Document:

Exhibit 10.2
 
RESTRICTED STOCK AWARD AGREEMENT
 
pursuant to the
XETA TECHNOLOGIES, INC.
2004 OMNIBUS STOCK INCENTIVE PLAN
 
SUMMARY OF RESTRICTED STOCK AWARD
 

	Employee Name (the “Employee”):
	 
	                                                                                       .

	 
	 
	 

	Date of Grant (“Date of Grant”):
	 
	 

	 
	 
	 

	No. of Restricted Shares  Awarded:
	 
	                                                                                       .

 
The foregoing Restricted Stock award was granted by XETA Technologies, Inc. (the “Company”) on December 18, 2008 pursuant to its 2004 Omnibus Stock Incentive Plan as amended (the “Plan”), and is subject to all of the terms and conditions set forth in this Restricted Stock Award Agreement (this “Agreement”) and the Plan, all of which are deemed incorporated herein in their entirety as one single and fully integrated agreement.
 
TERMS OF AWARD
 

Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Plan.

 

1.             Grant
of Restricted Stock.  The  Company hereby
grants to Employee
                                              
(                )
restricted shares of the Company’s common stock, having a par value of $.001
per share (the “Restricted Stock”), effective as
of the Date of Grant.  The Restricted
Stock is granted pursuant to the Plan and is subject to the terms and
provisions of this Agreement and the Plan as may be amended from time to time.

 

2.             Vesting of Restricted Stock.  The Restricted Stock shall vest in three equal
annual installments as follows (so long as Employee continues to be employed
with the Company as of the vesting date,):

 

	
  Vesting Date

  	
   

  	
  No. of Shares Vested

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 15,
  2010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 15,
  2011

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  January 15,
  2012

  	
   

  	
   

  	
   

  

 

Provided that all conditions of this Agreement and the Plan have been
satisfied, on each vesting date the restrictions of Section 3 shall
lapse with respect to the quantity of Restricted Stock then vesting.

 

 

3.             Restrictions.        In
addition to the restrictions provided for in the Plan, the Restricted Stock
shall be subject to the following restrictions.

 

(a)           The
Restricted Stock granted hereunder may not be sold, assigned, transferred,
pledged, hypothecated or otherwise disposed of, whether voluntarily or
involuntarily, by operation of law or otherwise, until the Restricted Stock
becomes vested in accordance with Section 2 above.  Immediately upon any attempt to transfer the
Restricted Stock prior to vesting of any rights hereunder, all unvested
Restricted Stock shall be forfeited by the Employee.

 

(b)           If
Employee’s employment with the Company is terminated by the Company without
Cause, by Employee voluntarily, by reason of Employee’s death or retirement, or
for any other reason other than “Cause” as that term is defined in the Plan,
all unvested Restricted Stock will automatically be forfeited, together with
any dividends paid on such unvested Restricted Stock, and all rights therein
will revert and be transferred to and reacquired by the Company, unless the
Committee, in its sole and absolute discretion, notifies the Employee otherwise
within thirty (30) days following such termination.

 

(c)           If
Employee’s employment with the Company is terminated by the Company for Cause,
all unvested Restricted Stock will, automatically and immediately, be forfeited
by Employee and transferred to the Company, together with any dividends that
may have been paid on such shares.

 

4.             Rights as
a Shareholder.  Subject to
the restrictions contained in this Agreement, Employee shall have all of the
rights of a shareholder of the Company, including the right to vote the
Restricted Stock and the right to receive cash dividends thereon; provided that
the Committee in its discretion may require that any dividends paid with
respect to unvested Restricted Stock be held in escrow until all restrictions
on such Restricted Stock have lapsed.

 

5.             Un-certificated Shares.    The Restricted Stock will be represented in book-entry
form by the Company’s transfer agent pursuant to the direct registration system
and will be evidenced by a direct registration statement.  In accordance with the Company’s bylaws,
Employee has the option to request that the Company issue a physical stock
certificate to Employee representing the Restricted Stock, after the Restricted
Stock vests.  Any certificates
representing and evidencing the Restricted Stock issued prior to vesting shall
be endorsed with the following restrictive legend:

 

The
transferability of this certificate and the shares of stock represented hereby
are subject to the restrictions, terms and conditions (including forfeiture
provisions and restrictions against transfer) contained in the 2004 Omnibus
Stock Incentive Plan of Xeta Technologies, Inc. and an Award Agreement
entered into between the registered owner of such shares and Xeta Technologies, Inc.
A copy of such Plan and Award Agreement is 

 

2

 

on file in the office of the
Secretary of Xeta Technologies, Inc., 1814 West Tacoma Street, Broken
Arrow, Oklahoma 74012.

