

         (c)      Participant Before-Tax Contributions Account. An Employee may
                  withdraw all or any portion of his or her Participant
                  Before-Tax Contributions, provided that the Employee has an
                  immediate and heavy financial need, as defined in paragraph
                  (i), the withdrawal is needed to satisfy the financial need,
                  as explained in paragraph (ii), and the amount of the
                  withdrawal does not exceed the limits in paragraph (iii).

                  (i)      Financial Need. The following expenses constitute an
                           immediate and heavy financial need: medical care of
                           the Employee, the Employee's Spouse, or the
                           Employee's dependents; costs associated with the
                           purchase of a principal residence of the Employee;
                           tuition, related educational fees, and room and board
                           for the next 12 months of post-secondary education of
                           the Employee, the Employee's Spouse, or the
                           Employee's dependents; payments to prevent the
                           Employee from being evicted from his or her principal
                           residence; payments to prevent the mortgage on the
                           Employee's principle residence from being foreclosed;
                           and any other expenses specifically identified in
                           Treasury Regulation section 1.401(k)-1(d)(2)(iv)(A),
                           as amended. In addition, the Committee may determine,
                           based on a review of all relevant facts and
                           circumstances, that a particular expense or series of
                           expenses of the Employee constitutes an immediate and
                           heavy financial need.

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<PAGE>

                  (ii)     Satisfaction of Need. The withdrawal is deemed to be
                           needed to satisfy the Employee's financial need if
                           (A) the Employee has obtained all withdrawals and all
                           non-taxable loans available from the Company's and
                           any Affiliated Entities' qualified plans, and (B) for
                           a period of at least 6 months from the date the
                           Employee receives the withdrawal, he or she ceases to
                           make Participant Before-Tax Contributions and
                           elective contributions to all qualified and
                           non-qualified plans maintained by the Company or any
                           Affiliated Entity.

                  (iii)    Maximum Withdrawal. An Employee may not withdraw more
                           than the sum of the amount needed to satisfy his or
                           her financial need and any taxes and penalties
                           resulting from the withdrawal. An Employee may not
                           withdraw any amount in excess of his or her
                           Participant Before-Tax Contributions unless the
                           Employee has attained age 59 1/2.

         (d)      Form of Payment of Withdrawal. Withdrawals under subsection
                  (c) shall be in cash. Withdrawals under subsections (a) and
                  (b) shall be in cash, except that any portion of a
                  Participant's Accounts that is invested in Company Stock may,
                  at the election of the Participant made at the time that
                  notice of withdrawal is made to the Committee, be withdrawn in
                  the form of whole shares of Company Stock.

         (e)      Withdrawal Rules. An Employee may not withdraw any amount
                  under this section that has been borrowed or that is subject
                  to a QDRO. The Committee shall temporarily suspend or limit
                  withdrawals under this section, as explained in section 13.9,
                  when the Committee is informed that a QDRO affecting the
                  Employee's Accounts is in process or may be in process. The
                  Committee shall issue such rules as to the frequency of
                  withdrawals, and withdrawal procedures, as it deems
                  appropriate. The Committee may postpone the withdrawal until
                  after the next Valuation Date. The Committee may have a
                  special valuation of the Trust Fund performed before a
                  withdrawal is permitted. The Plan may charge a fee for the
                  withdrawal as well as a fee for having a special valuation
                  performed, as determined by the Committee in its sole
                  discretion.

7.2      Loans.

         The Committee is authorized, as one of the Plan fiduciaries responsible
         for investing Plan assets, to establish a loan program. The loan
         program shall become effective on the date determined by the Committee.
         The Committee shall administer the Plan's loan program in accordance
         with the following rules:

         (a)      Availability. Loans are available only to Employees,
                  Participants who are parties-in-interest (within the meaning
                  of ERISA section 3(14)), and beneficiaries who are
                  parties-in-interest (collectively referred to in this section
                  as "Borrowers"). The Committee shall temporarily reduce the
                  amount a Participant may borrow or temporarily prevent the
                  Participant from borrowing when, as described in section 13.9,
                  the Committee is informed that a QDRO affecting the
                  Participant's Accounts is in process or may be in process.
                  Loans shall be temporarily unavailable to a prospective
                  Borrower while the Committee has suspended loans because the
                  Committee believes that the Plan may have a cause of action
                  against the Participant, as explained in subsection 13.9(h).

         (b)      Number of Loans. A Borrower may have no more than one loan
                  outstanding. The Committee may change the maximum number of
                  outstanding loans allowed at any time.

         (c)      Loan Amount. The Committee may establish a minimum loan amount
                  of no more than $500. The Committee may require loans to be
                  made in increments of no more than $100. The amount that a
                  Borrower may borrow is subject to the following limits.

                  (i)      A Borrower may not borrow more than (A) the aggregate
                           Participant Before-Tax Contributions made by the
                           relevant Participant, less any of such amounts
                           previously withdrawn, plus (B) the balance in the
                           Participant's Rollover Account.

                  (ii)     At the time the loan from this Plan is made, the
                           aggregate outstanding balance of all the Borrower's
                           loans from all qualified plans maintained by the
                           Company and Affiliated Entities, including the

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<PAGE>

                           new loan from this Plan, shall not exceed 50% of the
                           Borrower's vested interest in all qualified plans
                           maintained by the Company and Affiliated Entities.

                  (iii)    For purposes of this paragraph, the term "one-year
                           maximum" means the largest aggregate outstanding
                           balance, on any day in the one-year period ending on
                           the day before the new loan from this Plan is
                           obtained, of all loans to the Borrower from all
                           qualified plans maintained by the Company and
                           Affiliated Entities. For purposes of this paragraph,
                           the term "existing loans" means the aggregate
                           outstanding balance, on the day the new loan is made
                           to the Borrower, of all loans to the Borrower from
                           all qualified plans maintained by the Company and
                           Affiliated Entities, excluding the new loan from this
                           Plan. If the existing loans are greater than or equal
                           to the one-year maximum, then the new loan from this
                           Plan shall not exceed $50,000 minus the existing
                           loans. If the existing loans are less than the
                           one-year maximum, then the new loan from this Plan
                           shall not exceed $50,000 minus the one-year maximum.

                           For purposes of applying the above limits, the vested
                           portion of the Borrower's accounts under this Plan
                           and all other plans maintained by the Company and
                           Affiliated Entities shall be determined without
                           regard to any accumulated deductible employee
                           contributions (as defined in Code section
                           72(o)(5)(B)), and without regard to any amounts
                           accrued while the Borrower was ineligible to obtain a
                           loan (as described in subsection (a)).
                           Notwithstanding the foregoing, the Committee may, in
                           its sole discretion, establish lesser limits on the
                           amounts that may be borrowed, which limits shall be
                           applied in a non-discriminatory manner. The Committee
                           shall temporarily reduce the amount a Participant may
                           borrow or temporarily prevent the Participant from
                           borrowing, as described in section 13.9, when the
                           Committee is informed that a QDRO affecting the
                           Participant's Accounts is in process or may be in
                           process. No loan shall be made of amounts that are
                           required to be distributed prior to the end of the
                           term of the loan.

         (d)      Interest. Each loan shall bear a reasonable rate of interest,
                  which shall remain fixed for the duration of the loan. The
                  Committee or its agent shall determine the reasonable rate of
                  interest on the date the loan documents are prepared. The
                  Committee shall have the authority to establish procedures
                  from time to time for determining the rate of interest. In the
                  absence of Committee action, the interest rate shall be equal
                  to the prime lending rate, plus 1%, as published in the Wall
                  Street Journal on the first day that such newspaper is
                  published during the calendar quarter in which the loan
                  documents are prepared.

         (e)      Repayment. All loans shall be repaid, with interest, in
                  substantially level amortized payments made not less
                  frequently than quarterly. The maximum term for a loan is four
                  years; the minimum term for a loan is one year. The Committee
                  has the authority to decrease the minimum term for future
                  loans and the authority to increase the maximum term for
                  future loans to no more than five years. Loan repayments shall
                  be accelerated, and all loans shall be payable in full on the
                  date the Borrower separates from service (if the Borrower is
                  an Employee), the date the Borrower becomes ineligible to
                  borrow from the Plan under to subsection (a), and on any other
                  date or any other contingency as determined by the Committee.
                  If the Borrower is an Employee, loans shall be repaid through
                  payroll withholding unless (i) the Employee is pre-paying his
                  or her loan, in which case the pre-payment need not be through
                  payroll withholding, or (ii) the Employee is on an unpaid
                  leave of absence, in which case he or she may pay any
                  installment by personal check. Partial pre-payments are
                  accepted.

         (f)      Default. A loan shall be in default if any installment is not
                  paid by the end of the calendar quarter following the calendar
                  quarter in which the installment was due. Upon default, the
                  Committee may, in addition to all other remedies, apply the
                  Borrower's Plan accounts toward payment of the loan; however,
                  the Trustee may not exercise such right of set-off with
                  respect to the Borrower's Participant Before-Tax Contributions
                  Account until such account has become payable, pursuant to
                  section 6.5 or 7.1.

         (g)      Administration. A Borrower shall apply for a loan by
                  completing the application procedures specified by the
                  Committee. Until changed by the Committee, a Borrower shall
                  apply for a loan by calling the Trustee and completing a voice
                  application. The loan shall be processed in accordance with
                  reasonable procedures adopted from time to time by the
                  Committee. The Committee may impose a loan application fee, a
                  loan origination fee, a loan pre-payment fee, and loan
                  maintenance fees. All loans

                                       31
<PAGE>

                  shall be evidenced by a promissory note and shall be fully
                  secured. No Borrower whose Plan accounts are so pledged may
                  obtain distribution of any portion of the accounts that have
                  been pledged. The rights of the Trustee under such pledge
                  shall have priority over all claims of the Borrower, his or
                  her beneficiaries, and creditors. Each loan shall be treated
                  as a directed investment. Any increase or decrease in the net
                  worth of the Trust Fund attributable to such loan shall be
                  allocated solely to the Plan accounts of the Borrower.

ARTICLE VIII
ALLOCATION OF RESPONSIBILITIES - NAMED FIDUCIARIES

8.1      No Joint Fiduciary Responsibilities.

         The Trustee(s) and the Committee shall be the named fiduciaries under
         the Plan and Trust agreement and shall be the only named fiduciaries
         thereunder. The fiduciaries shall have only the responsibilities
         specifically allocated to them herein or in the Trust agreement. Such
         allocations are intended to be mutually exclusive and there shall be no
         sharing of fiduciary responsibilities. Whenever one named fiduciary is
         required by the Plan or Trust agreement to follow the directions of
         another named fiduciary, the two named fiduciaries shall not be deemed
         to have been assigned a shared responsibility, but the responsibility
         of the named fiduciary giving the directions shall be deemed his or her
         sole responsibility, and the responsibility of the named fiduciary
         receiving those directions shall be to follow them insofar as the
         instructions are on their face proper under applicable law.

8.2      The Company.

         The Company shall be responsible for: (a) making Company Contributions;
         (b) certifying to the Trustee the names and specimen signatures of the
         members of the Committee acting from time to time; (c) keeping accurate
         books and records with respect to its Employees and the appropriate
         components of each Employee's Compensation and furnishing such data to
         the Committee; (d) selecting agents and fiduciaries to operate and
         administer the Plan and Trust; (e) appointing an investment manager if
         it determines that one should be appointed; and (f) reviewing
         periodically the performance of such agents, managers, and fiduciaries.

8.3      The Trustee.

         The Trustee shall be responsible for: (a) the investment of the Trust
         Fund to the extent and in the manner provided in the Trust agreement;
         (b) the custody and preservation of Trust assets delivered to it; and
         (c) the payment of such amounts from the Trust Fund as the Committee
         shall direct.

