Omnibus Equity Compensation Plan – Apache Corp.

APACHE CORPORATION
2011 Omnibus Equity Compensation Plan

Section 1

Introduction

1.1 Establishment. Apache Corporation, a Delaware corporation
(hereinafter referred to, together with its Affiliates (as defined below) as the
“Company” except where the context otherwise requires), hereby establishes the
Apache Corporation 2011 Omnibus Equity Compensation Plan (the “Plan”), as it may
be amended and restated from time to time.

1.2 Purpose. The purpose of the Plan is to provide Eligible
Persons designated by the Committee for participation in the Plan with
equity-based incentives to: (i) encourage such individuals to continue in the
long-term service of the Company and its Affiliates, (ii) create in such
individuals a more direct interest in the future success of the operations of
the Company, (iii) attract outstanding individuals, and (iv) retain and motivate
such individuals. The Plan is intended to provide eligible individuals with the
opportunity to invest in the Company, thereby relating incentive compensation to
increases in stockholder value and more closely aligning the compensation of
such individuals with the interests of the Company153s stockholders.

Accordingly, this Plan provides for the granting of Incentive Stock Options,
Non-Qualified Stock Options, Performance Awards, Restricted Stock, Restricted
Stock Units, Stock Appreciation Rights or any combination of the foregoing, as
the Committee determines is best suited to the circumstances of the particular
individual as provided herein.

1.3 Effective Date. The Effective Date of the Plan (the
“Effective Date”) is May 5, 2011. This Plan and each Award granted hereunder are
conditioned on and shall be of no force or effect until the Plan is approved by
the stockholders of the Company. The Committee (or its delegate in accordance
with Section 3.4(b) hereof) may award grants, the entitlement to which shall be
expressly subject to the condition that the Plan shall have been approved by the
stockholders of the Company.

Section 2

Definitions

2.1 Definitions. The following terms shall have the meanings
set forth below:

	(a)		“Administrative Agent” means any designee or agent that may be appointed by the Committee pursuant to subsections 3.1(h) and 3.4 hereof.
	(b)		“Affiliate” means any entity other than the Company that is affiliated with the Company through stock or equity ownership or otherwise and is designated as an Affiliate for purposes of the Plan by the Committee; provided, however, that, notwithstanding any other provisions of the Plan to the contrary, for purposes of NQSOs and SARs, if an individual who otherwise qualifies as an Eligible Person provides services to such an entity and not to

			the Company, such entity may only be designated an Affiliate if the Company qualifies as a “service recipient,” within the meaning of Internal Revenue Code Section 409A, with respect to such individual; provided further that such definition of “service recipient” shall be determined by (a) applying Internal Revenue Code Section 1563(a)(1), (2), and (3), for purposes of determining a controlled group of corporations under Internal Revenue Code Section 414(b), using the language “at least 50 percent” instead of “at least 80 percent” each place it appears in Internal Revenue Code Section 1563(a)(1), (2), and (3), and by applying Treasury Regulations Section 1.414(c)-2, for purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of Internal Revenue Code Section 414(c), using the language “at least 50 percent” instead of “at least 80 percent” each place it appears in Treasury Regulations Section 1.414(c)-2, and (b) where the use of Shares with respect to the grant of an Option or SAR to such an individual is based upon legitimate business criteria, by applying Internal Revenue Code Section 1563(a)(1), (2), and (3), for purposes of determining a controlled group of corporations under Internal Revenue Code Section 414(b), using the language “at least 20 percent” instead of “at least 80 percent” at each place it appears in Internal Revenue Code Section 1563(a)(1), (2), and (3), and by applying Treasury Regulations Section 1.414(c)-2, for purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of Internal Revenue Code Section 414(c), using the language “at least 20 percent” instead of “at least 80 percent” at each place it appears in Treasury Regulations Section 1.414(c)-2; provided further that for purposes of ISOs, “Affiliate” shall mean any present or future corporation which is or would be a “subsidiary corporation” of the Company as the term is defined in Section 424(f) of the Internal Revenue Code.
	(c)		“Award” means any Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance Award, Dividend Equivalent or any other stock-based award granted to a Participant under the Plan.

	(d)		“Board” means the Board of Directors of the Company.
	(e)		“Change of Control” shall have the meaning assigned to such term in the Company153s Income Continuance Plan as in effect on the Effective Date

	(f)		“Committee” means the Stock Option Plan Committee of the Board or such other Committee of the Board that is empowered hereunder to administer the Plan. The Committee shall be constituted at all times so as to permit the Plan to be administered by “non-employee directors” (as defined in Rule 16b-3 of the Exchange Act) and “outside directors” (as defined in Treasury Regulations Section 1.162-27 (e)(3)) and to satisfy such additional regulatory or listing requirements as the Board may determine to be applicable or appropriate.
	(g)		“Deferred Delivery Plan” means the Company153s Deferred Delivery Plan, as it has been or may be amended from time to time, or any successor plan.

(h)

“Dividend Equivalent” means a right, granted to an Eligible
Person to receive cash, Stock, other Awards or other property equal in value to
dividends paid with respect to a specified number of shares of Stock, or other
periodic payments.


	(i)		“Eligible Persons” means those employees of the Company or of any Affiliates, members of the Board, and members of the board of directors of any Affiliates who are designated as Eligible Persons by the Committee. Notwithstanding the foregoing, grants of Incentive Stock Options may not be granted to anyone who is not an employee of the Company or an Affiliate.

	(j)		“Exchange Act” means the Securities Exchange Act of 1934, as amended.
	(k)		“Exercise Date” means the date of exercise determined in accordance with subsection 6.2(g) hereof.

	(l)		“Fair Market Value” means the per share closing price of the Stock as reported on The New York Stock Exchange, Inc. Composite Transactions Reporting System for a particular date or, if the Stock is not so listed on such date, as reported on NASDAQ or on such other exchange or electronic trading system which, on the date in question, reports the largest number of traded shares of Stock, provided, however, that if on the date Fair Market Value is to be determined there are no transactions in the Stock, Fair Market Value shall be determined as of the immediately preceding date on which there were transactions in the Stock; provided further, however, that if the foregoing provisions are not applicable, the fair market value of a share of the Stock as determined by the Committee by the reasonable application of such reasonable valuation method, consistently applied, as the Committee deems appropriate; provided further, however, that, with respect to ISOs, such Fair Market Value shall be determined subject to Section 422(c)(7) of the Internal Revenue Code. For purposes of the foregoing, a valuation prepared in accordance with any of the methods set forth in Treasury Regulation Section 1.409A-1(b)(5)(iv)(B)(2), consistently used, shall be rebuttably presumed to result in a reasonable valuation. This definition is intended to comply with the definition of “fair market value” contained in Treasury Regulation Section 1.409A-1(b)(5)(iv) and should be interpreted consistently therewith.
	(m)		“Incentive Stock Option” or “ISO” means any Option intended to be and designated as an incentive stock option and which satisfies the requirements of Section 422 of the Internal Revenue Code or any successor provision thereto.

	(n)		“Internal Revenue Code” or “Code” means the Internal Revenue Code of 1986, as it may be amended from time to time, and any successor thereto. Any reference to a section of the Internal Revenue Code or Treasury Regulation shall be treated as a reference to any successor section.
	(o)		“Involuntary Termination” means the termination of employment of the Participant by the Company or its successor for any reason on or after a Change of Control; provided, that the termination does not result from an act of the Participant that (i) constitutes common-law fraud, a felony, or a gross malfeasance of duty, or (ii) is materially detrimental to the best interests of the Company or its successor.

	(p)		“Non-Qualified Stock Option” or “NQSO” means any Option that is not intended to qualify as an “incentive stock option” under Section 422 of the Internal Revenue Code.
	(q)		“Option” means an option to purchase a number of shares of Stock granted pursuant to subsection 6.1.


	(r)		“Option Price” means the price at which shares of Stock subject to an option may be purchased, determined in accordance with subsection 6.2(b) hereof.

	(s)		“Participant” means an Eligible Person designated by the Committee, from time to time during the term of the Plan to receive one or more Awards under the Plan.
	(t)		“Performance Award” is a right to either a number of shares of Stock or SARs (“Performance Shares”) determined (in either case) in accordance with subsection 9.1 of this Plan based on the extent to which the applicable Performance Goals are achieved. A Performance Share shall be of no value to a Participant unless and until earned in accordance with subsection 9.2 hereof.

	(u)		“Performance Goals” are the performance conditions, if any, established pursuant to subsection 9.1 by the Committee in connection with an Award.
	(v)		“Performance Period” with respect to a Performance Award is a period not less than one calendar year or one fiscal year of the Company, beginning not earlier than the year in which such Performance Award is granted, which may be referred to herein and by the Committee by use of the calendar of fiscal year in which a particular Performance Period commences.