 

6.             Tax
Withholding Obligations. 
In order to satisfy any withholding or similar tax requirements relating
to the Restricted Stock, the Company has the right to deduct or withhold from
any payroll or other payment to Employee, or require Employee to remit to the
Company, an appropriate payment or other provision, which may include the
withholding of Restricted Stock.

 

7.             Change in Control.  Upon the occurrence of a Change in Control of
the Company, all unvested Restricted Stock shall immediately expire and be
cancelled.

 

8.             No Right to Continued Employment.  Neither the grant of
Restricted Stock nor this Agreement confers upon Employee any right to
continued employment with the Company.

 

9.             Nature
of Award and Registration of Stock.

 

(a)           The
award of the Restricted Stock is voluntary and does not create any right on the
part of Employee to receive future grants of any Incentive Awards under the
Plan.  All decisions with respect to
future grants of Incentive Awards, if any, will be at the sole discretion of
the Company.

 

(b)           The
Company has an effective registration statement on file with the Securities and
Exchange Commission with respect to the shares of common stock subject to this
Award.  The Company intends to maintain
this registration statement but has no obligation to do so.  If the registration ceases to be effective,
Employee will not be able to transfer or sell the vested Restricted Stock
unless exemptions from registration under applicable securities laws are
available. The Employee agrees that any resale by him or her of the Restricted
Stock will comply in all respects with the requirements of all applicable
securities laws, rules and regulations (including, without limitation, the
provisions of the Securities Act of 1933, as amended).

 

(c)           The Employee
shall execute and deliver to the Company such written representations or other
documentation, if any, as may be requested by the Company in order for it to
comply with applicable requirements of federal and state securities laws, as
well as any other applicable laws, rules or regulations.

 

10.          Miscellaneous.  This Agreement and the Award evidenced hereby
are made and granted pursuant to the Plan and are in all respects limited by
and subject to the terms of the Plan. 
All decisions of the Committee with respect to any question or issue
arising under the Plan or this Agreement shall be conclusive and binding on all
persons having an interest in the Restricted Stock award.  In the event of any conflict between the
terms of the Plan and the terms of this Agreement, the terms of the Plan shall
govern.  This Agreement shall be governed
by the laws of the State of Oklahoma, without resort to that state’s
conflict-of-laws rules.

 

3

 

EXECUTED in Broken Arrow, Oklahoma, on and as of
the Effective Date.

 

 

	
  XETA TECHNOLOGIES, INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Greg D. Forrest

  	
   

  
	
  Chief Executive Officer

  	
   

  

 

 

ACKNOWLEDGEMENT
OF EMPLOYEE:

 

The Employee
hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all
the terms and provisions hereof.  The
Employee acknowledges receipt of the prospectus for the Plan
dated                                    .

 

	
  “Employee”

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature

  	
   

  

 

4Exhibit 10.5

 

XETA
TECHNOLOGIES

2000 STOCK OPTION
PLAN

As amended and
Restated December 30, 2008

 

 

1.                                      Purpose.  The
purpose of the XETA Technologies 2000 Stock Option Plan (the “Plan”), is to
promote the interests of XETA Corporation, doing business as XETA Technologies
(the “Company”) by aiding the Company in attracting and retaining competent key
employees and directors by means of providing such persons with an opportunity
to acquire or increase their proprietary interest in the Company, and by
affording an incentive to selected key employees and directors to use their
best efforts to assist the Company in achieving long-term corporate
objectives.  It is intended that certain
options granted hereunder will qualify as incentive stock options within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended
and that other options granted hereunder will not be incentive stock options
but instead will be nonqualified stock options.

 

2.                                      Definitions.  Whenever
used herein, the following terms shall have the meanings set forth below:

 

(a)                                  “Board”
means the Board of Directors of the Company.

 

(b)                                 “Code”
means the Internal Revenue Code of 1986, as amended.

