Document:

Chesapeake's 2003 Stock Incentive Plan, as amended

 Exhibit 10.1.1 
 CHESAPEAKE ENERGY CORPORATION 
 2003 STOCK INCENTIVE PLAN 
 (as amended through February 13, 2006) 

 CHESAPEAKE ENERGY CORPORATION 
 2003 STOCK INCENTIVE PLAN 
  

					
	ARTICLE I PURPOSE	  	1
			
	 Section 1.1
	  	Purpose	  	1
	 Section 1.2
	  	Establishment	  	1
	 Section 1.3
	  	Shares Subject to the Plan	  	1
	 Section 1.4
	  	Shareholder Approval	  	1
		
	ARTICLE II DEFINITIONS	  	1
		
	ARTICLE III ADMINISTRATION	  	5
			
	 Section 3.1
	  	Administration of the Plan; the Committee	  	5
	 Section 3.2
	  	Committee to Make Rules and Interpret Plan	  	5
		
	ARTICLE IV GRANT OF AWARDS	  	6
		
	ARTICLE V STOCK OPTIONS	  	6
			
	 Section 5.1
	  	Grant of Options	  	6
	 Section 5.2
	  	Conditions of Options	  	6
	 Section 5.3
	  	Options Not Qualifying as Incentive Stock Options	  	8
	 Section 5.4
	  	Nonassignability	  	8
		
	ARTICLE VI RESTRICTED STOCK AWARDS	  	9
			
	 Section 6.1
	  	Grant of Restricted Stock Awards	  	9
	 Section 6.2
	  	Conditions of Restricted Stock Awards	  	9
		
	ARTICLE VII STOCK ADJUSTMENTS	  	10
		
	ARTICLE VIII GENERAL	  	10
			
	 Section 8.1
	  	Amendment or Termination of Plan	  	10
	 Section 8.2
	  	Acceleration of Awards on Death, Disability or Other Special Circumstances	  	11
	 Section 8.3
	  	Withholding Taxes	  	11
	 Section 8.4
	  	Certain Additional Payments by the Company	  	11
	 Section 8.5
	  	Regulatory Approval and Listings	  	11
	 Section 8.6
	  	Right to Continued Employment	  	12
	 Section 8.7
	  	Reliance on Reports	  	12
	 Section 8.8
	  	Construction	  	12
	 Section 8.9
	  	Governing Law	  	12
		
	ARTICLE IX ACCELERATION OF AWARDS UPON CORPORATE EVENT	  	12

 CHESAPEAKE ENERGY CORPORATION 
 2003 STOCK INCENTIVE PLAN 
 ARTICLE I 
 PURPOSE 
 Section 1.1
Purpose. This 2003 Stock Incentive Plan is established by Chesapeake Energy Corporation (the “Company”) to create incentives which are designed to motivate Employees and Consultants to put forth maximum effort toward the success
and growth of the Company and to enable the Company to attract and retain experienced individuals who by their position, ability and diligence are able to make important contributions to the Company’s success. Toward these objectives, the Plan
provides for the granting of Options and Restricted Stock Awards to Employees and Consultants on the terms and subject to the conditions set forth in the Plan. The Plan is designed to align the interests of participants with those of shareholders
through the use of stock-based incentives. 
 Section 1.2 Establishment. The Plan is effective as of April 15, 2003
and for a period of 10 years from such date. The Plan will terminate on April 14, 2013; however, it will continue in effect until all matters relating to the exercise of Options, distribution of Awards and administration of the Plan have been
settled. 
 Section 1.3 Shares Subject to the Plan. Subject to the limitations and adjustments set forth in this Plan,
Awards may be made under this Plan for a total of 10,000,000 shares of Common Stock. 
 Section 1.4 Shareholder Approval.
The Plan shall be subject to Shareholder Approval, which must occur within the period ending twelve months after the date the Plan is adopted by the Board. Pending such Shareholder Approval, Awards under the Plan may be granted, but Options may not
be exercised nor may Restricted Stock Awards vest prior to receipt of such Shareholder Approval. In the event such Shareholder Approval is not obtained within such twelve-month period, all such Awards shall be void. 
 ARTICLE II 
 DEFINITIONS

 Section 2.1 “Affiliated Entity” means any partnership or limited liability company in which a majority of
voting power thereof is owned or controlled, directly or indirectly, by the Company or one or more of its Subsidiaries or Affiliated Entities or a combination thereof. 
 Section 2.2 “Award” means, individually or collectively, any Option or Restricted Stock Award granted under the Plan to an Eligible Person by the applicable Committee pursuant to such
terms, conditions, restrictions, and/or limitations, if any, as the applicable Committee may establish by the Award Agreement or otherwise. 
 Section 2.3 “Award Agreement” means any written instrument that establishes the terms, conditions, restrictions, and/or limitations applicable to an Award in addition to those established by this Plan and by the
Committee’s exercise of its administrative powers. 

 Section 2.4 “Board” means the Board of Directors of the Company. 

Section 2.5 “Change of Control” means, for Participants other than Executive Officers, the occurrence of any of the
following: 
 (i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange
Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either (A) the then outstanding shares of common stock of the Company (the “Outstanding Company
Common Stock”) or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”). For purposes of this
paragraph 2.5 the following acquisitions by a Person will not constitute a Change of Control: (1) any acquisition directly from the Company; (2) any acquisition by the Company; (3) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation controlled by the Company; or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (A), (B) and (C) of paragraph
(iii) below; 
 (ii) the individuals who, as of the date hereof, constitute the board of directors (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the board of directors. Any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, is approved by a vote
of at least a majority of the directors then comprising the Incumbent Board will be considered a member of the Incumbent Board as of the date hereof, but any such individual whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Incumbent Board will not be deemed a member of the
Incumbent Board as of the date hereof; 
 (iii) the consummation of a reorganization, merger, consolidation or sale or other disposition of
all or substantially all of the assets of the Company (a “Business Combination”), unless following such Business Combination: (A) all or substantially all of the individuals and entities who were the beneficial owners, respectively,
of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock
and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately
prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be, (B) no Person (excluding any corporation resulting from such Business Combination or any employee benefit
plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting
from such Business Combination or the combined voting power of the then outstanding 
  

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 voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination
and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the
Board, providing for such Business Combination; or 
 (iv) the approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company. 
 For Executive Officers, a Change of Control means the occurrence of any of the foregoing events or a change of control as
defined in such Executive Officer’s employment agreement in force at the time of determination. 
 Section 2.6
“Code” means the Internal Revenue Code of 1986, as amended. Reference in the Plan to any Section of the Code shall be deemed to include any amendments or successor provisions to such Section and any regulations under such
Section. 
 Section 2.7 “Committee” has the meaning set forth in Section 3.1. 
 Section 2.8 “Common Stock” means the common stock, par value $.01 per share, of the Company and, after substitution, such
other stock as shall be substituted therefor as provided in Article VII or Article IX of the Plan. 
 Section 2.9
“Compensation Committee” means a committee designated by the Board which will consist of not less than two members of the Board who meet the definition of “non-employee directors” pursuant to Rule 16b-3, or any
successor rule, promulgated under Section 16 of the Exchange Act unless another committee is designated by the Board of Directors. 
 Section 2.10 “Consultant” means any person who is engaged by the Company, a Subsidiary or an Affiliated Entity to render consulting or advisory services. 
 Section 2.11 “Date of Grant” means the date on which the grant of an Award is authorized by the Committee or such later date
as may be specified by the Committee in such authorization. 
 Section 2.12 “Disability” has the meaning set
forth in Section 22(e)(3) of the Code. 
 Section 2.13 “Eligible Person” means any Employee or Consultant.

 Section 2.14 “Employee” means any employee of the Company, a Subsidiary or an Affiliated Entity. 

