Document:

TENGASCO, INC. STOCK INCENTIVE PLAN

                                    ARTICLE 1

                                    THE PLAN

     1.1.  NAME.  The name of this Plan is the Tengasco,  Inc.  Stock  Incentive
Plan.

     1.2 PURPOSE AND SCOPE.

        (a) The  purposes  of the Plan are to (i)  attract  and  retain the best
available personnel for positions of substantial responsibility,  (ii) encourage
ownership  of the  Company's  common  stock by Employees of the Company (and any
current  or  future  Parent  or  Subsidiary  of the  Company),  (iii)  encourage
ownership of the  Company's  common stock by the  Company's  Directors  (and any
current or future Parent or  Subsidiary  of the  Company),  and (iv) promote the
Company's  business  success by  creating a  long-term  mutuality  of  interests
between its Employees,  non-employee Directors,  other Plan participants and the
Company's shareholders.

        (b) The Plan provides for the granting of (i) Incentive  Stock  Options,
Nonqualified Stock Options and stock appreciation  rights ("SARs") to Employees;
and, (ii) Nonqualified  Stock Options and SARs to non-employee  Directors of the
Company and Consultants to the Company.

     1.3  EFFECTIVE  DATE AND  DURATION OF PLAN.  This Plan is  effective  for a
ten-year period  commencing on October 25, 2000, and ending on October 24, 2010,
provided that options and SARs granted  under the Plan prior to the  termination
date  shall  continue  to be  exercisable  in  accordance  with the terms of the
Agreement granting such option or SAR beyond termination of the Plan.

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                                    ARTICLE 2
                                   DEFINITIONS

     Capitalized  terms in this Plan shall have the following  meanings  (unless
the context plainly requires that a different meaning apply):

     2.1 ACT. The  Securities  Act of 1933, as amended from time to time, or any
replacement legislation.

     2.2  AGREEMENT.  Written  agreement  between the Company and the  Recipient
granting the option or SAR to the Recipient.

     2.3 BOARD. The Board of Directors of the Company.

     2.4 CODE. The Internal  Revenue Code of 1986, as amended from time to time,
or any replacement legislation and regulations promulgated thereunder.

     2.5 COMMITTEE.  The stock option or compensation committee appointed by the
Board,  if one is  appointed.  If no  Committee  has  been  appointed,  the term
Committee  shall mean the Board.  The Committee  shall consist  solely of two or
more Non-Employee  Directors as that term is defined under Regulation  240.16b-3
promulgated by the Securities and Exchange Commission.

     2.6 COMMON STOCK. The Company's $.001 par value common stock.

     2.7 COMPANY. Tengasco, Inc. and any successor to such corporation,  whether
by merger, consolidation, liquidation or otherwise.

     2.8  CONSULTANT.  Any  person  engaged  by the  Company  (or any  Parent or
Subsidiary)  as a  non-employee  service  provider  pursuant  to the  terms of a
written contract.

     2.9 DIRECTOR. Any duly elected member of the Board.

     2.10  DISABILITY.  Permanent  and total  disability  within the  meaning of
Section 22(e)(3) of the Code.

     2.11  EMPLOYEE.  All  persons  employed  by the  Company  or any  Parent or
Subsidiary, including officers, whether full-time or part-time.

     2.12  EXCHANGE  ACT. The  Securities  Exchange Act of 1934, as amended from
time to time, or any replacement legislation.

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     2.13 FAIR MARKET VALUE.  The closing price per share of Common Stock on the
American Stock Exchange or nationally  recognized  securities  exchange on which
the stock is  listed.  If the  stock is not  listed  on a  generally  recognized
securities  exchange,  Fair Market Value shall be determined by the Committee in
good faith,  using such criteria as the Committee  may, in its sole  discretion,
deem appropriate.

     2.14 INCENTIVE STOCK OPTION. Any stock option granted under this Plan which
is  intended to qualify as an  "incentive  stock  option"  within the meaning of
Section 422 of the Code.

     2.15  NONQUALIFIED  STOCK OPTION.  Any stock option granted under this Plan
which is not intended to qualify as an Incentive Stock Option.

     2.16  OPTIONED  SHARES.  Those  Shares  subject to a stock  option  granted
pursuant to this Plan.

     2.17  PARENT.  A parent  corporation,  whether now or  hereafter  existing,
within the meaning of Section 424(e) of the Code.

     2.18 PLAN. The Tengasco, Inc. Stock Incentive Plan, as amended from time to
time.

     2.19  RECIPIENT.  An  individual  who has  received  a stock  option or SAR
pursuant to this Plan.

     2.20  SHARE.  One share of the  Company's  Common  Stock,  as  adjusted  in
accordance with Section 5.7 of this Plan.

     2.20 SAR.  A stock  appreciation  right  which  entitles  the  holder  upon
exercise of that right to the product of (a) the excess of the Fair Market Value
of one Share on the date of exercise over the price per share established by the
Committee  (in its sole  discretion)  for the grant and (b) the number of Shares
subject to the grant,  payable in either  Shares,  cash or a combination  of the
two, as provided in Section 5.4(b).

     2.21  SUBSIDIARY.  A  subsidiary  corporation,  whether  now  or  hereafter
existing, within the meaning of Section 424(f) of the Code.

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                                    ARTICLE 3
                               PLAN ADMINISTRATION

     3.1 ADMINISTRATION.

        (a) The Plan shall be administered by the Committee. The Committee shall
have the  authority,  in its sole  discretion,  including,  but not  limited to,
determining  the  individuals who shall receive options and SARs; the times when
they  shall  receive  them;  whether  an  option  shall  be  an  Incentive  or a
Nonqualified Stock Option; whether an SAR shall be granted separately, in tandem
with or in  addition  to an  option;  the number of shares to be subject to each
option and SAR;  the term of each  option and SAR;  the date each option and SAR
shall  become  exercisable;  whether  an option or SAR shall be  exercisable  in
whole, in part or in installments,  and if in installments, the number of shares
to be subject to each installment; whether the installments shall be cumulative,
the  date  each  installment  shall  become  exercisable  and  the  term of each
installment;  whether to  accelerate  the date of exercise  of any  installment;
whether  shares may be issued on exercise of an option as partly  paid,  and, if
so, the dates when future  installments  of the exercise  price shall become due
and the amounts of such installments;  the exercise price of each option and the
base price of each SAR; the form of payment of the exercise  price;  the form of
payment by the  Company  upon the  Recipient's  exercise  of an SAR;  whether to
require that the Recipient remain in the employ of the Company or its Subsidiary
for a period of time from and after  the date the  option or SAR is  granted  to
him; the amount necessary to satisfy the Company's obligation to withhold taxes;
whether to restrict the sale or other  disposition of the shares of Common Stock
acquired  upon the exercise of an option and to waive any such  restriction;  to
subject  the  exercise  of  all  or  any  portion  of an  option  or  SAR to the
fulfillment of  contingencies as specified in the Agreement,  including  without
limitations,  contingencies  relating to financial  objectives (such as earnings
per share,  cash flow  return,  return on  investment  or growth in sales) for a
specified period for the Company,  and/or the period of continued  employment of
the Recipient with the Company or its Subsidiary,  and to determine whether such
contingencies have been met; to construe the respective Agreements granting such
options and

                                      -4-

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SARs;  with the consent of the Recipient,  to cancel or modify an option or SAR,
provided such option or SAR as modified would be permitted to be granted on such
date under the terms of the Plan; and to make all other determinations necessary
or advisable for administering the Plan. The  determinations of the Committee on
the matters referred to herein shall be conclusive.

        (b) Options and SARs granted  under this Plan shall be evidenced by duly
adopted  resolutions of the Committee  included in the minutes of the meeting at
which they are  adopted or in a unanimous  written  consent.

        (c) The  Committee  shall  endeavor  to  administer  the Plan and  grant
options and SARs hereunder in a manner that is compatible  with the  obligations
of persons subject to Section 16 of the Exchange Act,  although  compliance with
Section 16 is the  obligation  of the  Recipient,  not the Company.  Neither the
Committee,  the Board, nor the Company can assume any legal responsibility for a
Recipient's  compliance  with his  obligations  under Section 16 of the Exchange
Act.

        (d) No member of the  Committee  or the  Board  shall be liable  for any
action taken or determination made in good faith with respect to the Plan or any
option or SAR granted hereunder.

                                    ARTICLE 4
                             ELIGIBILITY FOR GRANTS

     4.1 ELIGIBILITY AND TERMS OF GRANTS.

        (a) The Committee shall have full  discretionary  authority to determine
the persons eligible to receive an option or SAR.

        (b) In determining  the persons to whom options or SARs shall be granted
and the  number of shares to be  covered by each  option or SAR,  the  Committee
shall  take into  account  the duties of the  respective  persons,  their  past,
present and  potential  contributions  to the success of the  Company,  and such
other factors as the Committee shall deem relevant to accomplish the purposes

                                      -5-
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of the Plan.

        (c) A Recipient  shall be eligible to receive  more than one grant of an
option or SAR  during  the term of the Plan,  on the  terms and  subject  to the
restrictions set forth herein.

     4.2 GRANTING OF OPTIONS.

        (a)  The  granting  of  any  option  or SAR  shall  be  entirely  in the
discretion of the Committee and nothing in the Plan shall be construed as giving
any Employee, Director or Consultant any right to participate under this Plan or
to receive any option or right under it.