 

(c)                                  “Committee”
means a committee designated by the Board, which shall consist of two or more “non-employee
directors” as defined in Rule 16b-3 under the Securities Exchange Act of
1934 as amended (the “1934 Act”) or any successor Rule. The Compensation
Committee of the Board may serve as the Committee, provided that it meets these
requirements.  In the event the Committee
shall no longer meet the qualification requirements set forth above, the Board
of Directors of the Company shall appoint a new committee to administer the
Plan, whose members shall cause the committee to qualify under the transaction
approval requirements of Rule 16b-3. The Committee shall have the
authority to appoint a subcommittee whose members qualify as “outside”
directors under Section 162(m) of the Code and the regulations
thereunder, to administer awards under the Plan to the extent required to meet
the requirements of Section 162(m) of the Code and the regulations
thereunder.

 

(d)                                 “Company”
means XETA Corporation, d/b/a XETA Technologies.

 

(e)                                  “Disability”
means a “permanent and total disability” which enables the Participant to be
eligible for and receive a disability benefit under the Federal Social Security
Act.

 

(f)                                    “Fair
Market Value” means the closing price of the Stock as reported on the NASDAQ
stock market for the applicable date, or if there were no sales on such date,
on the last day preceding the applicable date on which there were sales.

 

(g)                                 “Incentive
Stock Option” means an Option granted under the Plan which constitutes and
shall be treated as an “incentive stock option” as defined in Section 422
of the Code.

 

(h)                                 “Option”
means a right or rights to purchase shares of Stock described in Section 6.

 

(i)                                     “Option
Agreement” means the agreement between the Company and a Participant evidencing
the grant of an Option and containing the terms and conditions, not inconsistent
with the Plan, that are applicable to such Option.

 

(j)                                     “Participant”
means an individual to whom an Option is granted.

 

(k)                                  “Plan”
means the XETA Technologies 2000 Stock Option Plan, as amended from time to
time.

 

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(l)                                     “Retirement”
means the voluntary termination of a Participant’s employment with the Company
or a Subsidiary after twenty (20) years of continuous service or after age 59
1⁄2.

 

(m)                               “Stock”
means the Common Stock of the Company.

 

(n)                                 “Subsidiary”
means a subsidiary of the Company or an unincorporated organization controlled,
directly or indirectly, by the Company.

 

3.                                      Administration.  The
Plan shall be administered by the Committee, which shall act by vote or written
consent of a majority of its members. 
The Committee shall have full power and authority to construe,
interpret, and administer the Plan and may from time to time prescribe, amend
and rescind rules and regulations for carrying out this Plan as it may
deem proper and in the best interests of the Company.  Subject to the terms, provisions, and
conditions of the Plan, the Committee shall have exclusive jurisdiction to (i) select
the individuals to whom Options will be granted, (ii) determine the number
of shares subject to each Option and the time or times when Options will be
granted, (iii) determine the price of the shares subject to each Option, (iv) to
determine the time when each Option may be exercised, (v) fix such other
provisions of the Option Agreement as the Committee may deem necessary or
desirable consistent with the terms of the Plan, and (vi) determine all
other questions relating to the administration of the Plan.  The interpretation of any provisions of the
Plan by the Committee shall be final, conclusive, and binding upon all persons.
Subject to compliance with applicable legal requirements, the full Board may
exercise any of the authority conferred upon the Committee hereunder.  In the event of any such exercise of authority
by the Board, references in the Plan to the Committee shall be deemed to refer
to the Board.

 

4.                                      Shares
Subject to the Plan.

 

(a)                                  The
total number of shares of Stock authorized to be issued under the Plan shall be
300,000, subject to adjustment in accordance with the provisions of Section 8.

 

(b)                                 The
shares to be delivered upon exercise of an Option shall be made available, at
the discretion of the Board, from the authorized, unissued shares of the
Company’s Stock or from shares of Stock reacquired by the Company, including
shares purchased in the open market.

 

(c)                                  In
the event that any Option granted under the Plan expires, terminates, ceases to
be exercisable or is surrendered without having been exercised in full, the
shares subject to, but not delivered under, such Option shall again become
available for issuance under the Plan unless the Plan has been terminated. If
any Option is exercised by tendering shares of Stock, either actually or by
attestation, to the Company as full or partial payment in connection with the
exercise of an Option under this Plan, the shares of Stock so tendered may be
used by the Company to satisfy any other Option under the Plan, provided that
in no event may the number of shares of Stock issued under the Plan, net of the
shares so tendered, exceed the total number of shares authorized to be issued
under the Plan.