Section 2.15 “Employee Compensation Committee” means the Employee Compensation and Benefits Committee designated by the
Board which shall consist of not less than one member of the Board. 
 Section 2.16 “Exchange Act” means the
Securities Exchange Act of 1934, as amended. 
  

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 Section 2.17 “Executive Officer Participants” means Participants who are
subject to the provisions of Section 16 of the Exchange Act with respect to the Common Stock. 
 Section 2.18 “Fair
Market Value” means, as of any date, (i) if the principal market for the Common Stock is a national securities exchange or the Nasdaq stock market, the closing price of the Common Stock on that date on the principal exchange on which
the Common Stock is then listed or admitted to trading; or (ii) if sale prices are not available or if the principal market for the Common Stock is not a national securities exchange and the Common Stock is not quoted on the Nasdaq stock
market, the average of the highest bid and lowest asked prices for the Common Stock on such day as reported on the Nasdaq OTC Bulletin Board Service or by the National Quotation Bureau, Incorporated or a comparable service. If the day is not a
business day, and as a result, clauses (i) and (ii) are inapplicable, the Fair Market Value of the Common Stock shall be determined as of the last preceding business day. If clauses (i) and (ii) are otherwise inapplicable, the
Fair Market Value of the Common Stock shall be determined in good faith by the Committee. 
 Section 2.19 “Incentive
Stock Option” means an Option within the meaning of Section 422 of the Code. 
 Section 2.20 “Non-Executive
Officer Participants” means Participants who are not subject to the provisions of Section 16 of the Exchange Act. 
 Section 2.21 “Nonqualified Stock Option” means an Option to purchase shares of Common Stock which is not an Incentive Stock Option within the meaning of Section 422(b) of the Code. 
 Section 2.22 “Option” means an Incentive Stock Option or Nonqualified Stock Option granted under Article V of the Plan.

 Section 2.23 “Participant” means an Eligible Person to whom an Award has been granted by the Committee under
the Plan. 
 Section 2.24 “Plan”“ means the Chesapeake Energy Corporation 2003 Stock Incentive Plan.

 Section 2.25 “Restricted Stock Award” means an Award granted to an Eligible Person under Article VI of the
Plan. 
 Section 2.26 “Shareholder Approval” means approval by the holders of a majority of the outstanding
shares of Common Stock, present or represented and entitled to vote at a meeting called for such purposes. 
 Section 2.27
“Subsidiary” shall have the same meaning set forth in Section 424(f) of the Code. 
  

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 ARTICLE III 
 ADMINISTRATION 
 Section 3.1 Administration of the Plan; the Committee. The
Employee Compensation Committee shall administer the Plan with respect to Non-Executive Officer Participants, including the grant of Awards, and the Compensation Committee shall administer the Plan with respect to Executive Officer Participants,
including the grant of Awards. Accordingly, as used in the Plan, the term “Committee” shall mean the Employee Compensation Committee if it refers to Plan administration affecting Non-Executive Officer Participants or the Compensation
Committee if it refers to Plan administration affecting Executive Officer Participants. Although the Committee is generally responsible for the administration of the Plan, the Board in its sole discretion may take any action under the Plan that
would otherwise be the responsibility of the Committee. 
 Unless otherwise provided in the bylaws of the Company or resolutions adopted from
time to time by the Board establishing the Committee, the Board may from time to time remove members from, or add members to, the Committee. Vacancies on the Committee, however caused, shall be filled by the Board. The Committee shall hold meetings
at such times and places as it may determine. A majority of the Committee shall constitute a quorum, and the acts of a majority of the members present at any meeting at which a quorum is present shall be the valid acts of the Committee. Any action
which may be taken at a meeting of the Committee may be taken without a meeting if all the members of the Committee consent to the action in writing. 
 Subject to the provisions of the Plan and review by the Board, the Committee shall have exclusive power to: 
 (a) Select the Eligible Persons to participate in the Plan. 
 (b) Determine the time or times
when Awards will be granted. 
 (c) Determine the form of Award, whether an Incentive Stock Option, a Nonqualified Stock
Option or a Restricted Stock Award, the number of shares of Common Stock subject to any Award, all the terms, conditions (including performance requirements), restrictions and/or limitations, if any, of an Award, including the time and conditions of
exercise or vesting, and the terms of any Award Agreement, which may include the waiver or amendment of prior terms and conditions or acceleration of the vesting or exercise of an Award under certain circumstances determined by the Committee.
However, the Committee will not reprice outstanding Awards. 
 (d) Determine whether Awards will be granted singly or in
combination. 
 (e) Take any and all other action it deems necessary or advisable for the proper operation or administration
of the Plan. 
 Section 3.2 Committee to Make Rules and Interpret Plan. The Committee in its sole discretion shall have
the authority, subject to the provisions of the Plan and review by the Board, to establish, adopt, or revise such rules and regulations and to make all such determinations relating to the Plan as it may deem necessary or advisable for the
administration of the Plan. The Committee’s interpretation of the Plan or any Awards granted pursuant hereto and all decisions and determinations by the Committee with respect to the Plan shall be final, binding, and conclusive on all parties
unless otherwise determined by the Board. 
  

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 ARTICLE IV 
 GRANT OF AWARDS 
 The Committee may, from time to time, grant Awards to one or more Participants,
provided, however, that: 
 (a) Any shares of Common Stock related to Awards which terminate by expiration, forfeiture,
cancellation or otherwise shall be available again for grant under the Plan. 
 (b) Common Stock delivered by the Company upon
exercise of an Option or upon payment of an Award under the Plan may be authorized and unissued Common Stock or Common Stock held in the treasury of the Company. 
 (c) The Committee shall, in its sole discretion, determine the manner in which fractional shares arising under this Plan shall be treated.

 (d) Subject to Article VII, the aggregate number of shares of Common Stock made subject to Options and Restricted Stock
Awards granted to any Employee in any calendar year may not exceed two million shares. 
 ARTICLE V 
 STOCK OPTIONS 
 Section 5.1
Grant of Options. The Committee may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant Nonqualified Stock Options to any Eligible Persons and Incentive Stock Options to
Employees. Subject to the limitations of Section 5.2(e), these Options may be Incentive Stock Options or Nonqualified Stock Options, or a combination of both. Each grant of an Option shall be evidenced by an Award Agreement executed by the
Company and the Participant, and shall contain such terms and conditions and be in such form as the Committee may from time to time approve, subject to the requirements of Section 5.2. 
 Section 5.2 Conditions of Options. Each Option so granted shall be subject to the following conditions: 
 (a) Exercise Price. As limited by Section 5.2(e) below, the Award Agreement for each Option shall state the exercise price set
by the Committee on the Date of Grant. No Option shall be granted at an exercise price which is less than the Fair Market Value of the Common Stock on the Date of Grant. 
 (b) Form of Payment. The payment of the exercise price of an Option shall be subject to the following: 
  

	 	(i)	The full exercise price for shares of Common Stock purchased upon the exercise of any Option shall be paid at the time of such exercise. 

  

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	 	(ii)	The exercise price shall be payable in cash (including a check acceptable to the Committee, bank draft or money order) or by tendering, by either actual delivery of shares or by
attestation, shares of Common Stock acceptable to the Committee and valued at Fair Market Value as of the day of exercise, or any combination thereof, as determined by the Committee. 

  

	 	(iii)	The Committee may permit an Option granted under the Plan to be exercised by a participant in conjunction with a broker-dealer acting on behalf of a Participant, such broker-dealer
to remit the exercise price and any applicable withholding taxes directly to the Company, through procedures approved by the Committee. 

