Document:

Exhibit 10.1

Exhibit 10.1

DIRECTOR COMPENSATION PLAN OF
2010

Approved February 22, 2010

Effective Date: As of
January 1, 2010

This Director
Compensation Plan has been adopted for independent directors of the Company:

Directors who are
independent directors shall be granted automatically, on the first day of each
calendar year, an option to purchase 50,000 shares of common stock at an
exercise price equal to the last closing price of the common stock prior to the
effective date of the grant. The options shall vest quarterly at the rate of
25% each calendar quarter over that calendar year, commencing on the first day
of each calendar quarter.

For their service
on one or more committees of the Board of Directors, the independent directors
shall be entitled to a grant on the first day of each calendar year of stock
options to purchase 50,000 shares, or, at the election of the director, 50,000
shares of restricted stock, vesting quarterly at the rate of 25% throughout the
calendar year on the first day of each calendar quarter, commencing on January
1 of each calendar year. In addition, the Company shall pay each director
$15,000 to offset their tax liability in respect of the restricted stock, such
amount to be paid quarterly.

For the initial
year of this plan (2010), a director may, at his or her election, elect to
receive the Committee fees, in cash equal to the value of the restricted stock.

The option grant or
restricted stock award to the Chairman of the Board in respect of his
directors’ compensation and committee fees shall be at the rate of twice
the annual grants described above for independent directors, plus $15,000 in
cash to offset any tax liability for restricted stock.

If a director
ceases to be a director at any time during the calendar year, or ceases to be a
committee member during the calendar year, then the options or restricted stock
(plus cash), as the case may be, that have not yet vested shall lapse and shall
not vest or be issued to such person.

All options granted
under this plan shall remain in effect for five years after the date such
options were granted. In the event that the Company engages in an extraordinary
transaction, or in case a tender offer is commenced for shares of the Company
or in the event any person acquires more than 20% of the outstanding stock of
the Company (other than those persons who, as of this date, own a percentage of
the stock equal to or greater than 20%), then all options that have not vested,
and all restricted stock that has not yet vested, shall automatically and
without further action become vested.

All references to
shares that my be issued hereunder, and all outstanding options issued
hereunder, and all shares of restricted stock issued hereunder, shall be
adjusted in the event of any adjustment to, modification of or reclassification
of the capital stock of the Company.

 

4exv10w18

Exhibit No. 10.18

DEVON ENERGY CORPORATION

2009 LONG-TERM INCENTIVE PLAN

EMPLOYEE NONQUALIFIED STOCK OPTION

AWARD AGREEMENT

     THIS NONQUALIFIED STOCK OPTION AWARD AGREEMENT (the “Award Agreement”), is entered into
as of «Date» (the “Date of Grant”), by and between Devon Energy Corporation (the “Company”) and
«FirstName» «MiddleName» «LastName» (the “Participant”);

WITNESSETH:

     WHEREAS, the Participant is an employee of the Company or a Subsidiary or Affiliated Entity of
the Company, and it is important to the Company that the Participant be encouraged to remain in the
employ of the Company or a Subsidiary or Affiliated Entity of the Company, as applicable; and

     WHEREAS, in recognition of such facts, the Company desires to provide to the Participant a
nonqualified stock option to purchase «Shares» shares of the Common Stock of the Company (the
“Covered Shares”), as hereinafter provided, pursuant to the “Devon Energy Corporation 2009
Long-Term Incentive Plan” (the “Plan”), a copy of which is attached hereto.

     NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for good
and valuable consideration, the Participant and the Company hereby agree as follows:

     Section 1. Grant of Stock Option. The Company hereby grants to the Participant a
nonqualified stock option that is not intended to qualify under Section 422 of the Code, to
purchase all or any part of the Covered Shares (the “Stock Option”) subject to the terms and
conditions of this Award Agreement and the Plan, which is incorporated herein by reference and made
a part hereof for all purposes. The purchase price for each Covered Share to be purchased
hereunder shall be the exercise price set forth on the Cover Page (the “Exercise Price”).

     Section 2. Times of Exercise of Stock Option.

     (a) The Stock Option shall be exercisable on and after the vesting date for each installment
of Covered Shares as described in the following schedule (the “Vesting Date”) (but only if the
Participant’s Date of Termination has not occurred before the Vesting Date):

Vesting Schedule

	 	 	 
	Vesting Date	 	Covered Shares Vesting
	 	 	 
	«Vestdate1»

«Vestdate2»

«Vestdate3»

«Vestdate4»

«Vestdate5»	 	 

     (b) The Stock Option shall become fully vested and exercisable upon the occurrence of a Change
of Control Event that occurs (i) prior to the Participant’s Date of

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Termination or (ii) if the Participant has retired prior to such Change of Control Event and
is Post-Retirement Eligible, following the Participant’s Date of Termination.