 

(d)                                 Shares
of Stock issued under the Plan through the settlement, assumption or
substitution of outstanding awards or through obligations to grant future
awards as a condition of the Company acquiring another entity shall not reduce
the maximum number of shares available for delivery under the Plan.

 

(e)                                  More
than one Option may be granted to a Participant pursuant to the Plan.

 

5.                                      Eligibility.  Key
employees of the Company and any of its Subsidiaries, including officers and
directors who are salaried employees, and outside directors of the Company and
any of its Subsidiaries, shall be eligible to receive Options.  Key employees and directors to whom Options
may be granted will be those selected by the Committee from time to time who,
in the sole discretion of the Committee, have contributed in the past or who
may be expected to contribute materially in the future to the successful
performance of the Company or its Subsidiaries.

 

6.                                      Option
Terms and Conditions.  Each Option granted under the Plan shall
be evidenced by an Option Agreement which shall contain such terms and
conditions (which need not be uniform for all Participants) 

 

A-2

 

consistent with the Plan
as the Committee shall determine; provided, however, that each Option shall
satisfy the following requirements:

 

(a)          Exercise Price.  The price at which shares of
Stock may be purchased under an Option (the “Exercise Price”) and the number of
shares subject to the Option, which shall be fixed on the date of grant of the
Option, shall be specified in the Option Agreement.  The Exercise Price shall not be less than
Fair Market Value of such shares on the date the Option is granted, subject,
however, to the provisions of Section 8 hereof and further provided that
in no event shall the Exercise Price be less than the par value of the Stock.

 

(b)         Exercise of Options.

 

(i)             The
period during which an Option may be exercised shall not exceed ten (10) years
from the date the Option is granted; provided, however, that the Option may be
sooner terminated in accordance with the provisions of Subsection (d) below.

 

(ii)          An
Option may be exercised only after one year of continued employment by or
service as an outside director with the Company or one of its Subsidiaries
immediately following the date the Option is granted and, except as provided in
Subsection (d) below, only during the continuance of the Participant’s
employment with the Company or one of its Subsidiaries.  Subject to the foregoing limitations and the
terms and conditions of the Option Agreement, each Option shall be exercisable
in whole or in part in installments, at such time or times as the Committee may
prescribe in the Option Agreement.

 

(c)          Payment.  Full payment of the Exercise Price shall
be made at the time of exercising the Option in whole or in part.  The Exercise Price shall be payable (i) in
cash or by an equivalent means acceptable to the Committee, (ii) by
delivery (actually or by attestation) to the Company of shares of Stock owned
by the Participant having a Fair Market Value on the date of exercise of the
Option equal to the Exercise Price for the shares being purchased; except that
any portion of the Exercise Price representing a fraction of a share shall in
any event be paid in cash and no shares of the Stock which have been held by
the Participant for less than six (6) months may be delivered in payment
of the Exercise Price, or (iii) in the discretion of the Committee, by any
combination of the above.  For Options
granted prior to January 1, 2005, the Committee may grant an Option that
provides for the grant of a replacement Option if all or any portion of the
Exercise Price of the original Option is paid by delivery of shares of
Stock.  The replacement Option shall (i) cover
the number of shares of Stock surrendered to pay the Exercise Price of the
original Option; (ii) have an Exercise Price equal to 100% of the Fair
Market Value of such Stock on the date the replacement Option is granted; (iii) become
exercisable no sooner than six (6) months after the date of grant of the
replacement Option; and (iv) have an expiration date identical to the
expiration date of the original Option. 
No certificates for shares purchased upon exercise of an Option shall be
issued until full payment therefore has been made, and a Participant shall have
none of the rights of a shareholder until such certificates are issued to him
or her.

 

(d)         Termination of Employment.

 

(i)             Death.  If a Participant’s
employment is terminated by death, the Option may be exercised by the
Participant’s estate or by the person or persons to whom the Participant’s
rights pass by will or by the laws of descent and distribution, subject to the
same conditions upon exercise to which the Participant was subject prior to
death.  All Options which were not
exercisable as of the date of death shall expire as of such date.