        (b) The Committee may, in its sole  discretion,  accept the cancellation
of  outstanding  options or SARs in return for the grant of new  options or SARs
for the same or different number and at the same or different option price.

                                    ARTICLE 5
                               GENERAL PROVISIONS

     5.1 STOCK SUBJECT TO PLAN.

        (a) The stock  subject to options or SARs  hereunder  shall be shares of
Common Stock.  Such shares,  in whole or part,  may be  authorized  but unissued
shares,  reacquired  shares or both.  The  aggregate  number of shares of Common
Stock as to which  options  and SARs may be granted  from time to time under the
Plan shall not exceed  1,000,000,  subject to  adjustment as provided in Section
5.7 hereof.  The Company  shall at all times during the term of the Plan reserve
and keep  available  such number of shares of Common Stock as will be sufficient
to satisfy the requirements of the Plan

        (b) Any shares  subject to an option or SAR which for any reason expire,
are canceled or are terminated  unexercised  (other than those which expire, are
canceled or terminated pursuant to the exercise of a tandem SAR or option) shall
again become  available for the granting of options or SARs under the Plan.  The
number of shares of Common  Stock  underlying  that  portion of an option or SAR
which is exercised  (regardless of the number of shares  actually  issued) shall
not
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again become available for grant under the Plan.

     5.2 TERMS AND CONDITIONS; AGREEMENTS. Each option or SAR granted under this
Plan shall be evidenced by a written  agreement  (the  "Agreement")  between the
Company and the Recipient.  The Agreement shall be in the form determined by the
Committee  in  its  discretion  and  shall  be  subject  to  such  amendment  or
modification  from  time  to time  as the  Committee  shall  deem  necessary  or
appropriate to comply with or take advantage of applicable  laws or regulations.
Each Agreement shall  specifically  identify the portion,  if any, of the option
which  constitutes  an Incentive  Stock Option and the  portion,  if any,  which
constitutes a Nonqualified Stock Option. Each Agreement shall comply with and be
subject to the  following  terms and  conditions:

        (a) NUMBER OF SHARES.  Each  Agreement  shall state the number of shares
covered by the option or SAR.

        (b) EXERCISE PRICE AND BASE PRICE.

            (1) Each Agreement  shall state the exercise price for the option or
the base price for the SAR which price shall be determined by the Committee.

            (2) The date on which the  Committee  adopts a resolution  expressly
granting  an option or SAR shall be  considered  the day on which such option or
SAR is granted,  unless a future date is  specified in the  resolution,  and the
Fair Market Value of the Common Stock to which such option or SAR relates  shall
be determined at the close of the day on which the resolution is adopted, unless
another value and/or another date is specified in the resolution.

        (c) TERM.  Each  Agreement  shall  state the period  during and times at
which the option or SAR shall be  exercisable,  in accordance with the following
limitations:

            (1) The date on which the  Committee  adopts a resolution  expressly
granting  an option or SAR shall be  considered  the day on which such option or
SAR is granted,  although such grant shall not be effective  until the Recipient
has executed an Agreement with respect to such option or SAR.

            (2) Subject to the  provisions  of section 7.4 hereof,  the exercise
period of any option or SAR shall not exceed ten (10) years from the date of the
grant of the option or SAR.

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            (3) The  Committee  shall have the authority to accelerate or extend
the  exercisability of any outstanding option or SAR at such time and under such
circumstances  as it, in its sole  discretion,  deems  appropriate.  No exercise
period may be so extended  to  increase  the term of an option or SAR beyond ten
(10) years from the date of the grant.

            (4) The exercise  period shall be subject to earlier  termination as
provided in Sections 5.5 and 5.6 hereof,  and  furthermore,  shall be terminated
upon  surrender of the option or SAR by the Recipient if such surrender has been
authorized in advance by the Committee.

     5.3 NOTICE OF INTENT TO  EXERCISE  OPTION OR SAR.  An option or SAR granted
under the Plan may be exercised in whole or in part by notifying the Company (or
its  designee)  in the  manner  and upon the  terms  as may be  provided  in the
Agreement.

     5.4  EXERCISE  OF OPTION OR SAR.

        (a) Upon receipt by the Company (or its designee) of the notice provided
in Section  5.3,  an option  shall  deemed to be  exercised  as to the number of
Shares specified in such notice and Shares in that amount shall be issued to the
Recipient upon payment to the Company of the amount  specified in Section 6.2 or
7.5,  whichever is applicable.  The option  purchase price shall be paid in full
upon exercise unless the Agreement permits  installment  payments.  The purchase
price for the option shall be paid in cash,  or in shares of Common Stock having
a Fair  Market  Value  equal  to  such  option  price,  or in  property  or in a
combination  of cash  shares  and  property  and,  subject  to  approval  of the
Committee,  may be  effected  in whole or in part with funds  received  from the
Company at the time of exercise as a  compensatory  cash payment.  The Committee
shall have the sole and absolute discretion to determine whether or not property
other than cash or Common Stock may be used to purchase the Optioned Shares.

        (b) Upon receipt by the Company (or its designee) of the notice provided
in Section 5.3 of the exercise of a SAR, the SAR shall deemed to be exercised as
to the number of Shares  specified in the notice and the Committee  shall (as it
may determine in its sole  discretion)  issue to the Recipient either (1) Shares
of Common Stock based on the Fair Market Value on the date of payment  (with any
fractional Shares to be paid in cash), (2) cash or (3) a combination of Shares

                                      -8-
<PAGE>

and cash,  equal in value (in United States dollars) to the amount payable under
the SAR. Any cash  payment to be made by the Company  under this Section may, as
determined by the Committee in its sole  discretion,  be payable in installments
over a period of no more than 6 months.

     5.5 TERMINATION.  Except as provided herein or in the Agreement,  an option
or SAR may not be exercised unless the Recipient then is an Employee or Director
of or  consultant  to the Company (or a  corporation  or a parent or  subsidiary
corporation  of such  corporation  issuing  or  assuming  the option or SAR in a
transaction  to which  Section  424(a)  of the Code  applies),  and  unless  the
Recipient  has  remained  continuously  as an Employee or officer or Director or
consultant  to the  Company  since the date of grant of the  option or SAR.

        (a) Unless otherwise provided in the Agreement,  if the Recipient ceases
to be an Employee or Director of, or consultant  to, the Company  (other than by
reason of death,  Disability or  retirement),  all options and SARs  theretofore
granted to such  Recipient  that are  exercisable  at the time of such cessation
may,  unless  earlier  terminated in accordance  with their terms,  be exercised
within  three  months  after  such  cessation;  provided,  however,  that if the
employment or consulting  relationship of a Recipient shall  terminate,  or if a
Director shall be removed,  for cause, all options and SARs theretofore  granted
to such  Recipient  shall to the  extent  not  previously  exercised,  terminate
immediately.  Any such determination by the Committee as to whether  termination
is for cause shall be final and biding upon the Recipient.

        (b) Options and SARs granted under the Plan shall not be affected by any
change in the status of a Recipient  so long as he  continues  to be  associated
with the Company or its Subsidiary.

        (c) Nothing in the Plan or in any Option or SAR granted  hereunder shall
confer upon a Recipient  any right to continue in the employ of or maintain  any
other  relationship  with the Company or  interfere in any way with the right of
the Company to  terminate  such  employment  or other  relationship  between the
Recipient and the Company.

     5.6 DEATH, DISABILITY OR RETIREMENT OF RECIPIENT. Unless otherwise provided
in the Agreement, if a Recipient shall die while an Employee or Director of or a
consultant to the

                                      -9-

<PAGE>

Company,  or  if  the  Recipient's  employment,  officer  status  or  consulting
relationship shall terminate by reason of Disability or retirement,  all options
or  SARs  theretofore  granted  to  such  Recipient,  whether  or not  otherwise
exercisable,  unless earlier  terminated in accordance with their terms,  may be
exercised  by the  Recipient  or by the  Recipient's  estate or by a person  who
acquired the right to exercise such options or SARs by bequest or inheritance or
otherwise by reason of the death or  Disability  of the  Recipient,  at any time
within  one year  after  the date of  death,  Disability  or  retirement  of the
Recipient;  provided,  however, that in the case of Incentive Stock Options such
one-year period shall be limited to three months in the case of retirement.

     5.6 NON-TRANSFERABILITY OF OPTIONS; RESTRICTIONS ON TRANSFERABILITY.

        (a) No  option  or SAR  granted  under  the Plan  shall be  transferable
otherwise  than by will or the laws of descent and  distribution,  or  qualified
domestic  relations  order as  defined  in the  Code or Title I of the  Employee
Retirement  Income  Security Act, and options and SARs may be exercised,  during
the lifetime of the holder  thereof,  only by him or his legal  representatives.
Notwithstanding the foregoing, at the discretion of the Committee,  Nonqualified
Stock Options may be transferred in a transaction for estate planning  purposes.

        (b) Any  attempted  sale,  pledge,  assignment,  hypothecation  or other
transfer of an option  contrary to the provisions  hereof and/or the levy of any
execution,  attachment or similar process upon an option, shall be null and void
and without force or effect and shall result in a termination of the option.