8.4      The Committee - Plan Administrator.

         The Board of Directors of Apache (the "Board") shall appoint an
         administrative Committee consisting of no fewer than three individuals
         who may be, but need not be, Participants, officers, directors, or
         Employees of the Company. If the Board does not appoint a Committee,
         Apache shall act as the Committee under the Plan. The members of the
         Committee shall hold office at the pleasure of the Board and shall
         service without compensation. The Committee shall be the "Plan
         administrator" as defined in section 3(16)(A) of ERISA. It shall be
         responsible for establishing and implementing a funding policy
         consistent with the objectives of the Plan and with the requirements of
         ERISA. This responsibility shall include establishing (and revising as
         necessary) short-term and long-term goals and requirements pertaining
         to the financial condition of the Plan, communicating such goals and
         requirements to the persons responsible for the various aspects of the
         Plan operations, and monitoring periodically the implementation of such
         goals and requirements.

                                       32
<PAGE>

8.5      Committee to Construe Plan.

         (a)      The Committee shall administer the Plan and shall have all
                  discretion, power, and authority necessary for that purpose,
                  including, but not by way of limitation, the full and absolute
                  discretion and power to interpret the Plan, to determine the
                  eligibility, status, and rights of all individuals under the
                  Plan, and in general to decide any dispute and all questions
                  arising in connection with the Plan. The Committee shall
                  direct the Trustee concerning all distributions from the Trust
                  Fund, in accordance with the provisions of the Plan, and shall
                  have such other powers in the administration of the Trust Fund
                  as may be conferred upon it by the Trust agreement. The
                  Committee shall maintain all Plan records except records of
                  the Trust Fund.

         (b)      The Committee may adjust the Account(s) of any Participant, in
                  order to correct errors and rectify omissions, in such manner
                  as the Committee believes will best result in the equitable
                  and nondiscriminatory administration of the Plan.

8.6      Organization of Committee.

         The Committee shall adopt such rules as it deems desirable for the
         conduct of its affairs and for the administration of the Plan. It may
         appoint agents (who need not be members of the Committee) to whom it
         may delegate such powers as it deems appropriate, except that any
         dispute shall be determined by the Committee. The Committee may make
         its determinations with or without meetings. It may authorize one or
         more of its members or agents to sign instructions, notices and
         determinations on its behalf. The action of a majority of the Committee
         shall constitute the action of the Committee.

8.7      Interested Committee Members.

         If a Committee decision or action affects a small number of
         Participants including a Committee member, then such Committee member
         shall not participate in the Committee decision or action. The action
         of a majority of the disinterested Committee members shall constitute
         the action of the Committee.

8.8      Agent for Process.

         Apache's Vice President, General Counsel, and Secretary shall be the
         agents of the Plan for service of all process.

8.9      Indemnification of Committee Members.

         The Company shall indemnify and hold the members of the Committee, and
         each of them, harmless from the effects and consequences of their acts,
         omissions, and conduct in their official capacities, except to the
         extent that the effects and consequences thereof shall result from
         their own willful misconduct, breach of good faith, or gross negligence
         in the performance of their duties. The foregoing right of
         indemnification shall not be exclusive of the rights to which each such
         member may be entitled as a matter of law.

8.10     Conclusiveness of Action.

         Any action taken by the Committee on matters within the discretion of
         the Committee shall be conclusive, final and binding upon all
         participants in the Plan and upon all persons claiming any rights
         hereunder, including alternate payees and beneficiaries.

8.11     Payment of Expenses.

         The members of the Committee shall serve without compensation but their
         reasonable expenses shall be paid by the Company. The compensation or
         fees of accountants, counsel, and other specialists and any other costs
         of administering the Plan or Trust Fund may be charged to the Trust
         Fund, to the extent permissible under the provisions of ERISA.

                                       33
<PAGE>

ARTICLE IX
TRUST AGREEMENT - INVESTMENTS

9.1      Trust Agreement.

         Apache has entered into a Trust agreement to provide for the holding,
         investment, and administration of the funds of the Plan. The Trust
         agreement shall be part of the Plan, and the rights and duties of any
         individual under the Plan shall be subject to all terms and provisions
         of the Trust agreement.

9.2      Expenses of Trust.

         (a)      Except as provided in subsection (b) below, (i) all taxes upon
                  or in respect of the Trust shall be paid by the Trustee out of
                  the Trust assets, and all expenses of administering the Plan
                  and Trust shall be paid out of the Trust assets, to the extent
                  permitted by law and to the extent such taxes and expenses are
                  not paid by the Company or the Account Owner, and (ii) the
                  Committee shall have full discretion to determine how to
                  allocate taxes and expenses among Accounts. No fiduciary shall
                  receive any compensation for services rendered to the Plan if
                  the fiduciary is being compensated on a full time basis by the
                  Company.

         (b)      To the extent not paid by the Company, all expenses of
                  individually directed transactions in Trust assets, including
                  without limitation the Trustee's transaction fee, brokerage
                  commissions, transfer taxes, interest on insurance policy
                  loans, and any taxes and penalties that may be imposed as a
                  result of an individual's investment direction, shall be
                  assessed against the Account(s) of the Account Owner directing
                  such transactions.

9.3      Investments.

         (a)      Section 404(c) Plan. The Plan is intended to be a plan
                  described in ERISA section 404(c). To the extent that an
                  Account Owner exercises control over the investment of his or
                  her Accounts, no person who is a fiduciary shall be liable for
                  any loss, or by reason of any breach, that is the direct and
                  necessary result of the Account Owner's exercise of control.

         (b)      Directed Investments. Accounts shall be invested, upon the
                  written or telephone voice-response direction of each Account
                  Owner, in any one or more of a series of investment funds
                  designated by the Committee from time to time. One or more
                  such funds may, at the sole discretion of the Committee,
                  consist of shares of Company Stock. If so directed by Account
                  Owners, up to 100% of the Accounts under the Plan may be
                  invested in Company Stock. The funds available for investment
                  and the principal features thereof, including a general
                  description of the investment objectives, the risk and return
                  characteristics, and the type and diversification of the
                  investment portfolio of each fund, shall be communicated to
                  the Account Owners in the Plan from time to time. Any changes
                  in such funds shall be immediately communicated to all Account
                  Owners.

         (c)      Absence of Directions. To the extent that an Account Owner
                  fails to affirmatively direct the investment of his or her
                  Accounts, the Committee shall direct the Trustee in writing
                  concerning the investment of such Accounts. The Committee
                  shall act by majority vote. Any dissenting member of the
                  Committee shall, having registered his or her dissent in
                  writing, thereafter cooperate to the extent necessary to
                  implement the decision of the Committee.

         (d)      Change in Investment Directions. Account Owners may change
                  their investment directions, with respect to the investment of
                  new contributions and with respect to the investment of
                  existing amounts allocated to Accounts, on any business day.
                  The Committee shall establish procedures for giving investment
                  directions, which shall be in writing and communicated to
                  Account Owners.

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<PAGE>

ARTICLE X
TERMINATION AND AMENDMENT

10.1     Termination of Plan or Discontinuance of Contributions.

         Apache expects to continue the Plan indefinitely, but the continuance
         of the Plan and the payment of contributions are not assumed as
         contractual obligations. Apache may terminate the Plan or discontinue
         contributions at any time. Upon the termination of the Plan or the
         complete discontinuance of contributions, each Participant's Accounts
         shall become fully vested. Upon the partial termination of the Plan,
         the Accounts of all affected Participants shall become fully vested.
         The only Participants who are affected by a partial termination are
         those whose employment with the Company or Affiliated Entity is
         terminated as a result of the corporate event causing the partial
         termination; Employees terminated for cause and those who leave
         voluntarily are not affected by a partial termination.

10.2     Allocations upon Termination or Discontinuance of Company
         Contributions.

         Upon the termination or partial termination of the Plan or upon the
         complete discontinuance of contributions, the Committee shall promptly
         notify the Trustee of such termination or discontinuance. The Trustee
         shall then determine, in the manner prescribed in section 4.2, the net
         worth of the Trust Fund as of the close of the last business day of the
         calendar month in which such notice was received by the Trustee. The
         Trustee shall advise the Committee of any increase or decrease in such
         net worth that has occurred since the preceding Valuation Date. After
         crediting to the Participant Before-Tax Contributions Account of each
         Participant any amount contributed since the preceding Valuation Date,
         the Committee shall thereupon allocate, in the manner described in
         section 4.3, among the remaining Plan Accounts, in the manner described
         in Articles III, IV and V, any Company Contributions or forfeitures
         occurring since the preceding Valuation Date.

10.3     Procedure Upon Termination of Plan or Discontinuance of Contributions.

         If the Plan has been terminated or partially terminated, or if a
         complete discontinuance of contributions to the Plan has occurred, then
         after the allocations required under section 10.2 have been completed,
         the Trustee shall distribute or transfer the Account(s) of affected
         Employees as follows.

         (a)      Participant Before-Tax Contributions Accounts. If the Company
                  or Affiliated Entity maintains or establishes another defined
                  contribution plan (other than an employee stock ownership plan
                  defined in Code section 4975(e)(7)), then no amount in a
                  Participant Before-Tax Contributions Account may be
                  distributed to any Employee who has not yet attained age 59
                  1/2.

         (b)      Other Rules.

                  (i)      If the affected Employee's Account(s) have an
                           aggregate value of $5,000 or less (calculated in
                           accordance with applicable Treasury regulations),
                           then the Trustee shall distribute the Employee's
                           Account(s) (except, if subsection (a) applies, the
                           Participant Before-Tax Contributions Account) to the
                           Employee in a lump sum (other than an annuity).

                  (ii)     If the affected Employee's Account(s) have an
                           aggregate value of more than $5,000 (calculated in
                           accordance with applicable Treasury regulations), and
                           if the Company or an Affiliated Entity does not
                           maintain another defined contribution plan (other
                           than an employee stock ownership plan within the
                           meaning of Code section 4975(e)(7)), then the Trustee
                           shall distribute the Employee's Account(s) to the
                           Employee in a lump sum (other than an annuity).

                  (iii)    If the affected Employee's Account(s) have an
                           aggregate value of more than $5,000 (calculated in
                           accordance with applicable Treasury regulations), and
                           if the Company or an Affiliated Entity maintains
                           another defined contribution plan (other than an
                           employee stock ownership plan within the meaning of
                           Code section 4975(e)(7)), then the Trustee shall
                           transfer the Employee's Account(s) to the other plan
                           unless the Employee consents to an immediate
                           distribution of such Account(s)

                                       35
<PAGE>

                           (except, if subsection (a) applies, for the
                           Participant Before-Tax Contributions Account) in a
                           lump sum (other than an annuity).

         (c)      Any distribution or transfer made pursuant to this section may
                  be in cash, in shares of Company Stock to the extent a
                  Participant's Accounts are invested in Company Stock, or
                  partly in cash and partly in shares of Company Stock. After
                  all such distributions or transfers have been made, the
                  Trustee shall be discharged from all obligation under the
                  Trust; no Participant or beneficiary who has received any such
                  distribution, or for whom any such transfer has been made,
                  shall have any further right or claim under the Plan or Trust.

10.4     Amendment by Apache.

         Apache may at any time amend the Plan in any respect, without prior
         notice, subject to the following limitations. No amendment shall be
         made that would have the effect of vesting in the Company any part of
         the Trust Fund or of diverting any part of the Trust Fund to purposes
         other than for the exclusive benefit of Account Owners. The rights of
         any Account Owner with respect to contributions previously made shall
         not be adversely affected by any amendment. No amendment shall reduce
         or restrict, either directly or indirectly, the accrued benefit (within
         the meaning of Code section 411(d)(6)) provided that any Account Owner
         before the amendment, except as permitted by the Internal Revenue
         Service.

         If the vesting schedule is amended, each Participant with at least
         three Years of Service may elect, within the period specified in the
         following sentence after the adoption of the amendment, to have his or
         her nonforfeitable percentage computed under the Plan without regard to
         such amendment. The period during which the election may be made shall
         commence with the date the amendment is adopted and shall end on the
         latest of: (a) 60 days after the amendment is adopted; (b) 60 days
         after the amendment becomes effective; or (c) 60 days after the
         Participant is issued written notice of the amendment by the Company or
         Committee. Furthermore, no amendment shall decrease the nonforfeitable
         percentage, measured as of the later of the date the amendment is
         adopted or effective, of any Account Owner's Accounts.