 

(ii)          Disability.  If a
Participant’s employment with the Company or a Subsidiary is terminated by
Disability, any Options held by the Participant may be exercised in accordance
with and subject to the same conditions upon exercise to which the Participant
was subject prior to such Disability; provided, however, that the Option must
be exercised prior to the expiration date of the Option or within one year
after the date of Disability, whichever is earlier.  All Options which were not exercisable as of
the date of Disability shall expire as of such date.

 

A-3

 

(iii)       Retirement.  If
a Participant’s employment with the Company or a Subsidiary is terminated by
reason of Retirement, any Options held by the Participant may be exercised in
accordance with and subject to the same conditions upon exercise to which the
Options were subject prior to the Participant’s Retirement; provided, however,
that the Options must be exercised prior to the expiration date of the Options
or within three (3) months after the date of Participant’s Retirement,
whichever is earlier.  All Options which
were not exercisable as of the date of Retirement shall expire as of such date.

 

(iv)      Other Termination.  If a
Participant’s employment with the Company or a Subsidiary is terminated for any
reason other than for death or Disability and other than “for cause” as defined
in subparagraph (v) below, any Options held by the Participant may be
exercised in accordance with and subject to the same conditions upon exercise
to which the Options were subject prior to the Participant’s termination of
employment; provided, however, that the Options must be exercised prior to the
expiration date of the Options or within three (3) months after the date
of such termination of employment, whichever is earlier.  All Options which were not exercisable as of
the date of such termination shall expire as of such date.  In the case of a director who is not an
employee of the Company or a Subsidiary, termination of employment shall mean
the voluntary or involuntary cessation of Board service for any reason.

 

(v)         Termination For Cause.  Notwithstanding
any other provision in the Plan to the contrary, if the Participant’s
employment with the Company or a Subsidiary is terminated “for cause” (as
defined below), any unexercised Options held by the Participant shall
immediately be forfeited.  Termination “for
cause” shall mean termination by the Company because of: (x) the
Participant’s willful and continued failure to substantially perform his duties
(other than any such failure resulting from the Participant’s incapacity due to
physical or mental impairment); (y) the willful conduct of the Participant
which is demonstrably and materially injurious to the Company or a Subsidiary,
monetarily or otherwise, or (z) the conviction of the Participant for a
felony by a court of competent jurisdiction.

 

(e)          Special Incentive Stock Option Conditions.  Notwithstanding
anything in the Plan to the contrary, the following special conditions shall
apply to Incentive Stock Options granted under the Plan:

 

(i)             if
an Incentive Stock Option is granted to a Participant who, at the time such
Option is granted, owns stock that has more than 10 percent of the voting power
of all classes of stock of the Company or of any Subsidiary, then (x) the
Exercise Price of the Incentive Stock Option granted shall be not less than
110% of the Fair Market Value on the date of grant; and (y) the Incentive
Stock Option shall not be exercisable after the expiration of five (5) years
from the date such Option is granted; and

 

(ii)          Incentive
Stock Options shall not be granted to any Participant, the effect of which
would be to permit such Participant to first exercise options, in any calendar
year, for the purchase of shares having a Fair Market Value, determined at the
time the Option is granted, in excess of $100,000.  Any Option purporting to constitute an
Incentive Stock Option in excess of such limitation shall, to the extent of
such excess, constitute a nonqualified stock option.

 

(f)       Other Terms and Conditions.  Any Option granted
hereunder shall contain such other and additional terms, not inconsistent with
the terms of the Plan, which are deemed necessary or desirable by the
Committee.  Options may be granted that
are subject to different terms, conditions and restrictions than other Options
granted.  Except as otherwise expressly
provided in the Plan, the Committee may designate an Option, at the time of its
grant, as an Incentive Stock Option or as a nonqualified stock option;
provided, however, that an Option may be designated as an Incentive Stock
Option only if the applicable Participant is an employee of the Company or a
Subsidiary on the date of grant.

 

7.                                      Transferability
of Options.  An Option shall not be transferable except by will
or the laws of descent and distribution upon the death of the Participant.  Options shall be exercisable during the
Participant’s lifetime only by the Participant, or, in the event of the
Participant’s Disability, by his legal representative.  