	(w)		“Restricted Stock” means Stock granted to an Eligible Person under Section 8 hereof, that is subject to certain restrictions and to a risk of forfeiture.
	(x)		“Restricted Stock Unit” means a right, granted to an Eligible Person under Section 8 hereof, to receive Stock, cash or a combination thereof at the end of a specified vesting period.

	(y)		“Restriction Period” shall have the meaning assigned to such term in subsection 8.1.
	(z)		“Stock” means the $0.625 par value common stock of the Company and or any security into which such common stock is converted or exchanged upon merger, consolidation, or any capital restructuring (within the meaning of Section 13) of the Company.

	(aa)		“Stock Appreciation Right” or “SAR” means a right granted to an Eligible Person to receive an amount in cash, Stock, or other property equal to the excess of the Fair Market Value as of the Exercise Date of one share of Stock over the SAR Price times the number of shares of Stock to which the Stock Appreciation Right relates. Stock Appreciation Rights may be granted in tandem with Options or other Awards or may be freestanding.
	(bb)		“SAR Price” means the price at which the Stock Appreciation Right was granted, which shall be determined in the same manner as the Option Price of an Option in accordance with subsection 6.2 hereof.

(cc)

“Voluntary Termination with Cause” occurs upon a
Participant153s separation from service of his own volition and one or more of the
following conditions occurs without the Participant153s consent on or after a
Change of Control:


	(i)		There is a material diminution in the Participant153s base compensation, compared to his rate of base compensation on the date of the Change of Control.

	(ii)		There is a material diminution in the Participant153s authority, duties or responsibilities.
	(iii)		There is a material diminution in the authority, duties or responsibilities of the Participant153s supervisor, such as a requirement that the Participant (or his supervisor) report to a corporate officer or employee instead of reporting directly to the board of directors.

	(iv)		There is a material diminution in the budget over which the Participant retains authority.
	(v)		There is a material change in the geographic location at which the Participant must perform his service, including, for example the assignment of the Participant to a regular workplace that is more than 50 miles from his regular workplace on the date of the Change of Control.

The Participant must notify the Company of the existence of one or more
adverse conditions specified in clauses (i) through (v) above within 90 days of
the initial existence of the adverse condition. The notice must be provided in
writing to Apache Corporation153s Senior Vice President, Human Resources or
his/her delegate. The notice may be provided by personal delivery or it may be
sent by email, inter-office mail, regular mail (whether or not certified), fax,
or any similar method. Apache Corporation153s Senior Vice President, Human
Resources or his/her delegate shall acknowledge receipt of the notice within 5
business days; the acknowledgement shall be sent to the Participant by certified
mail. Notwithstanding the foregoing provisions of this definition, if the
Company remedies the adverse condition within 30 days of being notified of the
adverse condition, no Voluntary Termination with Cause shall occur.

2.2 Headings; Gender and Number. The headings contained in
the Plan are for reference purposes only and shall not affect in any way the
meaning or interpretation of the Plan. Except when otherwise indicated by the
context, the masculine gender shall also include the feminine gender, and the
definition of any term herein in the singular shall also include the plural.

Section 3

Plan Administration

3.1 Administration by the Committee. The Plan shall be
administered by the Committee. In accordance with the provisions of the Plan,
the Committee shall, in its sole discretion, adopt rules and regulations for
carrying out the purposes of the Plan, including, without limitation, the
authority to:

	(a)		Grant Awards;
	(b)		Select the Eligible Persons and the time or times at which Awards shall be granted;


	(c)		Determine the type and number of Awards to be granted, the number of shares of Stock to which an Award may relate and the terms, conditions, restrictions, and Performance Goals relating to any Award;

	(d)		Determine whether, to what extent, and under what circumstances an Award may be settled, canceled, forfeited, exchanged, or surrendered;
	(e)		Construe and interpret the Plan and any Award;

	(f)		Prescribe, amend, and rescind rules and procedures relating to the Plan;
	(g)		Determine the terms and provisions of Award agreements;

	(h)		Appoint designees or agents (who need not be members of the Committee or employees of the Company) to assist the Committee with the administration of the Plan;
	(i)		Communicate the material terms of each Award to its recipient within a relatively short period of time after approval; and

(j)

Make all other determinations deemed necessary or advisable for the
administration of the Plan.

3.2 Committee Discretion. The Committee shall, in its
absolute discretion, and without amendment to the Plan, have the power to
accelerate, waive or modify, at any time, any term or condition of an Award that
is not mandatory under this Plan; provided, however, that the Committee shall
not have any discretion to accelerate, waive or modify any term or condition of
an Award that is intended to qualify as “performance-based compensation” for
purposes of Section 162(m) of the Internal Revenue Code if such discretion would
cause the Award to not so qualify. In the event of a Change of Control, the
provisions of Section 12 hereof shall be mandatory and shall govern the vesting
and exercisability schedule of any Award granted hereunder.

3.3 Indemnification. No member of the Committee shall be
liable for any action, omission, or determination made in good faith. The
Company shall indemnify (to the extent permitted under Delaware law) and hold
harmless each member of the Committee and each other director or employee of the
Company to whom any duty or power relating to the administration or
interpretation of the Plan has been delegated against any cost or expense
(including counsel fees) or liability (including any sum paid in settlement of a
claim with the approval of the Committee) arising out of any action, omission or
determination relating to the Plan, unless, in either case, such action,
omission or determination was taken or made by such member, director or employee
in bad faith and without reasonable belief that it was in the best interests of
the Company. The determination, interpretations and other actions of the
Committee pursuant to the provisions of the Plan shall be binding and conclusive
for all purposes and on all persons.

3.4 Committee Delegation.

(a)

The Committee may from time to time adopt such rules and regulations for
carrying out the purposes of the Plan as it may deem proper and in the best
interests of the Company. The Committee may appoint an Administrative Agent, who
need not be a member of the Committee or an employee of the Company, to assist
the Committee in administration of

			the Plan and to whom it may delegate such powers as the Committee deems appropriate, except that the Committee shall determine any dispute. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan, or in any Award agreement entered into hereunder, in the manner and to the extent it shall deem expedient, and it shall be the sole and final judge of such inconsistency;
	(b)		The Committee has delegated authority to the Chief Executive Officer of the Company to grant Awards to employees of the Company who are not the Company153s executive officers (as such term is defined for purposes of Section 16 of the Exchange Act) and who are below the level of Regional Vice President or Staff Vice President; provided, that any such Awards may only be granted in accordance with guidelines established by the Committee.

3.5 Compliance with Section 162(m). Except as expressly
otherwise stated in any resolution of the Committee, the Plan is intended to
comply with the requirements of Section 162(m) or any successor section(s) of
the Internal Revenue Code (“Section 162(m)”) as to any “covered employee” as
defined in Section 162(m), and shall be administered, interpreted, and construed
consistently therewith. The Committee is authorized to take such additional
action, if any, that may be required to ensure that the Plan and any Award under
the Plan satisfy the requirements of Section 162(m), taking into account any
regulations or other guidance issued by the Internal Revenue Service.

Section 4

Stock Subject to the Plan

4.1 Number of Shares. Subject to adjustments pursuant to
Section 4.4 hereof, up to 25,500,000 shares of Stock are authorized for issuance
under the Plan in accordance with the Plan153s terms and subject to such
restrictions or other provisions as the Committee may from time to time deem
necessary. Notwithstanding the foregoing, the number of aggregate shares of
Stock available for issuance under the Plan at any given time shall be reduced
by (i) 1.0 share for each share of Stock granted in the form of Stock Options or
Stock Appreciation Rights, or (ii) 2.39 shares for each share of Stock granted
in the form of any Award that is not a Stock Option or Stock Appreciation Right.
During the duration of the Plan, no Eligible Person may be granted Options which
in the aggregate cover in excess of 10 percent of the total shares of Stock
authorized under the Plan. No Award may be granted under the Plan on or after
the 10-year anniversary of the Effective Date. The foregoing to the contrary
notwithstanding, within the aggregate limit described in the first sentence of
this Section 4.1, up to 25,500,000 shares of Stock may be issued pursuant to
ISOs granted under the Plan.

4.2 Availability of Shares Not Issued under Awards.
If shares of Stock which may be issued pursuant to the terms of the Plan awarded
hereunder are forfeited, cancelled, exchanged or surrendered or if an Award
otherwise terminates or expires without a distribution of shares to the holder
of such Award, the shares of Stock with respect to such Award shall, to the
extent of any such forfeiture, cancellation, exchange, surrender, termination or
expiration, again be available for Awards under the Plan; provided, however,
that in such case, the number of shares of Stock that may be issued under the
Plan shall increase by 1.0 share for each share related to a Stock Option or a
Stock Appreciation Right that is so forfeited, cancelled, exchanged or
surrendered or expired and by 2.39 shares for each such share which is not
related to a Stock Option or a Stock Appreciation Right. The number of shares
available shall not be increased by shares tendered, surrendered or withheld in
connection with the exercise or settlement of an Award or the related tax
withholding obligations. Furthermore, when a

SAR is settled in shares, the number of shares subject to the SAR under the
SAR Award agreement will be counted against the aggregate number of shares with
respect to which Awards may be granted under the Plan as one share for every
share subject to the SAR, regardless of the number of shares used to settle the
SAR upon exercise.