 (c) Exercise of Options. Options granted under the Plan shall be exercisable, in whole or in such installments and at such times, and shall expire at such time, as shall be provided by the Committee in the
Award Agreement. Exercise of an Option shall be by written notice stating the election to exercise in the form and manner determined by the Committee. Every share of Common Stock acquired through the exercise of an Option shall be deemed to be fully
paid at the time of exercise and payment of the exercise price. Upon the exercise of any Option, the Company shall issue and deliver to the Participant who exercised the Option a certificate representing the number of shares of Common Stock
purchased thereby. 
 (d) Other Terms and Conditions. Among other conditions that may be imposed by the Committee, if
deemed appropriate, are those relating to (i) the period or periods and the conditions of exercisability of any Option; (ii) the minimum periods during which Participants must be employed by the Company, a Subsidiary or Affiliated Entity,
or must hold Options before they may be exercised; (iii) the minimum periods during which shares acquired upon exercise must be held before sale or transfer shall be permitted; (iv) the maximum period that Participants will be allowed to
be inactively employed or on a leave of absence before their vesting is suspended until they return to active employment; (v) conditions under which such Options or shares may be subject to forfeiture; (vi) the frequency of exercise or the
minimum or maximum number of shares that may be acquired at any one time; (vii) the achievement by the Company of specified performance criteria; and (viii) protection of business matters. 
 (e) Special Restrictions Relating to Incentive Stock Options. Options issued in the form of Incentive Stock Options shall only be
granted to Employees of the Company or a Subsidiary and not to Employees of an Affiliated Entity unless such entity is classified as a “disregarded entity” of the Company or the applicable Subsidiary under the Code. In addition to being
subject to all applicable terms, conditions, restrictions and/or limitations established by the Committee, Options issued in the form of Incentive Stock Options shall comply with the requirements of Section 422 of the Code (or any successor
Section thereto), including, without limitation, the requirement that the exercise price of an Incentive Stock Option not be less than 100% of the Fair Market Value of the Common Stock on the Date of Grant, the requirement that each Incentive Stock
Option, unless sooner exercised, terminated or canceled, expire no later than 10 years from its Date of 
  

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 Grant, and the requirement that the aggregate Fair Market Value (determined on the Date of Grant) of the
Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a Participant during any calendar year (under this Plan or any other plan of the Company or any Subsidiary) not exceed $100,000. Incentive Stock Options
which are in excess of the applicable $100,000 limitation will be automatically recharacterized as Nonqualified Stock Options as provided under Section 5.3 of this Plan. No Incentive Stock Options shall be granted to any Employee if,
immediately before the grant of an Incentive Stock Option, such Employee owns more than 10% of the total combined voting power of all classes of stock of the Company or its Subsidiaries (as determined in accordance with the stock attribution rules
contained in Sections 422 and 424(d) of the Code). Provided, the preceding sentence shall not apply if, at the time the Incentive Stock Option is granted, the exercise price is at least 110% of the Fair Market Value of the Common Stock subject to
the Incentive Stock Option, and such Incentive Stock Option by its terms is exercisable no more than five years from the date such Incentive Stock Option is granted. 
 (f) Application of Funds. The proceeds received by the Company from the sale of Common Stock issued upon the exercise of Options
will be used for general corporate purposes. 
 (g) Shareholder Rights. No Participant shall have any rights as a
shareholder with respect to any share of Common Stock subject to an Option prior to the purchase of such share of Common Stock by exercise of the Option. 
 Section 5.3 Options Not Qualifying as Incentive Stock Options. With respect to all or any portion of any Option granted under this Plan not qualifying as an “incentive stock option” under
Section 422 of the Code, such Option shall be considered a Nonqualified Stock Option granted under this Plan for all purposes. Further, this Plan and any Incentive Stock Options granted hereunder shall be deemed to have incorporated by
reference all the provisions and requirements of Section 422 of the Code (and the Treasury Regulations issued thereunder) necessary to ensure that all Incentive Stock Options granted hereunder shall be “incentive stock options”
described in Section 422 of the Code. Further, in the event that the $100,000 limitation contained in Section 5.2(e) herein is exceeded in any Incentive Stock Option granted under this Plan, the portion of the Incentive Stock Option in
excess of such limitation shall be treated as a Nonqualified Stock Option under this Plan subject to the terms and provisions of the applicable Award Agreement, except to the extent modified to reflect recharacterization of the Incentive Stock
Option as a Nonqualified Stock Option. 
 Section 5.4 Nonassignability. Options are not transferable otherwise than by
will or the laws of descent and distribution. Any attempted transfer, assignment, pledge, hypothecation or other disposition of, or the levy of execution, attachment or similar process upon, any Option contrary to the provisions hereof shall be void
and ineffective, shall give no right to any purported transferee, and may, at the sole discretion of the Committee, result in forfeiture of the Option involved in such attempt. 
  

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 ARTICLE VI 
 RESTRICTED STOCK AWARDS 
 Section 6.1 Grant of Restricted Stock Awards. The
Committee may, from time to time, subject to the provisions of the Plan and such other terms and conditions as it may determine, grant a Restricted Stock Award to any Eligible Person. Restricted Stock Awards shall be awarded in such number and at
such times during the term of the Plan as the Committee shall determine. Each Restricted Stock Award may be evidenced in such manner as the Committee deems appropriate, including, without limitation, a book-entry registration or issuance of a stock
certificate or certificates into escrow until the restrictions associated with such Award are satisfied, and by an Award Agreement setting forth the terms of such Restricted Stock Award. 
 Section 6.2 Conditions of Restricted Stock Awards. The grant of a Restricted Stock Award shall be subject to the following:

 (a) Restriction Period. Each Restricted Stock Award shall require the holder to remain in the employment of the
Company, a Subsidiary, or an Affiliated Entity for a prescribed period (a “Restriction Period”). The Committee shall determine the Restriction Period or Periods that shall apply to the shares of Common Stock covered by each Restricted
Stock Award or portion thereof. In addition to any time vesting conditions determined by the Committee, Restricted Stock Awards may be subject to the achievement by the Company of specified performance criteria based upon the Company’s
achievement of target levels of earnings per share, share price, net income, cash flows, reserve additions or replacements, production volume, finding and operating costs, drilling results, acquisitions and divestitures, risk management activities,
return on equity, and/or total or comparative shareholder return, or other individual criteria as determined by the Committee. At the end of the Restriction Period, assuming the fulfillment of any other specified vesting conditions, the restrictions
imposed by the Committee shall lapse with respect to the shares of Common Stock covered by the Restricted Stock Award or portion thereof. 
 (b) Restrictions. The holder of a Restricted Stock Award may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of the shares of Common Stock represented by the Restricted Stock Award
during the applicable Restriction Period. The Committee shall impose such other restrictions and conditions on any shares of Common Stock covered by a Restricted Stock Award as it may deem advisable including, without limitation, restrictions under
applicable Federal or state securities laws, and may legend the certificates representing the shares of Common Stock subject to the Restricted Stock Award to give appropriate notice of such restrictions. 
 (c) Shareholder Rights. During any Restriction Period, the Committee may, in its discretion, grant to the holder of a Restricted
Stock Award all or any of the rights of a shareholder with respect to the shares, including, but not by way of limitation, the right to vote such shares and to receive dividends. If any dividends or other distributions are paid in shares of Common
Stock, all such shares shall be subject to the same restrictions on transferability as the shares of Common Stock subject to the Restricted Stock Award with respect to which they were paid. 
  