     (c) If (i) the Participant’s Date of Termination occurs under circumstances in which the
Participant is entitled to a severance payment from the Company, a Subsidiary, or an Affiliated
Entity under (A) the Participant’s employment agreement or severance agreement with the Company due
to a termination of the Participant’s employment by the Company without “cause” or by the
Participant for “good reason” in accordance with the Participant’s employment agreement or
severance agreement or (B) the Devon Energy Corporation Severance Plan and (ii) the Participant
signs and returns to the Company a release of claims against the Company in a form prepared by the
Company (the “Release”) and the Participant does not revoke the Release prior to the date the
Release becomes effective, then the Stock Option shall become fully vested and exercisable
effective as of the Participant’s Date of Termination. If the Participant fails to sign and return
the Release to the Company or revokes the Release prior to the date the Release becomes effective,
then the unvested portion of the Stock Option shall be forfeited.

     (d) The Stock Option shall become fully vested and exercisable upon the Participant’s Date of
Termination if the Participant’s Date of Termination occurs by reason of the Participant’s death.
The Committee may, in its sole and absolute discretion, elect to vest all or a portion of the
unvested portion of the Stock Option upon the Participant’s Date of Termination if the
Participant’s Date of Termination occurs by reason of disability, Normal Retirement Date, Early
Retirement Date, or other special circumstances (as determined by the Committee).

     (e) Notwithstanding any provision to the contrary in this Award Agreement, if the Participant
is Post-Retirement Eligible, the Participant shall, subject to the satisfaction of the conditions
in Section 9, be eligible to vest, in accordance with the Vesting Schedule above in this Section 2,
in the installments of the Covered Shares of the Stock Option that remain unvested on the Date of
Termination as follows:

	 	 	 	 	 
	 	 	Percentage of Unvested Installments of
	 	 	Covered Shares of the Stock Option
	Age at Retirement	 	Eligible to be Earned by the Participant
	54 and earlier
	 	 	0	%
	55
	 	 	60	%
	56
	 	 	65	%
	57
	 	 	70	%
	58
	 	 	75	%
	59
	 	 	80	%
	60 and beyond
	 	 	100	%

     Nothing in this Award Agreement shall be construed to affect the application of Section 12.5
of the Plan (relating to Change of Control), to the extent such Section would otherwise be
applicable.

     Section 3. Term of Stock Option. The Stock Option shall expire and cease to be
exercisable on the earliest to occur of:

     (a) The Expiration Date set forth on the Cover Page.

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     (b) If the Participant’s Date of Termination occurs by reason of death, the three-year
anniversary of such Date of Termination.

     (c) If the Participant’s Date of Termination occurs by reason of disability, and Section (d)
below (relating to termination or after Normal Retirement Date) does not apply, the one-year
anniversary of such Date of Termination.

     (d) If the Participant’s Date of Termination occurs by reason of Participant’s retirement and
the Participant is Post-Retirement Eligible, the Expiration Date of the Stock Option; provided,
however, if a Non-Compliance Event occurs following the Date of Termination, the Stock Option shall
cease to be exercisable on the one-year anniversary of such Non-Compliance Event.

     (e) If (i) the Participant’s Date of Termination occurs by reason of the Participant’s
retirement, (ii) the Date of Termination occurs on or after the Participant’s Normal Retirement
Date and (iii) the Participant is not Post-Retirement Eligible, the three-year anniversary of such
Date of Termination (or such later date as may be permitted by the Committee).

     (f) If the Participant’s Date of Termination occurs under circumstances in which the
Participant is entitled to a severance payment from the Company, a Subsidiary of the Company, or an
Affiliated Entity under an employment agreement or severance agreement with the Company, the last
day of the Severance Period. The “Severance Period” shall be the longer of:

(i) the period beginning on the Date of Termination and continuing through the end
of the period during which such severance payments are paid to the Participant; or

(ii) the period described in the following clause (B), if the amount of the
Participant’s severance payment is determined in whole or in part as being equal to
the product of (A) the Participant’s salary rate, multiplied by (B) a period
over which such amount would be computed.