         Each amendment shall be in writing. Each amendment shall be approved by
         Apache's Board of Directors (the "Board") or by an officer of Apache
         who is authorized by the Board to amend the Plan. Each amendment shall
         be executed by an officer of Apache to whom the Board has delegated the
         authority to execute the amendment.

ARTICLE XI
PLAN ADOPTION BY AFFILIATED ENTITIES

11.1     Adoption of Plan.

         Apache may permit any Affiliated Entity to adopt the Plan and Trust for
         its Employees. Thereafter, such Affiliated Entity shall deliver to the
         Trustee a certified copy of the resolutions or other documents
         evidencing its adoption of the Plan and Trust. The Employees of the
         Affiliated Entity adopting the Plan shall not be eligible to invest
         their Accounts in Company Stock until compliance with the applicable
         registration and reporting requirements of the securities laws.

11.2     Agent of Affiliated Entity.

         By becoming a party to the Plan, each Affiliated Entity appoints Apache
         as its agent with authority to act for the Affiliated Entity in all
         transactions in which Apache believes such agency will facilitate the
         administration of the Plan. Apache shall have the sole authority to
         amend and terminate the Plan.

11.3     Disaffiliation and Withdrawal from Plan.

         (a)      Disaffiliation. Any Affiliated Entity that has adopted the
                  Plan and thereafter ceases for any reason to be an Affiliated
                  Entity shall forthwith cease to be a party to the Plan.

                                       36
<PAGE>

         (b)      Withdrawal. Any Affiliated Entity may, by appropriate action
                  and written notice thereof to Apache, provide for the
                  discontinuance of its participation in the Plan. Such
                  withdrawal from the Plan shall not be effective until the end
                  of the Plan Year.

11.4     Effect of Disaffiliation or Withdrawal.

         If at the time of disaffiliation or withdrawal, the disaffiliating or
         withdrawing entity, by appropriate action, adopts a substantially
         identical plan that provides for direct transfers from this Plan, then,
         as to employees of such entity, no plan termination shall have
         occurred; the new plan shall be deemed a continuation of this Plan for
         such employees. In such case, the Trustee shall transfer to the trustee
         of the new plan all of the assets held for the benefit of employees of
         the disaffiliating or withdrawing entity, and no forfeitures or
         acceleration of vesting shall occur solely by reason of such action.
         Such payment shall operate as a complete discharge of the Trustee, and
         of all organizations except the disaffiliating or withdrawing entity,
         of all obligations under this Plan to employees of the disaffiliating
         or withdrawing entity and to their beneficiaries. A new plan shall not
         be deemed substantially identical to this Plan if it provides slower
         vesting than this Plan. Nothing in this section shall authorize the
         divesting of any vested portion of a Participant's Account(s).

11.5     Distribution Upon Disaffiliation or Withdrawal.

         (a)      Disaffiliation. If an entity disaffiliates from Apache and the
                  provisions of section 11.4 are not followed, then the
                  following rules apply to the Account(s) of employees of the
                  disaffiliating entity.

                  (i)      If the disaffiliating entity maintains a defined
                           contribution plan (other than an employee stock
                           ownership plan within the meaning of Code section
                           4975(e)(7)), then the Trustee shall transfer the
                           Employee's Account(s) to the other plan, if the other
                           plan so allows, unless the employee consents to an
                           immediate distribution in a lump sum (other than an
                           annuity) of the vested portion of his or her
                           Account(s). If the other plan does not permit a
                           transfer of Accounts, then the employee may retain
                           his or her Accounts in this Plan until the employee
                           consents to a distribution pursuant to Article VI.
                           Notwithstanding the preceding sentences, an employee
                           may not consent to an immediate distribution from his
                           or her Participant Before-Tax Contributions Account
                           unless he or she has attained age 59 1/2.

                  (ii)     If the disaffiliating entity does not maintain a
                           defined contribution plan (other than an employee
                           stock ownership plan within the meaning of Code
                           section 4975(e)(7)), then the Trustee shall
                           distribute the vested portion of the employee's
                           Account(s) to the employee in a lump sum (other than
                           an annuity), upon the consent of the employee. If the
                           employee does not consent to an immediate
                           distribution, then distribution may only be made
                           according to Article VI.

         (b)      Withdrawal. If an Affiliated Entity withdraws from the Plan
                  and the provisions of section 11.4 are not followed, then the
                  following rules apply to the Account(s) of Employees of the
                  withdrawing entity.

                  (i)      If the withdrawing entity maintains a defined
                           contribution plan that accepts transfers from this
                           Plan, then the Employee may transfer his or her
                           Account(s) from this Plan to such plan. No
                           forfeitures or acceleration of vesting shall occur
                           solely by reason of such transfer.

                  (ii)     If the withdrawing entity does not maintain a defined
                           contribution plan that accepts transfers from this
                           Plan, then the Employee's Account(s) shall remain in
                           this Plan.

         (c)      Any distribution or transfer made pursuant to this section may
                  be in cash, in shares of Company Stock, or partly in cash and
                  partly in shares of Company Stock. After such distribution or
                  transfer has been made, no Participant or beneficiary who has
                  received any such distribution, or for whom any such transfer
                  has been made, shall have any further right or claim under the
                  Plan or Trust.

                                       37
<PAGE>

ARTICLE XII
TOP-HEAVY PROVISIONS

12.1     Application of Top-Heavy Provisions.

         The provisions of this Article XII shall be applicable only if the Plan
         becomes "top-heavy" as defined below for any Plan Year beginning after
         December 31, 1983. If the Plan becomes "top-heavy" as of the
         Determination Date for a Plan Year, the provisions of this Article XII
         shall apply to the Plan effective as of the first day of such Plan Year
         and shall continue to apply to the Plan until the Plan ceases to be
         "top-heavy" or until the Plan is terminated or otherwise amended.

12.2     Determination of Top-Heavy Status.

         The Plan shall be considered "top-heavy" for a Plan Year if, as of the
         Determination Date for that Plan Year, the aggregate of the Account
         balances (as calculated according to the regulations under Code section
         416) of Key Employees under this Plan (and under all other plans
         required or permitted to be aggregated with this Plan) exceeds 60% of
         the aggregate of the Account balances (as calculated according to the
         regulations under Code section 416) in this Plan (and under all other
         plans required or permitted to be aggregated with this Plan) of all
         current Employees and all former Employees who terminated employment
         within one year of the Determination Date. This ratio shall be referred
         to as the "top-heavy ratio". For purposes of determining the account
         balance of any Participant, (a) the balance shall be determined as of
         the Determination Date, (b) the balance shall also include any
         distributions to the Participant during the one-year period ending on
         the Determination Date, and (c) the balance shall also include, for
         distributions made for a reason other than separation from service or
         death or disability, any distributions to the Participant during the
         five-year period ending on the Determination Date. This shall also
         apply to distributions under a terminated plan that, if it had not been
         terminated, would have been required to be included in an aggregation
         group. The Account balances of a Participant who had once been a Key
         Employee, but who is not a Key Employee during the Plan Year, shall not
         be taken into account. The following plans must be aggregated with this
         Plan for the top-heavy test: (a) a qualified plan maintained by the
         Company or an Affiliated Entity in which a Key Employee participated
         during this Plan Year or during the previous four Plan Years and (b)
         any other qualified plan maintained by the Company or an Affiliated
         Entity that enables this Plan or any plan described in clause (a) to
         meet the requirements of Code sections 401(a)(4) or 410. The following
         plans may be aggregated with this Plan for the top-heavy test: any
         qualified plan maintained by the Company or an Affiliated Entity that,
         in combination with the Plan or any plan required to be aggregated with
         this Plan when testing this Plan for top-heaviness, would satisfy the
         requirements of Code sections 401(a)(4) and 410. If one or more of the
         plans required or permitted to be aggregated with this Plan is a
         defined benefit plan, a Participant's "account balance" shall equal the
         present value of the Participant's accrued benefit. If the aggregation
         group includes more than one defined benefit plan, the same actuarial
         assumptions shall be used with respect to each such defined benefit
         plan. The foregoing top-heavy ratio shall be computed in accordance
         with the provisions of Code section 416(g), together with the
         regulations and rulings thereunder.

12.3     Special Vesting Rule.

         Unless section 5.1 provides for faster vesting, the amount credited to
         the Participant's Company Contributions Account shall vest in
         accordance with the following schedule during any top-heavy Plan Year:

<Table>
<Caption>
       Completed Years of Service            Vesting Percentage
       --------------------------            ------------------
<S>                                          <C>
              fewer than 2                           20%
                   3                                 40%
                   4                                 60%
                   5                                 80%
               6 or more                            100%
</Table>

                                       38
<PAGE>

12.4     Special Minimum Contribution.

         Notwithstanding the provisions of section 3.1 and Article IV to the
         contrary, in every top-heavy Plan Year, a minimum allocation is
         required for each Non-Key Employee who both (a) performed one or more
         Hours of Service during the Plan Year as a Covered Employee after
         satisfying any eligibility requirement of section 2.1, and (b) was an
         Employee on the last day of the Plan Year. The minimum allocation shall
         be a percentage of each Non-Key Employee's Compensation. The percentage
         shall be the lesser of 3% or the largest percentage obtained for any
         Key Employee by dividing his or her Annual Additions (to this Plan and
         any other plan aggregated with this Plan) for the Plan Year by his or
         her Compensation for the Plan Year. If the Participant participates in
         both this Plan and the Apache Corporation Money Purchase Retirement
         Plan, then the Participant's minimum allocation shall be provided in
         the Apache Corporation Money Purchase Retirement Plan. If this minimum
         allocation is not otherwise satisfied for any Non-Key Employee, the
         Company shall contribute the additional amount needed to satisfy this
         requirement to such Non-Key Employee's Company Contributions Account.

12.5     Change in Top-Heavy Status.

         If the Plan ceases to be a "top-heavy" plan as defined in this Article
         XII, and if any change in the benefit structure, vesting schedule, or
         other component of a Participant's accrued benefit occurs as a result
         of such change in top-heavy status, the nonforfeitable portion of each
         Participant's benefit attributable to Company Contributions shall not
         be decreased as a result of such change. In addition, each Participant
         with at least three Years of Service with the Company and Affiliated
         Entities on the date of such change, may elect to have the
         nonforfeitable percentage computed under the Plan without regard to
         such change in status. The period during which the election may be made
         shall commence on the date the Plan ceases to be a top-heavy plan and
         shall end on the later of (a) 60 days after the change in status
         occurs, (b) 60 days after the change in status becomes effective, or
         (c) 60 days after the Participant is issued written notice of the
         change by the Company or the Committee.

ARTICLE XIII
MISCELLANEOUS

13.1     RIGHT TO DISMISS EMPLOYEES - NO EMPLOYMENT CONTRACT.

         THE COMPANY AND AFFILIATED ENTITIES MAY TERMINATE THE EMPLOYMENT OF ANY
         EMPLOYEE AS FREELY AND WITH THE SAME EFFECT AS IF THIS PLAN WERE NOT IN
         EXISTENCE. PARTICIPATION IN THIS PLAN BY AN EMPLOYEE SHALL NOT
         CONSTITUTE AN EXPRESS OR IMPLIED CONTRACT OF EMPLOYMENT BETWEEN THE
         COMPANY OR AN AFFILIATED ENTITY AND THE EMPLOYEE.

13.2     Claims Procedure.

         (a)      All claims shall be filed by the Participant, the
                  Participant's beneficiary, or the authorized representative of
                  the claimant, by completing any procedures that the Committee
                  requires. These procedures shall be reasonable and may include
                  the completion of forms and the submission of documents and
                  additional information.