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 ARTICLE VII 
 STOCK ADJUSTMENTS 
 Subject to the provisions of Article IX of this Plan, in the event that the
shares of Common Stock, as presently constituted, shall be changed into or exchanged for a different number or kind or shares of stock or other securities of the Company or of another corporation (whether by reason of merger, consolidation,
recapitalization, reclassification, stock split, combination of shares or otherwise), or if the number of such shares of Common Stock shall be increased through the payment of a stock dividend, then there shall be substituted for or added to each
share available under and subject to the Plan as provided in Section 1.3 hereof, and each share then subject or thereafter subject or which may become subject to Awards under the Plan, the number and kind of shares of stock or other securities
into which each outstanding share of Common Stock shall be so changed or for which each such share shall be exchanged or to which each such share shall be entitled, as the case may be, on a fair and equivalent basis in accordance with the applicable
provisions of Section 424 of the Code; provided, however, in no such event will such adjustment result in a modification of any Award as defined in Section 424(h) of the Code. In the event there shall be any other change in the number or
kind of the outstanding shares of Common Stock, or any stock or other securities into which the Common Stock shall have been changed or for which it shall have been exchanged, then if the Committee shall, in its sole discretion, determine that such
change equitably requires an adjustment in the shares available under and subject to the Plan, or in any Award theretofore granted or which may be granted under the Plan, such adjustments shall be made in accordance with such determination, except
that no adjustment of the number of shares of Common Stock available under the Plan or to which any Award relates that would otherwise be required shall be made unless and until such adjustment either by itself or with other adjustments not
previously made would require an increase or decrease of at least 1% of the number of shares of Common Stock available under the Plan or to which any Award relates immediately prior to the making of such adjustment (the “Minimum
Adjustment”). Any adjustment representing a change of less than such minimum amount shall be carried forward and made as soon as such adjustment together with other adjustments required by this Article VII and not previously made would result
in a Minimum Adjustment. Notwithstanding the foregoing, any adjustment required by this Article VII which otherwise would not result in a Minimum Adjustment shall be made with respect to shares of Common Stock relating to any Award immediately prior
to exercise or settlement of such Award. 
 No fractional shares of Common Stock or units of other securities shall be issued pursuant to any
such adjustment, and any fractions resulting from any such adjustment shall be eliminated in each case by rounding downward to the nearest whole share. 
 ARTICLE VIII 
 GENERAL 
 Section 8.1 Amendment or Termination of Plan. The Board may suspend or terminate the Plan at any time. In addition, the Board may,
from time to time, amend the Plan in any manner, but may not adopt any amendment without Shareholder Approval if (i) the amendment relates to Incentive Stock Options and Section 422 of the Code requires Shareholder Approval of such
amendment, or (ii) in the opinion of counsel to the Company, Shareholder Approval is required by any federal or state laws or regulations or the rules of any stock exchange on which the common stock may be listed. 
  

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 Section 8.2 Acceleration of Awards on Death, Disability or Other Special
Circumstances. With respect to (i) a Participant who terminates employment due to a Disability, (ii) the personal representative of a deceased Participant, or (iii) any other Participant who terminates employment upon the
occurrence of special circumstances (as determined by the Committee), the Committee, in its sole discretion, may permit the purchase of all or any part of the shares subject to any unvested Option or waive the vesting requirements of a Restricted
Stock Award on the date of the Participant’s termination of employment due to a Disability, death or special circumstances, or as the Committee otherwise so determines. With respect to Options which have already vested at the date of such
termination or the vesting of which is accelerated by the Committee in accordance with the foregoing provision, the Participant or the personal representative of a deceased Participant shall have the right to exercise such vested Options within such
period(s) as the Committee shall determine. 
 Section 8.3 Withholding Taxes. A Participant must pay in cash to the
Company the amount of taxes required to be withheld by law upon the exercise of an Option. Required withholding taxes associated with a Restricted Stock Award must also be paid in cash unless the Committee permits a Participant to pay the amount of
taxes required by law to be withheld from a Restricted Stock Award by directing the Company to withhold from any Award the number of shares of Common Stock having a Fair Market Value on the date of vesting equal to the amount of required withholding
taxes. 
 Section 8.4 Certain Additional Payments by the Company. The Committee may, in its sole discretion, provide in
any Award Agreement for certain payments by the Company in the event that acceleration of vesting of any Award under the Plan is subject to the excise tax imposed by Section 4999 of the Code or any interest or penalties with respect to such
excise tax (such excise tax, interest and penalties, collectively, the “Excise Tax”). An Award Agreement may provide that the Participant shall be entitled to receive a payment (a “Gross-Up Payment”) in an amount such that after
payment by the Participant of all taxes (including any interest or penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the Participant retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon such acceleration of vesting of any Award. 
 Section 8.5 Regulatory Approval and Listings. The
Company shall use its best efforts to file with the Securities and Exchange Commission as soon as practicable following the date this Plan is effective, and keep continuously effective and usable, a Registration Statement on Form S-8 with respect to
shares of Common Stock subject to Awards hereunder. Notwithstanding anything contained in this Plan to the contrary, the Company shall have no obligation to issue or deliver certificates representing shares of Common Stock evidencing Awards prior
to: 
 (a) the obtaining of any approval from, or satisfaction of any waiting period or other condition imposed by, any
governmental agency which the Committee shall, in its sole discretion, determine to be necessary or advisable; 
  

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 (b) the listing of such shares on any exchange on which the Common Stock may be listed;
and 
 (c) the completion of any registration or other qualification of such shares under any state or federal law or
regulation of any governmental body which the Committee shall, in its sole discretion, determine to be necessary or advisable. 
 Section 8.6 Right to Continued Employment. Participation in the Plan shall not give any Participant any right to remain in the employ of the Company, a Subsidiary or an Affiliated Entity. Further, the adoption of this
Plan shall not be deemed to give any Employee or Consultant or any other individual any right to be selected as a Participant or to be granted an Award. 
 Section 8.7 Reliance on Reports. Each member of the Committee and each member of the Board shall be fully justified in relying or acting in good faith upon any report made by the independent public
accountants of the Company and its Subsidiaries and upon any other information furnished in connection with the Plan by any person or persons other than the Committee or Board member. In no event shall any person who is or shall have been a member
of the Committee or the Board be liable for any determination made or other action taken or any omission to act in reliance upon any such report or information or for any action taken, including the furnishing of information, or failure to act, if
in good faith. 
 Section 8.8 Construction. The titles and headings of the sections in the Plan are for the convenience of
reference only, and in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control. 
 Section 8.9 Governing Law. The Plan shall be governed by and construed in accordance with the laws of the State of Oklahoma except as superseded by applicable federal law. 
 ARTICLE IX 
 ACCELERATION OF AWARDS
UPON CORPORATE EVENT 
 If the Company shall, pursuant to action by the Board, at any time propose to dissolve or liquidate or merge
into, consolidate with, or sell or otherwise transfer all or substantially all of its assets to another corporation and provision is not made pursuant to the terms of such transaction for the assumption by the surviving, resulting or acquiring
corporation of outstanding Options under the Plan, or for the substitution of new awards therefor, the Committee shall cause written notice of the proposed transaction to be given to each Participant no less than forty days prior to the anticipated
effective date of the proposed transaction, and the Participant’s Award shall become 100% vested. Prior to a date specified in such notice, which shall be not more than 10 days prior to the anticipated effective date of the proposed
transaction, each Participant shall have the right to exercise his or her Option to purchase any or all of the Common Stock then subject to such Option or to receive the shares subject to any unvested Restricted Stock Award, free of any
restrictions. Each Participant, by so notifying the Company in writing, may, in exercising his or her Option, condition such exercise upon, and provide that such exercise shall become effective immediately prior to the consummation of the
transaction, in which event such 
  