     (g) If the Participant’s Date of Termination occurs and none of Sections (b), (c), (d), (e),
and (f) are applicable, the three month anniversary of such Date of Termination.

     Section 4. Nontransferability of Stock Option. The Stock Option may be exercised
during the lifetime of the Participant only by the Participant. Without limiting the generality of
the previous sentence, the Stock Option shall not be assigned, transferred (except as provided
above), pledged or hypothecated in any way whatsoever, shall not be assigned by operation of law,
and shall not be subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Stock Option contrary to the provisions
hereof, shall be null and void and without effect. However, in the event of a Participant’s death,
the Stock Option may be transferred in accordance with the provisions of a Participant’s will, the
applicable laws of descent and distribution, or a beneficiary designation that is in a form
approved by the Committee.

     Section 5. Employment. So long as the Participant shall continue to be an employee
of the Company or one or more of the Subsidiaries or Affiliated Entities of the Company, the Stock
Option shall not be affected by any change of duties or position. Nothing in the Plan or in this
Award Agreement shall confer upon the Participant any right to continue

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in the employ of the Company or any of its Subsidiaries or Affiliated Entities, or interfere
in any way with the right to terminate the Participant’s employment at any time.

     Section 6. Method of Exercising Stock Option.

     (a) Procedures for Exercise. The Stock Option may be exercised prior to the Expiration Date
by providing written notice in the form prescribed by the Company to the Secretary of the Company
or following the electronic exercise procedures adopted by the Company. The written notice shall
state the election to exercise the Stock Option, the number of Covered Shares to be purchased upon
exercise, the form of payment, and shall be signed by the person exercising the Stock Option.

     (b) Form of Payment. Payment of the full Exercise Price for the Covered Shares purchased
under this Award Agreement shall accompany the Participant’s notice of exercise, together with full
payment of applicable withholding taxes, if any. Payment shall be made (i) in cash or by check,
draft or money order payable to the order of the Company; (ii) by delivering shares of Common Stock
having a Fair Market Value on the date of payment equal to the amount of the Exercise Price, but
only to the extent such form of payment would not result in a compensation expense to the Company
for financial accounting purposes with respect to the shares of Common Stock used to pay the
Exercise Price unless otherwise determined by the Committee; or (iii) a combination of the
foregoing.

     (c) Further Information. In the event the Stock Option is exercised, pursuant to the
foregoing provisions of this Section 6, by any person other than the Participant due to the
Participant’s death, notice shall also be accompanied by appropriate proof of such person’s right
to exercise the Stock Option. The notice so required shall be given electronically or by personal
delivery to the Secretary of the Company or by registered or certified mail, addressed to the
Company at 20 North Broadway, Oklahoma City, Oklahoma 73102-8260, Attention: Secretary, and it
shall be deemed to have been given when it is delivered or when it is deposited in the United
States mail in an envelope addressed to the Company, as aforesaid, properly stamped for delivery as
a registered or certified letter.

     Section 7. Securities Law Restrictions. The Stock Option shall be exercised and
Common Stock issued only upon compliance with the Securities Act of 1933, as amended (the “Act”),
and any other applicable securities law, or pursuant to an exemption therefrom. If deemed
necessary by the Company to comply with the Act or any applicable laws or regulations relating to
the sale of securities, the Participant, at the time of exercise and as a condition imposed by the
Company, shall represent, warrant and agree that the Covered Shares subject to the Stock Option are
being purchased for investment and not with any present intention to resell the same and without a
view to distribution, and the Participant shall, upon the request of the Company, execute and
deliver to the Company an agreement to such effect.

     Section 8. Notices. All notices or other communications relating to the Plan and
this Award Agreement as it relates to the Participant shall be in writing and shall be delivered
electronically, personally or mailed (U.S. Mail) by the Company to the Participant at the then
current address as maintained by the Company or such other address as the Participant may advise
the Company in writing.

     Section 9. Conditions to Post-Retirement Vesting.

     (a) Notice of and Conditions to Post-Retirement Vesting. If the Participant is
Post-Retirement Eligible, the Company shall, within a reasonable period of time prior to the

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Participant’s Date of Termination, notify the Participant that the Participant has the right
to continue to vest following the Date of Termination in any unvested installments of Covered
Shares of the Stock Option (each such unvested installment, an “Installment”), provided that the
Participant executes and delivers to the Company, with respect to each such Installment, the
following documentation: (i) a non-disclosure letter agreement, in the form attached as Exhibit A,
(a “Non-Disclosure Agreement”) on or before January 1 of the year in which such Installment vests
pursuant to the Vesting Schedule (or, with respect to the calendar year in which the Date of
Termination occurs, on or before the Date of Termination), and (ii) a compliance certificate, in
the form attached as Exhibit B, (a “Compliance Certificate”) indicating the Participant’s full
compliance with the Non-Disclosure Agreement on or before November 1 of the year in which such
Installment vests pursuant to the Vesting Schedule.