        (c) As a condition  to the transfer of any shares of Common Stock issued
upon exercise of an option  granted under this Plan,  the Company may require an
opinion  of  counsel,  satisfactory  to the  Company,  to the  effect  that such
transfer will not be in violation of the Act or any other applicable  securities
laws or that such transfer has been registered  under Federal and all applicable
state securities laws. Further,  the Company shall be authorized to refrain from
delivering or  transferring  shares of Common Stock issued under this Plan until
the  Committee  determines  that such  delivery  or  transfer  will not  violate
applicable  securities  laws and the  Recipient  has tendered to the Company any
Federal, state or local tax owed by the Recipient as a result of exercising the

                                      -10-
<PAGE>

Option or SAR or  disposing of  any Common Stock when the  Company  has  a legal
liability to satisfy  such tax. The Company  shall not be liable for damages due
to delay in the  delivery or issuance  of any stock  certificate  for any reason
whatsoever,   including,   but  not  limited  to,  a  delay  caused  by  listing
requirements of any securities  exchange or any registration  requirements under
the Act, the Exchange Act, or under any other state,  federal or provincial law,
rule or  regulation.  The Company is under no  obligation  to take any action or
incur any expense in order to  register  or qualify the  delivery or transfer of
shares of Common  Stock  under  applicable  securities  laws or to  perfect  any
exemption from such registration or qualification. Furthermore, the Company will
not be liable to any  Recipient  for  failure to deliver or  transfer  shares of
Common Stock if such failure is based upon the provisions of this paragraph.

     5.7 RECAPITALIZATION;  EFFECT OF OTHER CHANGES.

        (a) Subject to any required  action by the  shareholders of the Company,
the aggregate number of Shares for which options may be granted  hereunder,  the
number of Shares  covered by any  outstanding  option or SAR,  and the price per
Share  thereof under each such option or SAR shall be  proportionately  adjusted
for the following:  (a) any dividend or other distribution declared as to Common
Stock which is payable in Shares:  and (b) an increase or decrease in the number
of  outstanding  shares of Common Stock  resulting from a stock split or reverse
split of shares,  recapitalization or other capital  adjustment.  All fractional
Shares  or other  securities  which  result  from  such an  adjustment  shall be
eliminated  and not carried  forward to any  subsequent  adjustment.

        (b) In the  event of the  proposed  dissolution  or  liquidation  of the
Company, or any corporate separation or division, including, but not limited to,
split-up,  split-off or spin-off,  or a merger or  consolidation  of the Company
with  another  corporation,  the  Committee  may provide that the holder of each
option and SAR then exercisable  shall have the right to exercise such Option or
SAR (at its then  current  exercise  price)  solely  for the kind and  amount of
shares of stock and other securities,  property, cash or any combination thereof
receivable upon such dissolution, liquidation, corporate separation or division,
or merger or consolidation by a holder of the number of Shares of

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<PAGE>

Common Stock for which such option or SAR might have been exercised  immediately
prior to such dissolution,  liquidation,  corporate  separation or division,  or
merger or consolidation.

        (c)  Paragraph  (b) of this  Section  5.7 shall not apply to a merger or
consolidation  in which the Company is the surviving  corporation  and shares of
Common Stock are not converted  into or exchanged  for stock,  securities of any
other  corporation,  cash or any  other  thing  of  value.  Notwithstanding  the
preceding  sentence,   in  case  of  any  consolidation  or  merger  of  another
corporation  into the Company in which the Company is the surviving  corporation
and in which there is a  reclassification  or change  (including a change to the
right  to  receive  cash or  other  property)  of the  Shares  of  Common  Stock
(excluding  a change in par  value,  or from no par value to par  value,  or any
change as a result of a subdivision or combination,  but including any change in
such Shares into two or more  classes or series of shares),  the  Committee  may
provide that the Recipient of each option or SAR then exercisable shall have the
right to exercise such option or SAR solely for the kind and amount of shares of
stock and other securities (including those of any new direct or indirect parent
of the Company),  property, cash or any combination thereof receivable upon such
reclassification, change, consolidation or merger by the holder of the number of
shares of Common Stock for which such option or SAR might have been exercised.

        (d) Except as expressly  provided in this  Section  5.7,  the  Recipient
shall have no rights by reason of any subdivision or  consolidation of shares of
stock of any class other than the Company's  Common Stock, or the payment of any
stock  dividend  or any other  increase  or  decrease in the number of shares of
stock of any class other than the Company's  Common  Stock,  or by reason of any
dissolution,  liquidation,  merger,  or  consolidation  or spin-off of assets or
stock of another corporation; and any issue by the Company of shares of stock of
any class, or securities  convertible  into shares of stock of any class,  other
than the Company's Common Stock,  shall not affect,  and no adjustment by reason
thereof  shall be made with  respect to, the number or price of shares of Common
Stock subject to an option or SAR. The grant of an option or SAR pursuant to the
Plan  shall  not  affect in any way the  right or power of the  Company  to make
adjustments,  reclassifications,  reorganizations  or changes of its  capital or
business structures, or to merge or consolidate, or to

                                      -12-

<PAGE>

dissolve,  liquidate,  or sell or  transfer  all or any part of its  business or
assets.

        (e) To the  extent  that the  foregoing  adjustments  relate to stock or
securities  of the Company,  such  adjustments  shall be made by the  Committee,
whose  determination  in that respect  shall be final,  binding and  conclusive,
provided that each Incentive  Stock Option  granted  pursuant to this Plan shall
not be  adjusted  in a manner  that  causes  such  option to fail to continue to
qualify as an Incentive  Stock  Option  within the meaning of Section 422 of the
Code.

     5.8 NO RIGHTS AS A  SHAREHOLDER;  NON-DISTRIBUTIVE  INTENT.

        (a)  Neither  a  Recipient  of an  option,  nor such  Recipient's  legal
Representative,  heir, legatee or distributee,  shall be deemed to be the holder
of, or to have any rights of a holder with respect to any shares subject to such
option  until after the option is  exercised  and the shares are issued.

        (b)  No   adjustment   shall  be  made  for   dividends   (ordinary   or
extraordinary,  whether in cash,  securities or other property) or distributions
or other  rights  for which  the  record  date is prior to the date  such  stock
certificate  is issued,  except as  provided  in Section  5.7  hereof.

        (c) Upon  exercise of an option at a time when there is no  registration
statement in effect under the Act relating to the shares issuable upon exercise,
Shares  may be issued to the  Recipient  only if the  Recipient  represents  and
warrants in writing to the Company that the shares  purchased are being acquired
for investment and not with a view to the distribution  thereof and provides the
Company  with  sufficient   information  to  establish  an  exemption  from  the
registration  requirements of the Act.

     5.9 CONVERSION OF OUTSTANDING OPTIONS TO SARS. The Company may, in its sole
discretion  and  without  the  consent  of the  Recipient,  elect at any time to
convert  any  option  granted  under the Plan to a SAR.  In the event of such an
election,  any  converted  SAR shall remain in effect until the option  involved
would have expired under the terms of the Agreement with the Recipient. The base
price of such SAR shall be determined  using the Fair Market Value of the Shares
subject to the option on the date the option was first  granted.  Notice of such
an election  shall be provided to the  Recipient  as soon as feasible  after the
date of the election.

                                      -13-

<PAGE>

     5.10 WITHDRAWAL. A Recipient may at any time elect in writing to abandon an
option or SAR with respect to the number of Shares as to which the option or SAR
shall not have been exercised.

     5.11  COMPLIANCE  WITH  APPLICABLE  LAWS  AND  ARTICLES  OF  INCORPORATION.

        (a) The Company shall have the right to place  appropriate  legends upon
the  certificate for any Shares issued pursuant to this Plan and take such other
acts as it may deem  necessary  or  appropriate  to ensure that the  issuance of
Optioned Shares or the exercise of a SAR complies with applicable  provisions of
Federal and state  securities  laws.

        (b) The Company  shall not be obligated to issue Shares under any option
or in payment of any SAR  granted  under this Plan that would  violate  any law.
Each Recipient may be required to make  representations,  enter into restrictive
agreements, or take such other actions as may be deemed necessary or appropriate
by the  Company  to ensure  compliance  with  applicable  law and the  Company's
Articles of Incorporation and By-laws.

                                    ARTICLE 6
                  SPECIAL RULES FOR NONQUALIFIED STOCK OPTIONS

     6.1 OPTION PRICE.  The purchase  price of Shares  subject to a Nonqualified
Stock  Option  shall be  determined  by the  Committee at the time the option is
granted;  provided,  that the  purchase  price shall not be less than 85% of the
Fair  Market  Value of such Shares on the date of the grant.