         (b)      The Committee shall review all materials and shall decide
                  whether to approve or deny the claim. If a claim is denied in
                  whole or in part, written notice of denial shall be furnished
                  by the Committee to the claimant within 90 days after the
                  receipt of the claim by the Committee, unless special
                  circumstances require an extension of time for processing the
                  claim, in which event notification of the extension shall be
                  provided to the claimant and the extension shall not exceed 90
                  days. The written notice shall set forth the specific reasons
                  for such denial, specific reference to pertinent Plan
                  provisions, a description of any additional material or
                  information necessary for the claimant to perfect the claim
                  and an explanation of why such material or information is
                  necessary, all written in a manner calculated to be understood
                  by the claimant. The notice shall include appropriate
                  information as to the steps taken if the claimant

                                       39
<PAGE>

                  wishes to submit the denied claim for review. The claimant may
                  request a review upon written application, may review
                  pertinent documents, and may submit issues or comments in
                  writing. The claimant must request a review within the
                  reasonable period of time prescribed by the Committee. In no
                  event shall such a period of time be less than 60 days. The
                  Committee shall decide all reviews of denied claims. A
                  decision on review shall be rendered within 60 days of the
                  receipt of request for review by the Committee. If special
                  circumstances require a further extension of time for
                  processing, a decision shall be rendered not later than 120
                  days following the Committee's receipt of the request for
                  review. If such an extension of time for review is required,
                  written notice of the extension shall be furnished to the
                  claimant prior to the commencement of the extension. The
                  Committee's decision on review shall be furnished to the
                  claimant. Such decision shall be in writing and shall include
                  specific reasons for the decision, written in a manner
                  calculated to be understood by the claimant, as well as
                  specific references to the pertinent Plan provisions on which
                  the decision is based.

         (c)      The Committee shall have total discretionary authority to
                  determine eligibility, status, and the rights of all
                  individuals under the Plan and to construe any and all terms
                  of the Plan.

13.3     Source of Benefits.

         All benefits payable under the Plan shall be paid solely from the Trust
         Fund, and the Company and Affiliated Entities assume no liability or
         responsibility therefor.

13.4     Exclusive Benefit of Employees.

         It is the intention of the Company that no part of the Trust, other
         than as provided in sections 3.3, 9.2, and 13.9 hereof and the Trust
         Agreement, ever to be used for or diverted for purposes other than for
         the exclusive benefit of Participants, Alternate Payees, and their
         beneficiaries, and that this Plan shall be construed to follow the
         spirit and intent of the Code and ERISA.

13.5     Forms of Notices.

         Wherever provision is made in the Plan for the filing of any notice,
         election, or designation by a Participant, Spouse, Alternate Payee, or
         beneficiary, the action of such individual may be evidenced by the
         execution of such form as the Committee may prescribe for the purpose.
         The Committee may also prescribe alternate methods for filing any
         notice, election, or designation (such as telephone voice-response or
         e-mail).

13.6     Failure of Any Other Entity to Qualify.

         If any entity adopts this Plan but fails to obtain or retain the
         qualification of the Plan under the applicable provisions of the Code,
         such entity shall withdraw from this Plan upon a determination by the
         Internal Revenue Service that it has failed to obtain or retain such
         qualification. Within 30 days after the date of such determination, the
         assets of the Trust Fund held for the benefit of the Employees of such
         entity shall be separately accounted for and disposed of in accordance
         with the Plan and Trust.

13.7     Notice of Adoption of the Plan.

         The Company shall provide each of its Employees with notice of the
         adoption of this Plan, notice of any amendments to the Plan, and notice
         of the salient provisions of the Plan prior to the end of the first
         Plan Year. A complete copy of the Plan shall also be made available for
         inspection by Employees or any other individual with an Account balance
         under the Plan.

13.8     Plan Merger.

         If this Plan is merged or consolidated with, or its assets or
         liabilities are transferred to, any other qualified plan of deferred
         compensation, each Participant shall be entitled to receive a benefit
         immediately after the merger, consolidation, or transfer that is equal
         to or greater than the benefit the Participant would have been

                                       40
<PAGE>

         entitled to receive immediately before the merger, consolidation, or
         transfer if this Plan had then been terminated.

13.9     Inalienability of Benefits - Domestic Relations Orders.

         (a)      Except as provided in section 7.2, relating to Plan loans,
                  subsection 6.1(c) relating to disclaimers, and subsections (b)
                  and (g) below, no Account Owner shall have any right to
                  assign, alienate, transfer, or encumber his or her interest in
                  any benefits under this Plan, nor shall such benefits be
                  subject to any legal process to levy upon or attach the same
                  for payment of any claim against any such Account Owner.

         (b)      Subsection (a) shall apply to the creation, assignment, or
                  recognition of a right to any benefit payable with respect to
                  a Participant pursuant to a Domestic Relations Order unless
                  such Domestic Relations Order is a QDRO, in which case the
                  Plan shall make payment of benefits in accordance with the
                  applicable requirements of any such QDRO.

         (c)      In order to be a QDRO, the Domestic Relations Order must
                  satisfy the requirements of Code section 414(p) and ERISA
                  section 206(d)(3). In particular, the Domestic Relations
                  Order: (i) must specify the name and the last known mailing
                  address of the Participant; (ii) must specify the name and
                  mailing address of each Alternate Payee covered by the order;
                  (iii) must specify either the amount or percentage of the
                  Participant's benefits to be paid by the Plan to each such
                  Alternate Payee, or the manner in which such amount or
                  percentage is to be determined; (iv) must specify the number
                  of payments or period to which such order applies; (v) must
                  specify each plan to which such order applies; (vi) may not
                  require the Plan to provide any type or form of benefit, or
                  any option, not otherwise provided under the Plan, subject to
                  the provisions of subsection (f); (vii) may not require the
                  Plan to provide increased benefits (determined on the basis of
                  actuarial value); and (viii) may not require the payment of
                  benefits to an Alternate Payee if such benefits have already
                  been designated to be paid to another Alternate Payee under
                  another order previously determined to be a QDRO.

         (d)      In the case of any payment before an Employee has separated
                  from service, a Domestic Relations Order shall not be treated
                  as failing to meet the requirements of subsection (c) solely
                  because such order requires that payment of benefits be made
                  to an Alternate Payee (i) on or after the dates specified in
                  subsection (f), (ii) as if the Employee had retired on the
                  date on which such payment is to begin under such order (but
                  taking into account only the Account balance on such date),
                  and (iii) in any form in which such benefits may be paid under
                  the Plan to the Employee. For purposes of this subsection, the
                  Account balance as of the date specified in the QDRO shall be
                  the vested portion of the Employee's Account(s) on such date.

         (e)      The Committee shall establish reasonable procedures to
                  determine the qualified status of Domestic Relations Orders
                  and to administer distributions under QDROs. Such procedures
                  shall be in writing and shall permit an Alternate Payee to
                  designate a representative to receive copies of notices. The
                  Committee shall temporarily prevent the Participant from
                  borrowing from his or her Accounts and shall temporarily
                  suspend distributions and withdrawals from the Participant's
                  Accounts, except to the extent necessary to make the required
                  minimum distributions under Code section 401(a)(9), when the
                  Committee receives a Domestic Relations Order or a draft of
                  such an order that affects the Participant's Accounts or when
                  one or the following individuals informs the Committee, orally
                  or in writing, that a QDRO is in process or may be in process:
                  the Participant, a prospective Alternate Payee, or counsel for
                  the Participant or a prospective Alternate Payee. The
                  Committee shall promulgate reasonable and non-discriminatory
                  rules regarding such suspensions, including but not limited to
                  how long such suspensions remain in effect. However, the
                  Participant may borrow such amounts from the Plan, subject to
                  the limits of section 7.2, and the Participant may receive
                  such distributions and withdrawals from the Plan, subject to
                  the rules of Articles VI and VII, as are consented to in
                  writing by all prospective Alternate Payees identified in the
                  Domestic Relations Order or, in the absence of a Domestic
                  Relations Order, as are consented to in writing by the
                  prospective Alternate Payee(s) who informed the Committee that
                  a QDRO was in process or may be in process. When the Committee
                  receives a Domestic Relations Order it shall promptly notify
                  the Participant and each Alternate Payee of such receipt and
                  provide them with

                                       41
<PAGE>

                  copies of the Plan's procedures for determining the qualified
                  status of the order. Within a reasonable period after receipt
                  of a Domestic Relations Order, the Committee shall determine
                  whether such order is a QDRO and notify the Participant and
                  each Alternate Payee of such determination. During any period
                  in which the issue of whether a Domestic Relations Order is a
                  QDRO is being determined (by the Committee, by a court of
                  competent jurisdiction, or otherwise), the Committee shall
                  separately account for the amounts payable to the Alternate
                  Payee if the order is determined to be a QDRO. If the order
                  (or modification thereof) is determined to be a QDRO within 18
                  months after the date the first payment would have been
                  required by such order, the Committee shall pay the amounts
                  separately accounted for (plus any interest thereon) to the
                  individual(s) entitled thereto. However, if the Committee
                  determines that the order is not a QDRO, or if the issue as to
                  whether such order is a QDRO has not been resolved within 18
                  months after the date of the first payment would have been
                  required by such order, then the Committee shall pay the
                  amounts separately accounted for (plus any interest thereon)
                  to the individual(s) who would have been entitled to such
                  amounts if there had been no order. Any determination that an
                  order is a QDRO that is made after the close of the 18-month
                  period shall be applied prospectively only. If the Plan's
                  fiduciaries act in accordance with fiduciary provision of
                  ERISA in treating a Domestic Relations Order as being (or not
                  being) a QDRO or in taking action in accordance with this
                  subsection, then the Plan's obligation to the Participant and
                  each Alternate Payee shall be discharged to the extent of any
                  payment made pursuant to the acts of such fiduciaries.

         (f)      The Alternate Payee shall have the following rights under the
                  Plan:

                  (i)      Single Payment. The only form of payment available to
                           an Alternate Payee is a single payment of the
                           distributable amount (measured at the time the
                           payment is processed). If the Alternate Payee is
                           awarded more than the distributable amount, the
                           Alternate Payee shall initially receive a
                           distribution of the distributable amount, with
                           additional payments made as soon as administratively
                           convenient after more of the amount awarded to the
                           Alternate Payee becomes distributable.

                  (ii)     Timing of Distribution. Subject to the limits imposed
                           by this paragraph, the Alternate Payee may choose (or
                           the QDRO may specify) the date of the distribution.
                           If the value of the nonforfeitable portion of an
                           Alternate Payee's Account (ignoring any portion of
                           the Participant's Rollover Account that was assigned
                           to the Alternate Payee) is $5,000 or less, the
                           Alternate Payee shall receive a single payment of the
                           distributable amount as soon as practicable (without
                           the Alternate Payee's consent), provided that the
                           value is $5,000 or less when the distribution is
                           processed. Otherwise, the distribution to the
                           Alternate Payee may occur at any time after the
                           Committee determines that the Domestic Relations
                           Order is a QDRO and before the Participant's Required
                           Beginning Date (unless the order is determined to be
                           a QDRO after the Participant's Required Beginning
                           Date, in which case the distribution to the Alternate
                           Payee shall be made as soon as administratively
                           practicable after the order is determined to be a
                           QDRO).

                  (iii)    Death of Alternate Payee. The Alternate Payee may
                           designate one or more beneficiaries, as specified in
                           section 6.1. When the Alternate Payee dies, the
                           Alternate Payee's beneficiary shall receive a
                           complete distribution of the distributable amount in
                           a single payment as soon as administratively
                           convenient.

                  (iv)     Investing. An Alternate Payee may direct the
                           investment of his Account pursuant to section 9.3.

                  (v)      Claims. The Alternate Payee may bring claims against
                           the Plan pursuant to section 13.2.

         (g)      Subsection (a) shall not apply to any offset of a
                  Participant's benefits against an amount that the Participant
                  is ordered or required to pay to the Plan if the following
                  conditions are met.