4.3 Stock Offered. The Company shall at all times during the
term of the Plan retain as authorized and unissued Stock and/or Stock in the
Company153s treasury, at least the number of shares from time to time require
under the provisions of the Plan, or otherwise assure itself of its ability to
perform its obligations hereunder.

4.4 Adjustments for Stock Split, Stock Dividend, Etc. If the
Company shall at any time increase or decrease the number of its outstanding
shares of Stock or change in any way the rights and privileges of such shares by
means of the payment of a Stock dividend or any other distribution upon such
shares payable in Stock or rights to acquire Stock, or through a Stock split,
reverse Stock split, subdivision, consolidation, combination, reclassification
or recapitalization involving the Stock (any of the foregoing being herein
called a “capital restructuring”), then in relation to the Stock that is
affected by one or more of the above events, the numbers, rights, and privileges
of the following shall be, in each case, equitably and proportionally adjusted
to take into account the occurrence of any of the above events, (i) the number
and kind of shares of Stock or other property (including cash) that may
thereafter be issued pursuant to subsections 4.1 and 4.10, (ii) the number and
kind of shares of Stock or other property (including cash) issued or issuable in
respect of outstanding Awards; and (iii) the exercise price, grant price, or
purchase price relating to any Award; provided that, with respect to Incentive
Stock Options, such adjustment shall be made in accordance with Section 424(h)
of the Internal Revenue Code; (iv) the Performance Goals, and (v) the individual
limitations applicable to Awards.

4.5 Other Changes in Stock. In the event there shall be any
change, other than as specified in subsections 4.4 hereof, in the number or kind
of outstanding shares of Stock or of any stock or other securities into which
the Stock shall be changed or for which it shall have been exchanged, and if the
Committee shall in its discretion determine that such change equitably requires
an adjustment in the number or kind of shares subject to outstanding Awards or
which have been reserved for issuance pursuant to the Plan but are not then
subject to an Award, then such adjustments shall be made by the Committee and
shall be effective for all purposes of the Plan and on each outstanding Award
that involves the particular type of stock for which a change was effected.

4.6 Rights to Subscribe. If the Company shall at any time
grant to the holders of its Stock rights to subscribe pro rata for additional
shares thereof or for any other securities of the Company or of any other
corporation, there shall be reserved with respect to the shares then under an
outstanding Award to any Participant of the particular class of Stock involved
the Stock or other securities which the Participant would have been entitled to
subscribe for if immediately prior to such grant the Participant had exercised
his entire Option. If, upon exercise of any such Option, the Participant
subscribes for the additional shares or other securities, the aggregate Option
Price shall be increased by the amount of the price that is payable by the
Participant for such additional shares or other securities as if the Participant
had exercised his entire Option immediately prior to the grant of such
additional shares or other securities.

4.7 General Adjustment Rules. No adjustment or substitution
provided for in this Section 4 shall require the Company to sell a fractional
share of Stock under any Option, or otherwise issue a fractional share of Stock,
and the total substitution or adjustment with respect to each Option shall be
limited by deleting any fractional share. In the case of any such substitution
or adjustment, the aggregate Option Price for the shares of Stock then subject
to the Option shall remain unchanged but the Option Price per

share under each such Option shall be equitably adjusted by the Committee to
reflect the greater or lesser number of shares of Stock or other securities into
which the Stock subject to the Option may have been changed.

4.8 Determination by the Committee, Etc. Adjustments under
this Section 4 shall be made by the Committee, whose determinations with regard
thereto shall be final and binding upon all parties.

4.9 Code Section 409A. For any Award that is not subject to
Internal Revenue Code Section 409A before the adjustments identified in the
preceding sections of this Section 4, no adjustment shall be made that would
cause the Award to become subject to Internal Revenue Code Section 409A. For an
Award that is subject to Internal Revenue Code Section 409A before the
adjustments identified in the preceding sections of this Section 4, no
adjustment shall cause the Award to violate Internal Revenue Code Section 409A,
without the prior written consent of both the Participant and the Committee.

4.10 Award Limits. The following limits shall apply to grants
of all Awards under the Plan:

	(a)		Options: The maximum aggregate number of shares of Stock that may be subject to Options granted in any calendar year to any one Participant shall be 250,000 shares.
	(b)		SARs: The maximum aggregate number of shares that may be subject to Stock Appreciation Rights granted in any calendar year to any one Participant shall be 250,000 shares. Any shares covered by Options which include tandem SARs granted to one Participant in any calendar year shall reduce this limit on the number of shares subject to SARs that can be granted to such Participant in such calendar year.

	(c)		Restricted Stock or Restricted Stock Units: The maximum aggregate number of shares of Stock that may be subject to Awards of Restricted Stock or Restricted Stock Units granted in any calendar year to any one Participant shall be 250,000 shares.
	(d)		Performance Awards: The maximum aggregate grant with respect to Performance Awards granted in any calendar year to any one Participant shall be 250,000 shares (or SARs based on the value of such number of shares).

To the extent required by Section 162(m) of the Code, shares subject to
Options or SARs which are canceled shall continue to be counted against the
limits set forth in paragraphs (a) and (b) immediately preceding.

4.11 Repayment/Forfeiture of Awards. If required by the
Sarbanes-Oxley Act of 2002 and/or by the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010, each Participant153s Award shall be conditioned
on repayment or forfeiture in accordance with applicable law and the related
Award agreement shall reflect any such condition. In addition, the Committee may
establish such conditions for repayment or forfeiture of Awards as the Committee
may adopt by policy for the Company or any Affiliate.

Section 5

Granting of Awards to Participants

5.1 Participation. Participants in the Plan shall be those
Eligible Persons who, in the judgment of the Committee (or, pursuant to Section
3.4(b), the Chief Executive Officer of the Company), are performing, or during
the term of their incentive arrangement will perform, vital services in the
management, operation, and development of the Company or an Affiliate, and
significantly contribute, or are expected to significantly contribute, to the
achievement of the Company153s long-term corporate economic objectives.
Participants may be granted from time to time one or more Awards; provided,
however, that the grant of each such Award shall be separately approved by the
Committee or granted in accordance with Section 3.4(b) hereof, and receipt of
one such Award shall not result in automatic receipt of any other Award. Upon
determination that an Award is to be granted to a Participant, as soon as
practicable, written notice shall be given to such person, specifying the terms,
conditions, rights and duties related thereto. Each Participant shall, if
required by the Committee, enter into an agreement with the Company, in such
form as the Committee shall determine and which is consistent with the
provisions of the Plan, specifying such terms, conditions, rights, and duties.
Awards shall be deemed to be granted as of the date specified in the grant
resolution of the Committee (or, in the case of grants made pursuant to Section
3.4(b), in accordance with the guidelines established by the Committee), which
date shall be the date of any related agreement with the Participant. In the
event of any inconsistency between the provisions of the Plan and any such
agreement entered into hereunder, the provisions of the Plan shall govern.

Awards granted to members of the Board shall be recommended to the full Board
by the Management Development and Compensation Committee and approved by the
full Board.

5.2 Notification to Participants and Delivery of
Documents. As soon as practicable after such determinations have
been made, each Participant shall be notified of (a) his/her designation as a
Participant, (b) the date of grant, (c) the number and type of Awards granted to
the Participant, (d) in the case of Performance Awards, the Performance Period
and Performance Goals, (e) in the case of Restricted Stock or Restricted Stock
Units, the Restriction Period (as defined in subsection 8.1), and (f) any other
terms or conditions imposed by the Committee with respect to the Award.

5.3 Delivery of Award Agreement. This requirement for
delivery of a written Award agreement is satisfied by electronic delivery of
such agreement provided that evidence of the Participant153s receipt of such
electronic delivery is available to the Company and such delivery is not
prohibited by applicable laws and regulations.

Section 6

Stock Options

6.1 Grant of Stock Options. Coincident with or following
designation for participation in the Plan, an Eligible Person may be granted one
or more Options. Grants of Options under the Plan shall be made by the Committee
or in accordance with Section 3.4(b). In no event shall the exercise of one
Option

affect the right to exercise any other Option or affect the number of shares
of Stock for which any other Option may be exercised, except as provided in
subsection 6.2(j) hereof.