     6.2 PAYMENT UPON EXERCISE OF OPTION. The amount to be paid by the Recipient
upon exercise of a  Nonqualified  Stock Option shall be the full purchase  price
for the  Shares  involved  provided  in the  Agreement  to be paid in the manner
determined by the Committee,  together with the amount of any required  federal,
state,  and local tax  withholding  (as  determined by the Committee in its sole
discretion).  The Committee may, in its sole  discretion,  permit a Recipient to
elect to pay the required tax withholding by having the Company  withhold Shares
having a Fair Market Value at the time of exercise equal to the amount  required
to be withheld. An election by a Recipient to

                                      -14-
<PAGE>

have shares  withheld  for this  purpose  will  (together  with such  additional
restrictions as the Company may impose) be subject to the following:

            (a) If a Recipient has received  multiple option grants,  a separate
election must be made for each grant;

            (b) The  election  must be made  prior  to the date  the  option  is
exercised;

            (c) The  election  will be  irrevocable;

            (d)  The  election  may  be  rejected  by  the  Company;

            (e) If the  Recipient  is an  "officer"  of the  Company  within the
meaning of  Section 16 of the  Exchange  Act  ("Section  16") as defined in Rule
16a-1(f) promulgated by the Securities Exchange Commission, the election may not
be made within six months following the grant of the option; and,

            (f) If the  Recipient  is an  "officer"  of the  Company  within the
meaning of Section 16, the election  must be made either six months prior to the
day the option is exercised or during the period beginning on the third business
day following the date of release of the Company's  quarterly or annual  summary
statement of sales and earnings and ending on the twelfth business day following
such date.

                                    ARTICLE 7
                    SPECIAL RULES FOR INCENTIVE STOCK OPTIONS

     7.1  CONFORMANCE  WITH CODE  REQUIREMENTS.  Incentive Stock Options granted
under  this Plan  shall  conform  to, be  governed  by,  and be  interpreted  in
accordance  with  Section  422  of  the  Code  and  any  regulations  thereunder
including,  without limitation, those provisions of Section 422 of the Code that
prohibit an option by its terms to be exercisable  after ten (10) years from the
date that it was granted.  All Incentive  Stock  Options  granted under the Plan
shall  at the  time  of the  grant  be  specifically  designated  as such in the
Agreement.  Only Employees may be granted Incentive Stock Options. To the extent
that any option granted as an Incentive Stock Option fails to conform

                                      -15

<PAGE>

to the applicable  requirements,  it shall be treated and honored by the Company
as a Nonqualified Stock Option.

     7.2 OPTION  PRICE.  The  purchase  price of each Share  optioned  under the
Incentive Stock Option  provisions of this Plan shall be determined by the Board
in its sole  discretion  but shall,  in no event,  be less than the Fair  Market
Value on the date of grant.

      7.3 LIMITATION ON AMOUNT OF INCENTIVE STOCK OPTION.
The aggregate Fair Market Value  (determined on the date of grant) of the Shares
with respect to which Incentive Stock Options are exercisable for the first time
during  any  calendar  year  under all plans of the  Company  (and any Parent or
Subsidiary) shall not exceed $100,000 (or such other limit as may be established
by law from time to time).

     7.4 LIMITATION ON GRANTS TO SUBSTANTIAL SHAREHOLDERS.  An Employee may not,
immediately prior to the grant of an Incentive Stock Option hereunder, own stock
in the  Company  representing  more than ten percent  (10%) of the total  voting
power of all classes of stock of the  Company  (after  taking  into  account the
attributions  rules of Section  424(d) of the Code)  unless the per share option
price  specified by the Board for the Incentive  Stock  Options  granted such an
Employee is at least one hundred ten percent  (110%) of the Fair Market Value of
the Company's  stock on the date of grant and such option,  by its terms, is not
exercisable  after the expiration of five (5) years from the date such option is
granted. For purposes of this limitation, Section 424(d) of the Code governs the
attributes of stock ownership.

     7.5 PAYMENT UPON EXERCISE OF OPTION. The amount to be paid by the Recipient
upon  exercise of an Incentive  Stock Option  shall be the full  purchase  price
thereof  provided in the  Agreement to be paid in the manner  determined  by the
Committee.

                                      -16-

<PAGE>

                                    ARTICLE 8
                            AMENDMENT AND TERMINATION

     8.1 AMENDMENT.

        (a) The Committee shall have the right to amend the Plan at any time and
from time to time;  provided,  that no such amendment of the Plan shall, without
stockholder  approval,  (1)  increase  the number of shares  which may be issued
under the Plan as set forth in Section  5.1,  (2) change in any way the class of
employees eligible to receive Incentive Stock Options under the Plan, (3) extend
the duration of the Plan,  or (4) be effective  if  stockholder  approval of the
amendment is required at such time in order for the Plan's stock options or SARs
to qualify for any available exemption from Section 16 of the Exchange Act or by
any other  applicable law,  regulation,  rule of order.

        (b) No amendment may be made that would cause options granted  hereunder
not to qualify as Incentive  Stock Options under the Code or would cause options
or SARs  under the Plan not to qualify  for  exemption  under  Section 16 of the
Exchange Act.

        (c) No amendment of the Plan shall,  without the written  consent of the
holder  of an  option or SAR  awarded  under  the Plan  prior to the date of the
amendment or termination adversely affect the rights of such holder with respect
to such option or SAR.

        (d) Notwithstanding anything herein or in any Agreement to the contrary,
the  Committee  shall  have the  power to amend  the Plan in any  manner  deemed
necessary or advisable  for options or SARs granted under the Plan to qualify to
be  treated  as  Incentive  Stock  Options  under the Code or for any  exemption
provided under Section 16 of the Exchange Act and any such amendment  shall,  to
the extent  deemed  necessary or advisable by the Board,  be  applicable  to any
outstanding  stock  options  previously  granted under the Plan. In the event of
such an amendment to the Plan, the holder of any option or SAR outstanding under
the Plan shall,  upon request of the Committee and as a condition for exercising
of such option or SAR, execute a conforming  amendment in the form prescribed by
the Committee to the Agreement within such reasonable period

                                      -17-

<PAGE>

of time as the Committee shall specify in such request.

     8.2  TERMINATION.  The Committee shall have the right to terminate the Plan
at any time; provided,  that no such termination shall terminate any outstanding
option or SAR previously  granted under the Plan or adversely  affect the rights
of such holder without his or her written consent. No new options or SARs may be
granted under the Plan on or after the date of termination.

                                    ARTICLE 9
                  FOREIGN EMPLOYEES, DIRECTORS AND CONSULTANTS

     9.1 OPTION GRANTS TO FOREIGN NATIONALS. The Committee may grant Options and
SARs under this Plan to eligible  Employees,  Directors or  consultants  who are
foreign nationals on such additional or different terms and conditions as may in
the  judgment  of the  Committee,  in  its  sole  discretion,  be  necessary  or
appropriate to comply with the  provisions of any  applicable  laws of a foreign
country.

                                   ARTICLE 10
                                  MISCELLANEOUS

     10.1 ADOPTION BY BOARD; APPROVAL OF SHAREHOLDERS. This Plan was approved by
the Board effective  October 25, 2000. Until and unless this Plan is approved by
the  shareholders  of the Company within twelve (12) months of the date the Plan
was approved by the Board,  as required by section 422(b) of the Code, this Plan
and the options  granted  hereunder  shall remain  effective,  but the reference
herein to Incentive Stock Options shall not be effective and all options granted
under the Plan shall be Nonqualified Stock Options.

     10.2 ASSUMPTION. Subject to the provisions of Section 5.7 hereof, the terms
and conditions of any  outstanding  option or SAR granted  pursuant to this Plan
shall be  assumed  by, be  binding  upon and shall  inure to the  benefit of any
successor corporation to the Company and shall, to the extent

                                      -18-
<PAGE>

applicable,  continue to be governed by the terms and  conditions  of this Plan.
Such successor corporation may, but shall not be obligated to, assume this Plan.

     10.3  TERMINATION OF RIGHT OF ACTION.  Every right of action arising out of
or in  connection  with  the  Plan by or on  behalf  of the  Company,  or by any
shareholder  of the Company  against any past,  present or future  member of the
Board or the  Committee,  or against  any  Employee,  or by an  Employee  (past,
present or future)  against  the  Company,  irrespective  of the place  where an
action may be brought  and of the place of  residence  of any such  shareholder,
Director or Employee,  will cease and be barred by the  expiration  of three (3)
years  from the date of the act or  omission  in  respect of which such right of
action is alleged to have  arisen or such  shorter  period as may be provided by
law.

     10.4  TAX  LITIGATION.  The  Company  shall  have  the  right,  but not the
obligation,   to  contest,   at  its  expense,   any  tax  ruling  or  decision,
administrative or judicial,  on any issue which is related to the Plan and which
the  Committee  believes to be  important to holders of options and SARs granted
under this Plan and to conduct any such contest or litigation  arising therefrom
to a final decision.

     10.5 NO RESTRICTIONS ON ADOPTION OF OTHER PLANS. Nothing in this Plan shall
restrict the Company's  rights to adopt other option plans  pertaining to any or
all of the Employees,  Directors or Consultants covered under this Plan or other
Employees, Directors or Consultants not covered under this Plan.

     10.6 COSTS AND EXPENSES.  Except as provided herein, all costs and expenses
of administering the Plan shall be paid by the Company.

     10.7 PLAN UNFUNDED.  This Plan shall be unfunded.  Except for the Company's
reservation of a sufficient  number of authorized  shares to the extent required
by law to meet the  requirements  of the Plan, the Company shall not be required
to establish  any special or separate fund or to make any other  segregation  of
assets to assure payment of any grant under the Plan.

     10.8 GOVERNMENT  REGULATIONS.  The rights of Recipients and the obligations
of the Company  hereunder shall be subject to all applicable  laws,  rules,  and
regulations and to such approvals as may be required by any governmental agency.