 12 

 Participant need not make payment for the Common Stock to be purchased upon exercise of such Option until five days after
receipt of written notice by the Company to such Participant that the transaction has been consummated. If the transaction is consummated, each Option, to the extent not previously exercised prior to the date specified in the foregoing notice, shall
terminate on the effective date such transaction is consummated. If the transaction is abandoned, (i) any Common Stock not purchased upon exercise of such Option shall continue to be available for purchase in accordance with the other
provisions of the Plan and (ii) to the extent that any Option not exercised prior to such abandonment and any Restricted Stock Award shall have vested solely by operation of this Article IX, such vesting shall be deemed voided as of the time
such acceleration otherwise occurred pursuant to Article IX, and the vesting schedule set forth in the Participant’s Award Agreement shall be reinstituted as of the date of such abandonment. 
 Upon the occurrence of a Change of Control, in the event that the provisions of the foregoing paragraph are not already invoked, each Participant shall
have the right to exercise his or her Option to purchase any or all of the Common Stock then subject to such Option or to receive the shares subject to any unvested Restricted Stock Award, free of any restrictions. Each Participant, by so notifying
the Company in writing, may, in exercising his or her Option, condition such exercise upon, and provide that such exercise shall become effective immediately prior to the Change of Control, in which event such Participant need not make payment for
the Common Stock to be purchased upon exercise of such Option until five days after receipt of written notice by the Company to such Participant that the Change of Control has occurred. If the Change of Control has occurred, each Option, to the
extent not previously exercised prior to the date specified in the foregoing notice, shall terminate on the effective date of such Change of Control. If the Change of Control is abandoned, (i) any Common Stock not purchased upon exercise of
such Option shall continue to be available for purchase in accordance with the other provisions of the Plan and (ii) to the extent that any Option not exercised prior to such abandonment and any Restricted Stock Award shall have vested solely
by operation of this Article IX, such vesting shall be deemed voided as of the time such acceleration otherwise occurred pursuant to Article IX, and the vesting schedule set forth in the Participant’s Award Agreement shall be reinstituted as of
the date of such abandonment. 
  

 13Chesapeake's 1994 Stock Option Plan, as amended

 Exhibit 10.1.3 
 CHESAPEAKE ENERGY CORPORATION 
 1994 STOCK OPTION PLAN 
 Effective Date: October 18, 1994 
 as
Amended Through February 13, 2006 

 CHESAPEAKE ENERGY CORPORATION 
 1994 STOCK OPTION PLAN 
  

							
	 	  	 	  	 	  	Page
	 ARTICLE I
	  	General Provisions	  	1
		  	1.1	  	Purpose	  	1
		  	1.2	  	General	  	1
		  	1.3	  	Administration of the Plan	  	1
		  	1.4	  	Shares Subject to the Plan	  	2
		  	1.5	  	Participation in the Plan	  	3
		  	1.6	  	Determination of Fair Market Value	  	3
		  	1.7	  	Grants of Options Under Stock Option Agreement	  	3
		  	1.8	  	Amendment and Termination of the Plan	  	3
		  	1.9	  	Effective Date	  	4
		  	1.10	  	Securities Law Requirements	  	4
		  	1.11	  	Stock Certificates	  	4
		  	1.12	  	Option Exercise and Payment for Stock	  	4
		  	1.13	  	Stock Options and ISO Options Granted Separately	  	5
		  	1.14	  	Use of Proceeds	  	5
		  	1.15	  	Non-Transferability of Options	  	6
		  	1.16	  	Additional Documents on Death of Participant	  	6
		  	1.17	  	Changes in Employment	  	6
		  	1.18	  	Stockholder Rights	  	6
		  	1.19	  	Adjustments Upon Changes in Capitalization	  	6
		  	1.20	  	Payment of Withholding Taxes	  	7
		  	1.21	  	Assumption of Outstanding Options	  	7
		  	1.22	  	Retirement and Disability	  	8
			
	 ARTICLE II
	  	Stock Options	  	8
		  	2.1	  	General Terms	  	8
		  	2.2	  	Grant and Terms for Stock Options	  	8
			
	 ARTICLE III
	  	ISO Options	  	9
		  	3.1	  	General Terms	  	9
		  	3.2	  	Grant and Terms of ISO Options	  	9
			
	 ARTICLE IV
	  	Acceleration of Options Upon Corporate Event	  	11
		  	4.1	  	Acceleration of Options	  	11
		  	4.2	  	Procedures for Acceleration and Exercise	  	12
		  	4.3	  	Certain Additional Payments by the Company	  	12
			
	 ARTICLE V
	  	Options Not Qualifying as Incentive Stock Options	  	13

 CHESAPEAKE ENERGY CORPORATION 
 1994 STOCK OPTION PLAN 
 ARTICLE i 
 General Provisions 
 1.1
Purpose. The purpose of CHESAPEAKE ENERGY CORPORATION 1994 STOCK OPTION PLAN (the “Plan”) shall be to attract, retain and motivate employees (the “Participants”) of Chesapeake Energy Corporation (the
“Company”) and of any parent or subsidiary of the Company by way of granting (i) nonqualified stock options (“Stock Options”) and (ii) incentive stock options (“ISO Options”). For purposes of this Plan, Stock
Options and ISO Options are sometimes collectively herein called “Options.” The ISO Options to be granted under the Plan are intended to be qualified pursuant to Section 422 of the Internal Revenue Code of 1986, as amended (the
“Code”), and the Stock Options to be granted are intended to be “nonqualified stock options” as described in Sections 83 and 421 of the Code. Further, under the Plan, the terms “parent” and “subsidiary” shall
have the same meaning as set forth in Subsections (e), (f) and (g) of Section 424 of the Code unless the context clearly indicates to the contrary. 
 1.2 General. The terms and provisions of this Article I shall be applicable to both Stock Options and ISO Options unless the context clearly indicates to the contrary. 
 1.3 Administration of the Plan; the Committee. For purposes of administration, the Plan shall be deemed to consist of two separate stock
option plans, a “Non-Executive Officer Participant Plan” which is limited to Non-Executive Officer Participants and an “Executive Officer Participant Plan” which is limited to Executive Officer Participants. Except for
administration and the category of Participants eligible to receive Options, the terms of the Non-Executive Officer Participant Plan and the Executive Officer Participant Plan are identical. 
 The Non-Executive Officer Participant Plan shall be administered by the Employee Compensation and Benefits Committee and the Executive Officer
Participant Plan shall be administered by the Special Stock Option Committee. Accordingly, with respect to decisions relating to Non-Executive Officer Participants, including the grant of Options, the term “Committee” shall mean only the
Employee Compensation and Benefits Committee; and, with respect to all decisions relating to the Executive Officer Participants, including the grant of Options, the term “Committee” shall mean only the Special Stock Option Committee.

 Unless otherwise provided in the by-laws of the Company or the resolutions adopted from time to time by the Board establishing the
Committee, the Board may from time to time remove members from, or add members to, the Committee. Vacancies on the 

 Committee, however caused, shall be filled by the Board. The Committee shall hold meetings at such times and places as it
may determine. A majority of the Committee shall constitute a quorum, and the acts of a majority of the members present at any meeting at which a quorum is present or acts reduced to or approved in writing by a majority of the members of the
Committee shall be the valid acts of the Committee. 
 Subject to the provisions of the Plan, the Committee shall have exclusive power to:

 (a) Select the Participants to be granted Options. 
 (b) Determine the time or times when Options will be granted. 
 (c) Determine the form of an Option, whether
an Incentive Stock Option or a Nonqualified Stock Option, the number of shares of Common Stock subject to the Option, all the terms, conditions (including performance requirements), restrictions and/or limitations, if any, of an Option, including
the time and conditions of exercise or vesting, and the terms of any Option Agreement, which may include the waiver or amendment of prior terms and conditions or acceleration or early vesting under certain circumstances determined by the Committee.