     (b) Consequences of Failure to Satisfy Vesting Conditions. In the event that, with respect to
any given Installment, the Participant fails to deliver either the respective Non-Disclosure
Agreement or Compliance Certificate for such Installment on or before the date required for the
delivery of such document (such failure, a “Non-Compliance Event”), the Participant shall not be
entitled to vest in any unvested Installments that would vest from and after the date of the
Non-Compliance Event and the Company shall be authorized to take any and all such actions as are
necessary to cause such unvested Stock Options to not vest and to terminate. The only remedy of
the Company for failure to deliver a Non-Disclosure Agreement or a Compliance Certificate shall be
the failure to vest in, and cancellation of, any unvested Installments then held by the
Participant.

     Section 10. Definitions. Words, terms, or phrases used in this Agreement shall have
the meanings set forth in this Section 10. Capitalized terms used in this Award Agreement but not
defined herein shall have the meaning designated in the Plan.

     (a) “Act” has the meaning set forth in Section 7.

     (b) “Award Agreement” has the meaning set forth in the preamble.

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

     (d) “Company” has the meaning set forth on the Cover Page.

     (e) “Compliance Certificate” has the meaning set forth in Section 9(a).

     (f) “Covered Shares” has the meaning set forth in the preamble.

     (g) “Date of Grant” has the meaning set forth in the preamble.

     (h) “Date of Termination” means the first day occurring on or after the Date of Grant on which
the Participant is not employed by the Company, a Subsidiary, or an Affiliated Entity, regardless
of the reason for the termination of employment; provided however, that a termination of employment
shall not be deemed to occur by reason of a transfer of the Participant between the Company, a
Subsidiary, and an Affiliated Entity or between two Subsidiaries or two Affiliated Entities. The
Participant’s employment shall not be considered terminated while the Participant is on a leave of
absence from the Company, a Subsidiary, or an Affiliated Entity approved by the Participant’s
employer pursuant to Company policies. If, as a result of a sale or other transaction, the
Participant’s employer ceases to be either a Subsidiary or an Affiliated Entity and the Participant
is not, at the end of the 30-day period following the transaction, employed by the Company or an
entity that is then a Subsidiary or

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an Affiliated Entity, then the date of the occurrence of such transaction shall be treated as
the Participant’s Date of Termination.

     (i) “Early Retirement Date” means the first day of the month coinciding with or next following
the date the Participant (i) attains age 55 and (ii) earns at least 10 Years of Service.

     (j) “Exercise Price” has the meaning set forth in Section 1.

     (k) “Expiration Date” has the meaning set forth on the Cover Page.

     (l) “Installment” has the meaning set forth in Section 9(a).

     (m) “Non-Compliance Event” has the meaning set forth in Section 9(b).

     (n) “Non-Disclosure Agreement” has the meaning set forth in Section 9(a).

     (o) “Normal Retirement Date” means the first day of the month coinciding with or next
following the date the Participant attains age 65.

     (p) “Participant” has the meaning set forth in the preamble.

     (q) “Plan” has the meaning set forth in the preamble.

     (r) “Post-Retirement Eligible” means the Participant’s Date of Termination occurs (i) by
reason of the Participant’s retirement and (ii) on or after the Participant has attained age
fifty-five (55) with ten (10) or more Years of Service.

     (s) “Stock Option” has the meaning set forth in Section 1.

     (t) “Vesting Date” has the meaning set forth in Section 2.

     (u) “Year of Service” shall mean a calendar year in which the Participant is employed with the
Company, a Subsidiary or Affiliated Entity for at least nine months of a calendar year. When
calculating Years of Service hereunder, Participant’s first hire date with the Company, a
Subsidiary or Affiliated Entity shall be used.