                                      -19-
<PAGE>

     10.9  PROCEEDS  FROM SALE OF STOCK.  Proceeds  of the  purchase of Optioned
Shares by a Recipient may be used by the Company for any business purpose.

     10.10  GOVERNING  LAW.  This Plan shall be  governed  by and  construed  in
accordance with the laws of the State of Tennessee.

     10.11  INVALIDITY.  If any  provision  of the Plan shall be held invalid or
unlawful  for any  reason,  such  event  shall not  affect or render  invalid or
unenforceable the remaining provisions of the Plan.

                        * * * * * * * * * * * * * * * * *
                                      -20-<PAGE>

                                                                    EXHIBIT 10.1

                                AMENDMENT NO. 2

          AMENDMENT NO. 2 dated as of October 10, 2000, between CHART
INDUSTRIES, INC., a Delaware corporation duly organized and validly existing
under the laws of the State of Delaware (the "Borrower"); each of the
                                              --------
Subsidiaries of the Borrower identified under the caption "SUBSIDIARY BORROWERS"
on the signature pages hereto (individually, a "Subsidiary Borrower" and,
                                                -------------------
collectively, the "Subsidiary Borrowers"); each of the Subsidiaries of the
                   --------------------
Borrower identified under the caption "SUBSIDIARY GUARANTORS" on the signature
pages hereto (individually, a "Subsidiary Guarantor" and, collectively, the
                               --------------------
"Subsidiary Guarantors" and, together with the Borrower and the Subsidiary
 ---------------------
Borrowers, the "Obligors"); each of the lenders that is a signatory hereto
                --------
(individually, a "Lender" and, collectively, the "Lenders"); THE CHASE MANHATTAN
                  ------                          -------
BANK, as administrative agent for the Lenders (in such capacity, together with
its successors in such capacity, the "Administrative Agent"); and NATIONAL CITY
                                      --------------------
BANK, as Documentation Agent.

          The Borrower, the Subsidiary Borrowers, the Subsidiary Guarantors,
each of the lenders that is a signatory thereto and the Administrative Agent are
parties to a Credit Agreement dated as of April 12, 1999 (as heretofore modified
and supplemented and in effect on the date hereof, the "Credit Agreement"),
                                                        ----------------
providing, subject to the terms and conditions thereof, for loans to be made by
said lenders to the Borrower in an aggregate original principal amount not
exceeding $300,000,000. The Borrower, the Subsidiary Borrowers, the Subsidiary
Guarantors, the Lenders and the Administrative Agent wish to amend the Credit
Agreement in certain respects, and accordingly, the parties hereto hereby agree
as follows:

          Section 1. Definitions. Except as otherwise defined in this Amendment
                     -----------
No. 2, terms defined in the Credit Agreement are used herein as defined therein.

          Section 2.  Amendments.  Subject to the satisfaction of the conditions
                      ----------
precedent specified in Section 5, but effective as of the date hereof, the
Credit Agreement shall be amended as follows:

          2.01.  References in the Credit Agreement (including references to the
Credit Agreement as amended hereby) to "this Agreement" (and indirect references
such as "hereunder", "hereby", "herein" and "hereof") shall be deemed to be
references to the Credit Agreement as amended hereby.

          2.02.  Section 1.01 of the Credit Agreement is hereby amended by
adding the following new definitions (to the extent not already included in said
Section 1.01) and inserting the same in the appropriate alphabetical locations
and by amending in their entirety the following definitions (to the extent
already included in said Section 1.01), as follows:

          "Applicable Margin" means, for any day, with respect to any ABR Loan
           -----------------
     (including any Swingline Loan) or Eurodollar Loan, as the case may be, of
     any Class the applicable rate per annum set forth below under the caption
     "ABR Spread" or "Eurodollar
<PAGE>

     Spread" with respect to such Class, respectively, based upon the Leverage
     Ratio as of the most recent determination date; provided that until the
                                                     --------
     third Business Day after delivery of the Borrower's unaudited consolidated
     financial statements for the fiscal quarter ending September 30, 2000, the
     "Applicable Margin" shall be the applicable rate per annum set forth below
     in Category 1:

<TABLE>
<CAPTION>
                                       ABR Spread            Eurodollar
                                      for Revolving          Spread for
         Leverage Ratio               Credit Loans            Revolving                                      Eurodollar
         --------------
                                      and Term Loan       Credit Loans and         ABR Spread for          Spread for Term
                                            A                Term Loan A            Term Loan B                Loan B
     ---------------------------------------------------------------------------------------------------------------------
     <S>                              <C>                 <C>                      <C>                     <C>

           Category 1
           ----------
                                          2.25%                 3.25%                  2.75%                    3.75%
     Greater than 6.00 to 1
     ---------------------------------------------------------------------------------------------------------------------
           Category 2
           ----------
                                          2.00%                 3.00%                  2.50%                    3.50%

     Less than or equal to
     6.00 to 1 and greater
         than 5.50 to 1
     ---------------------------------------------------------------------------------------------------------------------
           Category 3
           ----------
                                          1.75%                 2.75%                  2.25%                    3.25%
     Less than or equal to
      5.50 to 1 and greater
         than 4.00 to 1
     ---------------------------------------------------------------------------------------------------------------------
           Category 4
           ----------
                                          1.50%                 2.50%                  2.25%                    3.25%
     Less than or equal to
     4.00 to 1 and greater
         than 3.50 to 1
     ---------------------------------------------------------------------------------------------------------------------
           Category 5
           ----------
                                          1.25%                 2.25%                  2.25%                    3.25%
     Less than or equal to
     3.50 to 1 and greater
         than 3.00 to 1
     ---------------------------------------------------------------------------------------------------------------------
           Category 6
           ----------
                                          1.00%                 2.00%                  2.25%                    3.25%
     Less than or equal to
              3.00
     =====================================================================================================================
</TABLE>

     For purposes of the foregoing (but subject to the proviso above), (a) the
     Leverage Ratio shall be determined as of the end of each fiscal quarter of
     the Borrower's fiscal year based upon the Borrower's consolidated financial
     statements delivered pursuant to Section 6.01(a) or (b) and (b) each change
     in the Applicable Margin resulting from a change in the Leverage Ratio
     shall be effective during the period commencing on and including the date
     three Business Days after delivery to the Administrative Agent of such
     consolidated financial statements indicating such change and ending on the
     date immediately preceding the effective date of the next such change;
     provided that the Leverage Ratio shall be deemed to be in Category 1 above
     --------
     (i) at any time that an Event of Default has occurred and is continuing and
     (ii) if the Borrower fails to deliver the consolidated financial statements
     required to be delivered by it pursuant to Section 6.01(a) or (b) and/or
     the related compliance certificate, during the period from the expiration
     of the time for delivery thereof until such consolidated financial
     statements and compliance certificate are so delivered.

                                      -2-
<PAGE>

          Notwithstanding the foregoing, the Applicable Margin with respect to
     Incremental Revolving Credit Loans of any Series, shall be the rate agreed
     upon at the time Incremental Revolving Credit Commitments of such Series
     are established pursuant to the relevant Incremental Revolving Credit
     Agreement.

          "Class", when used in reference to any Loan or Borrowing, refers to
           -----
     whether such Loan, or the Loans constituting such Borrowing, are Revolving
     Credit Loans, Incremental Revolving Credit Loans, A Term Loans, B Term
     Loans, Swingline Loans or Foreign Currency Credits and, when used in
     reference to any Commitment, refers to whether such Commitment is a
     Revolving Credit Commitment, Incremental Revolving Credit Commitment of any
     Series, Term Loan A Commitment or Term Loan B Commitment.

          "Commitment" means a Revolving Credit Commitment, Incremental
           ----------
     Revolving Credit Commitment of any Series, Term Loan A Commitment or Term
     Loan B Commitment, or any combination thereof (as the context requires).

          "Credit Documents" means, collectively, this Agreement, the Letter of
           ----------------
     Credit Documents, the Security Documents and the Incremental Revolving
     Credit Agreements.

          "Incremental Revolving Credit Agreement" means an Agreement pursuant
           --------------------------------------
     to which Incremental Revolving Credit Commitments of any Series are
     established pursuant to Section 2.01(d).

          "Incremental Revolving Credit Commitment" means, with respect to each
           ---------------------------------------
     Incremental Revolving Credit Lender of any Series, the commitment, if any,
     of such Lender to make Incremental Revolving Credit Loans of such Series,
     expressed as an amount representing the maximum aggregate amount of such
     Lender's Incremental Revolving Credit Exposure of such Series hereunder, as
     such commitment may be (a) reduced from time to time pursuant to Section
     2.08 or 2.10(b) and (b) reduced or increased from time to time pursuant to
     assignments by or to such Lender pursuant to Section 10.04.  The initial
     amount of each Incremental Revolving Credit Lender's Incremental Revolving
     Credit Commitment of any Series will be specified in the Incremental
     Revolving Credit Agreement for such Series, or will be set forth in the
     Assignment and Acceptance pursuant to which such Lender shall have assumed
     its Incremental Revolving Credit Commitment of such Series.  The aggregate
     amount of the Incremental Revolving Credit Lenders' Incremental Revolving
     Credit Commitments of all Series will not exceed $10,000,000.