 (d) Determine whether Options will be granted singly or in combination. 
 (e) Accelerate the vesting or exercise of an Option when such action or actions would be in the best interest of the Company. 
 (f) Take any and all other action it deems necessary or advisable for the proper operation or administration of the Plan. 
 1.4 Shares Subject to the Plan. Shares of stock (“Stock”) covered by Stock Options and ISO Options shall consist of Four Million
Eight Hundred Eighty-Six Nine Hundred Ten (4,886,910) shares of the voting common stock, par value $.01, of the Company. Either authorized and unissued shares or treasury shares may be delivered pursuant to the Plan. If any Option for shares of
Stock granted to a Participant lapses, or is otherwise terminated, the Committee may grant Stock Options or ISO Options for such shares of Stock to other Participants. 
  

 - 2 - 

 1.5 Participation in the Plan. The Committee shall determine from time to time those
Participants who are to be granted Stock Options and ISO Options and the number of shares of Stock covered thereby. Provided, in no event may any Participant be granted more than One Million One Hundred Twenty-Five Thousand (1,125,000) Options
during any consecutive three calendar year period under the Plan. 
 1.6 Determination of Fair Market Value. As used in the
Plan, “fair market value” shall have the following meaning: (i) if the common stock of the Company is listed for trading on one or more national securities exchanges or the Nasdaq National Market System (the “NMS”), the
reported last sales price on such principal exchange or the NMS as of the granting date, or other relevant date, or if such common stock shall not have been traded on such date, the reported last sales price on such principal exchange or the NMS on
the first day prior thereto on which such common stock was so traded; or (ii) if the common stock of the Company is not listed for trading on a national securities exchange or the NMS but is traded in the over-the-counter market, the mean of
the highest and lowest bid prices for such common stock as of the granting date, or other relevant date, or if there are no such bid prices for such common stock on such date, the mean of the highest and lowest bid prices on the first day prior
thereto on which such prices existed. Provided, if the price of such common stock is not reported or listed as aforesaid, then the “fair market value” of such common stock shall be determined by the Committee as of the relevant date, and
the Committee shall utilize any reasonable and prudent method in determining such fair market value, including, without limitation, the obtaining of opinions of independent and well-qualified experts. 
 1.7 Grants of Options Under Stock Option Agreement. Each Stock Option or ISO Option granted under this Plan shall be evidenced by the
minutes of a meeting of the Committee or by the written consent of the Committee and by a written Stock Option Agreement effective on the date of grant and executed by the Company and the Participant. Each Option granted hereunder shall contain such
terms, restrictions and conditions as the Committee may determine, which terms, restrictions and conditions may or may not be the same in each case. 
 1.8 Amendment and Termination of the Plan. The Plan shall terminate at midnight, October 17, 2004, but prior thereto may be altered, changed, modified, amended or terminated by written amendment
approved by the Board. Provided, that no action of the Board may, without the approval of the holders of a majority of the Company’s securities present in person or represented by proxy at a meeting of stockholders entitled to vote thereon,
increase the aggregate number of shares of Stock which may be purchased under Stock Options or ISO Options granted under 
  

 - 3 - 

 the Plan; materially increase the benefits accruing to Participants under the Plan; or materially modify the requirements
as to eligibility for participation in the Plan. Except as provided in this Article I, no amendment, modification or termination of the Plan shall in any manner adversely affect any Stock Option or ISO Option theretofore granted under the Plan
without the consent of the affected Participant. 
 1.9 Effective Date. The Plan was approved by the Board on October 18,
1994, subject to approval of the holders of a majority of the Company’s securities present in person or represented by proxy at a meeting of stockholders entitled to vote thereon, which meeting must occur within twelve (12) months of
October 18, 1994. Hereafter, any reference to the effective date of the Plan shall mean the date of approval by the Board. 
 1.10
Securities Law Requirements. The Company shall have no obligation to issue any Stock hereunder unless the issuance of such shares would comply with any applicable federal or state securities laws or any other applicable law or regulations
thereunder. The Company may legend any stock certificate issued hereunder to reflect any restrictions under federal or state securities laws. 
 1.11 Stock Certificates. Upon the exercise of any Stock Option or ISO Option, a Participant shall be issued one or more certificates, as requested by the Participant, representing the Stock purchased pursuant to the exercised
Option. 
 1.12 Option Exercise and Payment for Stock. To exercise an Option, a Participant shall give written notice of
exercise to the person designated by the Committee at the Company’s principal office. Payment in full for shares of Stock purchased under this Plan shall accompany a Participant’s notice of exercise of an Option, together with payment for
any applicable withholding taxes as provided in Section 1.20. Payment shall be made in cash or by check, Stock of the Company or a combination thereof, and no loan or advance shall be made by the Company for the purpose of financing, in whole
or in part, the purchase of Stock unless such loan or advance has been approved by the Board. In the event that common stock of the Company is utilized as consideration for the purchase of Stock upon the exercise of a Stock Option or an ISO Option,
then, such common stock shall be valued at the “fair market value,” as defined in Section 1.6 of the Plan, as of the date of exercise. In addition to the foregoing procedure which may be available for the exercise of any Stock Option
or ISO Option, the Participant may deliver to the Company a notice of exercise which includes, in lieu of any other payment, an irrevocable instruction to the Company to deliver the 
  

 - 4 - 

 stock certificate representing the shares of Stock being purchased, issued in the name of the Participant, to a broker
approved by the Company and authorized to trade in the common stock of the Company. Upon receipt of such notice, the Company shall acknowledge receipt of the executed notice of exercise and forward this notice to the broker. Upon receipt of the copy
of the notice which has been acknowledged by the Company, and without waiting for issuance of the actual stock certificate with respect to the exercise of the Option, the broker may sell the Stock or any portion thereof. The broker shall deliver
directly to the Company that portion of the sales proceeds sufficient to cover the Option Price and withholding taxes, if any. Further, the broker may also facilitate a loan to the Participant upon receipt of the notice of exercise in advance of the
issuance of the actual stock certificate as an alternative means of financing and facilitating the exercise of any Option. For all purposes of effecting the exercise of an Option, the date on which the Participant delivers the notice of exercise to
the Company, together with payment for the shares of Stock being purchased as provided in this Section 1.12 and payment for any applicable withholding taxes as provided in Section 1.20, shall be the “date of exercise.” If a
notice of exercise and payment are delivered at different times, the date of exercise shall be the date the Company first has in its possession both the notice and full payment as provided herein. The Committee may adopt such other procedures which
it desires for the payment of the purchase price upon the exercise of a Stock Option or ISO Option which are not inconsistent with the applicable provisions of the Code which relate to Stock Options and ISO Options. In addition to the foregoing, the
Committee may, in its sole discretion, permit payment of the exercise price of Stock Options granted under the Plan by the Participant directing the Company to withhold from the shares of Stock to be delivered to the Participant upon exercise of the
Stock Option shares of Stock having a “fair market value” as defined in Section 1.6 of the Plan on the date of payment equal to the amount of the exercise price. 
 1.13 Stock Options and ISO Options Granted Separately. Since the Committee is authorized to grant Stock Options and ISO Options to
Participants, the grants thereof and Stock Option Agreements relating thereto will be made separately and totally independent of each other. Except as it relates to the total number of shares of Stock which may be issued under the Plan, the grant or
exercise of a Stock Option shall in no manner affect the grant and exercise of any ISO Options. Similarly, the grant and exercise of an ISO Option shall in no manner affect the grant and exercise of any Stock Options. 
 1.14 Use of Proceeds. The proceeds received by the Company from the sale of Stock pursuant to the exercise of Options granted under the
Plan shall be added to the Company’s general funds and used for general corporate purposes. 
  