                  (i)      The order or requirement to pay must arise (A) under
                           a judgment of conviction for a crime involving the
                           Plan, (B) under a civil judgment (including a consent
                           order or decree) entered by a court in an action
                           brought in connection with a violation (or alleged
                           violation) of part 4 of subtitle B of title I of
                           ERISA, or (iii) pursuant to a settlement agreement
                           between the Secretary of Labor and the Participant,
                           or a settlement agreement between the Pension Benefit
                           Guaranty Corporation and

                                       42
<PAGE>

                           the Participant, in connection with a violation (or
                           alleged violation) of part 4 of subtitle B of title I
                           of ERISA by a fiduciary or any other person.

                  (ii)     The judgment, order, decree, or settlement agreement
                           must expressly provide for the offset of all or part
                           of the amount ordered or required to be paid to the
                           Plan against the Participant's benefits provided
                           under the Plan.

                  (iii)    To the extent that the survivor annuity requirements
                           of Code section 401(a)(11) apply with respect to
                           distributions from the Plan to the Participant, if
                           the Participant is married at the time at which the
                           offset is to be made, (A) either the Participant's
                           Spouse must have already waived his or her right to a
                           qualified preretirement survivor annuity and a
                           qualified joint and survivor annuity or the
                           Participant's Spouse must consent in writing to such
                           offset with such consent witnessed by a notary public
                           or representative of the Plan (or it is established
                           to the satisfaction of a Plan representative that
                           such consent may not be obtained by reason of
                           circumstances described in Code section
                           417(a)(2)(B)), or (B) the Participant's Spouse is
                           ordered or required in such judgment, order, decree,
                           or settlement to pay an amount to the Plan in
                           connection with a violation of part 4 of subtitle B
                           of title I of ERISA, or (C) in such judgment, order,
                           decree, or settlement, the Participant's Spouse
                           retains the right to receive a survivor annuity under
                           a qualified joint and survivor annuity pursuant to
                           Code section 401(a)(11)(A)(i) and under a qualified
                           preretirement survivor annuity provided pursuant to
                           Code section 401(a)(11)(A)(ii). The value of the
                           Spouse's survivor annuity in subparagraph (C) shall
                           be determined as if the Participant terminated
                           employment on the date of the offset, there was no
                           offset, the Plan permitted commencement of benefits
                           only on or after Normal Retirement Age, the Plan
                           provided only the "minimum-required qualified joint
                           and survivor annuity," and the amount of the
                           qualified preretirement survivor annuity under the
                           Plan is equal to the amount of the survivor annuity
                           payable under the "minimum-required qualified joint
                           and survivor annuity." For purposes of this paragraph
                           only, the "minimum-required qualified joint and
                           survivor annuity" is the qualified joint and survivor
                           annuity which is the actuarial equivalent of the
                           Participant's accrued benefit (within the meaning of
                           Code section 411(a)(7)) and under which the survivor
                           annuity is 50% of the amount of the annuity which is
                           payable during the joint lives of the Participant and
                           his or her Spouse.

         (h)      The Committee shall temporarily prevent the Account Owner from
                  borrowing from his or her Accounts and shall temporarily
                  suspend distributions and withdrawals from his or her
                  Accounts, except to the extent necessary to make the required
                  minimum distributions under Code section 401(a)(9), when the
                  Committee has reason to believe that the Plan may be entitled
                  to an offset of the Participant's benefits described in
                  subsection (g). The Committee shall promulgate reasonable and
                  non-discriminatory rules regarding such suspensions, including
                  but not limited to how long such suspensions remain in effect.

13.10    Payments Due Minors or Incapacitated Individuals.

         If any individual entitled to payment under the Plan is a minor, the
         Committee shall cause the payment to be made to the custodian or
         representative who, under the state law of the minor's domicile, is
         authorized to receive funds on behalf of the minor. If any individual
         entitled to payment under this Plan has been legally adjudicated to be
         mentally incompetent or incapacitated, the Committee shall cause the
         payment to be made to the custodian or representative who, under the
         state law of the incapacitated individual's domicile, is authorized to
         receive funds on behalf of the incapacitated individual. Payments made
         pursuant to such power shall operate as a complete discharge of the
         Trust Fund, the Trustee, and the Committee.

13.11    Uniformity of Application.

         The provisions of this Plan shall be applied in a uniform and
         non-discriminatory manner in accordance with rules adopted by the
         Committee, which rules shall be systematically followed and
         consistently applied so that all individuals similarly situated shall
         be treated alike.

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<PAGE>

13.12    Disposition of Unclaimed Payments.

         Each Participant, Alternate Payee, or beneficiary with an Account
         balance in this Plan must file with the Committee from time to time in
         writing his or her address, the address of each beneficiary (if
         applicable), and each change of address. Any communication, statement,
         or notice addressed to such individual at the last address filed with
         the Committee (or if no address is filed with the Committee then at the
         last address as shown on the Company's records) will be binding on such
         individual for all purposes of the Plan. Neither the Committee nor the
         Trustee shall be required to search for or locate any missing
         individual. If the Committee notifies an individual that he or she is
         entitled to a distribution and also notifies him or her that a failure
         to respond may result in a forfeiture of benefits, and the individual
         fails to claim his or her benefits under the Plan or make his or her
         address known to the Committee within a reasonable period of time after
         the notification, then the benefits under the Plan of such individual
         shall be forfeited. Any amount forfeited pursuant to this section shall
         be allocated pursuant to section 5.5. If the individual should later
         make a claim for this forfeited amount, the Company shall, if the Plan
         is still in existence, make a special contribution to the Plan equal to
         the forfeiture, and such amount shall be distributed to the individual;
         if the Plan is not then in existence, the Company shall pay the amount
         of the forfeiture to the individual.

13.13    Applicable Law.

         This Plan shall be construed and regulated by ERISA, the Code, and,
         unless otherwise specified herein and to the extent applicable, the
         laws of the State of Texas, excluding any conflicts-of-law provisions.

ARTICLE XIV
MATTERS AFFECTING COMPANY STOCK

14.1     Voting, Etc.

         The shares of Company Stock in Accounts, whether or not vested, may be
         voted by the Account Owner to the same extent as if duly registered in
         the Account Owner's name. The Trustee or its nominee in which the
         shares are registered shall vote the shares solely as agent of the
         Account Owner and in accordance with the instructions of the Account
         Owner. If no instructions are received, the Trustee shall vote the
         shares of company Stock for which it has received no voting
         instructions in the same proportions as the Account Owners
         affirmatively directed their shares of Company Stock to be voted unless
         the Trustee determines that a pro rata vote would be inconsistent with
         its fiduciary duties under ERISA. If the Trustee makes such a
         determination, the Trustee shall vote the Company Stock as it
         determines to be consistent with its fiduciary duties under ERISA. Each
         Account Owner who has Company Stock allocated to his or her Accounts
         shall direct the Trustee concerning the tender (as provided below) and
         the exercise of any other rights appurtenant to the Company Stock. The
         Trustee shall follow the directions of the Account Owner with respect
         to the tender.

14.2     Notices.

         Apache shall cause to be mailed or delivered to each Account Owner
         copies of all notices and other communications sent to the Apache
         shareholders at the same times so mailed or delivered by Apache to its
         other shareholders.

14.3     Retention/Sale of Company Stock and Other Securities.

         The Trustee is authorized and directed to retain the Company Stock and
         any other Apache securities acquired by the Trust except as follows:

         (a)      In the normal course of Plan administration, the Trustee shall
                  sell Company Stock to satisfy Plan administration and
                  distribution requirements as directed by the Committee or in
                  accordance with provisions of the Plan specifically
                  authorizing such sales.

                                       44
<PAGE>

         (b)      In the event of a transaction involving the Company Stock
                  evidenced by the filing of Schedule 14D-1 with the Securities
                  and Exchange Commission ("SEC") or any other similar
                  transaction by which any person or entity seeks to acquire
                  beneficial ownership of 50% or more of the shares of Company
                  Stock outstanding and authorized to be issued from time to
                  time under Apache's articles of incorporation ("tender
                  offer"), the Trustee shall sell, convey, or transfer Company
                  Stock pursuant to written instructions of Account Owners
                  delivered to the Trustee in accordance with the following
                  sections 14.4 through 14.15. For purposes of such provisions,
                  the term "filing date" means the date relevant documents
                  concerning a tender offer are filed with the SEC or, if such
                  filing is not required, the date the Trustee receives actual
                  notice that a tender offer has commenced.

         (c)      If Apache makes any distribution of Apache securities with
                  respect to the shares of Company Stock held in the Plan, other
                  than additional shares of Company Stock (any such securities
                  are hereafter referred to as "stock rights"), the Trustee
                  shall sell, convey, transfer, or exercise such stock rights
                  pursuant to written instructions of Account Owners delivered
                  to the Trustee in accordance with the following sections of
                  this Article.

14.4     Tender Offers.

         (a)      Allocated Stock. In the event of any tender offer, each
                  Account Owner shall have the right to instruct the Trustee to
                  tender any or all shares of Company Stock, whether or not
                  vested, that are allocated to his or her Accounts under the
                  Plan on or before the filing date. The Trustee shall follow
                  the instructions of the Account Owner. The Trustee shall not
                  tender any Company Stock for which no instructions are
                  received.

         (b)      Unallocated Stock. The Trustee shall tender all shares of
                  Company Stock that are not allocated to Accounts in the same
                  proportion as the Account Owners directed the tender of
                  Company Stock allocated to their Accounts unless the Trustee
                  determines that a pro rata tender would be inconsistent with
                  its fiduciary duties under ERISA. If the Trustee makes such a
                  determination, the Trustee shall tender or not tender the
                  unallocated Company Stock as it determines to be consistent
                  with its fiduciary duties under ERISA.

         (c)      Suspension of Share Purchases. In the event of a tender offer,
                  the Trustee shall suspend all purchases of Company Stock
                  pursuant to the Plan unless the Committee otherwise directs.
                  Until the termination of such tender offer and pending such
                  Committee direction, the Trustee shall invest available cash
                  pursuant to the applicable provisions of the Plan and the
                  Trust Agreement.

         (d)      Temporary Suspension of Certain Cash Distributions.
                  Notwithstanding anything in the Plan to the contrary, no
                  option to receive cash in lieu of Company Stock shall be
                  honored during the pendency of a tender offer unless the
                  Committee otherwise directs.

14.5     Stock Rights.

         (a)      General. If Apache makes a distribution of stock rights with
                  respect to the Company Stock held in the Plan and if the stock
                  rights become exercisable or transferable (the date on which
                  the stock rights become exercisable or transferable shall be
                  referred to as the "exercise date"), each Account Owner shall
                  determine whether to exercise the stock rights, sell the stock
                  rights, or hold the stock rights allocated to his or her
                  Accounts. The provisions of this section shall apply to all
                  stock rights received with respect to Company Stock held in
                  Accounts, whether or not the Company Stock with respect to
                  which the stock rights were issued are vested.

         (b)      Independent Fiduciary. The Independent Fiduciary provided for
                  in this section 14.15 below shall act with respect to the
                  stock rights. All Account Owner directions concerning the
                  exercise or disposition of the stock rights shall be given to
                  the Independent Fiduciary, who shall have the sole
                  responsibility of assuring that the Account Owners' directions
                  are followed.

                                       45
<PAGE>

         (c)      Exercise of Stock Rights. If, on or after the exercise date,
                  an Account Owner wishes to exercise all or a portion of the
                  stock rights allocated to his or her Accounts, the Independent
                  Fiduciary shall follow the Account Owner's direction to the
                  extent that there is cash or other liquid assets available in
                  his or her Accounts to exercise the stock rights.
                  Notwithstanding any other provision of the Plan, each Account
                  Owner who has stock rights allocated to his or her Accounts
                  shall have a period of five business days following the
                  exercise date in which he or she may give instructions to the
                  Committee to liquidate any of the assets held in his or her
                  Accounts (except shares of Company Stock or assets such as
                  guaranteed investment contracts or similar investments), but
                  only if he or she does not have sufficient cash or other
                  liquid assets in his or her Accounts to exercise the stock
                  rights. The liquidation of any necessary investments pursuant
                  to an Account Owner's direction shall be accomplished as soon
                  as reasonably practicable, taking into account any timing
                  restrictions with respect to the investment funds involved.
                  The cash obtained shall be used to exercise the stock rights,
                  as the Account Owner directs. Any cash that is not so used
                  shall be invested in a cash equivalent until the next date on
                  which the Account Owner may change his or her investment
                  directions under the Plan.