          "Incremental Revolving Credit Commitment Termination Date" means, with
           --------------------------------------------------------
     respect to each Series, the commitment termination date specified in the
     respective Incremental Revolving Credit Agreement.

                                      -3-
<PAGE>

          "Incremental Revolving Credit Exposure" means, with respect to any
           -------------------------------------
     Incremental Revolving Credit Lender of any Series at any time, the sum of
     the outstanding principal amount of such Lender's Incremental Revolving
     Credit Loans of such Series at such time.

          "Incremental Revolving Credit Lender" means a Lender with an
           -----------------------------------
     Incremental Revolving Credit Commitment or, if the Incremental Revolving
     Credit Commitments have terminated or expired, a Lender with Incremental
     Revolving Credit Exposure.

          "Incremental Revolving Credit Loan" means a Loan made pursuant to
           ---------------------------------
     Section 2.01(d).

          "Series" has the meaning assigned to such term in Section 2.01(d).
           ------

          "Syndicated Loans" means, collectively, the Revolving Credit Loans,
           ----------------
     Incremental Revolving Credit Loans, Term Loan A and Term Loan B.

          2.03. Section 2.01 of the Credit Agreement is hereby amended by adding
a new clause (d) as follows:

          "(d)  Incremental Revolving Credit Loans.  In addition to Borrowings
                ----------------------------------
     of Revolving Credit Loans, A Term Loans and B Term Loans pursuant to
     paragraphs (a), (b) and (c) above, at any time and from time to time prior
     to December 30, 2001, the Borrower may request that one or more Persons
     (which may include a Lender) offer to enter into commitments to make
     additional revolving loans ("Incremental Revolving Credit Loans")  under
                                  ----------------------------------
     this paragraph (d), it being understood that if such offer is to be made by
     any Person that is not already a Lender hereunder, the Administrative Agent
     shall have consented to such Person being a Lender hereunder to the extent
     such consent would be required pursuant to Section 10.04(b) in the event of
     an assignment to such Person.  In the event that one or more of such
     Persons offer, in their sole discretion, to enter into such commitments,
     and such Persons and the Borrower agree as to the amount of such
     commitments that shall be allocated to the respective Persons making such
     offers and the interest rate and fees (if any) to be payable by the
     Borrower in connection therewith, the commitment reduction schedule and
     commitment termination date to be applicable thereto, the Borrower, such
     Persons and the Administrative Agent shall execute and deliver an
     appropriate Incremental Revolving Credit Agreement, and such Persons shall
     become obligated to make Incremental Revolving Credit Loan, under this
     Agreement in an amount equal to the amount of their Incremental Revolving
     Credit Commitments, as specified in such Incremental Revolving Credit
     Agreement.  The Incremental Revolving Credit Loans to be made pursuant to
     any such agreement between the Borrower and one or more Persons in response
     to any such request by the Borrower shall be deemed to be a separate
     "Series" of Incremental Revolving Credit Loans for all purposes of this
     -------
     Agreement and (except as otherwise expressly provided herein) shall be
     entitled to the same rights and privileges hereunder as the Revolving
     Credit Loans.

          Anything herein to the contrary notwithstanding, the Borrower shall
     not be entitled to request an Incremental Revolving Credit Borrowing
     unless, at the time of such

                                      -4-
<PAGE>

     request, (i) the Revolving Credit Commitments are fully utilized; (ii) the
     minimum aggregate principal amount of Incremental Revolving Credit
     Commitments entered into pursuant to any such request (and, accordingly,
     the minimum aggregate principal amount of any Series of Incremental
     Revolving Credit Loans) shall be $1,000,000 and (iii) the aggregate
     outstanding principal amount of Incremental Revolving Credit Loans of all
     Series, together with the aggregate unutilized Incremental Revolving Credit
     Commitments of all Series, shall not exceed $10,000,000 at any time.

          Following execution and delivery by the Borrower, one or more
     Incremental Revolving Credit Lenders and the Administrative Agent as
     provided above of an Incremental Revolving Credit Agreement with respect to
     any Series then, each Incremental Revolving Credit Lender of such Series
     agrees to make Incremental Revolving Credit Loans of such Series to the
     Borrower from time to time during the availability period for such Loans
     set forth in such Incremental Revolving Credit Agreement, in an aggregate
     principal amount that will not result in such Lender's Incremental
     Revolving Credit Loans of such Series exceeding such Lender's Incremental
     Revolving Credit Commitment of such Series; within the foregoing limits and
     subject to the terms and conditions set forth herein, the Borrower may
     borrow, prepay and reborrow Incremental Revolving Credit Loans of such
     Series."

          2.04. Clause (i) of Section 2.03 of the Credit Agreement is hereby
amended in its entirety to read as follows:

          "(i)  whether the requested Borrowing is to be a Revolving Credit
     Borrowing, Incremental Revolving Credit Borrowing (including, if
     applicable, the respective Series of Incremental Revolving Credit Loans to
     which such Borrowing relates), Term Loan A Borrowing or Term Loan B
     Borrowing;"

          2.05 Clause (c)(i) of Section 2.07 of the Credit Agreement is hereby
amended in its entirety to read as follows:

          "(i)  the Borrowing to which such Interest Election Request applies
     (including, if applicable, the respective Series of Incremental Revolving
     Credit Loans to which such Interest Election Request relates) and, if
     different options are being elected with respect to different portions
     thereof, the portions thereof to be allocated to each resulting Borrowing
     (in which case the information to be specified pursuant to clauses (iii)
     and (iv) of this paragraph shall be specified for each resulting
     Borrowing);"

          2.06. Clause (f) of Section 2.07 of the Credit Agreement is hereby
amended in its entirety to read as follows:

                                      -5-
<PAGE>

          "(f)  Limitations on Lengths of Interest Periods.  Notwithstanding any
                ------------------------------------------
     other provision of this Agreement, the Borrower shall not be entitled to
     request, or to elect to convert to or continue as a Eurodollar Borrowing:
     (i) any Revolving Credit Borrowing if the Interest Period requested
     therefor would end after the Revolving Credit Commitment Termination Date;
     (ii) any Incremental Revolving Credit Borrowing of a Series if the Interest
     Period requested therefor would end after the Incremental Revolving Credit
     Commitment Termination Date of such Series; (iii) any Term Borrowing if the
     Interest Period requested therefor would end after the Term Loan Maturity
     Date for the relevant Class; or (iv) any Term Borrowing if the Interest
     Period requested therefor would commence before and end after any Principal
     Payment Date for any Class unless, after giving effect thereto, the
     aggregate principal amount of the Term Loan A or Term Loan B, as the case
     may be, having Interest Periods that end after such Principal Payment Date
     shall be equal to or less than the aggregate principal amount of the Term
     Loan A or Term Loan B, respectively, permitted to be outstanding after
     giving effect to the payments of principal required to be made on such
     Principal Payment Date."

          2.07. Clause (a), (b) and (c) of Section 2.08 of the Credit Agreement
are hereby amended in their entirety to read as follows:

          "(a)  Scheduled Termination.  Unless previously terminated, (i) the
                ---------------------
     Term Loan Commitments of each Class shall terminate at 5:00 p.m., New York
     City time, on the Effective Date, (ii) the Revolving Credit Commitments
     shall terminate on the Revolving Credit Commitment Termination Date and
     (iii) the Incremental Revolving Credit Commitments of a Series shall
     terminate on the Incremental Revolving Credit Termination Date specified in
     the Incremental Revolving Credit Agreement of such Series.

          (b)   Voluntary Termination or Reduction.  The Borrower may at any
                ----------------------------------
     time terminate, or from time to time reduce, the Commitments of any Class;
     provided that (i) each reduction of the Commitments of any Class pursuant
     --------
     to this Section shall be in an amount that is $5,000,000 or a larger
     multiple of $1,000,000, (ii) the Borrower shall not terminate or reduce the
     Revolving Credit Commitments if, after giving effect to any concurrent
     prepayment of the Revolving Credit Loans in accordance with Section 2.10,
     the total Revolving Credit Exposures would exceed the total Revolving
     Credit Commitments and (iii) the Borrower shall not terminate or reduce the
     Incremental Revolving Credit Commitments of any Series if, after giving
     effect to any concurrent prepayment of the Incremental Revolving Credit
     Loans of such Series in accordance with Section 2.10, the total Incremental
     Revolving Credit Exposures of such Series would exceed the total
     Incremental Revolving Credit Commitments of such Series.

                                      -6-
<PAGE>

          (c)  Notice of Voluntary Termination or Reduction.  The Borrower shall
               --------------------------------------------
     notify the Administrative Agent of any election to terminate or reduce the
     Commitments of any Class under paragraph (b) of this Section at least three
     Business Days prior to the effective date of such termination or reduction,
     specifying such election and the effective date thereof.  Promptly
     following receipt of any notice, the Administrative Agent shall advise the
     Lenders of the contents thereof.  Each notice delivered by the Borrower
     pursuant to this Section shall be irrevocable; provided that a notice of
                                                    --------
     termination of the Revolving Credit Commitments or the Incremental
     Revolving Credit Commitments delivered by the Borrower may state that such
     notice is conditioned upon the effectiveness of other credit facilities, in
     which case such notice may be revoked by the Borrower (by notice to the
     Administrative Agent on or prior to the specified effective date) if such
     condition is not satisfied."