6.2 Stock Option Agreements. Each Option granted under the
Plan shall be identified as either an Incentive Stock Option or a Non-Qualified
Stock Option (or, if no such identification is made, then it shall be a
Non-Qualified Stock Option) and evidenced by a written agreement which shall be
entered into by the Company and the Participant to whom the Option is granted,
and which shall contain the following terms and conditions set out in this
subsection 6.2, as well as such other terms and conditions, not inconsistent
therewith, as the Committee may consider appropriate.

	(a)		Number of Shares. Each Stock Option agreement shall state that it covers a specified number of shares of Stock, as determined by the Committee.
	(b)		Price. The price at which each share of Stock covered by an Option may be purchased, the Option Price, shall be determined in each case by the Committee and set forth in the Stock Option agreement. The price may vary according to a formula specified in the Stock Option agreement, but in no event shall the Option Price ever be less than the Fair Market Value of the Stock on the date the Option is granted.

	(c)		No Backdating. There shall be no backdating of Options, and each Option shall be dated the actual date that the Committee adopts the resolution awarding the grant of such Option.
	(d)		Limitations on Incentive Stock Options. No Incentive Stock Option may be granted to an individual if, at the time of the proposed grant, such individual owns (or is attributed to own by virtue of the Internal Revenue Code) Stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company or any Affiliate unless (i) the exercise price of such Incentive Stock Option is at least 110 percent of the Fair Market Value of a share of Stock at the time such Incentive Stock Option is granted and (ii) such Incentive Stock Option is not exercisable after the expiration of five years from the date such Incentive Stock Option is granted.

To the extent that the aggregate Fair Market Value of Stock of the Company
with respect to which Incentive Stock Options are exercisable for the first time
by a Participant during any calendar year under the Plan and any other option
plan of the Company (or any Affiliate) shall exceed $100,000, such Options shall
be treated as Non-Qualified Stock Options. Such Fair Market Value shall be
determined as of the date on which each such Incentive Stock Option is granted.

	(e)		Duration of Options. Each Stock Option agreement shall state the period of time, determined by the Committee, within which the Option may be exercised by the Participant (the “Option Period”). The Option Period must end, in all cases, not more than ten years from the date an Option is granted.
	(f)		Termination of Options. During the lifetime of a Participant to whom a Stock Option is granted, the Stock Option may be exercised only by such Participant or, in the case of disability (as determined pursuant to the Company153s Long-Term Disability Plan or any successor plan) by the Participant153s designated legal representative, except to the extent such exercise would cause any Award intended to qualify as an ISO not to so qualify. Once a Participant to whom a Stock Option was granted dies, the Stock Option may be exercised only by the personal representative of the Participant153s estate or, with respect to

Stock Options that are not Incentive Stock Options, as otherwise provided in
Section 14.2. Unless the Stock Option agreement shall specify a longer or
shorter period, at the discretion of the Committee, then the Participant (or
representative, or, if applicable pursuant to Section 14.2, designated
beneficiary) may exercise the Stock Option for a period of up to three months
after such Participant terminates employment or ceases to be a member of the
Board.

(g) Exercise, Payments, Etc.

(i) Each Stock Option agreement shall provide that the method for exercising
the Option granted therein shall be by delivery to the Office of the Secretary
of the Company or to the Administrative Agent of written notice specifying the
number of shares of Stock with respect to which such Option is exercised and
payment to the Company of the aggregate Option Price. Such notice shall be in a
form satisfactory to the Committee and shall specify the particular Options (or
portions thereof) which are being exercised and the number of shares of Stock
with respect to which the Options are being exercised. The Participant153s
obligation to deliver written notice of exercise is satisfied by electronic
delivery of such notice through means satisfactory to the Committee and
prescribed by the Company. The exercise of the Option shall be deemed effective
on the date such notice is received by the Office of the Secretary or by the
Administrative Agent and payment is made to the Company of the aggregate Option
Price (the “Exercise Date”); however, if payment of the aggregate Option Price
is made pursuant to a sale of shares of Stock as contemplated by subsection
6.2(g)(iv)(E) below, the Exercise Date shall be deemed to be the date of such
sale. If requested by the Company, such notice shall contain the Participant153s
representation that he or she is purchasing the Stock for investment purposes
only and his or her agreement not to sell any Stock so purchased in any manner
that is in violation of the Exchange Act or any applicable state law, and such
restriction, or notice thereof, shall be placed on the certificates representing
the Stock so purchased. The purchase of such Stock shall take place upon
delivery of such notice to the Office of the Secretary of the Company or to the
Administrative Agent, at which time the aggregate Option Price shall be paid in
full to the Company by any of the methods or any combination of the methods set
forth in subsection 6.2(g)(iv) below.

(ii) The shares of Stock to which the Participant is entitled as a result of
the exercise of the Option shall be issued by the Company and either (A)
delivered by electronic means to an account designated by the Participant or (B)
delivered to the Participant in the form of a properly executed certificate or
certificates representing such shares of Stock. If shares of Stock are used to
pay all or part of the aggregate Option Price, the Company shall issue and
deliver to the Participant the additional shares of Stock, in excess of the
aggregate Option Price or portion thereof paid using shares of Stock, to which
the Participant is entitled as a result of the Option exercise.

(iii) The Company153s obligation to deliver the shares of Stock to which the
Participant is entitled as a result of the exercise of the Option shall be
subject to the payment in full to the Company of the aggregate Option Price and
the required tax withholding.

(iv) The aggregate Option Price shall be paid by any of the following methods
or any combination of the following methods:

	(A)	in cash, including the wire transfer of funds in U.S. dollars to one of the Company153s bank accounts located in the United States, with such bank account to be designated from time to time by the Company;

	(B)	by personal, certified or cashier153s check payable in U.S. dollars to the order of the Company;

	(C)	by delivery to the Company or the Administrative Agent of certificates representing a number of shares of Stock then owned by the Participant, the aggregate Fair Market Value of which (as of the Exercise Date) is equal to the aggregate Option Price of the Option being exercised, properly endorsed for transfer to the Company, provided that the shares of Stock used for this purpose must have been owned by the Participant for a period of at least six months;

	(D)	by certification or attestation to the Company or the Administrative Agent of the Participant153s ownership (as of the Exercise Date) of a number of shares of Stock, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the aggregate Option Price of the Option being exercised, provided that the shares of Stock used for this purpose have been owned by the Participant for a period of at least six months; or

	(E)	by delivery to the Company or the Administrative Agent of a properly executed notice of exercise together with irrevocable instructions to a broker to promptly deliver to the Company, by wire transfer or check as noted in subsection 6.2(g)(iv)(A) and (B) above, the amount of the proceeds of the sale of all or a portion of the Stock or of a loan from the broker to the Participant necessary to pay the aggregate Option Price.
(h)	Tax Withholding. Each Stock Option agreement shall provide that, upon exercise of the Option, the Participant shall make appropriate arrangements with the Company to provide for not less than the minimum amount of tax withholding required by law, including without limitation Sections 3102 and 3402 or any successor section(s) of the Internal Revenue Code and applicable state and local income and other tax laws, by payment of such taxes in cash (including wire transfer), by check, or as provided in Section 11 hereof.

	(i)		Repricing Prohibited. Subject to Sections 4, 6, 12, 13, and 16, outstanding Stock Options granted under this Plan shall not be repriced without approval by the Company153s stockholders. In particular, neither the Board nor the Committee may take any action: (1) to amend the terms of an outstanding Option or SAR to reduce the Option Price or grant price thereof, cancel an Option or SAR and replace it with a new Option or SAR with a lower Option Price or grant price, or that has an economic effect that is the same as any such reduction or cancellation or (2) to cancel an outstanding Option or SAR having an Option Price or grant price above the then-current Fair Market Value of the Stock in exchange for the grant of another type of Award, without, in each such case, first obtaining approval of the stockholders of the Company of such action.
	(j)		Stockholder Privileges. No Participant shall have any rights as a stockholder with respect to any shares of Stock covered by an Option until the Participant becomes the holder of record of such Stock. Except as provided in Section 4 hereof, no adjustments shall be

			made for dividends or other distributions or other rights as to which there is a record date preceding the date on which such Participant becomes the holder of record of such Stock.
	(k)		Section 409A Avoidance. Once granted, no Stock Option shall be modified, extended, or renewed in any way that would cause the Stock Option to be subject to Internal Revenue Code Section 409A. The Option Period shall not be extended to any date that would cause the Stock Option to become subject to Internal Revenue Code Section 409A. The Option Price shall not be adjusted to reflect any dividends declared and paid on the Stock between the date of grant and the date the Stock Option is exercised.