 - 5 - 

 1.15 Non-Transferability of Options. Except as otherwise herein provided, any Option
granted shall not be transferable otherwise than by will or the laws of descent and distribution, and the Option may be exercised, during the lifetime of the Participant, only by the Participant. More particularly (but without limiting the
generality of the foregoing), the Option shall not be assigned, transferred (except as provided above), pledged or hypothecated in any way whatsoever, shall not be assignable by operation of law and shall not be subject to execution, attachment, or
similar process. Any attempted assignment, transfer, pledge, hypothecation, or other disposition of the Option contrary to the provisions hereof shall be null and void and without effect. 
 1.16 Additional Documents on Death of Participant. No transfer of an Option by the Participant by will or the laws of descent and
distribution shall be effective to bind the Company unless the Company shall have been furnished with written notice and an authenticated copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of
the transfer and the acceptance by the successor to the Option of the terms and conditions of such Option. 
 1.17 Changes in
Employment. So long as the Participant shall continue to be an employee of the Company or its parent or one of its subsidiaries, any Option granted to him or her shall not be affected by any change of duties or position. Nothing in the Plan
or in any Stock Option Agreement which relates to the Plan shall confer upon any Participant any right to continue in the employ of the Company or its parent or any of its subsidiaries, or interfere in any way with the right of the Company or its
parent or any of its subsidiaries to terminate the Participant’s employment at any time. 
 1.18 Stockholder Rights. No
Participant shall have any rights as a stockholder with respect to any shares of Stock subject to an Option prior to the purchase of such shares of Stock by exercise of the Option. 
 1.19 Adjustments Upon Changes in Capitalization. The aggregate number of shares of Stock available for Options to be granted under the
Plan, the Option Price and the ISO Price and the total number of shares of Stock which may be purchased by a Participant on exercise of a Stock Option and an ISO Option shall be appropriately adjusted or modified by the Committee to reflect any
recapitalization, stock split, merger, consolidation, 
  

 - 6 - 

 reorganization, combination, liquidation, stock dividend or similar transaction involving the Company. Provided, any such
adjustment shall be made in such a manner as to not constitute a modification as defined in Section 424(h) of the Code. 
 1.20
Payment of Withholding Taxes. No exercise of any Option may be effected until the Company receives full payment for the Stock purchased, as provided in Section 1.12, and for any required state and federal withholding taxes. Payment
for withholding taxes shall be made in cash or by check unless the Committee otherwise provides. The Committee may permit payment to be made in the form of common stock of the Company either by the Participant surrendering, or the Company retaining
from the shares of Stock to be issued upon exercise of the Stock Option, that number of shares of Stock (based on fair market value) that would be necessary to satisfy the requirements for withholding any amounts of taxes due upon the exercise of
such Stock Option. The Committee shall also have the discretion to require that the Company retain shares of Stock issuable upon the exercise of a Stock Option to satisfy any Participant’s tax withholding obligations. For the purpose of
calculating the fair market value of shares surrendered or retained to pay withholding taxes, the relevant date shall be the date of exercise. In the event a Participant uses the “cashless” exercise/same-day sale procedure set forth in
Section 1.12 hereof to pay withholding taxes, the actual sale price of shares sold to satisfy payment shall be used to determine the amount of withholding taxes payable. Nothing herein, however, shall be construed as requiring payment of
withholding taxes at the time of exercise if payment of taxes is deferred pursuant to any provision of the Code, and actions satisfactory to the Company are taken which are designed to reasonably insure payment of withholding taxes when due. Each
Stock Option Agreement shall provide that, in the event a Participant disposes of any Stock acquired by the exercise of an ISO Option within the two-year period following grant, or within the one-year period following exercise, of the ISO Option,
the Participant shall so inform the Company. In such event, the Company shall have the right to require the Participant to remit to the Company an amount sufficient to satisfy all federal, state and local withholding tax requirements. 
 1.21 Assumption of Outstanding Options. To the extent permitted by the then applicable provisions of the Code, any successor to the Company
succeeding to, or assigned the business of, the Company as the result of or in connection with a merger, consolidation, combination, reorganization, liquidation or other similar transaction may assume Options outstanding under the Plan or issue new
Options in place of outstanding Options under the Plan with such assumption to be made on a fair and equivalent 
  

 - 7 - 

 basis in accordance with the applicable provisions of Section 424(a) of the Code; provided, in no event shall such
assumption result in a modification of any Option as defined in Section 424(h) of the Code. 
 1.22 Retirement and
Disability. For the purpose of this Plan, “Retirement” shall mean the voluntary termination of employment of a Participant with the Company, its parent or any of its subsidiaries after attaining at least 55 years of age, and
“Disability” shall mean termination of employment of a Participant after incurring a “disability” as defined in Section 22(e)(3) of the Code. 
 ARTICLE II 
 Stock Options 
 2.1 General Terms. With respect to Stock Options granted on or after the effective date of the Plan, the following provisions of this
Article II shall apply. The Stock Options granted under this Article II are intended to be “nonqualified stock options” as described in Sections 83 and 421 of the Code. 
 2.2 Grant and Terms for Stock Options. Stock Options shall be granted on the following terms and conditions. No Stock Option shall be
exercisable more than ten (10) years from the date of grant. Subject to such limitations, the Committee shall have the discretion to fix the period (“Option Period”) during which Stock Options may be exercised. At all times during the
period commencing with the date a Stock Option is granted to a Participant and ending on the earlier of the expiration of the Option Period applicable to such Stock Option or the date which is three (3) months prior to the date the Stock Option
is exercised by such Participant, such Participant must be an employee of either (i) the Company, (ii) a parent or a subsidiary of the Company, or (iii) a successor to the Company or parent or a subsidiary of such successor issuing or
assuming a Stock Option in a transaction to which Section 424(a) of the Code applies. Provided, in the case of a Participant who has incurred a Disability, the aforesaid three (3) month period shall mean a one (1) year period.
Provided further, in the event a Participant’s employment is terminated by reason of death, the Participant’s personal representative may exercise any unexercised Stock Option granted to the Participant under the Plan at any time within
three (3) years after the Participant’s death but in any event not after the expiration of the Option Period applicable to such Stock Option. 
  

 - 8 - 

 (a) Option Price. The option price (“Option Price”) for shares of Stock subject
to any Stock Option shall be determined by the Committee, but in no event shall the Option Price be less than the par value of the Stock. 
 (b) Acceleration of Otherwise Unexercisable Stock Options on Retirement, Death, Disability or Other Special Circumstances. The Committee, in its sole discretion, may permit (i) a Participant who terminates employment due
to Retirement, (ii) a Participant who terminates employment due to a Disability, (iii) the personal representative of a deceased Participant, or (iv) any other Participant who terminates employment upon the occurrence of special
circumstances (as determined by the Committee) to purchase (within three (3) months of such date of termination of employment or one (1) year in the case of a Participant suffering a Disability or three (3) years in the case of a
deceased Participant) all or any part of the shares subject to any Stock Option on the date of the Participant’s Retirement, Disability, death, or as the Committee otherwise so determines, notwithstanding that all installments, if any, with
respect to such Stock Option, had not yet accrued on such date. 
 (c) Number of Stock Options Granted. Participants may be
granted more than one Stock Option. In making any such determination, the Committee shall obtain the advice and recommendation of the officers of the Company, its parent, or a subsidiary of the Company who have supervisory authority over such
Participants. The granting of a Stock Option under the Plan shall not affect any outstanding Stock Option previously granted to a Participant under the Plan (or any other plans of the Company). 
 ARTICLE III 
 ISO Options

 3.1 General Terms. With respect to ISO Options granted on or after the effective date of the Plan, the following
provisions in this Article III shall apply to the exclusion of any inconsistent provision in any other Article in this Plan since the ISO Options to be granted under the Plan are intended to qualify as “incentive stock options” as defined
in Section 422 of the Code. 
 3.2 Grant and Terms of ISO Options. No ISO Options shall be granted to any person who is
not eligible to receive “incentive stock options” as provided in Section 422 of the Code. No ISO Options shall be granted to any Participant if, immediately before the grant of an ISO Option, such employee owns more than 10% of the
total combined voting power of all classes of 
  