          2.08. Section 2.09 of the Credit Agreement is hereby amended by
renumbering clauses (ii), (iii), (iv) and (v) thereof as clauses (iii), (iv),
(v) and (vi) thereof and adding a new clause (ii) to read as follows:

          "(ii)  to the Administrative Agent for account of the Incremental
     Revolving Credit Lenders of each Series the outstanding principal amount of
     the Incremental Revolving Credit Loans of such Series on the Incremental
     Revolving Credit Commitment Termination Date of such Series;"

          2.09. Clause (b)(ii) of Section 2.10 is hereby amended in its entirety
to read as follows:

          "(ii)  Debt Incurrence.  Upon any Debt Incurrence after the Effective
                 ---------------
     Date, the Borrower shall prepay the Loans (and/or provide cover for LC
     Exposure as specified in Section 2.05(k)), and/or the Revolving Credit
     Commitments and/or the Incremental Revolving Credit Commitments shall be
     subject to automatic reduction, in an aggregate amount equal to 100% of the
     Net Available Proceeds thereof, such prepayment and/or reduction to be
     effected in each case in the manner and to the extent specified in clause
     (vii) of this paragraph."

          2.10. Clause (a) of Section 2.11 is hereby amended in its entirety to
read as follows:

          "(a)  Commitment Fee.  The Borrower agrees to pay to the
                --------------
     Administrative Agent for account of (i) each Revolving Credit Lender a
     commitment fee, which shall accrue at a rate per annum equal to the
     Commitment Fee Rate on the average daily unused amount of the Revolving
     Credit Commitment of such Lender during the period from and including the
     Effective Date hereof to but excluding the earlier of the date such
     Revolving Credit Commitment terminates and the Revolving Credit Commitment
     Termination Date and (ii) each Incremental Revolving Credit Lender a
     commitment fee, which shall accrue at a rate per annum on the average daily
     unused amount of the Incremental Revolving Credit Commitment of such
     Incremental Revolving Credit Lender as shall be agreed upon in the
     respective Incremental Revolving Credit Agreement at the

                                      -7-
<PAGE>

     time such Incremental Revolving Credit Commitment is established. Accrued
     commitment fees shall be payable in arrears on each Quarterly Date and on
     the earlier of the date the Revolving Credit Commitment or the Incremental
     Revolving Credit Commitment, as applicable, terminates and the Revolving
     Credit Commitment Termination Date or the Incremental Revolving Credit
     Commitment Termination Date, as applicable, commencing on the first such
     date to occur after the date hereof. All commitment fees shall be computed
     on the basis of a year of 360 days and shall be payable for the actual
     number of days elapsed (including the first day but excluding the last
     day). For purposes of computing commitment fees with respect to the
     Revolving Credit Commitments, the Revolving Credit Commitment of a Lender
     shall be deemed to be used to the extent of the outstanding Revolving
     Credit Loans and LC Exposure of such Lender (and the Swingline Exposure and
     Foreign Currency Exposure of such Lender shall be disregarded for such
     purpose)."

          2.11. Clause (d) of Section 2.12 is hereby amended in its entirety to
read as follows:

          "(d)  Payment of Interest.  Accrued interest on each Loan shall be
                -------------------
     payable in arrears on each Interest Payment Date for such Loan and, in the
     case of (x) Revolving Credit Loans, upon termination of the Revolving
     Credit Commitments and (y) Incremental Revolving Credit Loans of a Series,
     upon termination of the Incremental Revolving Credit Commitments of such
     Series; provided that (i) interest accrued pursuant to paragraph (c) of
             --------
     this Section shall be payable on demand, (ii) in the event of any repayment
     or prepayment of any Loan (other than a prepayment of (x) a Revolving
     Credit ABR Loan prior to the Revolving Credit Commitment Termination Date
     or (y) an Incremental Revolving Credit ABR Loan of a Series prior to the
     Incremental Revolving Credit Commitment Termination Date of such Series),
     accrued interest on the principal amount repaid or prepaid shall be payable
     on the date of such repayment or prepayment and (iii) in the event of any
     conversion of any Eurodollar Borrowing prior to the end of the Interest
     Period therefor, accrued interest on such Borrowing shall be payable on the
     effective date of such conversion."

          2.12. Clause (c)(iii) and (iv) of Section 2.17 are hereby amended in
their entirety to read as follows:

          "(iii) each payment or prepayment of principal of Revolving Credit
     Loans, Incremental Revolving Credit Loans of a Series, the Term Loan A and
     the Term Loan B by the Borrower shall be made for account of the relevant
     Lenders pro rata in accordance with the respective unpaid principal amounts
     of the Syndicated Loans of such Class (and, if applicable, such Series)
     held by them; and (iv) each payment of interest on Revolving Credit Loans,
     Incremental Revolving Credit Loans of a Series, the Term Loan A and the
     Term Loan B by the Borrower shall be made for account of the relevant
     Lenders pro rata in accordance with the amounts of interest on such Loans
     then due and payable to the respective Lenders."

                                      -8-
<PAGE>

          2.13. Clause (a) of Section 7.01 is hereby amended in its entirety to
read as follows:

          "(a) Indebtedness created hereunder and under the other Credit
     Documents (including in respect of Incremental Revolving Credit Loans);"

          2.14. Clause (a) of Section 7.02 is hereby amended in its entirety to
read as follows:

          "(a) Liens created pursuant to the Security Documents (including in
     respect of Incremental Revolving Credit Loans);"

          2.15. Section 7.09 of the Credit Agreement is hereby amended in its
entirety to read as follows:

          "Section 7.09.  Certain Financial Covenants.
                          ---------------------------

          (a)  Leverage Ratio.  The Borrower will not permit the Leverage Ratio
               --------------
     to exceed the following respective ratios at any time during the following
     respective periods:

                  Period                               Ratio
                  ------                             ---------

          From July 1, 2000 through                  6.00:1.00
           September 30, 2000

          From October 1, 2000 through               5.75:1.00
           December 31, 2000

          From January 1, 2001 through               5.50:1.00
           March 31, 2001

          From April 1, 2001 through                 5.25:1.00
           June 30, 2001

          From July 1, 2001 through                  5.00:1.00
           September 30, 2001

          From October 1, 2001 through               4.75:1.00
           December 31, 2001

          From January 1, 2002 through               2.75:1.00
           December 31, 2002

          From January 1, 2003 and                   2.50:1.00
           thereafter

                                      -9-
<PAGE>

          (b)  Interest Coverage Ratio.  The Borrower will not permit the
               -----------------------
     Interest Coverage Ratio to be less than the following respective ratios as
     at the last day of any fiscal quarter ending during the following
     respective periods:

                  Period                               Ratio
                  ------                             ---------

          From July 1, 2000 through                  1.00:1.00
           September 30, 2000

          From October 1, 2000 through               1.00:1.00
           December 31, 2000

          From January 1, 2001 through               1.05:1.00
           March 31, 2001

          From April 1, 2001 through                 1.10:1.00
           June 30, 2001

          From July 1, 2001 through                  1.15:1.00
           September 30, 2001

          From October 1, 2001 through               1.20:1.00
           December 31, 2001

          From January 1, 2002 through               3.25:1.00
           December 31, 2002

          From January 1, 2003 through               3.50:1.00
           December 31, 2003

          From January 1, 2004 through               3.75:1.00
           December 31, 2005

          From January 1, 2006 and                   4.00:1.00
           thereafter

          (c)  Fixed Charge Coverage Ratio. The Borrower will not permit the
               ---------------------------
     Fixed Charge Coverage Ratio to be less than the following respective ratios
     at any time during the following respective periods:

                  Period                               Ratio
                  ------                             ---------

          From January 1, 2000 through               0.90:1.00
           September 30, 2000

          From October 1, 2000 to

                                      -10-
<PAGE>

                       December 31, 2001                    0.85:1.00

                     From January 1, 2002 and thereafter    1.25:1.00

          (d)  Net Worth.  The Borrower will not permit its Net Worth to be less
               ---------
     than the sum of (a) $57,500,000 plus (b) 50% of net income (if positive) of
                                     ----
     the Borrower and its Subsidiaries (determined on a consolidated basis in
     accordance with GAAP) for each fiscal quarter commencing with the fiscal
     quarter ending June 30, 2000 minus (c) the aggregate amount of any write-
                                  -----
     downs of goodwill taken subsequent to August 24, 1999 but not exceeding
     $10,000,000 minus (d) the aggregate amount of foreign currency translation
                 -----
     losses, offset by any translation gains, subsequent to March 31, 2000, but
     not exceeding $10,000,000."

          Section 3.  Waivers.  Effective as provided in Section 5 below, the
                      -------
Lenders hereby waive any Default that has occurred and/or is continuing on or
prior to the date hereof under the provisions of Section 7.09 of the Credit
Agreement (as in effect immediately prior to giving effect to this Amendment No.
2).

          Section 4.  Representations and Warranties.  The Borrower represents
                      ------------------------------
and warrants to the Lenders that the representations and warranties set forth in
Article IV of the Credit Agreement are true and complete on the date hereof as
if made on and as of the date hereof and as if each reference in said Article IV
to "this Agreement" included reference to this Amendment No. 2.