Section 7

7.1 Stock Appreciation Rights. The Committee (or, if so
provided pursuant to Section 3.4(b), the Chief Executive Officer of the Company)
is authorized to grant SARs to Participants either alone (“freestanding”) or in
tandem with other Awards, including Performance Awards, Options, and Restricted
Stock. Stock Appreciation Rights granted in tandem with any Award must be
granted at the same time as the Award is granted. Stock Appreciation Rights
granted in tandem with Options shall terminate and no longer be exercisable upon
the termination or exercise of the related Stock Options. Options granted in
tandem with Stock Appreciation Rights shall terminate and no longer be
exercisable upon the termination or exercise of the related Stock Appreciation
Rights. The Committee shall establish the terms and conditions applicable to any
Stock Appreciation Rights, which terms and conditions need not be uniform but
may not be inconsistent with the terms of the Plan. Freestanding Stock
Appreciation Rights shall generally be subject to terms and conditions
substantially similar to those described in Section 4 and subsection 6.2 for
Options, including, but not limited to, the requirements of subsections 6.2(b),
(d), and (i) and subsection 4.7 regarding general adjustment rules, minimum
price, duration, and prohibition on repricing.

7.2 Section 409A Avoidance. The SAR Price may be fixed on the
date it is granted or the SAR Price may vary according to an objective formula
specified by the Committee at the time of grant. However, the SAR Price can
never be less than the Fair Market Value of the Stock on the date of grant. The
SAR grant must specify the number of shares to which it applies, which must be
fixed at the date of grant (subject to adjustment pursuant to Sections 4, 6, and
11). Once granted, no SAR shall be modified, extended, or renewed in any way
that would cause the SAR to be subject to Internal Revenue Code Section 409A.
The period during which the SAR may be exercised shall not be extended to any
date that would cause the SAR to become subject to Internal Revenue Code Section
409A. The value of the SAR shall not be adjusted to reflect any dividends
declared and paid on the Stock between the date of grant and the date the SAR is
exercised; however, the right to one or more dividends declared and paid on the
Stock between the date of grant and the date the SAR is exercised may be set
forth in a separate arrangement.

Section 8

Restricted Stock and Restricted Stock Units

8.1 Restriction Period. At the time an Award of Restricted
Stock or Restricted Stock Units is made, the Committee shall establish the terms
and conditions applicable to such Award, including the period of

time (the “Restriction Period”) and attainment of performance goals during
which certain restrictions established by the Committee shall apply to the
Award. Awards of Restricted Stock or Restricted Stock Units may also be made in
accordance with Section 3.4(b). Each such Award, and designated portions of the
same Award, may have a different Restriction Period. Except as permitted or
pursuant to Sections 12 and 13 hereof, the Restriction Period applicable to a
particular Award shall not be changed. Restricted Stock or Restricted Stock
Units may or may not be subject to Internal Revenue Code Section 409A. If they
are subject to Internal Revenue Code Section 409A, the grant of the Restricted
Stock or Restricted Stock Units must contain the provisions needed to comply
with the requirements of Internal Revenue Code Section 409A, including but not
limited to (i) the timing of any election to defer receipt of the Restricted
Stock or Restricted Stock Units beyond the date of vesting, (ii) the timing of
any payout election, and (iii) the timing of the settlement of Restricted Stock
or a Restricted Stock Unit. Restricted Stock or Restricted Stock Units that are
subject to Internal Revenue Code Section 409A may be adjusted to reflect any
dividends declared and paid on the Stock between the date of grant and the date
the Restricted Stock or Restricted Stock Unit vests, but only to the extent
permitted in IRS guidance of general applicability.

8.2 Certificates for Stock. Restricted Stock shall be
evidenced in such manner as the Committee shall determine. If certificates
representing Restricted Stock are registered in the name of the Participant, the
Committee may require that such certificates bear an appropriate legend
referring to the terms, conditions, and restrictions applicable to such
Restricted Stock, that the Company retain physical possession of the
certificates, and that the Participant deliver a stock power to the Company,
endorsed in blank, relating to the Restricted Stock represented by a stock
certificate registered in the name of the Participant.

8.3 Restricted Stock Terms and Conditions. Participants shall
have the right to enjoy all shareholder rights during the Restriction Period
except that:

	(a)		The Participant shall not be entitled to delivery of the Stock certificate until the Restriction Period shall have expired.
	(b)		The Participant may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of the Stock during the Restriction Period.

	(c)		A breach of the terms and conditions established by the Committee with respect to the Restricted Stock shall cause a forfeiture of the Restricted Stock and any dividends withheld thereon.
	(d)		Dividends and Splits. As a condition to the grant of an Award of Restricted Stock, the Committee may specify whether any cash dividends paid on a share of Restricted Stock be automatically reinvested in additional shares of Restricted Stock or applied to the purchase of additional Awards under this Plan. Unless otherwise determined by the Committee, Stock distributed in connection with a Stock split or Stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such Stock or other property has been distributed.

8.4 Restricted Stock Units. The Committee (or, if so provided
pursuant to Section 3.4(b), the Chief Executive Officer of the Company) is
authorized to grant Restricted Stock Units to Participants, which

are rights to receive Stock at the end of a specified deferral period,
subject to the following terms and conditions:

Award and Restrictions. Settlement of an Award of Restricted Stock
Units shall occur upon expiration of the vesting period specified for such
Restricted Stock Unit by the Committee (or, if permitted by the Committee, as
elected by the Participant pursuant to Section 8.5). In addition, Restricted
Stock Units shall be subject to such restrictions (which may include a risk of
forfeiture) as the Committee may impose, if any, which restrictions may lapse at
the expiration of the vesting or deferral period, as the case may be, or at
earlier specified times (including based on achievement of performance goals
and/or future service requirements), separately or in combination, in
installments or otherwise, as the Committee may determine. Restricted Stock
Units shall be satisfied by the delivery of cash or Stock in the amount equal to
the Fair Market Value of the specified number of shares of Stock covered by the
Restricted Stock Units, or a combination thereof, as determined by the Committee
at the date of grant or thereafter.

8.5 Deferral of Receipt of Restricted Stock Units.
With the consent of the Committee, a Participant who has been granted a
Restricted Stock Unit may by compliance with the then applicable procedures
under the Plan irrevocably elect in writing to defer receipt of all or any part
of any distribution associated with that Restricted Stock Unit Award in
accordance with either the terms and conditions of the Deferred Delivery Plan or
the terms and conditions specified under the grant agreement and related
documents. The terms and conditions of any such deferral, including, but not
limited to, the period of time for, and form of, election; the manner and method
of payout; and the use and form of Dividend Equivalents in respect of
stock-based units resulting from such deferral, shall be as determined by the
Committee. The Committee may, at any time and from time to time, but
prospectively only except as hereinafter provided, amend, modify, change,
suspend, or cancel any and all of the rights, procedures, mechanics, and timing
parameters relating to such deferrals. In addition, the Committee may, in its
sole discretion, accelerate the pay out of such deferrals (and any earnings
thereon), or any portion thereof, either in a lump sum or in a series of
payments, but only to the extent that the payment or the change in timing of the
payment will not cause a violation of Internal Revenue Code Section 409A.

8.6 Bonus Stock and Awards in Lieu of Obligations. The
Committee is authorized to grant Stock as a bonus, or to grant Stock or other
Awards in lieu of obligations to pay cash or deliver other property under this
Plan or under plans or compensatory arrangements, provided that, in the case of
Participants subject to Section 16 of the Exchange Act, the amount of such
grants remains within the discretion of the Committee to the extent necessary to
ensure that acquisitions of Stock or other Awards are exempt from liability
under Section 16(b) of the Exchange Act. Stock or Awards granted hereunder shall
be subject to such other terms as shall be determined by the Committee. In the
case of any grant of Stock to an officer of the Company or an Affiliate in lieu
of salary or other cash compensation, the number of shares granted in place of
such compensation shall be reasonable, as determined by the Committee.

8.7 Dividend Equivalents. The Committee is authorized to
grant Dividend Equivalents to a Participant, entitling the Participant to
receive cash, Stock, other Awards, or other property equal in value to dividends
paid with respect to a specified number of shares of Stock, or other periodic
payments. Dividend Equivalents may be awarded on a free-standing basis or in
connection with another Award. The Committee may provide that Dividend
Equivalents shall be paid or distributed when accrued or shall be deemed to have
been reinvested in additional Stock, Awards, or other investment vehicles, and
subject to risk of forfeiture, as the Committee may specify. Notwithstanding the
foregoing, Dividend Equivalents shall not be granted in connection with the
grant of any Options or Stock Appreciation Right.