         (d)      Sale of Stock Rights. On and after the exercise date, the
                  Independent Fiduciary shall sell all or a portion of the stock
                  rights allocated to Accounts, as the Account Owner shall
                  direct.

14.6     Other Rights Appurtenant to the Company Stock.

         If there are any rights appurtenant to the Company Stock, other than
         voting, tender, or stock rights, each Account Owner shall exercise or
         take other appropriate action concerning such rights with respect to
         the Company Stock, whether or not vested, that is allocated to their
         Accounts in the same manner as the other holders of the Company Stock,
         by giving written instructions to the Trustee. The Trustee shall follow
         all such instructions, but shall take no action with respect to
         allocated Company Stock for which no instructions are received. The
         Trustee shall exercise or take other appropriate action concerning any
         such rights appurtenant to unallocated Company Stock.

14.7     Information to Trustee.

         Promptly after the filing date, the exercise date, or any other event
         that requires action with respect to the Company Stock, the Committee
         shall deliver or cause to be delivered to the Trustee or the
         Independent Fiduciary, as appropriate, a list of the names and
         addresses of Account Owners showing (i) the number of shares of Company
         Stock allocated to each Account Owner's Accounts under the Plan, (ii)
         each Account Owner's pro rata portion of any unallocated Company Stock,
         and (iii) each Account Owner's share of any stock rights distributed by
         Apache. The Committee shall date and certify the accuracy of such
         information, and such information shall be updated periodically by the
         Committee to reflect changes in the shares of Company Stock and other
         assets allocated to Accounts.

14.8     Information to Account Owners.

         The Trustee or the Independent Fiduciary, as appropriate, shall
         distribute and/or make available to each affected Account Owner the
         following materials:

         (a)      A copy of the description of the terms and conditions of any
                  tender offer filed with the SEC on Schedule 14D-1, or any
                  similar materials if such filing is not required, any material
                  distributed to shareholders generally with respect to the
                  stock rights, and any proxy statements and any other material
                  distributed to shareholders generally with respect to any
                  action to be taken with respect to the Company Stock.

         (b)      If requested by Apache, a statement from Apache's management
                  setting forth its position with respect to a tender offer that
                  is filed with the SEC on Schedule 14D-9 and/or a communication
                  from Apache given pursuant to 17 C.F.R. 240.14d-9(e), as
                  amended.

                                       46
<PAGE>

         (c)      An instruction form prepared by Apache and approved by the
                  Trustee or the Independent Fiduciary, to be used by an Account
                  Owner who wishes to instruct the Trustee to tender Company
                  Stock in response to the tender offer, to instruct the
                  Independent Fiduciary to sell or exercise stock rights, or to
                  instruct the Trustee or Independent Fiduciary with respect to
                  any other action to be taken with respect to the Company
                  Stock. The instruction form shall state that (i) if the
                  Account Owner fails to return an instruction form to the
                  Trustee by the indicated deadline, the Trustee will not tender
                  any shares of Company Stock the Account Owner is otherwise
                  entitled to tender, (ii) the Independent Fiduciary will not
                  sell or exercise any right allocated to the Account except
                  upon the written direction of the Account Owner, (iii) the
                  Trustee or Independent Fiduciary will not take any other
                  action that the Account Owner could have directed, and (iv)
                  Apache acknowledges and agrees to honor the confidentiality of
                  the Account Owner's directions to the Trustee.

         (d)      Such additional material or information as the Trustee or the
                  Independent Fiduciary may consider necessary to assist the
                  Account Owner in making an informed decision and in completing
                  or delivering the instruction form (and any amendments
                  thereto) to the Trustee or the Fiduciary on a timely basis.

14.9     Expenses.

         The Trustee and the Independent Fiduciary shall have the right to
         require payment in advance by Apache and the party making the tender
         offer of all reasonably anticipated expenses of the Trustee and the
         Independent Fiduciary, respectively, in connection with the
         distribution of information to and the processing of instructions
         received from Account Owners.

14.10    Former Account Owners.

         Apache shall furnish former Account Owners who have received
         distributions of Company Stock so recently as to not be shareholders of
         record with the information furnished pursuant to section 14.8. The
         Trustee and the Independent Fiduciary are hereby authorized to take
         action with respect to the Company Stock distributed to such former
         Account Owners in accordance with appropriate instructions from them.
         If the Trustee does not receive appropriate instructions, it shall take
         no action with respect to the distributed Company Stock.

14.11    No Recommendations.

         Neither the Committee, the Committee Fiduciary, the Trustee, nor the
         Independent Fiduciary shall express any opinion or give any advice or
         recommendation to any Account Owner concerning voting the Company
         Stock, any tender offer, stock rights, or the exercise of any other
         rights appurtenant to the Company Stock, nor shall they have any
         authority or responsibility to do so. Neither the Trustee nor the
         Independent Fiduciary has any duty to monitor or police the party
         making a tender offer or Apache in promoting or resisting a tender
         offer; provided, however, that if the Trustee or the Independent
         Fiduciary becomes aware of activity that on its face reasonably appears
         to the Trustee or Independent Fiduciary to be materially false,
         misleading, or coercive, the Trustee or the Independent Fiduciary, as
         the case may be, shall promptly demand that the offending party take
         appropriate corrective action. If the offending party fails or refuses
         to take appropriate corrective action, the Trustee or the Independent
         Fiduciary, as the case may be, shall communicate with affected Account
         Owners in such manner as it deems advisable.

14.12    Trustee to Follow Instructions.

         (a)      So long as the Trustee and the Independent Fiduciary, as the
                  case may be, have determined that the Plan is in compliance
                  with ERISA section 404(c), the Trustee or the Independent
                  Fiduciary shall tender, deal with stock rights, and act with
                  respect to any other rights appurtenant to the Company Stock,
                  pursuant to the terms and conditions of the particular
                  transaction or event, and in accordance with instructions
                  received from Account Owners. Except for voting, the Trustee
                  or the Independent Fiduciary shall take no action with respect
                  to Company Stock, stock rights, or other appurtenant rights
                  for which no instructions are received, and such Company
                  Stock, stock rights, or other appurtenant rights shall be
                  treated like all other Company Stock, stock rights, or other
                  appurtenant rights for which no instructions

                                       47
<PAGE>

                  are received. The Trustee, or if an Independent Fiduciary has
                  been appointed, the Independent Fiduciary, shall vote the
                  allocated Company Stock that an Account Owner does not vote as
                  specified in section 14.1.

         (b)      If the Trustee or Independent Fiduciary determines that the
                  Plan does not satisfy the requirements of ERISA section
                  404(c), the Trustee or Independent Fiduciary shall follow the
                  instructions of the Account Owner with respect to voting,
                  tender, stock rights, or other rights appurtenant to the
                  Company Stock unless the Trustee or Independent Fiduciary
                  determines that to do so would be inconsistent with its
                  fiduciary duties under ERISA. In such case, the Trustee or the
                  Independent Fiduciary shall take such action as it determines
                  to be consistent with its fiduciary duties under ERISA.

14.13    Confidentiality.

         (a)      The Committee shall designate one of its members (the
                  "Committee Fiduciary") to receive investment directions and to
                  transmit such directions to the Trustee or Independent
                  Fiduciary, as the case may be. The Committee Fiduciary shall
                  also receive all Account Owner instructions concerning voting,
                  tender, stock rights, and other rights appurtenant to the
                  Company Stock. The Committee Fiduciary shall communicate the
                  instructions to the Trustee or the Fiduciary, as appropriate.

         (b)      Neither the Committee Fiduciary, the Trustee, nor the
                  Independent Fiduciary shall reveal or release any instructions
                  received from Account Owners concerning the Company Stock to
                  Apache, an Affiliated Entity, or the officers, directors,
                  employees, agents, or representatives of Apache and Affiliated
                  Entities, except to the extent necessary to comply with
                  Federal or state law not preempted by ERISA. If disclosure is
                  required by Federal or state law, the information shall be
                  disclosed to the extent possible in the aggregate rather than
                  on an individual basis.

         (c)      The Committee Fiduciary shall be responsible for reviewing the
                  confidentiality procedures from time to time to determine
                  their adequacy. The Committee Fiduciary shall ensure that the
                  confidentiality procedures are followed. The Committee
                  Fiduciary shall also ensure that the Independent Fiduciary
                  provided for in section 14.15 is appointed.

         (d)      Apache, with the Trustee's cooperation, shall take such action
                  as is necessary to maintain the confidentiality of Account
                  records including, without limitation, establishment of
                  security systems and procedures which restrict access to
                  Account records and retention of an independent agent to
                  maintain such records. If an independent recordkeeping agent
                  is retained, such agent must agree, as a condition of its
                  retention by Apache, not to disclose the composition of any
                  Accounts to Apache, an Affiliated Entity or an officer,
                  director, employee, or representative of Apache or an
                  Affiliated Entity.

         (e)      Apache acknowledges and agrees to honor the confidentiality of
                  the Account Owners' instructions to the Committee Fiduciary,
                  the Trustee, and the Independent Fiduciary. If Apache, by it
                  own act or omission, breaches the confidentiality of Account
                  Owner instructions, Apache agrees to indemnify and hold
                  harmless the Committee Fiduciary, the Trustee, or the
                  Independent Fiduciary, as the case may be, against and from
                  all liabilities, claims and demands, damages, costs, and
                  expenses, including reasonable attorneys' fees, that the
                  Committee Fiduciary, the Trustee, or the Independent Fiduciary
                  may incur as a result thereof.

14.14    Investment of Proceeds.

         If Company Stock or the rights are sold pursuant to the tender offer or
         the provisions of the rights, the proceeds of such sale shall be
         invested in accordance with the provisions of the Plan and the Trust
         Agreement.

                                       48
<PAGE>

14.15    Independent Fiduciary.

         Apache shall appoint a fiduciary (the "Independent Fiduciary") to act
         solely with respect to the Company Stock in situations which the
         Committee Fiduciary determines involve a potential for undue influence
         by Apache in connection with the Company Stock and the exercise of any
         rights appurtenant to the Company Stock. If the Committee Fiduciary so
         determines, it shall give written notice to the Independent Fiduciary,
         which shall have sole responsibility for assuring that Account Owners
         receive the information necessary to make informed decisions concerning
         the Company Stock, are free from undue influence or coercion, and that
         their instructions are followed to the extent proper under ERISA. The
         Independent Fiduciary shall act until it receives written notice to the
         contrary from the Committee Fiduciary.

14.16    Method of Communications.

         Several provisions in this Article specify that various communications
         to or from an Account Owner must be in writing. The Committee, the
         Committee Fiduciary, the Independent Fiduciary, the Company, and the
         Trustee, as appropriate, shall each have full authority to treat other
         forms of communication, such as electronic mail or telephone
         voice-response, as satisfying any "written" requirement specified in
         this Article, but only to the extent permitted by the IRS, the
         Department of Labor, and the Securities Exchange Commission, as
         appropriate.

ARTICLE XV
UNIFORMED SERVICES EMPLOYMENT AND REEMPLOYMENT RIGHTS ACT OF 1994

15.1     General.

         (a)      The Uniformed Services Employment and Reemployment Rights Act
                  of 1994 (the "USERRA"), which is codified at 38 USCA Sections
                  4301-4318, confers certain rights on individuals who leave
                  civilian employment to perform certain services in the Armed
                  Forces, the National Guard, the commissioned corps of the
                  Public Health Service, or in any other category designated by
                  the President of the United States in time of war or emergency
                  (collectively, the "Uniformed Services"). An Employee who
                  joins the Uniformed Services shall be referred to as a
                  "Serviceman" in this Article. This Article shall be
                  interpreted to provide such individuals with all the benefits
                  required by the USERRA but no greater benefits than those
                  required by the USERRA. This Article shall supersede any
                  contrary provisions in the remainder of the Plan.