          Section 5.  Conditions Precedent.  The amendments to the Credit
                      --------------------
Agreement set forth in Section 2 and the waivers set forth in Section 3 shall
become effective, as of the date hereof, upon the satisfaction of the following
conditions precedent:

          5.01.  Execution by All Parties.  This Amendment No. 2 shall have been
                 ------------------------
executed and delivered by each of the Obligors and the Required Lenders.

          5.02.  Documents.  The Administrative Agent shall have received the
                 ---------
following documents, each of which shall be satisfactory to the Administrative
Agent in form and substance:

          (1)  Corporate Documents.  Certified copies of the charter and
               -------------------
     by-laws (or equivalent documents) of each Obligor (or, in the alternative,
     a certification to the effect that none of such documents has been modified
     since delivery thereof on the Effective Date pursuant to the Credit
     Agreement) and of all corporate authority for each Obligor (including board
     of director resolutions and evidence of the incumbency of officers for each
     Obligor) with respect to the execution, delivery and performance of this
     Amendment No. 2 and the Credit Agreement as amended hereby and extensions
     of credit under the Credit Agreement as amended hereby and each other
     document to be delivered by each Obligor from time to time in connection
     with the Credit Agreement as amended hereby (and the Administrative Agent
     and each Lender may conclusively rely on such certificate until it receives
     notice in writing from each Obligor to the contrary).

                                      -11-
<PAGE>

          (2)  Opinion of Counsel to the Obligors. A favorable written opinion
               ----------------------------------
     (addressed to the Administrative Agent and the Lenders and dated as of a
     date acceptable to the Administrative Agent) of (i) Calfee, Halter &
     Griswold LLP, counsel for the Obligors, and (ii) such other counsel to one
     or more of the Obligors, in each case in form and substance satisfactory to
     the Administrative Agent covering such matters relating to the Obligors and
     this Amendment No. 2 as the Administrative Agent shall reasonably request
     (and each Obligor hereby instructs such counsel to deliver such opinion to
     the Lenders and the Administrative Agent).

          (3)  Other Documents.  Such other documents as the Administrative
               ---------------
     Agent or any lender or Milbank, Tweed, Hadley & McCloy LLP, special New
     York counsel to Chase, may reasonably request.

          5.03.  Amendment Fee.  The Administrative Agent shall have received
                 -------------
for account of each Lender that consents to this Amendment No. 2 (evidenced by
receipt by the Administrative Agent of an executed counterpart of this Amendment
No. 2) by 5:00 p.m., New York City time, on October 10, 2000 an amendment fee in
an amount equal to 0.25% of the sum of Revolving Credit Exposures and unused
Revolving Credit Commitments, outstanding A Term Loans, and outstanding B Term
Loans of each such Lender.

          Section 5.  Miscellaneous.  The Borrower shall pay all reasonable
                      -------------
expenses incurred by the Administrative Agent, including the reasonable fees,
charges and disbursements of Milbank, Tweed, Hadley & McCloy LLP, special New
York counsel to Chase, in connection with the preparation, negotiation,
execution and delivery of this Amendment No. 2. Except as herein provided, the
Credit Agreement shall remain unchanged and in full force and effect. This
Amendment No. 2 may be executed in any number of counterparts, all of which
taken together shall constitute one and the same amendatory instrument and any
of the parties hereto may execute this Amendment No. 2 by signing any such
counterpart. This Amendment No. 2 shall be governed by, and construed in
accordance with, the law of the State of New York.

                                      -12-
<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Amendment No.
2 to be duly executed by their respective authorized officers as of the day and
year first above written.

                              CHART INDUSTRIES, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Chief Financial Officer and Treasurer

                      SUBSIDIARY BORROWERS
                      --------------------

                              CHART HEAT EXCHANGERS LIMITED

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Director

                              CHART-AUSTRALIA PTY, LTD.

                              By /s/ Arthur S. Holmes
                                -----------------------------
                                Name:  Arthur S. Holmes
                                Title:  Director

                                      -13-
<PAGE>

                              SUBSIDIARY GUARANTORS
                              ---------------------

                                   ALTEC, INC.

                                   By /s/ Don A. Baines
                                     ----------------------------
                                     Name:  Don A. Baines
                                     Title: Assistant Secretary

                                   CHART HEAT EXCHANGERS LIMITED
                                    PARTNERSHIP

                                   By:  CHART MANAGEMENT COMPANY, INC.,
                                        as its sole general partner

                                   By /s/ Don A. Baines
                                     ----------------------------
                                     Name:  Don A. Baines
                                     Title: Secretary and Treasurer

                                   CHART INDUSTRIES FOREIGN SALES
                                    CORPORATION

                                   By /s/ Don A. Baines
                                     ----------------------------
                                     Name:  Don A. Baines
                                     Title: Secretary and Treasurer

                                   CHART INTERNATIONAL INC.

                                   By /s/ Don A. Baines
                                     ----------------------------
                                     Name:  Don A. Baines
                                     Title: Treasurer and Chief Financial
                                             Officer

                                      -14-
<PAGE>

                              CHART MANAGEMENT COMPANY, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Secretary and Treasurer

                              CHART LEASING, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title:  Secretary and Treasurer

                              CHART CRYOGENIC SERVICES, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Assistant Secretary

                              CHART, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Secretary and Treasurer

                              CHART INTERNATIONAL HOLDINGS, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Secretary and Treasurer

                              CHART ASIA, INC.

                              By /s/ Don A. Baines
                                -----------------------------
                                Name:  Don A. Baines
                                Title: Secretary and Treasurer

                                      -15-
<PAGE>

                              CAIRE INC.

                              By /s/ Don A. Baines
                                 ------------------------------
                                 Name: Don A. Baines
                                 Title: Secretary and Treasurer

                                      -16-
<PAGE>

                              LENDERS
                              -------

                              THE CHASE MANHATTAN BANK,
                                individually and as Administrative Agent

                              By /s/ Henry W. Centa
                                 -----------------------------------
                                 Name: W. Centa
                                 Title: Vice President

                              NATIONAL CITY BANK

                              By /s/ Anthony J. DiMare
                                 -----------------------------------
                                 Name: Anthony J. DiMare
                                 Title: Senior Vice President

                              BANK ONE, MICHIGAN

                              By /s/ Paul R. DeMelo
                                 -----------------------------------
                                 Name: Paul R. DeMelo
                                 Title: Managing Director

                              VAN KAMPEN PRIME RATE INCOME TRUST

                              By: Van Kampen Investment Advisory Corp.

                              By /s/ Darvin D. Pierce
                                 -----------------------------------
                                 Name: Darvin D. Pierce
                                 Title: Vice President

                              SENIOR DEBT PORTFOLIO

                              By: Boston Management and Research,
                                  as Investment Advisor

                              By: /s/ Payson F. Swaffield
                                 -----------------------------------
                                 Name: Payson F. Swaffield
                                 Title: Vice President

                                      -17-
<PAGE>

                              U.S. BANK NATIONAL ASSOCIATION

                              By __________________________________
                                 Name:
                                 Title:

                              UNION BANK OF CALIFORNIA, N.A.

                              By /s/ J. Scott Jessup
                                 ----------------------------------
                                 Name: J. Scott Jessup
                                 Title: Vice President

                              FLEET NATIONAL BANK

                              By __________________________________
                                 Name:
                                 Title:

                              GENERAL ELECTRIC CAPITAL CORPORATION

                              By /s/ Gregory Hong
                                 ----------------------------------
                                 Name: Gregory Hong
                                 Title: Duly Authorized Signatory

                              HARRIS TRUST AND SAVINGS BANK

                              By /s/ Michael J. Johnson
                                 ----------------------------------
                                 Name: Michael J. Johnson
                                 Title: Vice President

                                      -18-
<PAGE>

                              THE HUNTINGTON NATIONAL BANK

                              By /s/ Laura L. Conway
                                 ----------------------------------
                                 Name: Laura L. Conway
                                 Title: Vice President

                              NATIONSBANK, N.A.

                              By __________________________________
                                 Name:
                                 Title:

                              STATE STREET BANK AND TRUST
                               COMPANY

                              By __________________________________
                                 Name:
                                 Title:

                              BANK AUSTRIA CREDITANSTALT
                               CORPORATE FINANCE, INC.

                              By __________________________________
                                 Name:
                                 Title:

                              FIRST MERIT BANK N.A.

                              By /s/ Robert W. Carpenter
                                 ----------------------------------
                                 Name: Robert W. Carpenter
                                 Title: Executive Vice President

                                      -19-
<PAGE>

                              KEYBANK NATIONAL ASSOCIATION

                              By __________________________________
                                 Name:
                                 Title:

                              KZH RIVERSIDE LLC

                              By /s/ Susan Lee
                                 ----------------------------------
                                 Name: Susan Lee
                                 Title: Authorized Agent

                              KZH STERLING LLC

                              By /s/ Susan Lee
                                 ----------------------------------
                                 Name: Susan Lee
                                 Title: Authorized Agent

                              KZH CYPRESSTREE - 1 LLC

                              By /s/ Susan Lee
                                 ----------------------------------
                                 Name: Susan Lee
                                 Title: Authorized Agent

                                      -20-

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