Section 9

Performance Awards

9.1 Establishment of Performance Goals for Company.
Performance Goals applicable to a Performance Award shall be established by the
Committee in its absolute discretion on or before the date of grant and within
the time period prescribed by, and shall otherwise comply with the requirements
of, Code Section 162(m)(4)(C), or any successor provision thereto, and the
regulations thereunder, for performance-based compensation. Such Performance
Goals may include or be based upon any of the following criteria, either in
absolute amount, per share, or per barrel of oil equivalent (boe): pretax income
or after tax income, operating profit, return on equity, capital or investment,
earnings, book value, increase in cash flow return, sales or revenues, operating
expenses (including, but not limited to, lease operating expenses, severance
taxes and other production taxes, gathering and transportation, general and
administrative costs, and other components of operating expenses), stock price
appreciation, implementation or completion of critical projects or processes,
production growth, reserve growth, and/or corporate acquisition goals based on
value of assets acquired or similar objective measures.

Where applicable, the Performance Goals may be expressed in terms of
attaining a specified level of a particular criteria or attaining a percentage
increase or decrease in a particular criteria, and may be applied relative to
internal goals or levels attained in prior years or related to other companies
or indices or as ratios expressing relationship between Performance Goals, or
any combination thereof, as determined by the Committee.

The Performance Goals may include a threshold level of performance below
which no vesting will occur, levels of performance at which specified vesting
will occur, and a maximum level of performance at which full vesting will occur.

The Committee may in its discretion classify Participants into as many groups
as it determines, and as to any Participant relate his/her Performance Goals
partially, or entirely, to the measured performance, either absolutely or
relatively, of an identified subsidiary, division, operating company, test
strategy, or new venture of the Company and/or its Affiliates.

Notwithstanding any other provision of the Plan, payment or vesting of any
Performance Award shall not be made until the applicable Performance Goals have
been satisfied and any other material terms of such Award were in fact
satisfied. The Committee shall certify in writing the attainment of each
Performance Goal. Notwithstanding any provision of the Plan to the contrary,
with respect to any Performance Award, (a) the Committee may not adjust,
downwards or upwards, any amount payable, or other benefits granted, issued,
retained, and/or vested pursuant to such an Award on account of satisfaction of
the applicable Performance Goals and (b) the Committee may not waive the
achievement of the applicable Performance Goals, except in the case of the
Participant153s death or disability, or a Change of Control.

9.2 Levels of Performance Required to Earn Performance
Awards. At or about the same time that Performance Goals are
established for a specific period, the Committee shall in its absolute
discretion establish the percentage of the Performance Awards granted for such
Performance Period which shall be earned by the Participant for various levels
of performance measured in relation to achievement of Performance Goals for such
Performance Period.

9.3 Other Restrictions. The Committee shall determine the
terms and conditions applicable to any Performance Award, which may include
restrictions on the delivery of Stock payable in connection with the Performance
Award and restrictions that could result in the future forfeiture of all or part
of any Stock earned. The Committee may provide that shares of Stock issued in
connection with a Performance Award be held in escrow and/or legended.
Performance Awards may or may not be subject to Internal Revenue Code Section
409A. If a Performance Award is subject to Internal Revenue Code Section 409A,
the Performance Award grant agreement shall contain the terms and conditions
needed to comply with the requirements of Internal Revenue Code Section 409A,
including but not limited to (i) the timing of any election to defer receipt of
the Performance Award, (ii) the timing of any payout election, and (iii) the
timing of the actual payment of the Performance Award. Performance Awards that
are subject to Internal Revenue Code Section 409A may be adjusted to reflect any
dividends declared and paid on the Stock between the date of grant and the date
the Performance Award is paid, but only to the extent permitted in IRS guidance
of general applicability.

9.4 Notification to Participants. Promptly after the
Committee has established the Performance Goals with respect to a Performance
Award, the Participant shall be provided with written notice of the Performance
Goals so established.

9.5 Measurement of Performance against Performance Goals.
The Committee shall, as soon as practicable after the close of a
Performance Period, determine (a) the extent to which the Performance Goals for
such Performance Period have been achieved and (b) the percentage of the
Performance Awards earned as a result.

These determinations shall be absolute and final as to the facts and
conclusions therein made and be binding on all parties. Promptly after the
Committee has made the foregoing determination, each Participant who has earned
Performance Awards shall be notified. For all purposes of this Plan, notice
shall be deemed to have been given the date action is taken by the Committee
making the determination. Participants may not sell, transfer, pledge, exchange,
hypothecate, or otherwise dispose of all or any portion of their Performance
Awards during the Performance Period.

9.6 Treatment of Performance Awards Earned. Upon the
Committee153s determination that a percentage of any Performance Award has been
earned for a Performance Period, Participants to whom such earned Performance
Awards have been granted and who have been in the employ of the Company or
Affiliates continuously from the date of grant until the end of the Performance
Period, subject to the exceptions set forth in the Performance Award agreement
and in Sections 10 and 12 hereof, shall be entitled, subject to the other
conditions of this Plan, to payment in accordance with the terms and conditions
of the Performance Awards. Performance Awards shall under no circumstances
become earned or have any value whatsoever for any Participant who is not in the
employ of the Company or its Affiliates continuously during the entire
Performance Period for which such Performance Award was granted, except as
provided in Sections 10 and 12.

9.7 Subsequent Performance Award Grants. Following the grant
of Performance Awards with respect to a Performance Period, additional
Participants may be designated by the Committee for grant of Performance Awards
for such Performance Period subject to the same terms and conditions set forth
for the initial grants, except that the Committee, in its sole discretion, may
reduce the value of the amounts to which subsequent Participants may become
entitled, prorated according to reduced time spent during the Performance
Period, and the applicable Performance Award agreement shall be modified to
reflect such reduction.

9.8 Stockholder Privileges. No Participant shall have any
rights as a stockholder with respect to any shares of Stock covered by a
Performance Award until the Participant becomes the holder of record of such
Stock.

Section 10

Termination of Employment, Death, Disability, etc.

10.1 Termination of Employment. Except as provided herein,
the treatment of an Award upon a termination of employment or any other service
relationship by and between a Participant and the Company or an Affiliate shall
be specified in the agreement controlling such Award. To the extent such Award
is subject to Section 409A of the Code, such termination of employment or any
other service relationship shall be a “separation from service” within the
meaning of Treasury Regulation Section 1.409A-1(h) with respect to any Award
intended to comply with Section 409A of the Internal Revenue Code; provided,
that a “separation from service” shall occur only if both the Company and the
Participant expect the Participant153s level of services to permanently drop by
more than half.

10.2 Termination for Cause. If the employment of the
Participant by the Company is terminated for cause, as determined by the
Committee, all Awards to such Participant shall thereafter be void for all
purposes. As used in subsections 9.1, 10.2, and 10.3 hereof, “cause” shall mean
a gross violation, as determined by the Committee, of the Company153s established
policies and procedures, provided that the effect of this subsection 10.2 shall
be limited to determining the consequences of a termination and that nothing in
this subsection 10.2 shall restrict or otherwise interfere with the Company153s
discretion with respect to the termination of any employee.

10.3 Performance Awards. Except as set forth below, each
Performance Award shall state that each such Award shall be subject to the
condition that the Participant has remained an Eligible Person from the date of
grant until the applicable vesting date as follows:

	(a)		If the Participant voluntarily leaves the employment of the Company or an Affiliates, or if the employment of the Participant is terminated by the Company for cause or otherwise, any Performance Award to such Participant not previously vested shall thereafter be void and forfeited for all purposes.
	(b)		A Participant shall become vested in all Performance Awards that have met the Performance Goals within the Performance Period on the date the Participant retires from employment with the Company on or after attaining retirement age (which for all purposes of this Plan is determined to be age 65, unless otherwise designated by the Committee at the time the Award is granted), on the date the Participant dies while employed by the Company, or on the date the Participant terminates service with the Company and the Affiliates due to permanent disability (as determined pursuant to the Company153s Long-Term Disability Plan or any successor plan, unless the Performance award is subject to Internal Revenue Code Section 409A, in which case “permanent disability” must also fall within the meaning specified in Internal Revenue Code Section 409A(a)(2)(C) or a more restrictive meaning established by the Committee) while employed by the Company. Such Participant shall not become entitled to any payment which may arise due to the occurrence of a Performance Goal after the Participant dies, terminates service due to permanent

disability, or retires. Payment shall occur as soon as administratively
convenient following the date the Participant dies, terminates service due to
permanent disability, or retires, but in no event shall the payment occur later
than March 15 in the calendar year immediately following the calendar year in
which the Participant died, so terminates service, or retired. If the
Participant dies before receiving payment, the payment shall be made to those
entitled pursuant to Section 14.2 of this Plan.

10.4 Forfeiture Provisions. Subject to Sections 12 and 14, in
the event a Participant terminates employment during a Restriction Period for
the Participant153s Restricted Stock or Restricted Stock Units, such Awards will
be forfeited; provided, however, that the Committee may provide for proration or
full payout in the event of (a) death, (b) permanent disability, or (c) any
other circumstances the Committee may determine.