         (b)      When a Serviceman leaves the Uniformed Services, he or she may
                  have reemployment rights with the Company or Affiliated
                  Entities, depending on many factors, including the length of
                  his or her stay in the Uniformed Services and the type of
                  discharge he or she received. When this Article speaks of the
                  date a Serviceman's potential USERRA reemployment rights
                  expire, it means the date on which the Serviceman fails to
                  qualify for reemployment rights (if, for example, he or she is
                  dishonorably discharged, or remains in the Uniformed Services
                  for more than 5 years) or, if the Serviceman obtains
                  reemployment rights, the date his or her reemployment rights
                  lapse because the Serviceman failed to timely exercise those
                  rights.

15.2     While a Serviceman.

         In general, a Serviceman shall be treated as an Employee while he or
         she continues to receive wages from the Company or an Affiliated
         Entity, and once the Serviceman's wages from the Company or Affiliated
         Entity cease, the Serviceman shall be treated as if he or she were on
         an approved, unpaid leave of absence.

         (a)      Participant Before-Tax Contributions. For purposes of making
                  Participant Before-Tax Contributions under section 3.2, if the
                  Serviceman was a Covered Employee when he or she became a
                  Serviceman, he or she shall continue to be treated as a
                  Covered Employee while he or she continues to receive wages
                  from the Company. As a consequence, (i) if he or she was a
                  Covered Employee who had satisfied the requirements of Article
                  II when he or she became a Serviceman, he or she may continue
                  to make

                                       49
<PAGE>

                  Participant Before-Tax Contributions from his or her wages
                  from the Company, and (ii) if he or she had not satisfied the
                  requirements of section 2.1 when he or she became a
                  Serviceman, his or her service in the Uniformed Services shall
                  be treated as service with the Company in determining when he
                  or she will be able to begin making Participant Before-Tax
                  Contributions under section 2.1, and if his or her wages from
                  the Company continue beyond that eligibility date, the
                  Serviceman may begin to make Participant Before-Tax
                  Contributions on such date. A Serviceman may change his or her
                  rate of contributions in the same manner as an Employee. A
                  Serviceman's Participant Before-Tax Contributions shall cease
                  when his or her wages from the Company cease.

         (b)      Company Contributions. Wages paid by the Company to a
                  Serviceman shall be included in his or her Compensation as if
                  the Serviceman were an Employee. A Serviceman's Participant
                  Before-Tax Contributions shall be matched according to the
                  formula in paragraph 3.1(b)(i). If the Employee was a Covered
                  Employee when he or she became a Serviceman and his or her
                  wages continue through the last business day of a Plan Year,
                  then (i) the Serviceman shall be treated as an "eligible
                  Participant" under subsection 3.1(a) for that Plan Year (and
                  shall therefore receive an allocation of any Company
                  Discretionary Contribution); (ii) the Serviceman shall be
                  treated as an "eligible Participant" under paragraph
                  3.1(b)(ii) for that Plan Year (and shall therefore receive an
                  allocation of any additional match provided under such
                  paragraph); (iii) if he or she was a Non-Highly Compensated
                  Employee when he or she became a Serviceman, he or she shall
                  be eligible to receive an allocation of any QNECs provided
                  under subsection 3.7(c); and (iv) he or she shall be treated
                  as an Employee under subsection 12.4(a) (and, if he or she is
                  a Non-Key Employee, he or she shall therefore receive any
                  minimum required allocation if the Plan is top-heavy).

         (c)      Investments. If the Serviceman has an account balance in the
                  Plan, he or she is an Account Owner and may therefore direct
                  the investment of his or her Accounts pursuant to section 9.3
                  and Article XIV.

         (d)      Loans. For purposes of borrowing from the Plan under section
                  7.2, a Serviceman shall be treated as an Employee until the
                  day on which his or her potential USERRA reemployment rights
                  expire. If a Serviceman with an outstanding loan continues to
                  receive wages from the Company or an Affiliated Entity after
                  joining the Uniformed Services, his or her loan payments shall
                  continue to be deducted from those wages. Once the
                  Serviceman's wages cease, his or her loan payments shall be
                  suspended until the earlier of (i) his or her reemployment
                  with the Company or an Affiliated Entity or (ii) the day on
                  which his or her potential USERRA reemployment rights expire.
                  The Serviceman may repay all or part of his or her loan at any
                  time during the suspension. During the payment suspension,
                  interest shall accrue on the unpaid balance of the loan. See
                  subsections 15.3(b) and 15.4(c) for the resumption of loan
                  payments for a reemployed Serviceman, and subsection 15.3(a)
                  for the timing of the loan's default if the Serviceman is not
                  reemployed.

         (e)      Distributions and Withdrawals. For purposes of Article VI and
                  section 7.1 (relating to distributions and in-service
                  withdrawals), the Serviceman shall be treated as an Employee
                  until the day on which his or her potential USERRA
                  reemployment rights expire. See section 15.3 once his or her
                  potential USERRA rights expire.

         (f)      QDROs. QDROs shall be processed while the Participant is a
                  Serviceman. The Committee has the discretion to establish
                  special procedures under subsection 13.9(e) for Servicemen,
                  by, for example, extending the usual deadlines to accommodate
                  any practical difficulties encountered by the Serviceman that
                  are attributable to his or her service in the Uniformed
                  Services.

         (g)      Rollovers. If the Serviceman was a Covered Employee when he or
                  she became a Serviceman, the Serviceman may make Rollover
                  Contributions pursuant to subsection 3.2(d) until the day on
                  which his or her potential USERRA reemployment rights expire.

15.3     Failure to Return.

         (a)      If a Serviceman is not reemployed before his or her potential
                  USERRA reemployment rights expire, the Committee shall
                  determine his or her Termination from Service Date by treating
                  his or her service in the

                                       50
<PAGE>

                  Uniformed Services as an approved leave of absence but
                  treating the expiration of his or her potential USERRA
                  reemployment rights as the failure to timely return from his
                  or her leave of absence, with the consequence that his or her
                  Termination from Service Date will generally be the date his
                  or her potential USERRA rights expired. Once his or her
                  Termination from Service Date has been determined, the
                  Committee shall determine his or her vested percentage. For
                  purposes of Article VI and section 7.1 (relating to
                  distributions), the day the Serviceman's potential USERRA
                  reemployment rights expired shall be treated as the day he or
                  she terminated employment with the Company and Affiliated
                  Entities. For purposes of subsection 5.2(d) (relating to the
                  timing of forfeitures), the Serviceman's last day of
                  employment shall be the day his or her potential USERRA
                  reemployment rights expired. If the Serviceman has an
                  outstanding loan from this Plan when his or her potential
                  USERRA reemployment rights expire, his or her loan shall go
                  into default on the last day of the calendar quarter after the
                  calendar quarter in which his or her potential USERRA
                  reemployment rights expired, unless, before the loan goes into
                  default, he or she repays the loan or is rehired pursuant to
                  subsection (b).

         (b)      If the Company or an Affiliated Company hires a former
                  Serviceman after his or her potential USERRA reemployment
                  rights have expired, he or she shall be treated like any other
                  former employee who is rehired. If he or she had an
                  outstanding loan and is reemployed before the loan goes into
                  default pursuant to subsection (a), his or her loan payments
                  shall be recalculated and the Company or Affiliated Entity
                  shall immediately resume withholding the revised loan payments
                  from his or her pay. The term of the loan when payments resume
                  shall be equal to the remaining term of the loan when payments
                  were suspended.

15.4     Return From Uniformed Service.

         This section applies solely to a Serviceman who returns to employment
         with the Company or an Affiliated Entity because he or she exercised
         his or her reemployment rights under the USERRA.

         (a)      Credit for Service. A Serviceman's length of time in the
                  Uniformed Services shall be treated as service with the
                  Company for purposes of vesting and determining his or her
                  eligibility to participate in the Plan upon reemployment.

         (b)      Participation. If the Serviceman satisfies the eligibility
                  requirements of section 2.1 before his or her reemployment,
                  and he or she is a Covered Employee upon his or her
                  reemployment, he or she may participate in the Plan
                  immediately upon his or her return.

         (c)      Loans. If the Serviceman's loan payments were suspended under
                  subsection 15.2(d) during his or her time in the Uniformed
                  Services, his or her loan payments shall be recalculated and
                  the Company or Affiliated Entity shall immediately resume
                  withholding the revised loan payments from his or her pay. The
                  term of the loan when payments resume shall be equal to the
                  remaining term of the loan when payments were suspended.

         (d)      Make-Up Before-Tax Contributions. In addition to his or her
                  regular Participant Before-Tax Contributions, a returning
                  Serviceman shall be permitted to make additional contributions
                  up to the amount of Participant Before-Tax Contributions he or
                  she could have made if, instead of becoming a Serviceman, he
                  or she had remained employed by the Company or Affiliated
                  Entity and been paid his or her Deemed Compensation during
                  that time. See subsection (h) for guidance on applying the
                  various limits contained in the Code to the calculation of the
                  maximum additional contribution the returning Serviceman may
                  make. Such additional contributions may only be made within a
                  period that begins on his or her reemployment date and whose
                  duration is the lesser of five years or three times his or her
                  length of time in the Uniformed Services. The additional
                  contributions shall be withheld from his or her Compensation
                  pursuant to the Serviceman's election. The Committee shall
                  establish administrative procedures for such elections. The
                  additional contributions shall be allocated to Participant
                  Before-Tax Contributions Accounts.

         (e)      Make-Up Match. For each additional contribution that the
                  Serviceman contributes pursuant to subsection (d), the Company
                  shall promptly contribute to his or her Accounts an additional
                  matching

                                       51
<PAGE>

                  contribution. The additional matching contribution shall be
                  equal to the Company Matching Contribution (including
                  forfeitures treated as Company Matching Contributions) that he
                  or she would have received if (i) his or her additional
                  contributions were Participant Before-Tax Contributions made
                  during his or her time in the Uniformed Services, and (ii) he
                  or she was paid his or her Deemed Compensation during his or
                  her time in the Uniformed Services. The Serviceman's
                  additional contributions shall be spread over the pay periods
                  in which they could have occurred in such a way as to maximize
                  the additional matching contribution. See subsection (h) for
                  guidance on applying the various limits contained in the Code
                  to the calculation of the additional matching contribution.
                  The additional matching contribution shall be allocated to the
                  Participant's Company Contributions Account unless the
                  additional matching contribution would have been designated a
                  QMAC, in which case it shall be allocated to his or her
                  Participant Before-Tax Contributions Account.

         (f)      Make-Up Company Discretionary Contribution. The Company shall
                  contribute an additional contribution to a Serviceman's
                  Accounts equal to the Company Discretionary Contribution
                  (including any forfeitures treated as Company Discretionary
                  Contributions) that would have been allocated to such Accounts
                  if the Serviceman had remained employed during his or her time
                  in the Uniformed Services, and had earned his or her Deemed
                  Compensation during that time. See subsection (h) for guidance
                  on applying the various limits contained in the Code to the
                  calculation of the additional discretionary contribution. The
                  additional discretionary contribution shall be allocated to
                  the Participant's Company Contributions Account unless the
                  additional discretionary contribution would have been
                  designated a QNEC, in which case it shall be allocated to his
                  or her Participant Before-Tax Contributions Account.

         (g)      Make-Up Miscellaneous Contributions. The Company shall
                  contribute to the Serviceman's Accounts any QNECs that the
                  Serviceman would have received pursuant to subsection 3.7(c),
                  and any top-heavy minimum contribution he or she would have
                  received pursuant to section 12.4, (including any forfeitures
                  treated as QNECs or top-heavy minimum contributions) if he or
                  she had remained employed during his or her time in the
                  Uniformed Services, and had earned Deemed Compensation during
                  that time. See subsection (h) for guidance on applying the
                  various limits contained in the Code to the calculation of the
                  QNECs and top-heavy minimum contribution. These additional
                  top-heavy minimum contributions shall be allocated to Company
                  Contributions Accounts. The additional QNECs shall be
                  allocated to Participant Before-Tax Contributions Accounts.