	 	 	 
	“COMPANY”

	 	DEVON ENERGY CORPORATION
	 

	 	a Delaware corporation
	 
	 	 
	“PARTICIPANT”

	 	«FirstName» «MiddleName» «LastName»
	 

	 	«Address1»
	 

	 	«City», «State», «Zip»
	 

	 	ID: «ID»

Page 6 of 9

 

 

EXHIBIT A

Form of Non-Disclosure Agreement

[Insert Date]

Devon Energy Corporation

20 North Broadway

Oklahoma City, OK 73102

          Re:  Non-Disclosure Agreement

Ladies and Gentlemen:

     This letter agreement is entered between Devon Energy Corporation (together with its
subsidiaries and affiliates, the “Company”) and the undersigned (the “Participant”) in
connection with that certain Nonqualified Stock Option Award Agreement (the “Agreement”) dated
                    , 2009 between the Company and the Participant. All capitalized terms used in
this letter agreement shall have the same meaning ascribed to them in the Agreement unless
specifically denoted otherwise.

     The Participant acknowledges that, during the course of and in connection with the
employment relationship between the Participant and the Company, the Company provided and the
Participant accepted access to the Company’s trade secrets and confidential and proprietary
information, which included, without limitation, information pertaining to the Company’s
finances, oil and gas properties and prospects, compensation structures, business and litigation
strategies and future business plans and other information or material that is of special and
unique value to the Company and that the Company maintains as confidential and does not disclose
to the general public, whether through its annual report and/or filings with the Securities and
Exchange Commission or otherwise (the “Confidential Information”).

     The Participant acknowledges that his position with the Company was one of trust and
confidence because of the access to the Confidential Information, requiring the Participant’s
best efforts and utmost diligence to protect and maintain the confidentiality of the
Confidential Information. Unless required by the Company or with the Company’s express written
consent, the Participant will not, during the term of this letter agreement, directly or
indirectly, disclose to others or use for his own benefit or the benefit of another any of the
Confidential Information, whether or not the Confidential Information is acquired, learned,
attained or developed by the Participant alone or in conjunction with others.

     The Participant agrees that, due to his access to the Confidential Information, the
Participant would inevitably use and/or disclose that Confidential Information in breach of his
confidentiality and non-disclosure obligations if the Participant worked in certain capacities
or engaged in certain activities for a period of time following his employment with the Company,
specifically in a position that involves (i) responsibility and decision-making authority or
input at the executive level regarding any subject or responsibility, (ii) decision-making
responsibility or input at any management level in the Participant’s individual area of
assignment with the Company, or (iii) responsibility and decision-making

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authority or input that otherwise allows the use of the Confidential Information
(collectively referred to as the “Restricted Occupation”). Therefore, except with the prior
written consent of the Company, during the term of this letter agreement, the Participant agrees
not to be employed by, consult for or otherwise act on behalf of any person or entity in any
capacity in which he would be involved, directly or indirectly, in a Restricted Occupation. The
Participant acknowledges that this commitment is intended to protect the Confidential
Information and is not intended to be applied or interpreted as a covenant against competition.

     The Participant further agrees that, during the term of this letter agreement, the
Participant will not, directly or indirectly on behalf of a person or entity or otherwise, (i)
solicit any of the established customers of the Company or attempt to induce any of the
established customers of the Company to cease doing business with the Company, or (ii) solicit
any of the employees of the Company to cease employment with the Company.

     This letter agreement shall become effective upon execution by the Participant and the
Company and shall terminate on December 31, 200___. [NOTE: Insert date that is the end of the
calendar year of the letter agreement.]

     If you agree to the above terms and conditions, please execute a copy of this letter
agreement below and return a copy to me.

	 	 	 	 	 
	 	“PARTICIPANT”

 	 
	 	  	
 	 
	 	 	[Name of Participant] 	 
	 	 	 	 
	 

THE UNDERSIGNED HEREBY ACCEPTS AND AGREES TO THE TERMS SET FORTH ABOVE AS OF THIS            DAY OF
                    ,
          .

	 	 	 	 	 
	 	“COMPANY”

DEVON ENERGY CORPORATION

 	 
	 	By:  	
 	 
	 	 	Name:  	 	 

	 	 	Title:  	 	 
	 

Page 8 of 9

 

 

EXHIBIT B

Form of Compliance Certificate

     I hereby certify that I am in full compliance with the covenants contained in that certain
letter agreement (the “Agreement”) dated as of
                    ,            between Devon Energy Corporation
and me and have been in full compliance with such covenants at all times during the period ending
October 31,           .

	 	 	 	 	 
	 	 	 
	 	
 	 
	 	[Name of Participant] 	 
	 	 	 
	 

Dated:                     

Page 9 of 9

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