Section 11

Tax Withholding

11.1 Withholding Requirement. The Company and any Affiliate
is authorized to withhold from any Award granted, or any payment relating to an
Award under this Plan, including from a distribution of Stock, amounts of
withholding and other taxes or social security payments due or potentially
payable in connection with any transaction involving an Award, and to take such
other action as the Committee may deem advisable to enable the Company and
Participants to satisfy obligations for the payment of withholding taxes and
other tax or social security obligations relating to any Award. This authority
shall include authority to withhold or receive Stock or other property and to
make cash payments in respect thereof, in satisfaction of a Participant153s tax
obligations, either on a mandatory or elective basis at the discretion of the
Committee.

11.2 Withholding Requirement : Stock Options and SARs. The
Company153s obligations to deliver shares of Stock upon the exercise of an Option
or SAR shall be subject to the Participant153s satisfaction of all applicable
federal, state, and local income and other tax and social security withholding
requirements.

At the time the Committee grants an Option, it may, in its sole discretion,
grant the Participant an election to pay all such amounts of required tax
withholding, or any part thereof:

	(a)		by the delivery to the Company or the Administrative Agent of a number of shares of Stock then owned by the Participant, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the amount required to be withheld, provided that such shares have been held by the Participant for a period of at least six months;
	(b)		by certification or attestation to the Company or the Administrative Agent of the Participant153s ownership (as of the Exercise Date) of a number of shares of Stock, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the amount required to be withheld, provided that such shares of Stock have been owned by the Participant for a period of at least six months; or

(c)

by the Company or the Administrative Agent withholding from the shares of
Stock otherwise issuable to the Participant upon exercise of the Option, a
number of shares of Stock, the aggregate Fair Market Value of which (as of the
Exercise Date) is not greater

			than the amount required to be withheld. Any such elections by Participants to have shares of Stock withheld for this purpose will be subject to the following restrictions:
	(i)		all elections shall be made on or prior to the Exercise Date; and

	(ii)		all elections shall be irrevocable.

11.3 Section 16 Requirements. If the Participant is an
officer or director of the Company within the meaning of Section 16 or any
successor section(s) of the Exchange Act (“Section 16”), the Participant must
satisfy the requirements of Section 16 and any applicable rules and regulations
thereunder with respect to the use of shares of Stock to satisfy such tax
withholding obligation.

11.4 Restricted Stock and Performance Award Payment and Tax
Withholding. Each Restricted Stock and Performance Award agreement
shall provide that, upon payment of any entitlement under such an Award, the
Participant shall make appropriate arrangements with the Company to provide for
the amount of minimum tax and social security withholding required by law,
including without limitation Sections 3102 and 3402 or any successor section(s)
of the Internal Revenue Code and applicable state and local income and other tax
and social security laws. The withholding may be deducted from the Award. Any
payment under such an Award shall be made in a proportion of cash and shares of
Stock, determined by the Committee, such that the cash portion shall be
sufficient to cover the withholding amount required by this Section. The cash
portion of any payment shall be based on the Fair Market Value of the shares of
Stock on the applicable date of vesting to which such tax withholding relates.
Such cash portion shall be withheld by the Company to satisfy applicable tax and
social security withholding requirements.

Section 12

Change of Control

12.1 In General. In the event of the occurrence of a Change
of Control of the Company:

(a) Without further action by the Committee or the Board,

all outstanding Options shall fully vest upon the Participant153s Involuntary
Termination or Voluntary Termination with Cause occurring on or after a Change
of Control. Such newly vested Options shall be fully exercisable as of the date
of the Involuntary Termination or Voluntary Termination with Cause on or after a
Change of Control occurs.

(b) Without further action by the Committee or the Board,

all unvested Restricted Stock Awards and Restricted Stock Units shall fully
vest upon the Participant153s Involuntary Termination or Voluntary Termination
with Cause occurring on or after a Change of Control. Such newly vested
Restricted Stock Units shall be converted to Stock and the Participant shall be
issued the requisite number of shares, after any withholding under Section 11,
as soon as administratively practicable after the Involuntary Termination or
Voluntary Termination with Cause on or after a Change of Control occurs, unless
the Participant had elected to defer Restricted Stock Units to the Deferred
Delivery Plan in which case the Participant153s account in the Deferred Delivery
Plan shall

be credited with deferred Restricted Stock Units as of the date of the
Involuntary Termination or Voluntary Termination with Cause on or after the
Change of Control occurs.

(c)	Assuming the achievement of a Performance Goal, the entitlement to receive cash and Stock under any outstanding Performance Award grants shall vest automatically, without further action by the Committee or the Board, and shall become payable as follows:
	(i)	If such Change of Control occurs subsequent to the achievement of a Performance Goal, any remainder of such payout amount shall vest as of the date of the Participant153s Involuntary Termination or Voluntary Termination with Cause occurring on or after the date of such Change of Control and shall be paid by the Company to the Participant within thirty (30) days of the date of such Involuntary Termination or Voluntary Termination with Cause which occurs on or after the date of the Change of Control in the manner set out in subsection 12.1 hereof.

	(ii)	If the achievement of a Performance Goal occurs subsequent to the date of a Change of Control, the applicable payout amount shall vest in full for which the Performance Period has not yet ended as of the date of the Participant153s Involuntary Termination or Voluntary Termination with Cause occurring on or after such Change of Control and shall be paid by the Company to the Participant within thirty (30) days after the later of (1) the date of the Participant153s Involuntary Termination or Voluntary Termination with Cause or (2) the date that the Performance Goal is reached. The payment will occur only if the Participant is employed at the time that the Performance Goal is reached or if the Performance Goal is reached after the Participant153s Involuntary Termination or Voluntary Termination with Cause occurring on or after the Change of Control.

(d)

To the extent that any Award is subject to Internal Revenue Code Section
409A, the Award shall contain appropriate provisions to comply with Internal
Revenue Code Section 409A, which shall supersede the provisions of subsections
(a), (b), and (c).

Section 13

Reorganization or Liquidation

In the event that the Company is merged or consolidated with another
corporation and the Company is not the surviving corporation, or if all or
substantially all of the assets or more than 20 percent of the outstanding
voting stock of the Company is acquired by any other corporation, business
entity or person, or in case of a reorganization (other than a reorganization
under the United States Bankruptcy Code) or liquidation of the Company, then the
Committee, or the board of directors of any corporation assuming the obligations
of the Company, shall, as to the Plan and outstanding Awards make appropriate
provision for the adoption and continuation of the Plan by the acquiring or
successor corporation and for the protection of any holders of such outstanding
Awards by the substitution on an equitable basis of appropriate stock of the
Company or of the merged, consolidated, or otherwise reorganized corporation
which will be issuable with respect to the Stock. Additionally, upon the
occurrence of such an event and provided that a Performance Goal has occurred,
upon written notice to the Participants, the Committee may accelerate the
vesting and payment dates of the entitlement to receive cash and Stock under

outstanding Awards so that all such existing entitlements are paid prior to
any such event. If a Performance Goal has not yet been attained, the Committee
in its discretion may make equitable payment or adjustment.

In its discretion, and on such terms and conditions as it deems appropriate,
the Committee may provide, either by the terms of an agreement applicable to any
Award or by resolution adopted prior to the occurrence of a Change of Control or
an event described in this Section 13, that any outstanding Award (or portion
thereof) shall be converted into a right to receive cash, on or as soon as
practicable following the closing date or expiration date of the transaction
resulting in the Change of Control or such event in an amount equal to the
highest value of the consideration to be received in connection with such
transaction for one share of Stock, or, if higher, the highest Fair Market Value
of a share of Stock during the thirty (30) consecutive business days immediately
prior to the closing date or expiration date of such transaction, less the
per-share Option Price or grant price of SARs, as applicable to the Award,
multiplied by the number of shares subject to such Award, or the applicable
portion thereof.

Section 14

Rights of Employees and Participants

14.1 Employment. Neither anything contained in the Plan or
any agreement nor the granting of any Award under the Plan shall confer upon any
Participant any right with respect to the continuation of his or her employment
by the Company or any Affiliate, or interfere in any way with the right of the
Company or any Affiliate, at any time, to terminate such employment or to
increase or decrease the level of the Participant153s compensation from the level
in existence at the time of the Award.

An Eligible Person who has been granted an Award in one year shall not
necessarily be entitled to be granted Awards in subsequent years.