 

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Notwithstanding the
foregoing, the Committee may, in its sole discretion, permit a Participant to
transfer a non-qualified Option, to a “family member” as defined in the General
Instructions to Form S-8 adopted by the Securities Exchange Commission
under the Securities Act of 1933, as amended, provided that such transfer is
not made for value as set forth in the General Instructions to Form S-8.  Any such Option so transferred to the
aforementioned persons shall be subject to the provisions of Section 6
concerning the exercisability during the Participant’s employment or service as
an outside director of the Company or any of its Subsidiaries.

 

8.                                      Changes
in Capital Adjustments Affecting Stock.  In the event that there
is any change in the capital structure of the Company through merger,
consolidation, reorganization, recapitalization, spin-off or otherwise, or if
there shall be any dividend on the Company’s Stock, payable in such Stock, of
if there shall be a Stock split or a combination of shares, then the number of
shares reserved for Options (both in the aggregate and with respect to each
Participant), and the number of shares subject to outstanding Options and the
price per share of each such Option, shall be proportionately adjusted by the
Committee as it deems equitable, in its absolute discretion, to prevent
dilution or enlargement of the rights of a Participant.  The issuance of Stock for consideration and
the issuance of Stock rights shall not be considered a change in the Company’s
capital structure.  No adjustment
provided for in this Section 8 shall require the issuance of any
fractional share.  To the extent deemed
advisable by the Committee, the adjustments made to the Options will not (i) result
in a modification to the incentive stock options as defined in Section 424
or other subsequent relevant Internal Revenue Code Sections and Treasury
Regulations; (ii) result in an earnings charge to the Company under
generally accepted accounting principles; or (iii) be made in a manner
that would cause Section 409A of the Code to apply to such adjusted
Options.

 

9.                                      Change
In Control.  Unless the Committee shall otherwise expressly
provide in the Option Agreement, upon the occurrence of a Change in Control of
the Company (as defined herein), all Options then outstanding under the Plan
shall become immediately fully exercisable by the Participant.  A “Change in Control” shall be deemed to have
occurred if:

 

(a)                                  Any
person becomes the “beneficial owner” (as defined in Rule 13d-3 under the
1934 Act), directly or indirectly, of securities of the Company representing 25
percent or more of the combined voting power of the Company’s then outstanding
common stock, unless through a transaction arranged by, or consummated with the
prior approval of the Board;

 

(b)                                 During
any period of two consecutive years, there shall cease to be a majority of the
Board comprised as follows:  individuals
who at the beginning of such period constituted the Board and any new director(s) whose
election by the Board or nomination for election by the Company’s shareholders
was approved by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved;

 

(c)                                  The
shareholders of the Company approve a merger or consolidation which would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) less than fifty
percent of the combined voting power of the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation;

 

(d)                                 The
shareholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all or
substantially all of its assets; or

 

(e)                                  Two-thirds
(2/3rd) of the
Board deems any other event to constitute a change in control of the Company
for purposes of this provision, or if, notwithstanding the occurrence of an
event as described in subsections (a) through (d) of this Section 9,
two-thirds (2/3rd) of
the Board deems such event not to constitute a change in control for purposes
of this provision.

 

10.                               Amendment
or Termination.  The Board of Directors of the Company shall have
the right, at any time, to amend or terminate the Plan in any respect which it
may deem to be in the best interests of the Company; provided, however, no
amendment to the Plan shall be made without the approval of the Company’s
shareholders if such amendment would: (i) materially increase the benefits
accruing to Participants under the Plan; (ii) materially increase the
number of securities that may be issued under the Plan; (iii) materially
modify the requirements as to 

 

A-5

 

eligibility for
participation in the Plan; or (iv) otherwise require shareholder approval
under the Oklahoma General Corporation Act, Rule 16b-3 of the Securities
Exchange Act of 1934, as amended from time to time, or Section 162(m) of
the Code.

 

11.                               Effective
Date and Approval.   This Plan, as Amended and Restated, was
approved by the Board of Directors on December 30, 2008.  Options issued under the Plan prior to January 1,
2005 will continue in effect and will be subject to the terms of the Plan as in
effect prior to this restatement.  The
Plan as originally adopted took effect upon its adoption by the Company’s Board
of Directors on January 5, 2000. 
The Plan was submitted to the Company’s shareholders and approved by
them at the Company’s annual meeting on April 11, 2000.