 - 9 - 

 stock of the Company, its parent or its subsidiaries (as determined in accordance with the stock attribution rules
contained in Sections 422 and 424(d) of the Code). Provided, the preceding sentence shall not apply if, at the time the ISO Option is granted, the ISO Price (as defined below) is at least 110% of the “fair market value” of the Stock
subject to the ISO Option, and such ISO Option by its terms is exercisable no more than five (5) years from the date such ISO Option is granted. 
 (a) ISO Option Price. The option price for shares of Stock subject to an ISO Option (“ISO Price”) shall be determined by the Committee, but in no event shall such ISO Price be less than the
greater of (a) the “fair market value” of the Stock on the date of grant or (b) the par value of the Stock. 
 (b)
Annual ISO Option Limitation. With respect to ISO Options granted, in no event during any calendar year will the aggregate “fair market value” (determined as of the time the ISO Option is granted) of the Stock for which the
Participant may first have the right to exercise under any “incentive stock options” granted under the Plan and all other plans qualified under Section 422 of the Code which are sponsored by the Company, its parent and any subsidiary
exceed $100,000. ISO Options which are in excess of the applicable $100,000 limitation will be recharacterized as Stock Options as provided under Article V herein. 
 (c) Terms of ISO Options. ISO Options shall be granted on the following terms and conditions: No ISO Option shall be exercisable more than ten (10) years from the date of grant. Subject to such
limitation, the Committee shall have the discretion to fix the period (the “ISO Period”) during which any ISO Option may be exercised. ISO Options granted shall not be transferable except by will or by laws of descent and distribution. At
all times during the period commencing with the date an ISO Option is granted to a Participant and ending on the earlier of the expiration of the ISO Period applicable to such ISO Options or the date which is three (3) months prior to the date
the ISO Option is exercised by such Participant, such Participant must be an employee of either (i) the Company, (ii) a parent or a subsidiary of the Company, or (iii) a successor to the Company or a parent or a subsidiary of such
successor issuing or assuming an ISO Option in a transaction to which Section 424(a) of the Code applies. Provided, in the case of a Participant who incurs a Disability, the aforesaid three (3) month period shall mean a one (1) year
period. Provided further, in the event a Participant’s employment is terminated by reason of death, the Participant’s personal representative may exercise any unexercised ISO Option granted to the Participant under the Plan at any time
within three (3) years after the Participant’s death but in any event not after the expiration of the ISO Period applicable to such ISO Option. 
  

 - 10 - 

 (d) Acceleration of Otherwise Unexercisable ISO Options on Retirement, Death, Disability or Other
Special Circumstances. The Committee, in its sole discretion, may permit (i) a Participant who terminates employment due to Retirement, (ii) a Participant who terminates employment due to a Disability, (iii) the personal
representative of a deceased Participant, or (iv) any other Participant who terminates employment upon the occurrence of special circumstances (as determined by the Committee) to purchase (within three (3) months of such date of
termination of employment or one (1) year in the case of a Participant suffering a Disability or three (3) years in the case of a deceased Participant) all or any part of the shares subject to any ISO Option on the date of the
Participant’s Retirement, Disability, death, or as the Committee otherwise so determines, notwithstanding that all installments, if any, had not accrued on such date. 
 (e) Number of ISO Options Granted. Subject to the applicable limitations contained in the Plan with respect to ISO Options, Participants
may be granted more than one ISO Option. In making any such determination, the Committee shall obtain the advice and recommendation of the officers of the Company, its parent or a subsidiary of the Company who have supervisory authority over such
Participants. Further, the granting of an ISO Option under the Plan shall not affect any outstanding ISO Option previously granted to a Participant under the Plan. 
 ARTICLE IV 
 Acceleration of Options Upon Corporate Event 
 4.1 Acceleration of Options. Where dissolution or liquidation of the Company or any merger, consolidation, combination, reorganization or
similar transaction in which the Company is not a surviving corporation is involved and no provision is made for the assumption of outstanding Options or the substitution therefor, consistent with Section 4.2 hereof, each outstanding Option
granted hereunder shall terminate upon the occurrence of the transaction, but the Participant shall have the right, immediately prior thereto, to exercise his or her Option, in whole or in part, to the extent that it shall not have been previously
exercised, without regard to any vesting provisions. 
 4.2 Procedures for Acceleration and Exercise. If the Company shall,
pursuant to action by its Board, at any time propose to dissolve or liquidate or merge into, consolidate with, or sell or otherwise transfer all or substantially all of its 
  

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 assets to another corporation and provision is not made pursuant to the terms of such transaction for the assumption by
the surviving, resulting or acquiring corporation of outstanding Options under the Plan, or for the substitution of new options therefor, the Committee shall cause written notice of the proposed transaction to be given to each Participant not less
than forty (40) days prior to the anticipated effective date of the proposed transaction, and his or her Option shall become one hundred percent (100%) vested and, prior to a date specified in such notice, which shall be not more than ten
(10) days prior to the anticipated effective date of the proposed transaction, each Participant shall have the right to exercise his or her Option to purchase any or all of the Stock then subject to such Option. Each Participant, by so
notifying the Company in writing, may, in exercising his or her Option, condition such exercise upon, and provide that such exercise shall become effective at the time of, but immediately prior to, the consummation of the transaction, in which event
such Participant need not make payment for the Stock to be purchased upon exercise of such Option until five (5) days after written notice by the Company to such Participant that the transaction has been consummated. If the transaction is
consummated, each Option, to the extent not previously exercised prior to the date specified in the foregoing notice, shall terminate on the effective date of such consummation. If the transaction is abandoned, (i) any Stock not purchased upon
exercise of such Option shall continue to be available for purchase in accordance with the other provisions of the Plan and (ii) to the extent that any Option not exercised prior to such abandonment shall have vested solely by operation of this
Section 4.2, such vesting shall be deemed annulled, and the vesting schedule set forth in the Participant’s Stock Option Agreement shall be reinstituted, as of the date of such abandonment. 
 4.3 Certain Additional Payments by the Company. The Committee may, in its sole discretion, provide in any Stock Option Agreement for
certain payments by the Company in the event that acceleration of vesting of any Option under the Plan is considered a payment by the Company (a “Payment”) subject to the excise tax imposed by Section 4999 of the Code or any interest
or penalties with respect to such excise tax (such excise tax, interest and penalties, collectively, the “Excise Tax”). A Stock Option Agreement may provide that the Participant shall be entitled to receive a payment (a “Gross-Up
Payment”) in an amount such that after payment by the Participant of all taxes (including any interest or penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the Participant retains an
amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payment. 
  

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 ARTICLE V 
 Options Not Qualifying as Incentive Stock Options 
 With respect to all or any portion of any
Option granted under the Plan not qualifying as an “incentive stock option” under Section 422 of the Code, such Option shall be considered as a Stock Option granted under this Plan for all purposes. Further, this Plan and any ISO
Options granted hereunder shall be deemed to have incorporated by reference all the provisions and requirements of Section 422 of the Code (and the Treasury Regulations issued thereunder) which are required to provide that all ISO Options
granted hereunder shall be “incentive stock options” described in Section 422 of the Code. Further, in the event that the Committee grants ISO Options under this Plan to a Participant, and, in the event that the applicable limitation
contained in Section 3.2 (b) herein is exceeded, then, such ISO Options in excess of such limitation shall be treated as Stock Options under this Plan subject to the terms and provisions of the applicable Stock Option Agreement, except to
the extent modified to reflect recharacterization of the ISO Options as Stock Options. 
  

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