         (h)      Application of Limitations.

                  (i)      The make-up contributions under subsections (d), (e),
                           (f), and (g) (the "Make-Up Contributions") shall be
                           ignored for purposes of determining the Company's
                           maximum contribution under subsection 3.1(d), the
                           limits on Participant Before-Tax Contributions under
                           paragraph 3.2(a)(ii), the limits on Annual Additions
                           under section 3.4, the ADP test of section 3.5, the
                           ACP test of section 3.6, the non-discrimination
                           requirements of Code section 401(a)(4), and (if the
                           Serviceman is a Key Employee) calculating the minimum
                           required top-heavy contribution under section 12.4.

                  (ii)     In order to determine the maximum Make-Up
                           Contributions, the following limitations shall apply.

                           (A)      The Serviceman's "Aggregate Compensation"
                                    for each year shall be calculated. His or
                                    her Aggregate Compensation shall be equal to
                                    his or her actual Compensation, plus his or
                                    her Deemed Compensation that would have been
                                    paid during that year. Each type of
                                    Aggregate Compensation (for benefit
                                    purposes, deferral purposes, etc.) shall be
                                    determined separately.

                           (B)      The Serviceman's Aggregate Compensation each
                                    Plan Year shall be limited to the dollar
                                    limit in effect for that Plan Year under
                                    Code section 401(a)(17), for the purposes
                                    and in the manner specified in subsection
                                    1.14(f).

                           (C)      The limits of subsection 3.1(d) (relating to
                                    the maximum contribution by the Company to
                                    the Plan) for each Plan Year shall be
                                    calculated by using the Serviceman's
                                    Aggregate Compensation for that Plan Year,
                                    and by treating the Make-Up Contributions
                                    that are

                                       52
<PAGE>

                                    attributable to that Plan Year's Deemed
                                    Compensation as having been made during that
                                    Plan Year.

                           (D)      The limits of paragraph 3.2(a)(ii) (relating
                                    to the maximum 401(k) Contributions) and
                                    paragraph 3.2(b)(ii) (relating to the
                                    maximum Catch-Up Contributions) for each
                                    calendar year shall be calculated by
                                    treating as 401(k) and Catch-Up
                                    Contributions his or her additional
                                    contributions pursuant to subsection (d)
                                    that are attributable to that calendar
                                    year's Deemed Compensation.

                           (E)      The limits of section 3.4 (relating to the
                                    maximum Annual Additions to a Participant's
                                    Accounts) shall be calculated for each
                                    Limitation Year by using the Serviceman's
                                    Aggregate Compensation for that Limitation
                                    Year, and by treating as Annual Additions
                                    all the Make-Up Contributions that are
                                    attributable to that Limitation Year's
                                    Deemed Compensation.

                           (F)      The Serviceman's maximum Make-Up
                                    Contributions shall not be limited by the
                                    results of the Plan's ADP test or ACP test
                                    for any Plan Year in which the Serviceman
                                    has Deemed Compensation, even if the
                                    Serviceman is treated as a Highly
                                    Compensated Employee (using his or her
                                    Aggregate Compensation) for that Plan Year.

                  (i)      Deemed Compensation. A Serviceman's Deemed
                           Compensation is the Compensation that he or she would
                           have received (including raises) had he or she
                           remained employed by the Company or Affiliated Entity
                           during his or her time in the Uniformed Services,
                           unless it is not reasonably certain what his or her
                           Compensation would have been, in which case his or
                           her Deemed Compensation shall be based on his or her
                           average rate of compensation during the 12 months
                           (or, if shorter, his or her period of employment with
                           the Company and Affiliated Entities) immediately
                           before he or she entered the Uniformed Services. A
                           Serviceman's Deemed Compensation shall be reduced by
                           any Compensation actually paid to him or her during
                           his or her time in the Uniformed Services (such as
                           vacation pay). Deemed Compensation shall cease when
                           the Serviceman's potential USERRA reemployment rights
                           expire. Each type of Deemed Compensation (for benefit
                           purposes, deferral purposes, etc.) shall be
                           determined separately.

                                       APACHE CORPORATION

Date: 10/21/02                         By: /s/ Jeffrey M. Bender
      -----------------------              -------------------------------------

                                       Title: Vice President - Human Resources
                                              ----------------------------------

                                       53
<PAGE>

                                   APPENDIX A

                             PARTICIPATING COMPANIES

The following Affiliated Entities were actively participating in the Plan as of
the following dates:

<Table>
<Caption>
                                                     Participation                          Participation
               Business                               Began As Of                            Ended As Of
               --------                              -------------                          -------------
<S>                                               <C>                                     <C>
Apache International, Inc.                        September 22, 1987                             N/A

Apache Energy Resources  Corporation                January 1, 1994                       December 31, 1995
(Known as Hadson Energy Resources
Corporation before January 1, 1995)

Apache Canada Ltd.                                   May 17, 1995                                N/A
</Table>

                             -- END OF APPENDIX A --

                                       A-1
<PAGE>

                                   APPENDIX B

                       HADSON ENERGY RESOURCES CORPORATION

                                  INTRODUCTION

Apache acquired Hadson Energy Resources Corporation ("HERC") as of November 12,
1993. HERC and its wholly owned subsidiary, Hadson Energy Limited ("HEL"),
maintained the Hadson Energy Resources Corporation Employee 401(k) Plan (the
"HERC Plan"), a profit sharing plan containing a cash or deferred arrangement.
The HERC Plan was terminated as of December 31, 1993, and amounts were
transferred from the HERC Plan to this Plan.

The transferred amounts that are subject to the distribution restrictions of
Code section 401(k) shall be placed in the Participant Before-Tax Contributions
Accounts. Any remaining transferred amounts that represent after-tax
contributions, rollovers, or the associated investment earnings shall be placed
in the Rollover Account. All remaining transferred amounts shall be placed in
the Company Contributions Account.

                             -- END OF APPENDIX B --

                                       B-1
<PAGE>

                                   APPENDIX C

                             CORPORATE TRANSACTIONS

Over the years, Apache and its Affiliated Entities have engaged in numerous
corporate transactions, both acquisitions and sales. This Appendix contains any
special provisions that apply to employees affected by the corporate
transaction, including both those who become Employees and those who cease to be
Employees.

                                      SALES

For an Employee who transferred to Natural Gas Clearinghouse ("NGC") pursuant to
the terms of the Employee Benefits Agreement effective April 1, 1990 between
Apache and NGC, a Period of Service shall be calculated by treating as
employment with Apache any period(s) of employment after April 1, 1990 with NGC
or any business that is then treated as a single employer with NGC pursuant to
Code section 414(b), 414(c), 414(m), or 414(o).

Employees terminated in connection with the summer 1995 sale of certain
properties to Citation 1994 Investment Limited Partnership are fully vested in
their Plan Accounts as of September 1, 1995.

An Employee who transferred to Producers Energy Marketing LLC ("ProEnergy") in
the first half of 1996 is fully vested in his or her Plan Accounts as of the
date of transfer. If such an individual becomes an Employee again, all new
contributions to his or her Plan Accounts shall vest according to the regular
rules.

                                  ACQUISITIONS

A Period of Service for vesting purposes for a New Employee (listed below) shall
be determined by treating all periods of employment with the Former Employer
Controlled Group as periods of employment with Apache. The "Former Employer
Controlled Group" means the Former Employer (listed below), its predecessor
company/ies, and any business while such business was treated as a single
employer with the Former Employer or predecessor company pursuant to Code
section 414(b), 414(c), 414(m), or 414(o).

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       C-1
<PAGE>

The following individuals are "New Employees" and the following companies are
"Former Employers":

<Table>
<Caption>
          Former Employer                                             New Employees
          ---------------                                             -------------
<S>                                                <C>
Hadson Energy Resources Corporation                All individuals employed by HERC or HEL on
("HERC") and Hadson Energy Limited                 November 12, 1993.
("HEL")

Crystal Oil Company ("Crystal")                    All individuals hired from Crystal or related companies
                                                   within a week of the closing date on an asset purchase
                                                   that was originally scheduled to close on December 31,
                                                   1994.

Texaco Exploration & Production, Inc.              All individuals hired from TEPI or Inc. ("TEPI") related
                                                   companies in late February and early March 1995 in
                                                   connection with an acquisition of assets from TEPI.

The Phoenix Resource Companies, Inc.               All individuals hired by Apache in 1996 who were
("Phoenix")                                        Phoenix employees on May 20, 1996.

Crescendo Resources, L.P. ("Crescendo")            All individuals hired from April 30, 2000 through
                                                   June 1, 2000 from Crescendo and related companies in
                                                   connection with an April 30, 2000 asset acquisition from
                                                   Crescendo.

Collins & Ware ("C&W") and Longhorn                All individuals hired from C&W and Longhorn and
Disposal, Inc. ("Longhorn")                        related companies in connection with a May 23, 2000
                                                   asset acquisition from C&W and Longhorn.

Occidental Petroleum Corporation ("Oxy")           All individuals hired from Oxy and related companies in
                                                   connection with an August 2000 asset acquisition from
                                                   an Oxy subsidiary.
</Table>

                              --END OF APPENDIX C--

                                       C-2
<PAGE>

                                   APPENDIX D

                   DEKALB ENERGY COMPANY / APACHE CANADA LTD.

                                  INTRODUCTION

Through a merger effective as of May 17, 1995, Apache then held 100% of the
stock of DEKALB Energy Company (which has been renamed Apache Canada Ltd.).
Apache Canada Ltd. has adopted this Plan, and Apache has approved its adoption,
as of May 17, 1995, for the eligible employees of Apache Canada Ltd.

Capitalized terms in this Appendix have the same meanings as those given to them
in the Plan. The regular terms of the Plan shall apply to the employees of
Apache Canada Ltd., except as provided below.

                           ELIGIBILITY TO PARTICIPATE

Notwithstanding section 1.15, an employee of Apache Canada Ltd. shall be a
Covered Employee only if (1) he or she is either a U.S. citizen or a U.S.
resident, and (2) he or she was employed by Apache or another Company
immediately before becoming an employee of Apache Canada Ltd.

                         VESTING AND ELIGIBILITY SERVICE

For any individual who becomes an employee of Apache on or after May 17, 1995,
his or her Period of Service shall include any periods of employment before May
17, 1995, with DEKALB Energy Company or any business then treated as a single
employer with DEKALB Energy Company pursuant to Code section 414(b), 414(c),
414(m), or 414(o).

                                  COMPENSATION

If the payroll of the Apache Canada Ltd. employee is handled in the United
States, then the definitions of Compensation in section 1.14 shall apply. To the
extent that the payroll of the Apache Canada Ltd. employee is handled outside of
the United States, the following definitions of Compensation shall apply in lieu
of the definitions found in subsections 1.14(a) and 1.14(b):

         (a)      Code Section 415 Compensation. For purposes of determining the
                  limitation on Annual Additions under section 3.4 and the
                  minimum contribution under section 12.4 when the Plan is
                  top-heavy, Compensation shall mean foreign earned income
                  (within the meaning of Code section 911(b)) paid by the
                  Company or an Affiliated Entity, and shall also include
                  elective contributions that are not includable in the
                  Employee's income pursuant to Code sections 125, 132(f)(4),
                  402(e)(3), 402(h), 403(b), 408(p), 414(u)(2)(C), 414(v)(6)(B),
                  or 457. For purposes of section 3.4, Compensation shall be
                  measured over a Limitation Year. For purposes of section 12.4,
                  Compensation shall be measured over a Plan Year.

         (b)      Code Section 414(q) Compensation. For purposes of identifying
                  Highly Compensated Employees and Key Employees, Compensation
                  shall have the same meaning as in paragraph (a), except that
                  Compensation shall be measured over a Plan Year and shall not
                  include any amounts accrued by, but not paid to, the Employee
                  during the Plan Year.

                             -- END OF APPENDIX D --

                                       D-1

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