 

12.                               Duration
of Plan.  The Plan shall remain in effect for a period of ten (10) years
from the date of its adoption by the Board, unless sooner terminated in
accordance with Section 10.

 

13.                               Miscellaneous.

 

(a)                                  The
Plan and all Options granted pursuant to it are subject to all applicable laws,
rules and regulations, including without limitation Federal Securities
laws and tax laws.  Notwithstanding any
provisions of the Plan or any Option Agreement, the Participant shall not be
entitled to exercise an Option nor shall the Company be obligated to issue any
shares to a Participant if such exercise or issuance would constitute a
violation of any provision of any such laws, rules or regulation.

 

(b)                                 The
Committee may require each Participant acquiring Stock pursuant to the exercise
of an Option to represent to and agree with the Company in writing that such
Participant is acquiring the shares without a view to distribution thereof.  No shares of Stock shall be issued pursuant
to an Option until all applicable securities laws and other legal or regulatory
requirements have been satisfied.  The
Committee may require the placing of stop-orders and restrictive legends on
certificates for Stock, as it deems appropriate.

 

(c)                                  The
proceeds received by the Company from the sale of Shares pursuant to Options
may be used for general corporate purposes.

 

(d)                                 The
Company may, as a condition to issuing Stock upon exercise of an Option, require
the payment (through withholding from the Participant’s salary or payment of
cash by the Participant) of any federal, state or local taxes required by law
to be withheld with respect to such.

 

(e)                                  The
adoption of the Plan does not preclude the adoption by appropriate means of any
other incentive plan for employees and nothing herein shall be construed to
limit the Company’s right to grant options outside of the Plan for any proper
and lawful purpose.

 

(f)                                    The
fact that an employee has been granted an Option under the Plan shall not in
any way affect or qualify the right of the employer to terminate the employee’s
employment at any time.

 

(g)                                 Members
of the Committee shall be entitled to indemnification as directors of the
Company, and to any limitation of liability and reimbursement as directors with
respect to their services as members of the Committee.

 

(h)                                 The
Participant is required to notify the Company of a disqualifying disposition of
Company stock acquired through the exercise of incentive stock options as
defined in Section 422 or other subsequent relevant Internal Revenue Code
Sections and Treasury Regulations.

 

14.                               Section 409A
of the Code.

 

(a)                                  The Plan is
designed with the intent that no Options granted under the Plan shall be
subject to Section 409A of the Code, and all provisions hereof shall be
construed in a manner consistent with that intent.

 

A-6

 

(b)                                 To the extent that the Committee determines
that any Option granted under the Plan is subject to Section 409A of the
Code, the Option Agreement evidencing such Option shall incorporate the terms
and conditions necessary to avoid the consequences specified in Section 409A(a)(1) of
the Code.  To the extent applicable, the
Plan and Option Agreements shall be interpreted in accordance with Section 409A
of the Code and Department of Treasury regulations and other interpretive
guidance issued thereunder (“409A Guidance”). 
Notwithstanding any provision of the Plan to the contrary, in the event
that the Committee determines that any Option may be subject to Section 409A
of the Code, the Board of Directors may adopt such amendments to the Plan and
the applicable Option Agreement or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or
take any other actions, that the Board determines are necessary or appropriate
to: (i) exempt the Option from Section 409A of the Code and/or
preserve the intended tax treatment of the benefits provided with respect to the
Option; or (ii) comply with the requirements of Section 409A of the
Code and 409A Guidance.  Neither the
Company nor the Committee shall be responsible for any additional tax imposed
pursuant to Section 409A of the Code, nor will the Company or the Committee
be required to indemnify or otherwise reimburse a Participant for any liability
incurred as a result of Section 409A of the Code.

 

(c)                                  Notwithstanding
anything to the contrary in this Plan (and unless the Option Agreement provides
otherwise, with specific reference to this sentence), to the extent that a
Participant holding an Option that constitutes “deferred compensation” for
purposes of Section 409A of the Code is a “specified employee” (as defined
in Section 409A of the Code and 409A Guidance), no distribution or payment
of any amount shall be made before a date that is six (6) months following
the date of such Participant’s “separation from service” (as defined in Section 409A
of the Code and 409A Guidance) or, if earlier, the date of the Participant’s
death.

 

A-7

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