14.2 Non-transferability. Except as otherwise determined at
any time by the Committee as to any Awards other than ISOs, no right or interest
of any Participant in an Award granted pursuant to the Plan shall be assignable
or transferable during the lifetime of the Participant, either voluntarily or
involuntarily, or subjected to any lien, directly or indirectly, by operation of
law, or otherwise, including execution, levy, garnishment, attachment, pledge,
bankruptcy, or court order; provided that the Committee may permit
further transferability of Awards other than ISOs, on a general or a specific
basis, and may impose conditions and limitations on any permitted
transferability, subject to any applicable Restriction Period; provided
further, however, that no Award may be transferred for value or
other consideration without first obtaining approval thereof by the stockholders
of the Company. In the event of a Participant153s death, a Participant153s rights
and interests in any Award as set forth in an Award agreement, shall be
transferable by testamentary will or the laws of descent and distribution, or,
with respect to Awards other than Incentive Stock Options, a beneficiary
designation that is in a form approved by the Committee and in compliance with
the provisions of this Plan, applicable law, and the applicable Award agreement,
and payment of any entitlements due under the Plan shall be made to the
Participant153s designated beneficiary, legal representatives, heirs, or legatees,
as applicable. If in the opinion of the Committee a person entitled to payments
or to exercise rights with respect to the Plan is disabled from caring for his
or her affairs because of mental condition, physical condition, or age, payment
due such person may be made to, and such rights shall be exercised by, such
person153s guardian, conservator, or other legal personal representative upon
furnishing the Committee with evidence satisfactory to the Committee of such
status. If any individual entitled to payment or to exercise rights

with respect to the Plan is a minor, the Committee shall cause the payment to
be made to (or the right to be exercised by) the custodian or representative
who, under the state law of the minor153s domicile, is authorized to act on behalf
of the minor or is authorized to receive funds on behalf of the minor. With
respect to those Awards, if any, that are permitted to be transferred to another
individual, references in the Plan to exercise or payment related to such Awards
by or to the Participant shall be deemed to include, as determined by the
Committee, the Participant153s permitted transferee. A Participant153s unexercised
Option or SAR, or amounts due but remaining unpaid to such Participant, at the
Participant153s death, shall be exercised or paid as designated by the Participant
by will or by the laws of descent and distribution, or, with respect to any
unexercised Option or SAR other than an Incentive Stock Option, in accordance
with the Participant153s beneficiary designation in a form approved by the
Committee and in compliance with the provisions of this Plan, applicable law and
the applicable Award agreement. In the event any Award is exercised by or
otherwise paid to the executors, administrators, heirs or distributees of the
estate of a deceased Participant, or the transferee or designated beneficiary of
an Award, in any such case, pursuant to the terms and conditions of the Plan and
the applicable Award agreement and in accordance with such terms and conditions
as may be specified from time to time by the Committee, the Company shall be
under no obligation to issue shares of Stock thereunder unless and until the
Company is satisfied, as determined in the discretion of the Committee, that the
person or persons exercising such Award, or to receive such payment, are the
duly appointed legal representative of the deceased Participant153s estate or the
proper legatees or distributees thereof, or the valid transferee or designated
beneficiary of such Award, as applicable. Any purported assignment, transfer or
encumbrance of an Award that does not comply with this Section 14.2 shall be
void and unenforceable against the Company.

14.3 Noncompliance with Internal Revenue Code Section 409A.
If an Award is subject to the requirements of Internal Revenue Code Section
409A, to the extent that the Company or an Affiliate takes any action that
causes a violation of Internal Revenue Code Section 409A or fails to take
reasonable actions required to comply with Internal Revenue Code Section 409A,
in each case as determined by the Committee, the Company shall pay an additional
amount to the Participant (or beneficiary) equal to the additional income tax
imposed pursuant to Internal Revenue Code Section 409A on the Participant as a
result of such violation, plus any taxes imposed on this additional payment.

Section 15

Other Employee Benefits

The amount of any income deemed to be received by a Participant as a result
of the payment under an Award or exercise shall not constitute “earnings” or
“compensation” with respect to which any other employee benefits of such
Participant are determined, including without limitation benefits under any
pension, profit sharing, life insurance, or salary continuation plan.

Section 16

Amendment, Modification, and Termination

The Committee or the Board may at any time terminate, and from time to time
may amend or modify the Plan, and the Committee or the Board may, to the extent
permitted by the Plan, from time to time amend or modify the terms of any Award
theretofore granted, including any Award agreement, in each case,

retroactively or prospectively; provided, however, that no
amendment or modification of the Plan may become effective without approval of
the amendment or modification by the Company153s stockholders if stockholder
approval is required to enable the Plan to satisfy an applicable statutory or
regulatory requirements, unless the Company, on the advice of outside counsel,
determines that stockholder approval is not necessary.

Notwithstanding any other provision of this Plan, no amendment, modification,
or termination of the Plan or any Award shall adversely affect the previously
accrued material rights or benefits of a Participant under any outstanding Award
theretofore awarded under the Plan, without the consent of such Participant
holding such Award, except to the extent necessary to avoid a violation of
Internal Revenue Code Section 409A or the Board or the Committee determines, on
advice of outside counsel or the Company153s independent accountants, that such
amendment or modification is required for the Company, the Plan, or the Award to
satisfy, comply with, or meet the requirements of any law, regulation, listing
rule, or accounting standard applicable to the Company.

The Committee shall have the authority to adopt (without the necessity for
further stockholder approval) such modifications, procedures, and subplans as
may be necessary or desirable to comply with the provisions of the laws
(including, but not limited to, tax laws and regulations) of countries other
than the United States in which the Company may operate, so as to assure the
viability of the benefits of the Plan to Participants employed in such
countries.

Section 17

Requirements of Law

17.1 Requirements of Law. The issuance of Stock and the
payment of cash pursuant to the Plan shall be subject to all applicable laws,
rules, and regulations, including applicable federal and state securities laws.
The Company may require a Participant, as a condition of receiving payment under
an Award, to give written assurances in substance and form satisfactory to the
Company and its counsel to such effect as the Company deems necessary or
appropriate in order to comply with federal and applicable state securities
laws.

17.2 Section 409A of the Code. It is intended that this Plan
shall comply with the provisions of, or an exemption from, Internal Revenue Code
Section 409A and the Treasury regulations relating thereto. Awards are intended
to be exempt from Internal Revenue Code Section 409A to the extent possible. Any
Award or payment that qualifies for an exemption shall be considered as the
first payment(s) made under the Plan. For purposes of the limitations on
nonqualified deferred compensation under Internal Revenue Code Section 409A,
each payment of compensation under this Plan shall be treated as a separate
payment of compensation for purposes of applying the deferral election rules and
the exemption for certain short-term deferral amounts under Internal Revenue
Code Section 409A. In no event may the Participant, directly or indirectly,
designate the calendar year of any payment subject to Internal Revenue Code
Section 409A under this Plan.

Six-month Delay for Specified Participants.
Notwithstanding any other provision of this Plan, to the extent that the right
to any payment (including the provision of benefits) hereunder provides for the
“deferral of compensation” within the meaning of Internal Revenue Code Section
409A(d)(1), the payment shall be paid (or provided) in accordance with the
following: If the Participant is a “Specified Employee” within the meaning of
Internal Revenue Code Section 409A(a)(2)(B)(i) on the date of the

Participant153s Separation from Service (the “Separation Date“), and if
an exemption from the six (6) month delay requirement of Internal Revenue Code
Section 409A(a)(2)(B)(i) is not available, then no such payment shall be made or
commence during the period beginning on the Separation Date and ending on the
date that is six months following the Separation Date or, if earlier, on the
date of the Participant153s death. The amount of any payment that would otherwise
be paid to the Participant during this period shall instead be paid to the
Participant on the first day of the first calendar month following the end of
the period.

Prohibition on Acceleration. Unless a payment is
exempt from Internal Revenue Code Section 409A, the date of payment may not be
accelerated and any payment made pursuant to the termination and liquidation of
the Plan shall not be accelerated except in compliance with Internal Revenue
Code Section 409A generally and Treasury Regulation § 1.409A-3(j)(4)(ix)
specifically.

17.3 Section 16 Requirements. If a Participant is an officer
or director of the Company within the meaning of Section 16 of the Exchange Act,
Awards granted hereunder shall be subject to all conditions required under Rule
16b-3, or any successor rule(s) promulgated under the Exchange Act, to qualify
the Award for any exemption from the provisions of Section 16 available under
such Rule. Such conditions are hereby incorporated herein by reference and shall
be set forth in the agreement with the Participant, which describes the Award.

17.4 Governing Law. The Plan and all agreements hereunder
shall be construed in accordance with and governed by the laws of the State of
Texas.

Section 18

Duration of the Plan

The Plan shall terminate on the ten year anniversary of the Effective Date.
No grants shall be awarded after such termination; however, the terms of the
Plan shall continue to apply to all Awards outstanding when the Plan terminates.

Dated: February 10, 2011; Effective May 5, 2011.



ATTEST:		APACHE CORPORATION

/s/ Cheri L. Peper	By:	/s/ Margery M. Harris

Cheri L. Peper		Margery M. Harris
Corporate Secretary		Senior Vice President,
		Human Resources

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